Work Starts on $110M RiverPlace Development

PORTLAND, OR-Walsh Construction started work this week for the Strand Condominiums, a development of Onder Development Co. and Williams & Dame Development that will include mid-rise three residential towers (222 units) and one single-story 8,000-sf waterfront restaurant. The 2.5-acre development site is located on the west bank of the Willamette River, immediately north of the Marquam Bridge. The total development cost for the project is $110 million. The construction timeline is 24 to 36 months. Construction financing and mezzanine debt for the project is under negotiation. The necessary equity for the project is being provided by affiliates of locally based ScanlanKemperBard Cos. and Lehman Bros.Jack Onder tells GlobeSt.com that two of the three towers will have 11 floors and the third will have 13 floors. Townhouse units will fill the first two floors of each of the condo towers, some of which will be set up as live-work units. The upper floors will house more traditional condominium units. The unit prices will be upward of $350 per sf.The development is regulated by a disposition and development agreement between the developer group and the Portland Development Commission, the city’s urban renewal agency. As part of the agreement, the PDC sold the land to the developers last year for $3.7 million. The PDC acquired the site from Pacific Power & Light in 1985 and for the last several years has been working with the state Department of Environmental Equality on a clean-up plan for the site, which was home to the Lincoln Steamplant. As part of the remediation process, some 60,000 cubic yards of contaminated soil will be removed from the site, which will then be “capped” with a one-story underground parking garage.The project has been through many iterations since the original DDA was approved in 1999. The first DDA called for one hotel tower and one condo tower, but the hotel financier eventually walked away from the deal. In August 2001, Williams & Dame brought on board Seattle-based Gordon Sondland (the new hotel partner, working with Inter-Continental Hotels) and a new DDA was approved that called for a 110-room luxury hotel and two condominium towers containing 170 condominiums. The agreement also had the PDC participating in the profits from the condo sales.By April 2002, plans changed again, with Williams & Dame delaying the hotel project and bringing on local condominium developer John Carroll to focus on developing the condominiums first. Later that year, the PDC denied a request to raise the height limit on the property to 200 feet from 150 feet. By mid-2003, Onder had joined the project, Carroll and Sondland were out and the hotel portion of the project was tossed out altogether in favor of additional for-sale residential units and a destination restaurant. Also tossed out of the DDA was the city’s participation in any profits. The development leaves just one RiverPlace parcel undeveloped, but probably not for long. The PDC expects to issue an RFP later this month for the one-acre site immediately south of the Strand condominium project. Property taxes from the Strand development and this last final RiverPlace parcel will be used to fund the installation of infrastructure for the new riverfront redevelopment area south of the Marquam Bridge.