Two proposed Oregon construction projects shelved

Two large private construction projects supported by building trades unions have been shelved.

Earlier this month, NorthernStar Natural Gas Inc., halted development of a $650 million liquefied natural gas facility at Bradwood Landing near Astoria and filed for Chapter 7 bankruptcy.

Last week, the Portland Development Commission (PDC) voted to renew its office lease in Old Town, scuttling a proposal by TMT Development Co. to move to the yet-to-be-built Park Avenue West Tower downtown.

NorthernStar’s proposal to turn an abandoned lumber mill on the Columbia River into a natural gas plant would have created 450 construction jobs over three years. It would have been union- built under a project labor agreement with the Columbia Pacific Building and Construction Trades Council.

“There's a lot of spin about why NorthernStar bowed out of the Bradwood Landing project, but one thing is clear: Foot-dragging on the part of state regulators didn’t help,” said Tom Ivancie, executive director of Energy Action Northwest, a labor-management coalition promoting reliable energy. “Their cunning game of ‘bring me a rock, no a different rock,’ played for six long years, finally wore down Bradwood’s investors.”

Initial development work on Bradwood Landing began nearly six years ago. Since that time, the company has spent nearly $100 million.

“While we’re disappointed, we are truly grateful for the tremendous support the project received from citizens in Clatsop County and Oregon’s business and labor communities,” said NorthernStar President Paul Soanes. “Bradwood Landing is a great example of a project that business and labor came together to support.”

Tom Chamberlain, president of the Oregon AFL-CIO, said the decision to suspend the project will hurt all Oregonians. “From the start this was a project mired in conflict and rhetoric, and it’s disappointing that the opponents took such a short-sighted view, and refused to consider the benefits this project would bring to Oregon, including providing an efficient bridge fuel, creating much-needed jobs, and increasing competition to drive down natural gas prices for Oregon’s consumers,” Chamberlain said.

Had PDC, Portland’s urban renewal agency, voted to relocate, it would have kick-started construction on the 33-story Park Avenue West Tower. TMT halted work a year ago after the Great Recession dried up construction loans. The stoppage pushed hundreds of union construction workers onto the unemployment line and left a large hole in the ground in the heart of downtown.

TMT needed PDC to commit to a long-term lease for three floors in order to qualify for a construction loan.

At a PDC meeting May12, TMT President Vanessa Sturgeon (granddaughter of owner Tom Moyer) said their project would put about 300 construction workers back to work by June 30.

Richard Sells, superintendent for Hoffman Construction, told commissioners that resurrecting Park Avenue West might even encourage other projects to move foreward.

“If this project goes, I would venture to say that other projects would have the courage to go also,” he said.

PDC Executive Director Bruce Warner said problems with the Park Avenue West Tower location arose when TMT wouldn’t reveal who was securing its construction loan and was unwilling to put in writing a start-date for construction once PDC signed a lease. Additional questions were raised as to whether or not two other tenants — Portland law firm Stoel Rives and Niketown — had actually committed to long-term leases at the building.

In a press release, Warner said Old Town won out because the space didn’t have to be financed and constructed and there were no worries about unanticipated costs and who would pay for them. “This was a very difficult decision,” he said. “I feel we got a very good deal for Portland’s taxpayers.”

The final vote to renew the Old Town lease was 3-1.

John Mohlis, a PDC commissioner who is head of the Columbia Pacific Building and Construction Trades Council, had to recuse himself from the debate after PDC attorneys determined he had a conflict of interest.