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After facing numerous appeals, the team developing the 23-story Hyatt Place and Allison Residences has placed the project on hold.

The project, a collaboration between Seattle multifamily developer Vibrant Cities and hotelier The Sunray Companies of Madison, Mississippi, was intended for a quarter-block property at 350 N.W. 12th Ave. now used as a parking lot. The building was designed by Otak Inc. to feature 12 floors of apartments (113 units) atop an 11-story hotel with 160 rooms.

The decision to pause development of the 250-foot-tall tower, Vibrant Cities CEO James Wong stated in an email, was because Portland 鈥渟till needs to recover from the aftermath of (the COVID-19 pandemic) and protests,鈥� and financing is more challenging now 鈥� in part because of higher interest rates.

When approved in 2019, the Bureau of Development Services estimated the project value at $66 million. Due to inflation, that cost has since risen by approximately 20 percent.

The proposal for the Hyatt Place and Allison Residences drew opposition in the Pearl District during the land use approval process. The building would be the first to reach the 250-foot maximum height allowed in the area under the Central City 2035 plan, which aims to increase density in the downtown core.

Pearl Neighbors for Integrity in Design (PNID) took its opposition of the plans to the Oregon Land Use Board of Appeals (LUBA) on grounds that the building鈥檚 height would be out of scale with the surrounding neighborhood, which mainly has low-rise buildings. However, the group ultimately withdrew its appeal to LUBA, leading to its dismissal in May 2021 and concluding a two-year land use battle.

Although a building permit for the tower鈥檚 foundation and groundwork was approved for issuance by the BDS in February, it has since expired, according to Ken Ray, spokesperson for BDS.

Typically, project teams have three years to obtain a building permit from when land use approval is granted. The Hyatt Place project team received an additional year via an emergency measure taken by the Portland City Council to extend land use deadlines for projects approved from July 1, 2017, through Dec. 31, 2020, due to the COVID-19 pandemic鈥檚 effects on the development community.

The project team now has until the beginning of 2024 to seek a building permit, or its land use approval will expire. If Vibrant Cities were to proceed with development after the expiration date, the land use approval process would need to restart.

Ray stated that while the foundation permit has expired, the BDS could provide an extension if the bureau receives a written request, which has not happened to date. However, if the land use approval expires, the bureau will no longer be able to issue the building permit. The BDS has reached out to the team to inquire about its interest in continuing the project, given the multiple extensions it has received in the past.

Vibrant Cities did not respond to requests for comment on whether it will seek an extension.