There may be a lesson to learn--or one of those “teaching moments”—in two City of Bend forays into real estate investment and development.
Much like any private entity, the city has been whipsawed by the disastrous economy of the past few years and a dispute with original partners on, respectively, it’s investment in the former Bend Bulletin site near downtown and the 1,500 acre proposed Juniper Ridge mega-mixed use project on the northern end of town.
On the one hand the Bulletin site might have appeared a good investment when the city paid the newspaper’s controlling corporation $2 million in late 2002 for the 3.17 acre site at 1526 NW Wall St. on the northern edge of the downtown business core.
In 2009 the city listed the property for sale through Compass Commercial brokerage at $3.9 million, as the full impact of the economic slump reached through the Bend residential and commercial real estate market.
Juniper Ridge has endured a more tortuous path since the city took ownership from Deschutes County at no cost with the conditions that it be used for a “public purpose” such as job creation, follow a master plan and include at least 10% of the land for parks and open space.
At the start the city was faced with conflicting opinions from real estate brokers, neighboring residents and the Oregon Department of Transportation—among others. Brokers claimed there was potentially too much emphasis on residential at the expense of attracting industrial companies and building regional employment.
Traffic impact issues, initally a major stumbling block, appear to have been resolved in negotiations with Oregon DOT.
But the city ran headon into dispute with the original private development management group over ownership of the Juniper Ridge master plan that resulted in a $2.5 million payment by the city of to acquire it outright.
As presented on the city’s web site Juniper Ridge should eventually evolve into a business, research, retail shopping and residential community that could also include a university. As described in the master plan, it would be “a mixed-use, walkable environment that encourages alternatives to private auto use.”
There is increasing public and private support and momentum for expansion of the Oregon State University OSC/Cacades to a full four-year college. But thus far Juniper Ridge doesn’t appear to be the leading candidate for the potential college location.
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| Seven lots totaling 23 acres are listed in Juniper Ridge |
To date Juniper tenants are the headquarters of Les Schwab tire company, which moved from Prineville; Suterra, a biotechnology company: and PacifiCorp, which has plans for a service center.
There have been suggestions the city should follow the lead of Prineville, which has attracted major data centers for Facebook and Apple. But a counter argument is that the centers consume larger sized lots and have high power demands without producing significant long-term employement.
Compass Commercial listing information shows the brokerage has seven 1.5 to 9 acre parcels totaling 23 acres ready for construction within Juniper Ridge, all at approximately $7.00/ square foot or $305,000 an acre. The total listing price of all parcels is slightly more than $6.97 million.
Some commercial brokers say the market for industrial land has improved substantially in recent years, with vacancy rates cut in half from about 20% to 10%.
To date Bend has spent an estimated $18 million on Juniper for infrastructure and other costs, and assumed debt of about $10 million. It has financed the debt with about $1 million annually in urban renewal tax funds and land sales have totaled nearly $10 million
