SAN FRANCISCO — A long-debated plan to build a 600-room hotel next to the Oregon Convention Center in Portland may be rising from the grave.
The proposal, which has been on the table in one form or another for the last 20-plus years, seemed dead a year and half ago without political support for bond financing. But a convention center revitalization plan — possibly scaled down and without as much public financing — has received a tentative show of support from the newly elected president of the Metro Regional Government.
A partnership of the Metro Council, the city of Portland and Multnomah County had backed earlier hotel proposals but could not generate enough political support to push through plans in September 2009.
“We are looking at possibly something smaller or other plans that do not involve nearly as much new construction,” said Lew Bowers, central city division manager at the Portland Development Commission. “Let’s see what we can come up with in the next year. Maybe the market gets better. Maybe the political constellations change, and we can find another way to do public financing.”
The area around the center already has hotels, but a bigger one would likely qualify the center for larger conventions.
Two earlier plans for 600-room hotels — one to be built north of the center and one east on land owned by the PDC — died because politicians felt the plans posed too much financial risk for the public.
Both plans included large chunks of bond financing; the eastern plan would have required the most, more than $200 million.
“We were unable to find enough cushion to protect the general fund when it was stress-tested,” Bowers said.
Despite the lack of progress, the PDC has kept money in its budget for a hotel plan, including $3.2 million for the next fiscal year. Bowers said a new plan could include building a smaller hotel or upgrading a nearby one.
However, no formal proposals are in the works, and talks have been preliminary.
“It would be premature to say the hotel is back on the table in any serious way,” said Roy Kaufmann, a spokesman for Portland Mayor Sam Adams, who supported past hotel plans. “The short answer is that we, the city and the region, are trying to figure out a way to get more value and competitiveness out of the convention center.”
In 2009, Adams formed a task force that recommended a $5 million engineering study of a proposed $227 million bond-financed, 600-room convention center hotel. Starwood Resorts & Hotels Worldwide was slated to operate the hotel, which would be financed by bonds backed by hotel revenue. But leaders worried that the hotel would not generate enough revenue to maintain adequate debt service coverage ratios.
And Adams may have a new ally for the plan in Metro Council President Tom Hughes.
Hughes’ main interest “is in making sure the convention center here is a viable facility,” said Stephanie Soden, a Metro spokesperson. “The hotel is one way at going about it, but he is also looking at other options, as well. It really is very early.”
Portland leaders have been debating proposals for a hotel next to the Oregon Convention Center since 1989.
