As required to be eligible for the tax break, 15% of the 319 units in the 22-story apartment tower will be held for moderate-income renters. The income-restricted units would average 514 sf in size and rent for an average of $870 per month plus utilities. According to the rules, the rent and utilities must not exceed 30% of a renter's gross monthly income.
TCR says the tax break is needed to make a reasonable return on its investment in an unproven rental market. The Portland Development Commission and the city Planning Commission already have recommended approval of the abatement, which will negate the increased value of the residential but not the ground-floor retail.
The city council had the opportunity to vote on the waiver this week but did not. It will revisit the issue next week. Mayor Tom Potter and Commissioner Erik Sten have said they will back the waiver. Commissioners Randy Leonard and Sam Adams have said they will vote against the waiver.
The swing votes on the council on this issue, Dan Saltzman, asked TCC to turn some of the income-restricted units from studios and one-bedroom units into two-bedroom units that would be more appropriate for couples and families.
TCR acquired the land for the project (called Block 39) in January, paying $5.6 million to a group of investors that includes local developer Homer Williams. Williams is involved in several condominium developments in the immediate area.
The city has been raising the bar that must be cleared before developers can obtain the property tax break. Last year, the council added the 15% requirement, and earlier this month it approved annual financial reviews of those receiving the breaks to make sure that, after the waiver expires, they are receiving no more than a 10% profit on the income-restricted units.
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