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Thursday, May 27, 2010

Is Sam Adams buying off The Oregonian?

The revelation that the City of Portland is planning to buy a large parcel of vacant land from the city's monopoly daily newspaper and turn it into some sort of seldom used "disaster staging area" has raised at least a few eyebrows around town. The reported price in the deal is $10 million, and it's the mayor and Fireman Randy who are pushing it. As we reported the other day, they tried to slip this one into the water bureau budget for the coming year, but when that maneuver came to light, they hurriedly moved it out into some other place in the black hole known as the city's budget.

The boldness of this move -- and the screaming conflicts of interest, both governmental and journalistic -- are breathtaking. Here we are in the midst of a major recession, with real estate prices plummeting, Portland's economy deeply tanking, businesses failing, and the city government faced with rapidly declining revenues. Suddenly it's time to set up a disaster response assembly lot where none existed before? Could the O's headlong decline, which has led to the decimation of its staff, have anything to do with it? Could the mayor, whose resignation the paper has already demanded without effect, be trying to buy off the fourth estate?

And where did the $10 million figure come from? The county lists three lots at that location, totaling about 10.6 acres. The real market value is shown as $8,069,720. (The O apparently bought the property in 2000 for $6.2 million.) Assuming that the city wants to buy all three lots, why is it paying a 23.9% premium at a time when real estate values are in freefall? And does industrial land in Northwest Portland, which has stood vacant for a decade, really merit 61.3% appreciation over that period of time?

Is this a bailout for the O? A bailout for the O's shareholders, the Newhouse family -- one of the richest families in the entire world? And what will the newsies provide in return, consciously or not, to the politicians who are flushing out their bosses' odd real estate play with cash? It's an ugly little deal -- but hey, ain't that Portland these days.

Comments (35)

Gee, and checking the City's own portlandmaps.com reveals the site to be in the "HIGH" earthquake hazard area. That sure doesn't seem like a great idea for the proposed use. Isn't this site where ESCO used to be?

Don't we already have perfectly good parks where they can do this kind of thing in the event of a disaster? How about the vacant land at the shuttered up Washington High which is surrounded by a residential core? I agree that the deal smells bad given that this is most certainly a buyer's market and real estate is declining in value by the day. The last thing the cash strapped city needs to do at this point in time is shell out 10 million for a vacant lot.

Why put your eggs all in one basket? If there is a quake and all this equipment is in one place. What happens if you can't get to it. It should be spread out. not just in the city, but just outside in stable areas too. And raising water and sewer rates! Many homeowner can barely keep up now.

While this deal does stink of something improper, it is worth saying that this particular lot is sitting right at the last stoplight on Yeon before it turns into a freeway, with quick emergency access to basically anything.

If they were paying market price for it, and the economy wasn't in the toilet, and there was a clear demonstrated need for such a thing... which none of these are true... then maybe this wouldn't be such a bad site for it.

I think that's the old US Steel site that's been sitting empty since the late 1980's.

Great Leader already has the Police Bureau, Streets & Transportation, with Randy Leonard apparently in his pocket the Water/Sewer/Bikes/Scholarship/GeneralCollections Bureau whatever it's turning into, plus I don't know what else. Perhaps the mayor does want his own media outlet, or maybe he just want the O to owe him a big favor. Or maybe it's just another 'investment' like the old Post Office site.

Who knows what he's up to next? I have a feeling all will be revealed to the people in due time. Perhaps there's even some sort of 'Enabling Act' of historical proportions around the corner...

"...before it turns into a freeway, with quick emergency access to basically anything."

I would expect a freeway to become a parking lot in the event of a major disaster, though. I think Bladerunner's comment is pretty on target.

At one time, Costco tried to get clearance to build a mega-store at that site, but was thwarted by neighbors et al.


I don't think Sam needs to "buy off" the big O. He seems own their staff as it is.

Portland is one large disaster staging area.

As previously noted, highest and best use would be Costco, Wal-Mart. Why does the city need this property at all? With all of the vacant land at the area between PIR and the Expo center this is another boondoggle. These people search out things to waste our money on!!

It's a pretty good site to watch the Fremont Bridge collapse into a hunk of twisted steel and shattered concrete.

And it would also be a good staging area for shipping out all of us democracy lovers to the FEMA camps.

This is fascinating, someone should give Sam and Randy a call and explain to them how to use LoopNet (a comm listing service for free once you get an acct) and they could find the following in the general area (Address/Asking/Acres/$PerAcre):

12160 NE Riverside $1,450,000.00 5.48 $264,598.54
17800 NE Riverside $1,700,000.00 5.21 $326,295.59
10504 NW St Helens $7,850,000.00 24.74 $317,299.92
6849 NE Columbia $2,575,000.00 11.25 $228,888.89
2167 NE Elrod $1,850,000.00 10.86 $170,349.91
Average = $3,085,000.00 11.508 $261,486.57

Sam's Land $10,000,000 10.6 $943,396.23

The O is making blogs look more belivable every day by comparison. OF COURSE IT IS A PAYOFF!!!

BTW - I have to admit, this is a relative bargain compared to the Central PO deal.

Forgot - How do they pay for this largesse?

If you still read the O and believe it, front page of Metro:

Water (12% after last year's 18% increase) and Sewer (another 6.35% after umpteen years of raises) have increased. They will find a back door to siphone money out of PWB while the Auditor looks the other way.

No wonder Gary whatsisname quit, he must have a little shred of conscience or foretaste of the potential illegallity of all this crap.

All with a 5-0 vote of City COuncil. And Portland has done nothing more than study LT2. God forbid if they actually do something.

In the case of emergency where the bridges are out of commission: I would hazzard a guess that most of the people on Portland's emergency and street crews do not live in NW, and would have just as hard a time getting to the staging site.

Anyway, whatever is behind this, the bottom line is that this is an absolutely ridiculous expenditure at this time. A Big One only happens once in many hundreds of years, so odds are quite good it won't happen in the next three or four years. We can probably wait until better economic times return.

These guys just don't understand money. Straight up. We could do with at least one token businessperson on the council.

Water turned into 15% increase....they snuck in a 3% increase on the "base charge".

Sorry, I just noticed:

12160 NE Riverside $1,450,000.00 / 5.48 / $264,598.54

Should be:

12160 NW St Helens $1,450,000.00 / 5.48 / $264,598.54

Doesn't change that CoP is paying $946K/acre while the average asking is $261K/acre

Why not just use Forest Park? We own it and it is already a staging area and only 12 blocks away.

But let's get serious. Who, what, where are the studies, commissions, stakeholders that decided we needed a "staging area"? What brought this on? After Sam's glorious decision are we now to get one of his famous power point, easel-grease-pencil- board, mike-in-hand, lecturing TownHall Meetings????

Not only is the average asking price $261K per acre, very few sites (if any) are selling these days. This means that the asking prices are too high. I would wager a cash offer on one of these parcels from the city would net a lower actual selling price.

If they were clever they could negotiate a friendly Eminent Domain proceeding so the land owner could avoid capital gains taxes. This would drop the acceptable price even further.

If the intent was to acquire the property for some genuine city services oriented purpose, I'm sure there's no shortage of clever and sneaky ways the city could get hold of it. This blog alone is largely about fast ones City Hall is constantly pulling.

I agree with the other posters... like the Central PO, they're paying top dollar for some other reason, yet to be revealed.

Great research on land sales. I think the an equally good counterpoint here is that Adams is taking a very rare, unsually large, and well located industrial parcel off the market while it could be used to attract a sizable employer to the City. No, I'm not thinking Costco here, I'm talking about manufacturing.

Think about it...if City Hall was at all serious about job creation they'd partner with the owners of that site and bundle it in an incentive package to attract a large employer. Instead, Adams and Leonard are being grabby with our money and reducing the inventory of industrial land at the same time.

These Bozos don't have a clue...and you can bet that since the Oregonian owns it, this will be one of the least publicized land grabs of all time. And we all though it was sketchy that the Oregonian didn't report about Bob Caldwell's DUI? They surely won't make a peep when they're trying to unload this asset at a tremendous gain on the backs of ratepayers.

I don't get where this conversation is going. Shouldn't the question be "why do we need a staging area for any future catastrophic disaster?" and not questioning the value of the Oregonian property? Which is very legitimate after you answer the first question.

How is this staging area to be used? What size might it be if needs are ascertained? Are there any existing city owned property that might suffice?' Who's analyzed which bridges, freeways will have failure for a 6.3, 6.9 or 7.5 quake, which would make the O property a worthless staging area in a quake? Gosh, are we just going to roll over for the stupidity of SamRand?

Taxpayer money used by elected officials to curry favor with the Oregonian? Isn't that voter-owned elections?

Unfortunately, these Bozos do have one clue - how to be the city that works us over. This time it is so apparent and in our face.

They have no conscience when attempting to sneak $10 million from a very basic need of the people - water.

Creating more debt when PWB is already in debt. They do not care as if on a joyride with the money, and for us higher and higher rates.

What happens when people can no longer afford the “water general fund”?

What happens when a city is on the verge of bankruptcy?

They may not want that news to get out. Better to raid our water.

Two words for what they are going to use that land for:

Re-Education Camps

You will be re-educated to enjoy the wisdom of our great leaders Sam and Randy and their handpuppets: Nick, Amanda, and Dan.

I'll see you at the barricades.

Think of how much Ignorant Sam and the City Council would have paid a crony 'consultant' for the information provided by Steve (this time) and other guests and the Proprietor of this site. But dealing with facts is foreign to them. Pathetic. Glad I already have my pitchfork.


If a municipality wants to buy some land for a specific purpose, they would normally outline the purpose, define the specific qualities they're looking for, then narrow it down to three or four parcels and determine which one offers the greatest utility at the best price.

Otherwise, it looks like the Mayor is treating the public treasury like his own piggy bank to reward supporters and (potentially) exclude enemies.

Nevermind the fact we can't take anything the Mayor says at face value.

If you suspend reality and say ok, we take the bait, we need emergency staging areas and we need 'em yesterday ... LW and Mister Tee are making excellent points. Where have these specifics been addressed in public documents supporting the proposed land purchase? With $10m to drop on some land there's a whole lot of unemployed and underemployed real estate folks who'd want to get in on the bidding process.

PD, are you suggesting that we build a manufacturing concern, which will pump money INTO the local economy, as opposed to retail sales which pumps money OUT of the region? Whatever are you thinking?!

Government in general has degenerated into buying off this group and that group with other peoples' money.

This will end only when government cannot extract enough money out of the taxpayers to feed the greedy.

There's blood in them thar turnips!

Dignity Village II?

Irony - they use the water fund to purchase land and then again to subsidize shanty's for the people who can no longer pay their water bills.

Those that still can pay will pay and pay, some swamped with debt.

Portland may however have the distinction of being noted as an eco Shantytown. Perhaps win an award at the annual AIA event.

If Randy has anything to do with this deal, then yes, they haven't the slightest clue what the value of land is. They get themselves so committed to a project or property that they leave themselves no negotiating room (same could be said for PDC).

I would hope at minimum an appraisal should be conducted. In the current climate where nobody is buying land, it would be hard to argue a single reason for paying above appraised value.

Britt Storkson - This will end only when government cannot extract enough money out of the taxpayers to feed the greedy.

What happens then?

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