Broadway Corridor (Post Office Redevelopment) | Proposed

[subterranean]

I agree with you about the advocacy, I just think some of them should have a thorough understanding of what they're asking for before they ask for it.

The way I've seen these deals structured, the 15% developer fee would be a separate lien against the property that is paid back to the developer in the form of a loan payment. Therefore, the bank's required 20% would be over and above all lien obligations (e.g. a total debt service ratio above 1.2). And even if this were a nonprofit project, the IRS/State of Oregon would require the 15% to be paid to the developer (this is how nonprofit developers even survive). I didn't make it clear that the 15% would be the developer fee. The monthly profit would be within that 20%, but doesn't include operating expenses, such as paying a property management company (which can be expensive).

There are no government organizations that I'm aware of who could provide a $200 million loan at 0% interest. Even state agencies who do some gap financing provide it at interest because their positions often aren't funded with tax dollars. They fund their operations with interest, just like a bank with better intentions.

I'm failing to see the connection you're trying to make between property values increasing and the cost of paying back a loan. Who is going to take on a property where half of the units are a giant liability? How far down the road are you talking? Covenants on the property would likely keep half the units affordable for 60 years.

As for your rent, a portion no doubt goes into property management, replacement reserves and operating reserves. That is, when your unit turns over, it inevitably needs to be repaired. Or if your fridge does out, they have to replace it. Operating reserves cover the time it takes to turn over your unit when you move out.

[johnliu]

Whether downtown property values rise in the future is irrelevant if the parcel is occupied by units whose rental revenue does not rise similarly.

[Encolpius]

Originally Posted by subterranean

The way I've seen these deals structured, the 15% developer fee would be a separate lien against the property that is paid back to the developer in the form of a loan payment. Therefore, the bank's required 20% would be over and above all lien obligations (e.g. a total debt service ratio above 1.2). And even if this were a nonprofit project, the IRS/State of Oregon would require the 15% to be paid to the developer (this is how nonprofit developers even survive). I didn't make it clear that the 15% would be the developer fee. The monthly profit would be within that 20%, but doesn't include operating expenses, such as paying a property management company (which can be expensive).

Okay, thanks for clarifying that further. So the developer gets a fee of 15% of the total construction cost (but you've applied this 15% to bank interest as well; it's actually 24% of the construction contract) of the affordable portion of the project -- that's guaranteed, no risk -- plus whatever profit they're able to make on the market-rate portion of the project? Plus appreciation of the real estate?! Sounds good!

(For comparison, in the old days the 'developer' used to be an architect's firm hired by the property owner; the architect/construction project manager would subcontract for individual portions of the construction work and was paid a traditional 5% of the building costs. But that was a lump sum paid on completion of the work. Instead the developer's fee is paid out over a period of time -- twenty years, same as the loan? What if the developer sells the property -- do they still keep collecting their 15%?)

Originally Posted by subterranean

There are no government organizations that I'm aware of who could provide a $200 million loan at 0% interest. Even state agencies who do some gap financing provide it at interest because their positions often aren't funded with tax dollars. They fund their operations with interest, just like a bank with better intentions.

Well, the Bank of England has been making loans to commercial banks in the UK for the past decade at 0.5% interest. I understand that a government lender needs to fund their operations somehow, but would it require $116.8m over twenty years to manage a single real estate loan?

It seems like the whole problem comes in terms of the profit expectations of the bank and property developers. If we're just looking at construction costs and operating expenses of the building, near 100% of the units could be affordable, no problem.

Originally Posted by johnliu

Whether downtown property values rise in the future is irrelevant if the parcel is occupied by units whose rental revenue does not rise similarly.

Yeah, but I mean that's the whole problem with the housing market, isn't it? We would hope that AMI rises over time, and rents rise 'similarly' (i.e. keeping pace with and not exceeding the rise in incomes). For the past few decades, this wildly hasn't been the case. That's the problem. Maybe Portland should peg allowable rent increases to inflation, as in several European countries?

[maccoinnich]

An open house will be up on line at https://www.broadwaycorridorpdx.com/ on Wednesday. I'm told it will include three development options for the masterplan.

[maccoinnich]

The open house is delayed, but you can see the three concepts they've developed in this presentation.

[zilfondel]

Thats a lot of tennis courts. I wouldn't think tennis is such a critical and widely-played sport that you would want to have 3/4 of the public space to be programmed for it.

[johnliu]

Maybe reflects the demographics expected to reside there.

[grommel]

Originally Posted by zilfondel

Thats a lot of tennis courts. I wouldn't think tennis is such a critical and widely-played sport that you would want to have 3/4 of the public space to be programmed for it.

Tennis is great, but I don't actually see any tennis courts in these concepts. The "play" version appears to have two basketball courts and two mini soccer fields(?)

[maccoinnich]

At this level of design I’m sure that all that they’re intending to convey is the concept of active recreation, and not specific sports.

[urbanlife]

Looking at the three options, I really think it should be a combination of Play and Nature.

[2oh1]

I'm not clear on how any of them interact with the bridge for pedestrians. I love how the "Nature" concept shows a green arrow going from the parks straight across multiple lanes of traffic that splits in three directions... because that makes sense, right?

If the green arrow represents the green loop (it does), then the only concept that comes close to making sense is "Play," because the only way for pedestrians and cyclists to enter the left side of the bridge is from the far left, not from the middle, and not from the right. Trying to enter the bridge on the left from anywhere other than the far left will get them killed because the middle means oncoming traffic.

The entire point of the green loop is to "promote more walking, biking, rolling, jogging and public transit trips in, around, to and from the city's urban core." Two of the three concepts for this site don't even show a basic understanding of that. I don't think any of the concepts do a good job of interacting with the bridge, though I realize the bridge creates quite a challenge for the site, but "Nature" and "Discovery" do a particularly poor job of connecting the green loop with the bridge. Seriously, terrible.

The north side of the bridge needs north side access for pedestrians and cyclists.
The south side of the bridge needs south side access for pedestrians and cyclists.

The idea of dumping pedestrians and cyclists into the center of traffic at the bridgehead is so poorly thought through that I'm baffled by the oversight.

[johnliu]

Originally Posted by 2oh1

I'm not clear on how any of them interact with the bridge for pedestrians. I love how the "Nature" concept shows a green arrow going from the parks straight across multiple lanes of traffic that splits in three directions... because that makes sense, right?

If the green arrow represents the green loop (it does), then the only concept that comes close to making sense is "Play," because the only way for pedestrians and cyclists to enter the left side of the bridge is from the far left, not from the middle, and not from the right. Trying to enter the bridge on the left from anywhere other than the far left will get them killed because the middle means oncoming traffic.

The entire point of the green loop is to "promote more walking, biking, rolling, jogging and public transit trips in, around, to and from the city's urban core." Two of the three concepts for this site don't even show a basic understanding of that. I don't think any of the concepts do a good job of interacting with the bridge, though I realize the bridge creates quite a challenge for the site, but "Nature" and "Discovery" do a particularly poor job of connecting the green loop with the bridge. Seriously, terrible.

The north side of the bridge needs north side access for pedestrians and cyclists.
The south side of the bridge needs south side access for pedestrians and cyclists.

The idea of dumping pedestrians and cyclists into the center of traffic at the bridgehead is so poorly thought through that I'm baffled by the oversight.

Perhaps they are assuming some sort of complicated signal phasing wherein cars stop and bikes swarm over the "Y" roadway at the west end of the bridge, followed by EMTs picking up those felled by the streetcar tracks.

[maccoinnich]

Originally Posted by 2oh1

I'm not clear on how any of them interact with the bridge for pedestrians. I love how the "Nature" concept shows a green arrow going from the parks straight across multiple lanes of traffic that splits in three directions... because that makes sense, right?

If the green arrow represents the green loop (it does), then the only concept that comes close to making sense is "Play," because the only way for pedestrians and cyclists to enter the left side of the bridge is from the far left, not from the middle, and not from the right. Trying to enter the bridge on the left from anywhere other than the far left will get them killed because the middle means oncoming traffic.

The entire point of the green loop is to "promote more walking, biking, rolling, jogging and public transit trips in, around, to and from the city's urban core." Two of the three concepts for this site don't even show a basic understanding of that. I don't think any of the concepts do a good job of interacting with the bridge, though I realize the bridge creates quite a challenge for the site, but "Nature" and "Discovery" do a particularly poor job of connecting the green loop with the bridge. Seriously, terrible.

The north side of the bridge needs north side access for pedestrians and cyclists.
The south side of the bridge needs south side access for pedestrians and cyclists.

The idea of dumping pedestrians and cyclists into the center of traffic at the bridgehead is so poorly thought through that I'm baffled by the oversight.

I'm really confused by what you think is being proposed.

[justrmor]

The fact that this project isn't being devoted primarily to affordable housing reveals again that Portland's leadership is out of touch.

[subterranean]

Originally Posted by justrmor

The fact that this project isn't being devoted primarily to affordable housing reveals again that Portland's leadership is out of touch.

Show me the money. And in all honesty, as a person who worked in affordable housing for many years, I can think of a lot better places to put low-income housing. Unlike the armchair housing advocates and pseudo planners of this forum, not everyone thinks the pearl would offer a high quality of life for low-income families. I couldn’t imagine being a single mother with low or no income with 3 kids raising them there. Low-income housing should be dispersed throughout the city, in neighborhoods. Add your 20% to this site, but putting thousands of low income people in one location goes against housing policy and best practice for the last 30+ years.

[Encolpius]

^ I imagine you're right, the Pearl is not currently a particularly nice place to be a low-income person with children. In fact, aside from Jamison Square (which is usually full of children), I *personally* find the Pearl District a not-particularly-nice place to be, period. But that's probably because the city never seriously tried to meet the target of 35% - 50% affordable housing it laid out in 1994, nor did it do anything much to ensure that 'the market-rate housing in the River District should be targeted to as wide a market as possible' and that 'families with children should be encouraged to locate in the River District and specific development plans should include services and amenities that support this effort' (I'm quoting the River District Housing Implementation Strategy). Instead the Pearl, a place created by massive public investments like the Streetcar (funded through urban renewal districts), was abandoned to the free market, which created the type of neighborhood that capitalism tends to produce wherever it encounters favorable conditions and pliant and accommodating public officials. (On the eve of the inclusionary zoning ordinance, 90% of the new housing being built in the River District was high-end).

This site and project belong to the people of Portland, which have a once-generational opportunity to remake the Pearl with some of the qualities it was always supposed to have, including a lively and diverse public realm that's accessible to all. To make it a neighborhood, in other words, replete with low-income single mothers with three kids, immigrants, bus drivers, teachers, daycare workers, hotel maids, librarians, &c., and to make it a good neighborhood for those people as well as a good urban neighborhood with amazing public amenities.

Show me the money? Give me a break. Portland's never been so wealthy. How much money has the city already found to make the Pearl what it is, a playground for yuppies and the rich elderly? How much has it invested in this site already? (at least $157m, if you include federal spending to relocate the Post Office to its new site). If you think the city's short on money to build family and affordable housing here, three words: Urban Renewal District.

[subterranean]

^ I did some hypothetical math on the previous page. I honestly asked where the money would come from, and I’m still waiting for someone to respond.

[justrmor]

Raise taxes.

[maccoinnich]

Well, we're voting on whether to raise taxes for affordable housing in November. If it passes, the City of Portland will receive a share of the revenues and have an opportunity to decide where it could spend them.

The 2015 Framework Plan for the Post Office sites assumes 30% of the new housing will units will be affordable, which is about 720 new units. The city could choose to increase that by using bond funds in the Pearl, but I'd question the wisdom of that. The Pearl already has thousands of units of affordable housing, making it the neighborhood with the highest percentage of regulated affordable units in the city. Meanwhile neighborhoods like Ladds Addition, Eastmoreland, Southwest Hills and Laurelhurst have exactly zero units of regulated affordable housing. Other close in neighborhoods on the eastside have greater than zero but nothing close to matching the income profile of the city.

So, if I were in charge of the Housing Bureau I think I'd want to make sure that we spent new bond funds in parts of the city with high opportunity (i.e. good schools, access to transit), but where we traditionally haven't spent any money on affordable housing.

[DMH]

Originally Posted by maccoinnich

Well, we're voting on whether to raise taxes for affordable housing in November. If it passes, the City of Portland will receive a share of the revenues and have an opportunity to decide where it could spend them.

The 2015 Framework Plan for the Post Office sites assumes 30% of the new housing will units will be affordable, which is about 720 new units. The city could choose to increase that by using bond funds in the Pearl, but I'd question the wisdom of that. The Pearl already has thousands of units of affordable housing, making it the neighborhood with the highest percentage of regulated affordable units in the city. Meanwhile neighborhoods like Ladds Addition, Eastmoreland, Southwest Hills and Laurelhurst have exactly zero units of regulated affordable housing. Other close in neighborhoods on the eastside have greater than zero but nothing close to matching the income profile of the city.

So, if I were in charge of the Housing Bureau I think I'd want to make sure that we spent new bond funds in parts of the city with high opportunity (i.e. good schools, access to transit), but where we traditionally haven't spent any money on affordable housing.

I think you have offered wise advice to disperse the affordable housing investments in neighborhoods throughout the city where schools, shopping, and transit can support the residents. And I have always voted Yes for affordable housing, child enrichment, transit, library, and arts bond measures. But for the first time, I will vote No on the upco,ming regional affordable housing bond measure. I am opposed because of the continuous reliance on property taxes for bond measures. As a fixed-income, retired person, I can no longer survive ever-increasing property taxes and remain in my home in a thoroughly walkable neighborhood that is perfect for those wishing to age in place. I write to all of my political leaders urging them to use broad-based tax sources to fund big projects. Dare I suggest a modest sales tax?