The bright canary-yellow building with the deep green sustainable features marked the start of a new chapter last week in a story of urban development in an economic recession.
And it has all the hallmarks of a page-turner: false starts and do-overs, new condo construction in a saturated market, cowbell ringing picketers, and the power of sheer perseverance in a seven-year, start-to-finish launch of a recession-era project.
K-Station, a contemporary-design, four-story condominium and retail development on the corner of Northeast Interstate Avenue and Killingsworth Street, swung open its big glass double doors on Oct. 17 for the grand opening of a project seven years, two developers and $16 million in the making.
The Portland Development Commission issued the original RFP for development of the 35,000 square-foot site in 2004 and awarded the contract only to see the developer withdraw in 2005, citing rising construction costs and market risks. A second RFP was issued, the specs changed and in August 2006, Winkler Development Corporation was selected for the project.
Perseverance through partnerships
The grand opening and model home tour drew the original project partners to the podium and members of the Overlook Neighborhood Association, local supporters and agency staff to the unfinished retail space on the ground floor to help mark the day.
Jim Winkler, president of Winkler Development Corporation and project developer since 2006, moderated remarks from Portland Development Commission Executive Director Patrick Quinton, Mayor Sam Adams, Metro Council President Tom Hughes and City Commissioner Nick Fish.
"I'm proud to be a part of the Killingsworth project," said the PDC's Quinton. "We started this at the beginning of the recession and have seen the project go on life support a couple of times. We're here today due to the perseverance of Jim Winkler, the Portland Housing Bureau and the rest of the team."
Boosting walkability and generating jobs
Metro's Transit-Oriented Development Program was onboard from the project's start with a $250,000 funding grant. The TOD program provides incentives to private developers to build moderate- to high-density, mixed-use projects located near transit that create a pedestrian-friendly environment. The Interstate MAX Yellow Line runs just steps from the front door and access to the TriMet bus service is no further. Bike racks on every floor of the building encourage use of alternative modes of travel.
Metro President Tom Hughes spoke of the careful consideration given to choosing projects for transit-oriented development funds, noting the investments go to those that deliver the greatest "bang for the buck." He added, "While Metro's investment represents only about 10 percent of the total cost of the project, we bring money to the table when it helps close the gap in making a project viable."
Hughes also talked jobs. As a line of protestors filed past the large, plate glass windows behind the podium ringing cowbells and carrying signs reading, "R&H Construction does not pay area standard wages and benefits – The Pacific Northwest Regional Council of Carpenters," Hughes remarked on the irony of having a backdrop of picketers at a project that "created more jobs than the economy could ever provide." According the PDC website, the project provided approximately 80 full-time equivalent construction jobs.
R&H Construction is the general contractor for Killingsworth Station. When reached for comment, Jack Gamboa, lead representative for the regional council, indicated that R&H Construction isn't always choosing subcontractors that pay area standard wages and benefits, and that the protestors were "standing up for the working guy." Gamboa said a letter was sent on behalf of the council to the PDC and R&H in January of 2011, but he was not aware of a response from either party.
John Ward, president of R&H Construction, says every publically funded project has to pay prevailing wages set by Oregon's Bureau of Labor and Industries – and they make certain you do through a certification process. "We have to send in our payroll records every week on every public job," says Ward. "BOLI then certifies that we've complied. It's a non-issue. We were certified."
Hitting the targets of the Interstate Corridor Urban Renewal Area plan
K-Station falls within the Interstate Corridor Urban Renewal Area and as such, was designed to meet the economic development and social justice objectives identified in the urban renewal area plan, developed with extensive neighborhood involvement.
Several of the morning's speakers noted the project had exceeded the plan's social justice objective with 40 percent minority, women, and emerging small business participation, "setting a high bar for minority participation," according to Patrick Quinton. Satisfying the plan's objective of using innovative green design and construction techniques, the LEED certified building offers solar-thermal hot water, energy-efficient appliances, green roofs and onsite stormwater management.
The project hit the plan's economic development objective by fostering a healthy business environment with 9,000 square feet of for-sale and lease-to-own commercial condominiums on the ground floor for neighborhood-serving retail businesses and entrepreneurs.
Affordable living with cutting-edge design
K-Station, is a mixed-income development with 60 percent of the 57 one- and two-bedroom homes affordable at 80 percent of median family income. One-bedroom units start at $169,900 and two-bedroom units start at $287,900. Down payment assistant loans are also available for income-eligible, first-time homebuyers.
Interior details include recessed lighting, oversized windows and light shelves that bounce natural light up toward the ceiling, reflecting it deeper into the interior of the room. Responsibly-sourced bamboo hardwood floors used in the units add to the reflective surface area, making even homes on the backside of the building appear bright and inviting.
Brushed aluminum, aero-line light fixtures in the wide hallways suggest a Pearl District gallery more than a moderate-income condominium project.
Ben Andrews, principal broker with Willamette Realty Group that is marketing the residential project, said seven contracts for condominiums were in process at the time of the grand opening. "Now that the models are open," said Andrews, "we probably receive a couple calls a day from interested folks."
Show of commercial courage
Community development financing during an economic downturn when liquidity is tight and capital is scarce is not for the weak of heart. "It's not often when a borrower thanks a lender," Jim Winkler noted at the end of the grand opening presentation. Proposing a development of 57 condos back in 2008 when the market was saturated and condos under construction were being converted to apartment projects overnight was asking a lender to take a financial leap of faith.
Wells Fargo leapt. As the ceremony drew to a close, Winkler thanked the bank for its "commercial courage" in supporting the project with construction loans, adding what could be said of any degree of financial risk-taking in a time of no-to-slow economic recovery, "It takes guts and commitment."