Where the Iberdrola money's really going
Here's an emerging trend in Portland: When the city says it's handing out tax dollars to keep "green" businesses in town, chances are the money's actually being paid to those businesses' landlords. We noticed this recently when it was revealed that the $8 million sweetheart loan made by the city to keep Vestas's American headquarters here was in fact made to developer Mark Edlen and his co-investors on the real estate project to which Vestas is expected to relocate (if it survives that long).
An alert reader points out that the same thing is about to happen with the straight-out $1.15 million grant being made for the supposed purpose of keeping Iberdrola in Portland. If one reads the fine print, as opposed to what gets printed in the newspaper, one sees that the money is actually going to be paid to Iberdrola's landlord, for "tenant improvements." That landlord in something called SPF Brewery Blocks, LLC, which the State of Oregon lists as being located at JP Morgan Investment Management Inc. in New York City. Apparently the landlord has agreed to make some rent concessions to Iberdrola, but who knows how much, or for how long, those will be? Iberdrola is supposedly also going to agree to stay in the building for another 10 years or else pay liquidated damages to the city, but we'll believe that one when we see it signed.
In any event, if Iberdrola pulls out of Portland, the Brewery Blocks boys will no doubt get to keep the improvements that the taxpayers have bought. See how they did that? A neat little trick by the Portland Development Commission and its real estate pals.
And what are these "tenant improvements" going to be? Here's the sum total of what we the people are being told:
Various tenant improvements in Brewery Block 4 which may be amended from time to time. Such subsequent amendments to the Scope of Work shall be reviewed and approved by prior to Grantee entering into a contract for construction in connection with any Scope of Work
Well, that sure pins it down, eh?
Not to mention the gross distortion of the intent of the "urban renewal" statutes. Are the Brewery Blocks "blighted"? We don't think so.
| Posted at 8:48 AM | Permalink |
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Comments (8)
That blank building with "Stairs, Elevator and Parking" is Powell's Books. Painfully blighted!
Posted by NW Portlander | February 6, 2012 9:11 AM
Thanks to Jack for reminding us how the rich get richer and the rest of us pay for it!
99% vs. 1%
Vote for Mitt, he's just a regular guy!
Posted by Lowered Expectations | February 6, 2012 9:20 AM
30 July 07 - Portland Biz Journal:
"The sale of the Brewery Blocks for $291.6 million led real estate news for the week. Institutional investors advised by JPMorgan Asset Management submitted the winning bid for the multiblock property in the Pearl District."
Probably the usual - Pension funds or insurance companies looking for returns. An insurance company bought the Enzo condos for $360K a unit as rentals.
Still the same issue - Keep polishing the same apple by pouring more money into it while the rest of the bushel rots.
Minus points for foresight or creativity on behalf of the CoP. I kinda thought once we set up the URD and the things got built we'd be through spending public money on it.
Posted by Steve | February 6, 2012 11:21 AM
Oh yeah, more good-sounding news about CoP:
http://blog.oregonlive.com/portlandcityhall/2012/01/eric_johansen_portland_city_tr.html
Johansen said he expects to pursue consulting work.
God, the arm-twisting to justify some of the BS between Samdy has got to be evil.
Posted by Steve | February 6, 2012 11:41 AM
Sorry, BS means Bold Spending.
Posted by Steve | February 6, 2012 11:42 AM
Need an Oregon version of the CA law that abolished these thefts from the public purse. Socialized risk, privatized profit. There could hardly be a more perfect definition of graft.
Posted by dyspeptic | February 6, 2012 2:27 PM
Does "various tenant improvements" also include campaign contributions?
Now we all know what going "$$$green$$$" really means...
Posted by Ralph Woods | February 6, 2012 4:05 PM
I don't know what bothers me more - that the City is needlessly enriching JP Morgan (what say you Occupy types?), or that all of the economic activity in this City is drawn to the Pearl District like a moth to a flame.
If Iberdrola is so green, why don't they rent a vacant, modest space elsewhere in the city? They could save a bundle, but then you would have to care about business.
Perhaps it was always about the luxe image and Class-A trappings. That's fine of course, just don't expect to chase it with my money.
Posted by Downtown Denizen | February 6, 2012 7:45 PM