Centennial Mills has been left jilted yet again, and city leaders will have to wait for another developer to revitalize the Northwest Portland riverfront property.

Lynd Opportunity Partners, the San Antonio-based developer that had entered into exclusive negotiations with Prosper Portland to develop the Centennial Mills site, has backed out of the deal, Prosper Portland Executive Director Kimberly Branam informed city commissioners in a letter sent April 17.

Lynd’s exit follows a procession of other developers – including Harsch Investment Properties, LAB Holding, Venerable Properties and Intrinsic Ventures – that have evaluated Centennial Mills for development potential before backing away. The city purchased the property in 2000. Lynd was selected from among five finalists in a 2017 search for development partners.

Prosper Portland’s next step may be to check in with the other firms, Branam said.

“We haven’t yet decided what our next steps are going to be, but I think we are interested in seeing whether any of the previous parties that expressed interest remain interested,” she said.

The property still holds development potential despite existing obstacles, Branam said.

“We now have a lot more certainty on what it’s going to take to make a development work,” she said. “I’m optimistic that the next development partner will be the development partner to make it work.”

Lynd’s development plans and cost expectations changed during the course of negotiations, Branam wrote in her letter to commissioners. The cost of repurposing the historic flour mill was among the challenges, Branam wrote.

When Lynd was selected, an executive boasted about the waterfront views that would sell residential and retail space. Lynd engaged SERA Architects, landscape architect Mayer/Reed and law firm Stoel Rives on the project. A Lynd development executive did not return messages seeking comment about the news, which was first reported by Willamette Week.

Prosper Portland is not considering giving up on developing the 4.4-acre property, or turning it into a park or other use, officials said.

“We’re not at this point contemplating reopening the future use of that property,” Branam said. “I feel like City Council has been pretty clear that development is a priority here.”

The site has a number of issues, including contamination around the Tanner Creek sewer line that runs through the property and site-wide industrial contamination, said Eric Jacobson, senior project manager at Prosper Portland. The contamination would require some soil removal, and then a cap and fill. The site has also flooded, including in 1996.

In March 2017, the City Council gave its blessing to Prosper Portland to pursue a full-site redevelopment and relocate the Police Bureau’s Mounted Patrol unit from the property.

The site includes a flour mill that city officials seek to preserve. A feed mill was demolished to prepare for development. The City Council also directed Prosper Portland to provide affordable housing commensurate with 60 percent of area median income.

The Central City 2035 plan added another wrinkle, increasing the setback required from the Willamette River from 25 feet to 50 feet.

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The latest developer seeking to transform Centennial Mills greeted Pearl District neighbors last week, offering to listen to local residents but volunteering few details about their plans for the historic riverfront site in Northwest Portland.

Lynd Opportunity Partners, a major developer based in San Antonio, was selected in April to enter into exclusive negotiation with Prosper Portland for the 4.4-acre property.

Lynd executives introduced their project team, including SERA Architects, landscape architect Mayer/Reed and heavy-hitting law firm Stoel Rives.

Members of the project team said the number of buildings and their heights, uses and configuration were to be determined.

“This is a large parcel and it could potentially support three to four buildings on it,” SERA principal Kurt Schultz said.

The project team plans to undergo a voluntary Central City master plan through the city of Portland.

“We think that’s the best way to move forward,” Schultz said. “It takes more time, but we think that’s the right move for the city of Portland.”

Each building would go through a separate design review process.

Schultz pledged there would be affordable housing on the site. “The only thing that I can guarantee you will be on the site is affordable housing,” he said.

The site will also have a “large amount of public open space,” Schultz said.

Lynd is a major player in the national multifamily market, with 35,000 units in 50 metropolitan areas. The company is privately held by founder Michael Lynd Sr.

“We’ve been successful in every market we’ve been in, and it’s because we pay attention to what the consumer wants,” said Scott Brymer, Lynd’s president of development.

Brymer pointed to the riverfront views as a key selling point for whatever is eventually built on the site. “That sells condominiums, that sells apartments, that sells any retail experience that might be there,” he said.

“They’re not making any more land on the Willamette River,” Brymer said. “We have a tremendous opportunity to do it right.”

Questioned about Lynd’s record, Brymer pointed to ENV, a luxury apartment tower the company built in Chicago that sold for a record price on a per-square-foot basis in that market.

Lynd is the latest developer to try a hand at bringing new life to Centennial Mills. Jordan Schnitzer explored developing the site in 2015-16 but could not come to an agreement with city officials. Prosper Portland, then known as the Portland Development Commission, settled a lawsuit in 2012 with developer LAB Holding of Costa Mesa, California, after plans for the site shifted. At different times, Venerable Properties and Intrinsic Ventures also evaluated the possibilities at Centennial Mills.

“I do think it is different this time for a number of reasons,” Will Thier, Prosper Portland’s project manager for Centennial Mills, said in an interview. “First of all we have a great deal of clarity from our elected officials and from the bureau directors in terms of what the priorities are on the site and what resources are or are not available. In the past, there was not always perfect clarity on some of those items. That additional clarity provides a lot more certainty for the developer in terms of how they approach the site.”

Last year, the City Council endorsed a plan for a full-site redevelopment that precluded the Police Bureau’s mounted patrol from returning to the site. Commissioners also directed Prosper Portland to prioritize affordable housing.

The site has seen its share of challenges, including flooding and environmental contamination. Two historic structures, the 1910 flour mill and the 1926 feed mill, have complicated plans. The feed mill has been demolished as part of Prosper Portland’s clean-up of the site; the flour mill is expected to be preserved.

Neighbors have sought to maintain access to the Greenway Trail that runs by the site. Some have also argued for low-slung buildings on the site that wouldn’t interfere with views of nearby condo owners.

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A San Antonio developer will be the latest to try its hand at turning Centennial Mills into something.

Prosper Portland will enter into exclusive negotiations with Lynd Opportunity Partners to sell the 4.4-acre waterfront property.

The Texas developer is proposing to construct two residential buildings with approximately 400 units, according to an agency staff report. The buildings would be subject to inclusionary housing rules, so approximately 20 percent would be rent-restricted affordable units.

Lynd also plans to preserve and renovate the existing flour mill at the Northwest Portland property, according to the report.

Development on the site would also preserve space for the Willamette River Greenway trail, with a setback from the river, according to Prosper Portland.

The former mill property has been the subject of years of development proposals that failed to come to fruition. The property was purchased by the Portland Development Commission (since rebranded Prosper Portland) in 2000.

The agency has entertained bids for Centennial Mills at various times since 2007. Jordan Schnitzer’s Harsch Investment Properties became involved in 2015, but a memorandum of understand expired without Harsch moving forward.

Last year, the agency received the City Council’s blessing for a full-site redevelopment pushing out the Police Bureau’s Mounted Patrol.

Lynd’s bid was chosen after a national solicitation, Prosper Portland project manager Will Thier said.

The property has proved difficult to develop. It is in a low floodplain that flooded in 1996. The existing flour mill adds another complication – the aging structure must be renovated or demolished, and the city has a goal to keep it around. And Pearl District neighbors have weighed in to ensure redevelopment lives up to the city’s vision for the site.

“As we all know, the history of Centennial Mills has been fraught with disappointment,” said David Dysert, co-chairman of the Pearl District Neighborhood Association Planning and Transportation Committee.

Another Pearl District resident, Larry Mazer, asked what assurances the agency has that Lynd will follow through on the city’s goals that were laid out in earlier plans.

“We hope you will include in the agreement some sort of enforcement mechanism so we can ensure the goals of the 2006 plan are implemented,” he said.

Thier told the Prosper Portland Board of Commissioners that he would work with the agency’s attorneys on specific contract provisions to hold Lynd accountable to the city’s plans.

Lynd, founded in 1980, has developed $500 million of new development in San Antonio, Chicago, Denver, Miami and Austin, Texas. The company also manages 35,000 multifamily units in 16 states. Lynd did not respond to interview requests.

If Prosper Portland and Lynd reach a tentative disposition and development agreement, the matter will return to the agency’s board for final approval.

Prosper Portland plans to close on the agreement late this year, Thier said.

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