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To Jeff Borlaug, director of brokerage at , development of the largest swath of vacant land in the city core is a perfect example of a chicken-and-egg dilemma.

A team at NAI Norris, Beggs & Simpson has begun marketing the site – a 22-acre parcel covering 16 city blocks between the Pearl District and Northwest Portland. But when a development has the potential for as many as 4 million square feet of built space, many different ideas exist about how to start the project.

“We’re testing the waters and what we are finding out is that it’s difficult in determining what needs to be developed first,” Borlaug said. “Do you attract people there with the retail and then build the housing, or do you develop the housing and then bring the retail when the demand is there?”

According to J. Craig Boretz, vice president and chief tax officer with Con-way, the international freight company decided about four years ago to look into the possibility of developing the property it presently underutilizes.

Among some of the concepts were a system of canals, a baseball stadium and a new high school. Then the real estate bubble burst, and the project was placed on hold until earlier this year.

“The market has started to change and not only are developers looking to do projects, they are starting to get the financing to make them a reality,” Boretz said.

But from early in the process, Boretz said the Con-way team recognized that the development needed to be phased appropriately to be successful. This is because completion of the overall project could require 15 years, he said.

Chris Johnson, executive vice president at NAI Norris, Beggs & Simpson, said initial interest from developers has been for market-rate apartments. This may be because a strong retail presence exists already in surrounding districts.

Sam Rodriguez, vice president of development with the regional office of Mill Creek Residential Trust, is presently conducting predevelopment work for the first project on the Con-way site. The company is building a 179-unit market-rate apartment complex at the corner of Northwest 23rd Avenue and Savier Street.

Johnson said other apartment projects could move forward at the site, which is bordered by Pettygrove Street, Quimby Street, 21st Avenue and 22nd Avenue.

But the only certainty right now, Johnson said, is that Con-way wants to develop the outskirts of the properties first to make a distinct area and then move inward.

A group of Portland State University graduate students, however, last year pitched a different strategy for the site. The students recommended first anchoring the site with a Target store, which would be built in the first phase of development. The area would then become a destination before people would be invited to reside there.

But as Borlaug pointed out, businesses won’t necessarily rush to move into a new area.

“It’s true,” he said. “If you want to talk people into moving there, you need to have the amenities there to support them.

“But if there aren’t residents living in the neighborhood, it’s a hard sale to retailers because they don’t know what the demographic will be. A restaurant needs to know if the people are going to want a white linen-type place or a buffet.”

Johnson said the market will ultimately determine what is built.

“This isn’t going to be the traditional master-planned development where everything is decided from the onset and produced by a master developer,” he said. “We see it as more like the Brewery Blocks, where their flexibility with having a lot of land and not a definitive plan or developer made the project successful.”

In addition to drawing strong interest from developers representing residential and small retail, Johnson noted that the site also is attracting developers and companies looking to build offices. Such projects could help activate the area, he said.

The uncertainty won’t last long. Johnson said three or four strong ideas have come out of just two months of marketing. He expects a deal to be drawn up within the next 90 days for at least one of the properties.