Prosper Portland‘s board has approved a $13 million sale of the 4.4-acre Centennial Mills property.

The board’s OK of the disposition and development agreement with a development group that includes Tim Ralston of Portland and two California-based partners kicks off a due diligence period. The developers will begin conceptual design work with GBD Architects and investigate the site.

Prosper Portland received four offers for Centennial Mills. The offer by Ralston’s group wasn’t the highest or the lowest, but it was the only one from a development group with local riverfront experience, said Sarah Harpole, senior project manager for Prosper Portland.

“We felt their offer was probably the most informed by their knowledge of the site,” she said.

Commissioners unanimously approved the agreement during a meeting on Wednesday.

The deal comes after numerous previous attempts by developers to redevelop the defunct flour mill property in Northwest Portland. In recent years, LAB Holding, Harsch Investment Properties and Lynd Opportunity Partners investigated redevelopment but ultimately abandoned those efforts.

The latest suitors include Ralston of MLR Ventures LLC, Orlando Montero of Handson Equities LLC and Emanuel Yashari of Yashari LLC or Emma Corp.

Prosper Portland chose the development team in part because of its experience developing River North, the property immediately north of Centennial Mills, Harpole said. River North includes the 140-unit Riverscape Townhomes.

The developers have not settled on what they will build, Harpole said. If housing is constructed, any inclusionary housing obligations would be satisfied on-site.

The disposition and development agreement allows the developers 10 years to complete the project. Some commissioners expressed concern about the long leash.

“I would just hate to see that property sit for 10 years – 10 more years,” Chairman Gustavo Cruz said.

In 2000, Prosper Portland (then the Portland Development Commission) acquired the property from ADM Milling Co.

Prosper Portland staff wanted to give the developers a “conservative but reasonable back-end date,” Harpole said, particularly given pandemic complications.

The fate of the historic flour mill on the property appears to be sealed. The agreement contains no provision requiring the developers to retain the mill.

“My feeling is that this decision was inevitable,” said Stan Penkin, president of the Pearl District Neighborhood Association. “I know it was an impediment in any developer making a project pencil out. That’s disappointing, because it’s such an iconic historic structure.”

Prosper Portland “kind of went dark on us” after years of communication regarding Centennial Mills, Penkin said.

“This announcement caught us by surprise,” he said. “There was no communication with us that this was in the works.”

Prosper Portland staff will reach out to the neighborhood association and Restore Oregon, Harpole said Wednesday.

The neighborhood association would like to see some affordable housing at the site, Penkin said. The association also wants to ensure a “really significant connection to the river” from the north Pearl District.

Some previous planning efforts envisioned a bridge over Naito Parkway to connect the neighborhood with the riverfront property. Penkin acknowledged construction of a bridge would be expensive and maybe unrealistic, but added that a better connection between the property and neighborhood is necessary.

“I know it’s not a done deal yet,” he said. “When and if it is, I sure hope there’s going to be a really productive and meaningful conversation with the neighborhood (about) what will be there.”

Centennial Mills has various site challenges that have complicated redevelopment efforts. The waterfront location makes below-grade parking infeasible. The property is vulnerable to flooding and was inundated in 1996. Various environmental contaminants – including asbestos, lead, pesticides, creosote and polychlorinated biphenyls (PCBs) – have been found at the site. Some of that has been cleaned up in the past 20 years.

In 2017, a contractor completed demolition of a historic feed mill that was listing and settling, and removed pilings.

Prosper Portland’s board on Wednesday also approved a $1.2 million contract extension with Safeguard Security to provide round-the-clock security at the site. Trespassing has been an ongoing issue for Centennial Mills.

Prosper Portland spends approximately $450,000 a year in carrying costs at the site, Harpole said.

The $13 million purchase would give Prosper Portland additional funding in the River District, an area that also includes Broadway Corridor. In September, Continuum Partners walked away as developer of the initial blocks of the U.S. Postal Service site, although the Denver firm is remaining a development adviser.

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A Pearl District group on Thursday continued to fight plans for a 23-story hotel and residential building that would dwarf others nearby. Pearl Neighbors for Integrity in Design pleaded its case to the Portland City Council in a three-hour hearing.

Plans for the 197,118-square-foot Hyatt Place and Allison Residences have elicited substantial opposition. The building, residents say, would interfere with motor vehicle, bicycle and pedestrian traffic, provide no on-site parking and ruin the character of the South Pearl, where low-slung warehouses mix with modern condo buildings.

The proposal, approved by the Portland Design Commission earlier this year, calls for a structure that would be the tallest in the Pearl since implementation of the Central City 2035 plan. The zoning reform raised allowable building heights around the city in a bid to accommodate more housing and growth. But the bigger buildings have sparked backlash from residents who say their neighborhoods’ character is being threatened.

PNID’s appeal was presented by Bateman Seidel land-use attorney Carrie Richter. She said the project “turns its back” on the Flanders Greenway – a future bicyclist- and pedestrian-friendly route planned by the Portland Bureau of Transportation – and introduces a “pinch point” on Northwest 12th Avenue where neighborhood traffic would encounter a loading zone for the proposed building.

The project is planned for 350 N.W. 12th Ave., on the southeast corner of 12th Avenue and Flanders Street. The property currently holds a surface parking lot.

PNID also presented a slickly produced video illustrating the evolution of the Pearl from an “industrial wasteland” into a desirable modern neighborhood. The project is “an example of extracting all of the potential development rights while sacrificing all of the adjacent area,” PNID President Patricia Cliff said in recorded testimony.

The Central City 2035 plan raised allowable building height on the site, with bonuses, from 175 feet to 250 feet.

The project is planned by a joint venture of Seattle multifamily developer Vibrant Cities and hotelier The Sunray Companies of Madison, Mississippi. A lawyer for the developers, Renee France, said the project conforms to design guidelines, making other objections irrelevant.

“Most of the arguments made by the appellants attempt to either ignore that criterion or impermissibly expand or mischaracterize the applicable guidelines,” she said.

France added: “This building, and this project, is exactly what Central City 2035 intended.”

Cliff, in her video narration, invoked historical racial displacement in the neighborhood and tied PNID’s appeal to the Black Lives Matter movement. That brought a sharp response from David Dysert, who serves as co-chairman of the Pearl District Neighborhood Association‘s Planning and Transportation Committee (Dysert said he was speaking as an individual).

“We can have honest disagreements about development and design, context and code, but it is disingenuous and cynical to use the argument of racial displacement for personal concerns over height, density or use,” Dysert said. “Requiring all future buildings remain below one’s own 15th-story penthouse view has nothing to do with racial equity or honoring a people’s history.”

The appeal was filed by PNID, a 501(c)(3) group that is not affiliated with the city-sanctioned Pearl District Neighborhood Association.

City commissioners did not deliberate Thursday, and chose to hold their opinions on the appeal for another day.

Commissioner Amanda Fritz grilled Gary Larson, a consulting architect with Otak, about how the building would complement the context of existing buildings – a design guideline. Larson responded that nearby buildings have materials similar to ones planned for the tower, including concrete bases.

The Design Commission unanimously approved Otak’s design in January after a series of design advice meetings.

The City Council is tentatively scheduled to vote on the appeal on Sept. 16. The record will remain open for new submissions until 5 p.m. on Thursday.

The council could uphold, deny or remand the appeal to the Design Commission. Either side could then appeal the council’s decision to the Oregon Land Use Board of Appeals.

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They couldn’t figure out where to put the valet parking.

If valet parking for a 23-story hotel and apartment building in the Pearl District were placed on Northwest 12th Avenue, it could cause conflicts with residential buildings including The Casey and street traffic.

Yet if it were placed on Northwest Flanders Street, it would interfere with a plan to turn the street into a bikeway that would run from Waterfront Park to Flanders Crossing – a bridge over Interstate 405 that crews are slated to begin building this year.

The design problems for the Hyatt Place and Allison Residences were thorny. The project from a partnership of two out-of-state developers called for a dense building on a quarter-block property in a busy part of the Pearl District.

It was the first project in the south Pearl to take advantage of several provisions of the Central City 2035 plan, including a greater height limit of 250 feet, up from 175 feet. The building will have no parking – another change from old requirements that rankled some nearby residents.

Throughout the design process, the Pearl District Neighborhood Association was involved, prodding and pushing details to be more in keeping with the neighborhood and acceptable to residents. Leaders of the group’s Planning and Transportation Committee met at least three times with architects from Otak Inc., the local design firm engaged by developers Vibrant Cities of Seattle and The Sunray Companies of Madison, Mississippi. They wrote letters. They attended hourslong Portland Design Commission hearings, which culminated in the project’s approval on Jan. 16.

“Our whole focus is to make things better,” said David Dysert, co-chairman of the Pearl District Neighborhood Association Planning and Transportation Committee. “We have a very positive relationship with the city and with the Design Commission because they respect what we’re trying to do.”

The city’s 94 officially recognized neighborhood associations are under scrutiny like never before, receiving blame from some parties for stalling projects that would bring needed housing. A code change proposed by the Office of Community and Civic Life threatened to reduce associations’ role in the city’s public process. For now, those changes have been shelved, with Commissioner Chloe Eudaly’s office establishing a work group to consider the future of public involvement.

Dysert said the Pearl District Neighborhood Association is more diverse than detractors give it credit for, and does not seek to stop projects, but rather to shape them.

“We’re pro-development,” he said. “We’re pro-density.”

The Hyatt Place and Allison Residences offer a case study in how neighborhood associations work with designers and the city’s Bureau of Development Services.

Otak‘s Casey McKenna is the project manager for the Hyatt Place and Allison Residences. He worked closely with Pearl District representatives in finalizing the design.

“It was a very collaborative experience,” he said. “We presented to them three times. The third time, they were beginning to really feel like they were part of the process.”

The neighborhood association representatives also went to Otak’s offices to puzzle over models. The group’s input helped inform the building’s massing and upper-floor step-backs, materials and ground-floor elements that will be part of the pedestrian experience, including a water feature evoking Tanner Creek that is required by design guidelines.

“It was a working meeting,” McKenna said.

Early on, Otak made the decision to move the valet parking and loading to 12th Avenue. Having trucks backing onto the Northwest Flanders Bikeway could have been managed, but was best avoided, McKenna said.

“(The Portland Bureau of Transportation) didn’t want it; the neighborhood didn’t want it,” he said. “We moved the loading dock.”

Conversations between Otak’s architects and the neighborhood association leaders required some give and take, McKenna said.

“Overall, I think we would see it as a pretty positive experience,” he said. “There was some contention, certainly, in some of the earlier meetings. As an architect, sometimes you have to listen, and let them talk and listen to what they have to say.”

At times, neighborhood association leaders had to be told certain design changes would be impossible under city codes, McKenna said.

“There are just so many competing elements with a complex project like this,” he said. “Often the public doesn’t understand why things are the way they need to be. There are times where you have to say, ‘yeah, the code doesn’t allow that to happen.’”

Moving the dock and valet parking was eased by the building’s design, which places the main entrance at the corner. Some building systems could simply be swapped to the other side.

Otak also worked closely with Bureau of Development Services staffers Art Graves and Tim Heron.

Throughout, the project was challenged by another group of Pearl District residents: the Pearl Neighbors for Integrity in Design. The nonprofit group, led by Patricia Cliff as president, fought the project for months with the help of a land-use attorney.

At one early Design Commission meeting, Cliff called the project “vertical sprawl,” and the group paraded around the room with hand-drawn pictures of a maple tree at the corner of 12th Avenue and Flanders Street that will be axed to make way for the building.

The competing priorities of Cliff’s group and the city-recognized neighborhood association have led to much consternation in the Pearl District. Adding to the issues, Cliff also serves on the neighborhood association’s Planning and Transportation Committee led by Dysert and Reza Farhoodi as co-chairmen.

“We’re kind of dealing with it,” Dysert said. “We haven’t had this before where someone has built a separate organization that is in some way parallel to what we do.”

Cliff could not be reached for comment Friday. But she said in the aftermath of the Jan. 16 approval that she still has concerns about the Hyatt Place and Allison Residences.

“It is not a user-friendly building, and it could be potentially very dangerous for pedestrians, drivers and bicyclists,” Cliff said.

The project team hopes to break ground in the fourth quarter of 2020, McKenna said.

The building will have approximately 160 hotel rooms on floors two through 11, and 113 studio and one-bedroom apartments on floors 12 through 23. The developers have opted to satisfy Portland’s inclusionary housing requirements with affordable units on site, rather than pay a fee in lieu, McKenna said. The precise number of affordable units is still to be determined.

“It’s certainly something that we’re super proud of,” McKenna said of the project. “We’re blazing a new trail.”

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The Portland Design Commission has delayed making a decision on a proposal for a 23-story hotel and multifamily project that has raised opposition from neighbors in the Pearl District.

The design by Otak Inc. has improved from earlier iterations, design commissioners said. But they opted not to take a vote at a Thursday hearing, leaving the record open for more written testimony.

The proposed tower would be the first in the Pearl District under Central City 2035 zoning that raised height limits. The developers plan to use the full height limit, with bonuses, of 250 feet – an increase from the previous limit of 175 feet.

Neighbors have objected to the height and bulk of the Hyatt Place design. The building would be constructed on a quarter-block lot at Northwest 12th Avenue and Flanders Street.

“The central problem here is there is too much mass and too much height and it is not contextually appropriate,” said Carrie Richter, a land use attorney representing the Pearl Neighbors for Integrity in Design, a community group that has challenged tall building projects in the area. PNID is distinct from the city-recognized neighborhood association.

The Hyatt Place project comes from a development team of Seattle developer Vibrant Cities and The Sunray Companies of Madison, Mississippi.

The 197,118-square-foot building would hold 160 hotel rooms on floors two through 11, and 113 studio and one-bedroom units on floors 12 through 23. The project was valued at $66 million by the city’s Bureau of Development Services.

Otak’s Gary Larson said the design team had used setbacks and other architectural moves to reduce the apparent mass.

“We have created a dynamism here with also the goal of bringing the height of the building into the context of the neighborhood,” he said.

Richter told design commissioners that they should follow the previous zoning rules because the Central City 2035 plan was remanded in August by the state Land Use Board of Appeals. The city lacked a factual basis for the height limits, LUBA said.

“The tallest building that you can approve is 175 feet,” Richter said.

City officials said they would follow the 250-foot height limit, which has been declared effective but not formally “acknowledged” – the final step of approval by the Oregon Department of Land Conservation and Development.

Architectural changes made since previous meetings with design commissioners won praise. Reza Farhoodi, a resident representing the Pearl District Neighborhood Association, said the design appeared “more cohesive.”

“This project will set a precedent for height in the Pearl District neighborhood, so it’s important to get the design details right,” he said.

Design commissioners said a required water feature was better integrated into the ground floor façade. They also praised the stouter appearance of the building’s base, which was criticized in earlier designs as too weak.

“The base-middle-top expression is a clear improvement over earlier expressions,” Commissioner Brian McCarter said.

McCarter, however, voiced one significant concern.

“My one disappointment is urban street trees,” he said. “It really bothers me in a quarter-block building that we’ve set a precedent for one street tree in a hundred feet. … To have a single tree in a hundred feet, it seems like we’ve got to do better than that.”

The project team will return before the Design Commission for final deliberations and a decision on Jan. 9.

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Deep in the bowels of the city of Portland’s policymaking process, Committee 3.96 went to work.

The committee’s 25 members quietly reviewed decades-old city codes meant to give neighborhoods a voice in city budgeting and evaluations of land use. The group, formed last year by a City Council directive with members drawn mostly from local activism and nonprofit groups, had a task: examine the roles of the city’s influential neighborhood associations, and recommend changes.

Committee 3.96 began meeting in November 2018, working within the city’s Office of Community and Civic Life. Then on July 18, after months of study and debate, Committee 3.96 issued its recommendations. They landed with all the subtlety of a bomb.

A four-page document approved by the committee is filled with vague language on reducing disparities and delivering just and equitable outcomes, but the recommendations are unmistakable. Proposed changes would broadly reduce the role of neighborhood associations, putting them on equal footing with other groups engaged in affinity-based, business, community or issue advocacy.

Neighborhood associations fear the changes will sideline them, rendering them voiceless to influence the surge of infill construction that has reshaped urban neighborhoods. Yet many stakeholders say it is time for a change in 20th-century city codes that favor neighborhood associations and their largely older, wealthier and whiter demographic of homeowners.

The proposed changes raise a host of questions for future development, including whether neighborhood associations would retain the right to appeal Design Commission rulings to the City Council with the appeal fee of up to $5,000 waived.

“I’m not quite sure if it’s better or worse for development, in part because we have something that we’ve been working with for many, many years,” said Sam Rodriguez, senior managing director of multifamily developer Mill Creek Residential Trust. “You kind of know what you’re dealing with. If you don’t have (a neighborhood association) structure, what are you dealing with?”

Neighborhood associations such as the Pearl District and Overlook groups often have a sophisticated understanding of the city’s design guidelines, Rodriguez said.

“This could be more of a mob mentality,” he said. Other groups, he said, “are not necessarily going to have the structure of the neighborhood association.”

In some cases, splinter groups – such as the Pearl Neighbors for Integrity in Design – have sprung up to oppose developments. If those neighborhood groups are recognized alongside neighborhood associations, it could change the dynamic.

The committee’s recommendations, which were first reported by The Oregonian/OregonLive, were overseen by the office of Commissioner Chloe Eudaly, who is in charge of the Office of Community and Civic Life.

A spokeswoman for Eudaly, Margaux Weeke, acknowledged the code recommendations had caused confusion. They are not intended to place limits on neighborhood associations, she said.

“This is not taking away neighborhood associations; this is not banning neighborhood associations,” she said. “They will absolutely continue to exist. It’s allowing other types of organizations to have a seat at the table. It’s about addition and multiplication, not subtraction and division.”

The changes are meant to empower groups such as Living Cully that are not among Portland’s 95 city-recognized neighborhood associations, Weeke said.

“Basically, the proposed changes say ‘neighborhood-based groups’ instead of ‘neighborhood associations,’ which is just to allow other types of groups to be officially recognized groups,” she said.

Some neighborhood association leaders were skeptical that the new code language wouldn’t sideline neighborhood associations.

“I don’t buy it,” said Stan Penkin, president of the Pearl District Neighborhood Association.

The committee’s report comes as city officials face demands to ease housing shortages. Neighborhood associations often campaign against proposed housing developments, and their demands for parking capacity can drive up project costs.

Rodriguez said neighborhood associations can be difficult to work with.

“They’re quite powerful and they’re less inclined to support development than not,” he said.

Penkin and other neighborhood association leaders said the groups deserve some of the criticism they receive for not-in-my-backyard politics.

“In some cases there’s a NIMBY aspect to it,” Penkin said. “I wouldn’t deny that. But on the other hand, (when) there’s a project coming to a neighborhood, the neighborhood having a say in it, we’ve got better projects and better buildings out of it from having a say.”

Committee 3.96’s report seems to raise more questions than it answers, leaving commissioners, neighborhood associations and developers wondering what the proposal actually entails.

“It’s a bunch of aspirational statements, statements of value, which are important, but there’s no process there,” Penkin said.

The code language will go before the City Council for consideration. A work session is tentatively scheduled for September.

It’s unclear whether Committee 3.96’s proposed changes have majority support on the council. A spokesman for Mayor Ted Wheeler stated that Wheeler has not taken a position.

“We are watching the process closely and will continue engaging with key stakeholders, including the Office of Community and Civic Life, to better understand the nuances of the proposal and learn more about possible outcomes should the code change go into effect,” Tim Becker, a spokesman for Wheeler, wrote in an email.

Commissioners Nick Fish and Amanda Fritz also have not taken positions on the changes, representatives said. Commissioner Jo Ann Hardesty’s office did not immediately respond to a request for comment.

The proposed changes caught many neighborhood associations by surprise.

“I just felt like it wasn’t a robust enough public process,” said Elizabeth Milner, a Sellwood-Moreland Improvement League board member.

Neighborhood association leaders said there’s value in the public accountability they provide. They often invite developers to meet with neighborhood residents in public forums. Neighborhood associations hold public meetings, take votes and publish meeting minutes and agendas. Non-officially recognized groups have no such transparency requirements.

Milner said the Sellwood neighborhood association has become younger and more diverse in recent years. The board president, Tyler Janzen, is a 27-year-old renter. Milner said she has mixed feelings about the proposed changes.

“I can understand a lot of the criticisms against the role neighborhood associations have played in Portland,” she said. “I would like to see the Office of Civic Life work with neighborhood associations as partners to craft the next chapter of civic involvement in Portland. I would like to see them engage the neighborhood associations rather than see them try to erase them systematically.”

Editor’s note: This story has been updated to reflect the correct fee to appeal Design Commission decisions to the City Council.

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Pearl District residents gathered en masse at a Portland Design Commission meeting Thursday to protest plans for a 23-story hotel tower that would reach 250 feet in height, the maximum allowed after a new code was adopted in 2018 by the City Council.

Hyatt Place, designed by Otak, Inc. and developed by Seattle-based Vibrant Cities, is a mixed-use project that would feature 11 floors of hotel rooms and 11 floors of apartments, with some affordable housing units included. A restaurant and café are planned to sit on the ground floor.

The building would rise from a quarter-block property at Northwest 12^th Avenue and Flanders Street.

The proposal has already undergone two design advice sessions with the commission. On Thursday, the project team sought a land-use review, at which point the building could move forward with development.

Several dozen members of the public, most of them led by Pearl Neighbors for Integrity in Design (PNID), came to voice their opposition to the project, citing concerns about the sheer size of the project and the traffic it might create.

“There needs to be some serious carving of the massing,” said David Dysert, who was representing the Pearl District Neighborhood Association. He said that the volume of the building wouldn’t match the area, and that with the new code in place, any new building is going to set a precedent.

PNID President Patricia Cliff said the organization is not opposed to new development in the Pearl District, but finds the size of the project inappropriate for the south side of the neighborhood. Perhaps most worrisome, she said, is a complete lack of parking provided.

While more than 20 people signed up to provide public testimony, nearly all of them ceded their time to Carrie Richter, a land-use lawyer representing PNID.

Richter said the lack of parking, combined with a 12-foot loading zone and a quarter-block site, makes for a dangerous situation. She cited a nearby Hampton Inn with a hundred-foot loading zone and an 80-percent block space, which she said was deemed insufficient by transportation experts.

With no vehicle parking, the building should be “ground zero” for cyclist-supportive housing, but falls short in this regard as well, Richter said. She said the spaces for bicycle parking are too small, the entrance to the parking is awkward and the building lacks outdoor temporary parking.

“Bicycling is a complete afterthought in this building,” Richter said. “This is not celebrating the bicycle by any stretch of the imagination.”

For their part, commissioners discussed more nuanced aspects of the project, and didn’t address the most pressing concerns presented by the opposition related to height and traffic.

Commissioner Brian McCarter was one of several who took issue with black bands that separate the base of the building from the tower, saying that design works better with shorter buildings. He also criticized the building’s mass on the small parcel.

“It’s got a lot of issues for me,” he said. “I can’t overlook the scale and massing problems.”

Commissioner Jessica Molinar took issue with using metal panels as cladding material, although other commissioners expressed approval. Molinar said she didn’t find the material suitable for the size and location of the building, and said it would make more sense on Burnside Street.

“The metal does not work in the context,” she said. “I think part of that is the scale.”

As far as the neighborhood is concerned, most commissioners didn’t find the building to be out of place, saying the Pearl District is already eclectic in its makeup.

“There are so many different kinds of buildings in the Pearl that I don’t think, contextually, this is out of whack,” Commissioner Zari Santner said. “I like the idea of variety and diversity of style.”

Based on public opposition, the design team decided to postpone the vote for a future meeting, at which point they will provide counterarguments to opponents of the project.

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Fremont Place won preliminary approval after design changes satisfied earlier objections from Pearl District residents and the Portland City Council.

The council voted 4-0 Thursday to reject an appeal from the Pearl District Neighborhood Association of prior Design Commission approval.

In response to earlier council opposition, TVA Architects and the developer, Lincoln Property Co. of Dallas, reworked the design of the 275-unit mixed-use building. The redesign pushes back the building façade an additional 15 feet from the seawall, to 32 feet, 9 inches away.

The additional space allows for a wider (now 20 feet) Willamette River Greenway between the building and the river. The revised design reduces bike parking from 206 spaces to 140. It does not change the number of residential units.

The 17-story building reaches 175 feet in height, includes 305,936 square feet and uses 84 percent of the allowable floor area ratio. Designers worked to preserve neighbors’ views as much as possible, said Tim Wybenga, principal at TVA Architects.

“Although the council has made it quite clear that views are not a consideration, they were a design factor,” he said. “And so a lot of the massing of this building and the way it’s pushed has to do with consideration of views and sight lines of Pearl District neighbors.”

Fremont Place will not include any affordable apartments; the project entered into the city’s approval process before inclusionary housing rules took effect.

Commissioners praised the redesign.

“The revised plan feels less cramped,” Nick Fish said. “It’s more open, more airy.”

The changes “have satisfactorily addressed the concerns of the Pearl District Neighborhood Association,” said Stanley Penkin, president of the group.

“The applicant has made significant improvements to the greenway, which now better serves the neighborhood and the city,” he said.

Commissioners, responding to criticism from one Pearl District resident, defended their role providing a final check on the Design Commission’s decisions.

“I don’t think this is the right forum to constantly second-guess the Design Commission,” Fish said. “But in the rare instances we’ve done that, I actually think those conversations were quite principled.”

Fish suggested the City Council should raise the bar for appeals of Design Commission decisions. The council could change city rules to choose which appeals to take up, much like the U.S. Supreme Court does, instead of automatically taking each appeal, he said.

Commissioner Amanda Fritz objected to that idea.

“If we narrow who gets to appeal, or how those appeals happen, that means that some people are left out, and the whole process here in Portland is about having people have their say to their elected officials,” Fritz said.

Thursday’s vote was preliminary; a final vote is scheduled for May 31. Commissioner Dan Saltzman was absent from Thursday’s hearing.

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For developers contemplating multifamily projects in Portland, the City Council‘s appeals process represents a perplexing puzzle.

After the City Council upheld the Pearl District Neighborhood Association‘s appeal of the Design Commission’s approval of the Fremont Apartments, developers began to wonder where the council stands on new housing projects.

“It’s chilling for anyone who goes down the fairway with entitlements,” Cairn Pacific principal Tom DiChiara said.

The City Council reconsidered its decision to uphold the appeal and opened the door for further discussion. Now the council is scheduled to revisit the appeal on May 10.

In the case of the Fremont Apartments, if the development team were required to go back to the drawing board, the project would change substantially. The proposed 17-story tower would no longer be vested under pre-inclusionary housing rules, so any new application would have to include affordable units.

Inclusionary housing rules require developers to either set aside 15 percent to 20 percent of multifamily units as affordable units or pay a hefty fee. Fremont Apartments was part of a flood of multifamily projects – totaling 19,000 units – that were submitted for city approval before inclusionary housing rules took effect on Feb. 1, 2017.

The developer of the Fremont Apartments, Lincoln Property Company of Dallas, did not respond to interview requests.

The back-and-forth regarding the Fremont Apartments has added to a sense of uncertainty for multifamily projects that come before the City Council. The council also voted to allow a height increase for NBP Capital‘s proposed multifamily towers in the RiverPlace area; that project has not been examined by the Portland Design Commission yet. Instead, NBP Capital reportedly circulated project information at City Hall.

The uncertainty comes amid broader signs of oversupply in luxury apartment housing and increased costs for land and construction. Developers have expressed concern that the economic expansion, now in its ninth year, can’t keep going forever.

Rents have declined in Portland, slipping 0.6 percent in March compared to a year earlier. Many managers of new luxury apartment buildings have taken to offering concessions.

“There is a lot of fear and hesitation and challenge to keep our development cycle going,” Brad Malsin, principal of Beam Development, said at a City Council meeting in March. “Land prices are escalating, construction prices are escalating and people are fearful – developers are fearful that (with) inclusionary zoning, we can’t make a lot of projects work.”

Malsin began to criticize the City Council’s initial move to uphold the neighborhood association’s appeal of the Fremont Apartments, but he was cut off by Mayor Ted Wheeler.

“That process is not closed,” Wheeler said. “Move on.”

In a subsequent interview, Malsin added that allowing neighbors to halt a project at City Council sends a bad message to developers.

“I think it’s problematic, and you’re sending out mixed messages,” he said. “The Fremont Place Apartments are a prime example of people – citizens – intervening at the wrong stage of the development process.”

The public has ample time to comment on development proposals during early stages, Malsin said.

“To have people come in at the last minute and have people say you’re blocking my view, I find that incredibly disturbing and undermining public process and public planning,” he said.

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In a tentative vote, the Portland City Council unanimously upheld an appeal to deny the proposal for Lincoln Property Company’s Fremont Apartments, planned in the Pearl District between Northwest Naito Parkway and the Willamette River. The council will hold a final vote at 11 a.m. on April 4.

TVA Architects‘ design, with several modifications, received the Portland Design Commission‘s approval in December with a 3-1 vote. But the Pearl District Neighborhood Association (PDNA) appealed that decision, and got its opportunity to present arguments at a public hearing before the council in February.

“Because this is an iconic location, and because this building will set the standard for that location, I want us to set that standard very high,” Mayor Ted Wheeler said.

Commissioner Amanda Fritz, who previously served on the city’s planning commission, said the proposed building’s height and its impact on views of the Fremont Bridge from Fields Park were not relevant to her decision. She brought up several concerns, including the height of the rooftop mechanical equipment, the reduced width of vertically-hung bicycle racks and the narrow width of the greenway by the building.

Overall, she said, plans do not meet city criteria with the modifications requested.

Wheeler and Commissioner Nick Fish agreed that the greenway in the proposed design would be too narrow.

“What we do here with this development will set the standard for the rest of the development that will take place along that corridor,” Wheeler said. “It is my belief that we need to aggressively protect the greenway.”

Fish mentioned the emerging greenway in the South Waterfront District as an example of a wider one, with dedicated spaces for bicyclists and pedestrians.

“You can make a very persuasive case that the fact that the buildings are set back further enhances the experience of the neighborhood, of the residents, and of the whole feeling of the emerging neighborhood,” Fish said, adding that the greenway in the Fremont Apartments design is unsatisfactory because of the narrow “choke point” at the southern end. “As someone who likes to ride his bike down by the river … that is not a successful greenway.”

Tim Wybenga of TVA Architects stated in an email that the project team has no specific plans on how to move forward at this point, but is looking at all options.

“For the project to have gone through all of that process and get rejected by council is extremely disheartening and frustrating,” he stated.

Wheeler noted that any development along that corridor will likely be tall.

“We are a growing city; there will be more height and there will be more density,” he said. “I believe this design team and this development team has the capacity and spades to be able to deliver a building that will meet their objectives as well as meet the community objectives and be celebrated for many, many generations to come.”

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Pearl District residents unhappy about plans for the Fremont Apartments project, between Northwest Naito Parkway and the Willamette River, took their complaints before the Portland City Council on Wednesday.

TVA Architects‘ design, with several modifications, received the Portland Design Commission‘s approval in December with a 3-1 vote. But the Pearl District Neighborhood Association (PDNA) appealed that decision, and got its opportunity to present initial arguments.

The hearing will continue at 10:15 a.m. March 7, when the City Council will have three options: deny the appeal and uphold the Design Commission’s decision to approve the proposal, deny the appeal and approve a revised proposal or grant the appeal and deny the proposal.

The main point of contention is the proposed height – the building would top out at 175 feet, exceeding the maximum allowed height of 100 feet. This requested modification met approval because the lower floors of the building extend out, which design commissioners found allowed for a better view of the Fremont Bridge than alternatives.

“This project does set, if approved, a very dangerous precedent for riverfront development in this area, which will wipe out the view of the Fremont Bridge,” said PDNA’s attorney Jeff Kleinman, who prepared the appeal. “There will be no further argument against such development if it is approved.”

As designed, the proposed structure at 1650 N.W. Naito Parkway would be 17 stories and include 306,000 square feet. It would have 275 residential units above 6,600 square feet of ground-floor retail and restaurant space. A parking garage would have 152 spaces.

The proposal also calls for a 60-foot-wide pedestrian plaza on the north side, and reconstruction of the greenway trail on the site. Currently, the parcel is serving as a surface parking lot.

“The Design Commission found that the proposal supports the river and greenway trail, has a massing concept that takes the view of the Fremont Bridge into account, incorporates a similar scale and massing as other developments in the North Pearl, and incorporates balconies, large areas of glazing, active ground-floor spaces and large plaza which reflect the North Pearl context in orient towards the river,” senior city planner Ben Nielsen said.

The appeal contends 13 design guidelines are not being met, and challenges six of the seven modifications. The PDNA’s appeal states it wasn’t mandatory for the Design Commission to approve any of the requested modifications.

“Basically what we’re talking about in a nutshell is a project that might work elsewhere on a city block removed from the river,” Kleinman said, adding that the height and massing are inappropriate for the site. “The application depends upon several modifications, none of which can be justified.”

The appeal isn’t the first hurdle for the project’s developer, Dallas-based Lincoln Property Company. In November, the Design Commission heard from neighboring residents unhappy that the building would block views of the bridge.

Patrick Gilligan, Lincoln Property Company executive vice president, said at the hearing the company owns about 50 buildings in Portland.

“We’re very committed to Portland and making the city a better place as much as we can through our projects,” he said.

The proposal has an inappropriate massing concept that doesn’t reflect the identity of the Pearl District neighborhood, according to Peter Gramlich, owner of Gramlich Design and Planning and an instructor at Portland Community College.

“This proposal violates the most basic principle of design: first, do no harm to your surroundings,” he said. “It detracts from the character of the waterfront area rather than reinforcing it. It seals the Willamette River greenway off from the neighborhood and the public as a whole, effectively seizing it for private benefit.”

The proposed building, Gramlich said, would not complement existing ones in the neighborhood.

“The case of the Fremont Apartments represents a crucial decision point for Portland,” said George Galster, professor of planning at Wayne State University.

Galster argued that the modifications approved by the Design Commission do not meet city design standards, such as increasing access to sunlight along the greenway, facilitating access along the riverfront, creating opportunities for views of the river, and ensuring bonus height granted to sites next to the Fremont Bridge not affect views of the bridge.

“The Design Commission essentially approved modifications that allow the Fremont Apartments to be taller and fatter than are permitted by code,” he said. “This development will set in motion a long-term development pattern that will be the poison pill for the Pearl.”

Dozens of people, mostly Pearl District residents, testified at the hearing. Many said the view of Fremont Bridge from Fields Park is iconic and would suffer from construction of the proposed building. Others agreed with attorney Kleinman’s slippery slope argument.

“I love our views, our mountains, our bridges, our waterway,” said Jeanie Coates, who said she has lived in the Pearl District for four years. “I want to call upon you to look for what is right for the city of Portland. Use your vision. Use your power. Let’s get this project redirected.”

Tim Wybenga of TVA Architects said there is no protected view of Fremont Bridge from Fields Park, but the company recognizes the view is important to residents.

“This is an important part of Portland, so from the beginning we said, ‘Let’s see what we can do from a good neighbor standpoint from day one of this project,’” he said.

Architects studied the mass of the building to take the view of the bridge into consideration in the design, Wybenga said. TVA Architects staffers have met with the PDNA several times throughout the design process, he added.

“We’ve spent a lot of time on this with the neighbors, and we did so not as a requirement but because we wanted the neighbors to be on board and we wanted to get that input,” he said.

As a result, architects redesigned the public plaza and greenway portion of the site to encourage use of the riverfront, Wybenga said. Trees on the site in its current condition block views and access to the river, he said, adding the proposed L-shape of the building steps down toward the river.

“This tower belongs in the Pearl,” he said regarding testimony that the proposed building doesn’t complement the neighborhood. “Most towers in the Pearl are substantially larger than this.”

Following testimony, the council agreed to leave the record open for 14 days before it votes. The record for new evidence is open to both the architect and the appellant until Feb. 28 and rebuttals to new testimony is open until March 6.

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