Request for Offers (RFO)Real Property Purchase of the SW Third and Taylor Property

Issued: MAY 23, 2014

Offers due: JUNE 27, 2014 BY 5:00 PM (PACIFIC TIME)

Photo by TriMet

Photo by R.

RFO: SW Third and Taylor Property Page 2 of 11

1. Executive Summary

Through this Request for Offers (RFO), the Portland Development Commission (PDC), the economic development and urban renewal agency for the city of Portland, Oregon (City) is seeking negotiable offers from qualified development teams to purchase and redevelop the 10,000 square foot (SF) parcel located at the northeast corner of SW 3rd Avenue and SW Taylor Street in downtown Portland (the Property). The Property is owned by PDC and is located at 820-838 SW 3rd Avenue in Portland’s central city and the Downtown Waterfront (DTWF) Urban Renewal Area (URA).

The developer selected under this RFO (Developer) may enter into a Memorandum of Understanding (MOU) with PDC. The MOU will generally define roles, responsibilities, contingencies, and commitments of the Developer and PDC. Upon successful negotiation, PDC and the Developer may enter into a Purchase and Sale Agreement (PSA) outlining in detail the terms and conditions of the Property conveyance and redevelopment.

Those interested in submitting a proposal in response to the RFO should, at a minimum, address the general requirements outlined in this RFO. Responses – by mail or email – are due at the PDC offices no later than the day and time listed on the cover sheet and addressed to:

Eric JacobsonPortland Development Commission222 NW Fifth AvenuePortland, Oregon 97209-3859Phone: 503-823-3306E-mail: jacobsone@pdc.us

SW Third & Taylor Property

© Google Maps

Future James Beard Public Market

Future Puppet Labs HQ

Future Jama Software HQ

Tom McCall Waterfront Park

Portland State University

eBay Portland HQ

Portland City Hall

Future Apple Store

Pioneer Courthouse Square

Kixeye Portland HQ

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2. About the Portland Development Commission

Created by Portland voters in 1958, PDC has been a driving force in Portland’s reputation for vibrancy and livability. As Portland’s urban renewal and economic development agency, PDC focuses on investing in the job creation, innovation, and economic opportunity that will transform Portland into one of the world’s most desirable and equitable cities. In neighborhoods throughout the city, PDC has revitalized main streets and increased the capacity of businesses to expand and provide employment opportunities to Portland area residents.

In carrying out our mission over the years, PDC has played a key role in some of Portland’s most important landmarks, including Pioneer Courthouse Square, Pioneer Place, the Lan Su Chinese Garden, Gov. Tom McCall Waterfront Park, the Eastbank Esplanade, and Airport, Interstate and Transit Mall-Clackamas MAX Light Rail. Recent accomplishments involving property conveyance include the following projects:

• renovation of the Globe Hotel Building, now home to the Oregon College of Oriental Medicine (OCOM);

• renovation of the Convention Plaza Building, now known as Eastside Exchange which contains more than 60,000 square feet of office space.

The Revised PDC Strategic Plan 2010 – 2014 includes goals related to economic growth, healthy neighborhoods, vibrant central city, social equity, and effective stewardship over resources and operations (Appendix 1). Making the Property available for purchase and redevelopment is intended to advance several of these goals.

Oregon College of Oriental Medicine

Eastside Exchange

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3. About the Property

A. Street Address: 830 – 838 SW Third Avenue, Portland, OR 97209

B. Property Identification: i. Property ID: R245986ii. State ID: 1S1E03BA 6100iii. Legal Description: Lots 5 and 6, Block 22, in the City of Portland, County of Multnomah and State of Oregon

C. Parcel Size: 10,000 Square Feet (0.23 acres)

D. Existing Structures and Uses: The Property is vacant and has no current uses.

E. Comprehensive Plan Designation: The Property is designated Central Commercial (CX) in Portland’s Comprehensive Plan and is located within the Central City Plan District.

F. Zoning Designation: The Property is zoned Central Commercial with design review overlay (CXd) and is located in the Central City Plan District.

G. Historic Designation: The Property is not located in a historic district. However, the Property abuts the Yamhill Historic District on the east property line.

H. Topography: The Property is flat and is below 50 feet in elevation.

I. Flood Plain Status: The Property is not located in a flood hazard area, floodway, or other flood area (Flood Insurance Rate Map Number 4101830093E dated October 19, 2004).

J. Utilities: Sanitary, storm, electric, and water services are available to service the Property from the street.

 

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3. About the Property (cont’d)

K. Transportation and Access: The Property is located in Portland’s highly-walkable central business district. Light rail stops for Tri-Met’s MAX Red, Blue, Yellow, and Green Lines are located within three blocks of the Property. The Property also has nearby bus service and is well served by the region’s freeway network. There are currently no curb cuts on either SW 3rd Avenue or SW Taylor Street.

L. Environmental Conditions: An Expanded Phase One Environmental Site Assessment (ESA) including limited groundwater sampling was conducted by Parametrix in May 2007 (Appendix 2). The investigation did not identify any Recognized Environmental Conditions in association with the subject property and no additional investigation was recommended.

A Data Gap Phase II ESA was completed for the subject property by Ash Creek Associates in January 2013 in order to assess groundwater quality, potential soil vapor concerns, and soil conditions at the Site (Appendix 3). No volatile organic compounds (VOCs) were detected in groundwater. Soil vapor samples collected at the Property contained low levels of VOCs commonly present in urban areas but not at concentrations warranting additional investigation. Soil samples collected at the Property did not contain any contaminants exceeding Oregon Department of Environmental Quality (DEQ) risk-based levels prompting environmental cleanup. However, shallow soil samples collected from the northeast quadrant of the Property identified an estimated 275 cubic yards of soil containing chromium, lead, and mercury at levels exceeding the DEQ Clean Fill Criteria. If removed during future development, soil containing metals in excess of the DEQ Clean Fill Criteria will either require disposal at a Subtitle D landfill (e.g. Hillsboro Landfill) or the developer could request DEQ establish a site-specific determination for the disposition of Property soil.

 

M. Property History: PDC acquired the Property in August 1999 and in 2000 demolished a two-story dilapidated building.

N. Easements: The Property has a recorded Easement Agreement concerning a sub-surface masonry wall located on the Property that is associated with the adjacent Director Building (Appendix 4). The Easement Agreement affects 82 square feet of the Property.

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4. Development Objectives

In making the Property available for purchase and redevelopment, PDC seeks to enhance the neighborhood vitality, increase the tax base, and maximize the financial return to PDC as follows.

• To maximize PDC’s land sale proceeds and close the transaction as early as possible;

• For the predominant use to be private taxable development that maximizes the assessed property value and generation of property tax revenue;

• Financial Terms: Minimize the need for PDC financial assistance and maximize PDC’s financial return.

• For the development to be consistent with zoning regulations and to further the development objectives of the DTWF URA Plan; and

• For the development to be carried out as expeditiously as possible and to be concluded within five years.

Photo by: Finetooth

“Apple Proposes Spectacular Store for Portland”, ifoapplestore.com, February 28, 2012

Downtown Portland in the News

“Airbnb picks Portland as first ‘Shared City’ in effort to address tax issues, encourage livability,” geekwire.com, March 3, 2014

“EBay expands downtown Portland outpost with new lease,” oregonlive.com, March 13, 2014

“Jama Software picks new downtown Portland headquarters”, oregonlive.com, January 24, 2014

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5. Compliance with PDC Policies

A. Social Equity. PDC is committed to increasing economic opportunity and income for all Portland residents and historically disadvantaged Portlanders in particular as described in PDC’s Equity Policy (Appendices 5 and 6). The selected Developer must comply with the following PDC programs:

Business Equity Program. The goal of the Business Equity Program (BEP) is to ensure that PDC’s work provides professional, supplier, and construction contracting opportunities to Certified Firms (i.e., certified minority-owned businesses, women-owned businesses, disadvantages businesses, and emerging small businesses). The BEP also encourages the participation of businesses owned by veterans. The utilization goal for Certified Firms is twenty percent (20%) of the project’s architectural and engineering costs and hard construction costs.

Workforce Equity Program. The Workforce Equity Program (WEP) aims to maximize apprenticeship opportunities in the construction trades, ensure employment opportunities for People of Color and women, and encourage the employment of people with disabilities and veterans. The WEP has mandatory requirements related to apprenticeship, and aspirational goals related to achieving workforce diversity, encouraging the employment of veterans and people with disabilities, and achieving a workforce that reflects the diversity of the City of Portland.

B. Green Building Policy. PDC is committed to promoting sustainable, energy efficient buildings. The selected Developer will be required to comply with PDC’s Green Building Policy to advance this goal (Appendix 7).

6. Prevailing Wage

Subject to the amount of public investment in the project, if any, the project will be required to comply with Oregon’s prevailing wage statutes.

7. EB-5 Financing

Through PDC’s partnership with American United Regional Center (AURC), financing through the Employment-Based Immigration: Fifth Preference (EB-5) Program created by the United States Congress in 1990 may be available to the developer contingent upon the number of jobs created by the proposed development. For more information concerning EB-5 financing, contact Marvin Kau of AURC at (503) 477-8170.

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8. Submission Requirements

The following should be included in the response:

A. Price and Terms

• Purchase price

• Due Diligence Period and Conditions. If extensions are requested please include price and whether funds are applicable to purchase price.

• Earnest money payment and date upon which earnest money becomes non-refundable and released to PDC.

• Conditions precedent to closing.

• Required Seller’s representations at closing.

• Upside participation, look back provisions and/or any other term or alternative structure that will potentially maximize the PDC financial return.

B. Proposed Project

• Brief project description, including project uses, estimated value, and project schedule

• Summary of Development Team Capability and Financial Capacity, including completion of the Statement of Developer Qualifications and Financial Capability (Appendix 8).

C. Commitment and approach to complying with PDC’s Business and Workforce Equity Policy and Green Building Policy.

Submittal Instructions, Requests for Clarification and Changes to this RFO

In an effort to reduce the amount of paper used as part of this RFO, all responses must be submitted either by email or mailed on a compact disk or flash drive. Responses should be in either Adobe Acrobat (.pdf ) or Microsoft Word (.doc) format and submitted to:

Eric JacobsonPortland Development Commission222 NW Fifth AvenuePortland, Oregon 97209-3859Phone: 503-823-3306E-mail: jacobsone@pdc.us

Responses are not to exceed 20 pages.

Questions about any matter contained in this RFO should be emailed to Eric Jacobson (mail to: jacobsone@pdc.us) no later than ten (10) business days prior to the deadline of this RFO. All material changes or clarification of any matter contained in this RFO will be published in the form of a written addendum to this RFO at this location on PDC’s website: www.pdc.us/bids. PDC may make a courtesy effort to notify interested parties that an addendum has been pub-lished, but PDC is under no obligation to do so. As such, parties interested in this RFO should refer frequently to the website for this RFO. PDC may also load supplemental information about this project to that location as well.

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9. Evaluation Criteria and Selection

All complete and responsive proposals will be evaluated by an evaluation committee. The evaluation will be based on the information submitted as well as any related information that PDC may discover or request in analyzing or verifying information submitted in the proposal. The following Evaluation Criteria will be used to evaluate the proposals:

A. Business Terms

1. Proposed purchase price and terms that maximize PDC’s land sale proceeds.

2. Proposed earnest money payment.

3. Project schedule: due diligence period, date of property conveyance and date of project completion.

4. Project value of proposed development.

B. Proposed Project

1. Predominant use is private taxable development that maximizes development opportunity.

2. Proposed use is consistent with zoning regulations, DTWF URA goals, and PDC development objectives.

3. Proposed project is financially feasible and requires no PDC financial assistance.

C. Development Team Capability

1. Demonstrated successful experience on projects similar in scope and type to proposed project, including projects with public/private development relationship.

2. Demonstrated financial capacity to close on the property within a reasonable due diligence period and undertake the project without PDC investment.

D. Compliance with PDC Business and Workforce Equity and Green Building Policy

1. Demonstrated ability to maximize diversity in its past projects or business practices and commitment to strive to meet the PDC Equity Policy.

2. Demonstrated ability to advance green building and sustainable developments in past projects and commitment to strive to meet the PDC Green Building Policy.

This RFO may lead to one of the following outcomes:

• Direct negotiations for sale and redevelopment of the Property through a MOU or PSA with a Developer selected as part of this RFO.

• The issuance of a Request for Proposals (RFP) or Request for Qualifications (RFQ) to a developer or developers chosen as part of this RFO.

• The issuance of a RFP or RFQ open to all potential development teams.

• Cancellation of this RFO without the selection of a development team or the issuance of a RFP or RFQ.

PDC expects the evaluation of submittals will be completed by the end of July 2014. PDC anticipates engaging the selected Developer in a MOU or PSA by August 2014.

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10. Terms of this RFO

This RFO is not a request for competitive proposals and is not subject to the Oregon Public Contracting Code (ORS 279). This RFO in no way obligates PDC to enter into a relationship with any entity that responds to this RFO or limits or restricts PDC’s right to enter into a relationship with an entity that does not respond to this RFO. In its sole discretion, PDC may pursue discussions with one or more entities responding to this RFO or none at all. PDC further reserves the right, in its sole discretion, to cancel this RFO at any time for any reason. To the extent that PDC elects to enter into a relationship with an entity regarding a development proposal, such entity shall be required to comply with PDC’s policies, including its Business and Workforce Equity Policy and Green Building Policy in connection any work undertaken on such proposal.

Information provided to PDC in response to this RFO will become the property of PDC and will be subject to public inspection in accordance with the Oregon Public Records Law, ORS 192.410, et seq. If an entity responding to this RFO believes that a specific portion of its response constitutes a “trade secret” under Oregon Public Records Law (ORS 192.501.2) and is, therefore, exempt from disclosure, the entity must clearly identify that specific information as a “trade secret.” Identification of information as a “trade secret” does not necessarily mean that the information will be exempt from disclosure. PDC will make that determination based on the nature of the information and the requirements of the Oregon Public Records Law.

PDC is self-represented for this transaction and will not be paying any third party brokerage fees.

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11. Appendix: Supplemental Information Available

1. Portland Development Commission Revised Strategic Plan 2010-2014 (January 2012).

2. Expanded Phase One Environmental Site Assessment, Parametrix, May 2007.

3. Data Gap Phase II Environmental Site Assessment, Ash Creek Associates, January 2013.

4. Easement Agreement between the City of Portland and SN Investment Properties, LLC, March 5, 2004.

5. PDC Equity Policy, January 9, 2013

6. Equity Administrative Procedures, Part 3, April 1, 2013.

7. PDC Green Building Policy, June 22, 2005.

8. Statement of Developer Qualifications and Financial Capability.

“City gets peek at James Beard Public Market,” portlandtribune.com, September 2, 2013

Downtown Portland in the News

“Video game developer Kixeye opens Portland office,” oregonlive.com, November 19, 2013

“Puppet Labs new downtown headquarters,” oregonlive.com, March 5, 2014

“Google Fiber reaches preliminary franchise agreement with Portland,” oregonlive.com, April 16, 2014