Major development in Portland's Bayside back on track
Courtesy of The Federated Cos.
A rendering of the southeast view of the proposed midtown development from Chestnut Street.
Courtesy of The Federated Cos.
Courtesy of The Federated Cos.
Construction on a major residential and commercial development proposed for Portland’s Bayside area is expected to begin by the end of the year, five years after the plan was first proposed and then scaled back.
Although the developer roughly halved the size of the so-called midtown project in response to a 2014 lawsuit from a community group fighting the development, the four-building project would still add 90,000 square feet of commercial space and 440 market-rate apartments to Portland during a tight housing market. Construction is estimated to take up to two years.
The city announced Wednesday afternoon that it had come to an agreement with the developer, The Federated Cos., and expected the project to break ground by the end of this year. Before the announcement, the future of the project planned for empty lots between Marginal Way and Somerset Street was uncertain.
The latest twist that threw the project in jeopardy again came less than four months ago when the city informed the developer that the plan would require city council approval again because the developer’s contract to buy city-owned land where it plans to build had expired. The developer then threatened to sue the city, saying the city was retaliating over the developer telling the city it planned to reduce the number of apartments from 440 to 260 to make room for hotels in two of the four proposed buildings.
The Portland Press Herald reported Wednesday that the hiring of Portland City Manager Jon Jennings in July came at a key time, soon after communications between the parties had broken down. Greg Mitchell, Portland’s economic development director, told the paper that Jennings being hired and joining the discussions “clearly helped the process.”
Federated, a real estate investment group with offices in Boston and Miami, will pay the city roughly $2.4 million for the 3.5-acre plot located at Chestnut and Somerset streets, and Portland will invest roughly $9 million to construct an 800-space parking garage and roughly $2.7 million to raise the grade level of Somerset Street, the Press Herald reported.
The city’s costs will be paid for through federal loans and grants, tax increment financing money and general obligation debt, the paper reported.
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