What replaces Lloyd Center? Don't hold your breath.

 

Now that the long, slow death march at Lloyd Center is finally completed, our thoughts turn to what could replace the big shopping mall on 27 acres near the heart of our major Pacific Northwest city.

Alas, there is no way of knowing.  Yes, the City Council approved a “voluntary master plan” with pretty drawings showing office towers, high-rise residences and 8 acres of public open space, scattered among 14 specific “development areas.”  But a close look at the formal decision reveals important escape routes for the property owner, New-York based KREF Lloyd Center Owner LLC.  Here they are:

 1) Selling off parcels to other developers.  This no doubt is the KREF preferred strategy, but the problem lies with the high-rise commercial zoning.  The way to maximize profits under the zoning is to build high-rise buildings office towers and condos/apartments.  But we know the high-rise office market in Portland is almost dead, with major downtown buildings selling for small fractions of their earlier values.

   It is difficult to conceive of demand for tall new office space.  Based on some current condo prices, the outlook is almost as troubling for residential towers.  So how many prospective developers will be lining up?   The wait could take a long time.  If so, Northeast Portland could have a voluminous vacant scare abutting the prominent Sullivan’s Gulch and Irvington neighborhoods sitting nearby.

2) The owner or a buyer can elect whether to implement the any portion of the voluntary master plan, or else supersede the plan with a subsequent land-use review.

 3) The owner may also elect to render the voluntary master plan null and void by submitting a subsequent land-use application for the whole 27 acres.

 

By comparison, a “mandatory” master plan carries a 10-year time limit for execution, or the plan expires.  Given Portland’s current climate for high-rise buildings, the voluntary master plan approved on the Lloyd Center land could sit vacant presumably for longer than 10 years.  One wonders if there couldn’t have been a better urban planning strategy.  Alas, keeping the Lloyd Center in place was never a feasible option; in an ideal world, perhaps more attention could be been given to finding a productive new future for it beyond retailing.

 -----Fred Leeson

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