December 28, 2004

Dance Of The Bridgehead Developers

Let The Spinning Begin

Readers of the Portland Tribune today might notice how two of the prosepctive developers for the Burnside Bridgehead have begun backpeddling, in rhetoric if not yet in reality.

"Even the developers who have included big-box retailers in their proposals say they are not wedded to them, however," says the Tribune article in question. "Both say the tenants could change once serious negotiations begin."

Mark Edlen, a partner at Gerding/Edlen, said his company's plans are flexible, given neighborhood concerns.

"Our proposal does not spin on Home Depot. If you don’t want them, we'll take it out," he said.

Of course, at the meeting at which the three development teams presented their proposals to the public for the first time, the Gerding/Edlen repeatedly defended the inclusion of big box retail in their plan, despite having referred to it as a "negative" from the financial standpoint.

Rather than discuss how they might approach the project if big box retail were a firm no-go, the Gerding/Edlen team instead stressed that Home Depot had an "open mind" as to the urban context, and that the location would be a "one of a kind store" amongst the company's stores. Further, the team suggested that "if they could do it in Manhattan, they could do it here in Portland" -- demonstrating a lack of attention to the distinct natures of different urban environments.

Then again, the team also referred to their interpretation of the Request for Proposals as having "strong interest" in seeing proposals contining big box retail. In a development such as this one, it is important to take note of where each team went with their thinking in the first instance.

Did the Gerding/Edlen challenge themselves or the awaiting public? No, they took the path of least resistence, compiling an uninspired proposal which reflect a disappointing lack of interest in the context and character of the district -- let alone a lack of interest in the public opposition to what they were going to propose, which was obvious for some time prior to any of these developers creating their proposals.

What we find most curious about this team's inclusion of Home Depot in their proposal is that in their first response (pdf) to a request for more information from the Portland Development Commission, they say the following:

Home Depot is a financial 'net neutral' to the viability of our proposal. As stated in our proposal, the cost to build the store and required parking exceeds the amount that Home Depot is willing to pay.

Notice, of course, how the second sentence sounds more like the financial "negative" they copped to during their presentaiton, not the financial "neutral" of the first sentence above. Anyway, we find the above comment curious because it underscores the fact that despite even the clear financial problems with including a Home Depot, Gerding/Edlen insisted on going forward with a big box proposal, and didn't present any real options for how it might work without big box retail, or at least not any that demosntrated a particular imagination.

Moving along to the other proponent of big box retail at the Bridgehead site, we return to the Tribune article where we left off, one the subject of the developers being open to removing big box retail:

Bruce Wood, a senior director for Opus-Northwest, said the same is true of his company's plans.

"The PDC said that if we planned to include a large retailer, we needed to name it. We named Lowe's because we have had discussions with them, but we have not made any commitment to them," Wood said.

We were going to go back to our original reporting from the develoepr presentations to point out how disingenuous this is, and how much the Opus team is fixated upon big box retail and resistent to anything else, but we didn't have to, because the Tribune article itself is enough:

But Wood of Opus-Northwest said that only a large, established retailer could obtain the financing necessary to go into such a project.

"You need to have a retailer at the center of the project that has credit. No bank is going to loan millions of dollars to a company with no credit," Wood said.

So don't look to Opus to be much interested in suddenly changing the direction they, along with the Gerding/Edlen team, took in the first instance.

It should also be noted that while Opus argues that only the presence of a big box retailer would attract the necessary attention and involvement from banks, the competing Beam proposal -- the one without big box retail -- has in its proposal a letter of interest from Bank of America.

While any involvement on their part of course is predicated upon financial specifics, the fact that based on what Beam has so far a major bank has expressed an interest suggests that Opus may not know what they are talking about, and is ismply trying to say whatever it can to avoid having to rethink their assumptions or their proposal.

In fact, both the Gerding/Edlen and Opus teams, when you examine their statements over time and in context, are fairly defensive about the approaches they've taken even as they provide lip service to the idea of no including big box retail.

What needs to get not become lost in all of this dancing around is that only one developer constructed a proposal that in the first instance avoided big box retail and focused on the small, the local, and the character of the district. It's important where these developers went, on their own, right off the bat. It tells us something about whether or not they are suited to the task at hand.

Gerding/Edlen and Opus Northwest in many ways took that path of least resistence, which is usually the road most-travelled. Beam from the start challenged that sort of inertial assumption.

No matter how much the other two developers try to spin their way past the public opposition to big box retail, they can't spin their way out of the fact that when given the opportunity to develop proposals for this project, they failed to think outside the box.

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