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The long-awaited Centennial Mills redevelopment project is finally revving up. But the Portland Development Commission‘s board won’t raise the green flag until committed tenants are on board.

The team selected to redevelop the former mill site along the waterfront in Northwest Portland met with the PDC’s board last week. Developer Lab Holding of Costa Mesa, Calif., and its principal, Shaheen Sadeghi, are confident they can meet the board’s request.

“This sounds like a great project with the potential for a regional draw,” Portland Development Commission Chairman Scott Andrews said. “(But) at the end of the day, for this project to go forward you’re going to need tenants in hand because there is no more building on speculation.”

Sadeghi last week gave an update on the $45.8 million project to develop the 4.7-acre site. Plans call for redeveloping 11 interconnected buildings into 145,000 square feet of mixed-use commercial space and approximately 65,000 square feet of public space. Food service tenants would occupy 75,000 square feet of the commercial space.

No tenants are firmly committed yet, PDC project coordinator Sarah Harpole said. However, the PDC and Lab Holding are working out a disposition and development agreement that would outline financing and potential tenants.

“This will not be speculative,” she said. “We hope to have this all outlined in the DDA.”

The DDA is expected to be completed by the end of the year and go before the board for approval in early 2011.

Sadeghi said he had letters from Wells Fargo and U.S. Bank expressing interest in financing the project. He added that restaurateur Michael Mina Group of San Francisco and sustainable furniture manufacturer HD Buttercup of Los Angeles have expressed interest in possibly establishing locations at Centennial Mills.

“I expect to create 1,000 jobs here and that’s not being rosy,” Sadeghi said. “I’ve asked all the tenants at all of our projects how many people they employ and figured out how many this would create per square foot.”

The development team will attempt to incorporate Portland culture into the project via the tenant mix, Sadeghi said. The focus will be on culinary arts and sustainability, so the team will look for local and non-franchised businesses, outdoor recreational retailers, green goods and services, healthy dining options and wellness facilities, according to the development vision.

Sadeghi said rental rates will be “reasonable,” and restaurant-space amenities will outdo those at other spaces around town.

“My projects tend to attract young entrepreneurs, and in my experience the most daunting thing for one of these young restaurateurs is paying $400,000 or more for a commercial kitchen,” he said. “That’s why we’ve developed our plug-and-play system, which we plan on implementing here.”

Basically, mechanical systems are installed as part of construction. Restaurant owners thus face lower initial start-up costs.

The PDC’s expected investment for the project is estimated at $8.6 million. Slightly less than $13 million of urban renewal money is reserved for the project, but that money also must go toward a $5 million pedestrian bridge planned to span Northwest Naito Parkway and the $3 million relocation of the Portland Police mounted patrol unit stables.

Sadeghi is optimistic, despite the shortfall.

“I know it’s not the time to start negotiating, but I am confident that the overall cost could still come down some,” he said.

Once the DDA is signed, Lab Holding will tackle the land-use approval and permitting processes. Construction is slated to start in mid-2012 and finish in 2013.