Developer of Portland's midtown project drops plan to pursue tax credits from the state
Courtesy of The Federated Cos.
A rendering of the northwest view of the proposed midtown development in Portland's Bayside neighborhood.
Courtesy of The Federated Cos
A rendering of the southeast view of the proposed development from Chestnut Street.
The developer behind the major residential and commercial project planned for Portland's Bayside area won’t seek $4.3 million in tax credits from the state.
Miami-based Federated Cos. expects to break ground on the $100 million project, known as the midtown project, in January, but it says it will be doing so without the additional funding from the tax credits, according to the Portland Press Herald
A financial service company had submitted an application in early November for the state’s New Markets Capital Investment program. The deal would have allowed Federated to leverage $8.1 million of its own money to receive an additional $2.9 million from U.S. Bank.
U.S. Bank would have provided Federated with the additional funding if it was approved to receive the $4.3 million in taxpayer-funded tax credits over seven years from the state.
A spokesman for Federated told the Press Herald it dropped its plan to pursue the tax credits because limitations imposed by the transaction structure and fees in excess of $1 million made the benefit from the program unattractive.
A Federated subsidiary will lend $8.1 million to an investment fund operated by U.S. Bank, which will then bundle the loan with its own cash and lend $10.95 million to a CityScape subsidiary.
The $4.3 million in taxpayer-funded tax credits would go to U.S. Bank, which is contributing $2.9 million to the project for the promise of receiving the tax credits over the next seven years.
The Bayside development has been in the works for half a decade, and the current plan calls for four buildings to be built between Chestnut and Somerset streets over the next two years. The development would include 450 residential units, 840 parking spaces and 90,000 square feet of retail and commercial space.
The added investment through the tax credit program would have helped finance the first phase of the project, a seven-story parking garage with 38,000 square feet of retail space on the first floor, according to the Press Herald.
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Major development in Portland's Bayside back on track
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