City, firm stall over Glenwood.

Byline: Jack Moran The Register-Guard

SPRINGFIELD - The initial attraction has worn off, and it's clear that the exclusive relationship forged last year between the city and a Portland-based development firm to rejuvenate Glenwood is on the rocks.

Last October, Apex Investment Group accepted city officials' proposal to work with them on an ambitious project to redevelop Glenwood's riverfront district. But subsequent disagreements have left the two sides without a formal plan. Now, they're squabbling over who is supposed to take the next step. And both sides acknowledge they still want to play the field.

"I don't think (city officials) are sincere about moving forward," Apex Chief Development Officer Dan Ingrim said this week during an interview in which he noted that his firm's Portland office has about $500 million invested in other projects.

"We have a lot on our plate right now," Ingrim said. "Don't get me wrong, we'd love to do this (Glenwood) project. But communication between us and the city has essentially disappeared. Honestly, I don't know what we're going to do."

Ingrim said he has found the city's effort unfocused and sluggish. Another annoyance is his belief that Springfield officials made "a major blunder" by negotiating purchase option agreements with a number of Glenwood property owners that gave the owners inflated expectations of the value of their holdings.

"In the beginning, I was really impressed with the city's plan," Ingrim said. "But I've discovered that there are significant flaws."

Ingrim said he is waiting to hear back from Springfield officials regarding a planned meeting between the two parties and key property owners.

But city officials say the next move should be made by Apex, and that a deal to move forward cannot be finalized until after the firm submits a detailed development plan for a 48-acre section of northeast Glenwood.

"We would like to know what they would like to do," city Community Development Manager John Tamulonis said.

"What we are trying to do is get (from Apex) a development proposal that is suitable for that area over a number of years. We haven't got to the point yet where we're seeing lots of movement on that."

The standoff comes after the city earlier this year completed a crucial step that Apex had demanded: a market study on the viability of redevelopment in Glenwood.

The city-funded study showed that option agreements between the city and 17 Glenwood owners were most likely unworkable because they priced the land at well over market value.

On average, the owners asked for about $1 million an acre for their properties. The market study, completed by Leland Consulting Group of Portland, concluded that it would not make sense for a developer to pay more than $200,000 to $300,000 an acre.

The agreements gave the city or a developer the right to buy the properties for the amounts requested by the owners for set periods of time. The city paid Glenwood owners a total of $87,000 to secure the options, but has since let most of the agreements expire.

Tamulonis agreed that further negotiations with property owners will be needed.

But he said the city has fulfilled its obligation to Apex by funding the $47,000 market study.

"We'd like to be able to say `We've done our part, now can you do your part?' ' Tamulonis said. He acknowledged that communication between city staff members and Ingrim has been difficult, in part because "he does travel a bit."

Tamulonis said success in Glenwood is at the top of Springfield officials' priority list.

"This might not be a major project" to Apex, he said. "But to us, it is a major project."

In choosing Apex last year for the Glenwood job, city officials were impressed by the firm's financial strength, its development success in the United States and the Middle East, and its idea to showcase the Glenwood stretch of the Willamette River and create a vibrant neighborhood.

Apex representatives had appeared intrigued by the possibility of working with Springfield officials to institute a city-approved plan to redevelop an area that is now home to auto repair shops, used car lots and a mobile home park.

The city's deteriorating relationship with Apex will be discussed at an Oct. 8 meeting of the Springfield Urban Renewal Agency. The group, which oversees redevelopment work in Glenwood, includes the Springfield City Council and two Lane County com- missioners.

Springfield Mayor Sid Leiken said it might be time for the city to consider wooing other private developers to keep the redevelopment ball rolling.

"We need to be flexible about moving forward," Leiken said. "It sounds like (Apex and the city are) not on the same page. Maybe it wasn't the right idea to have an exclusive (arrangement) with one developer."

Leiken pointed out that before choosing Apex, the city had never before initiated a public-private partnership to manage a job as large as the one planned for Glenwood.

"We've never really been down this road before," he said. "So, I do not view this as a failure. But what we don't want to do is allow any momentum to slip away. That, to me, is critical. I think there is still momentum on our side."

Leiken noted that several other developers have expressed interest in reshaping Glenwood's riverfront area. Among the people he mentioned were members of a Lane County-based development group whose preliminary development proposal was passed over by the city last year when city officials chose Apex for the Glenwood project.

Two members of that group, Eugene developers Wally Graff and Greg Vik, both said they remain interested in the job.

Vik said he has continued to work on a plan to redevelop a small part of the Glenwood riverfront district. He declined to release specifics, but said he expected that news regarding a new tenant interested in occupying a space in northeast Glenwood could be made public within weeks.

Graff said he assured Tamulonis shortly after the city chose Apex that "no bridges were burned." He still feels that way.

"If we were reapproached, I think we would be interested," Graff said.

Graff and Vik said that if the city had chosen them a year ago, they already would be under way with redevelopment. But they said they understood a year ago that the Springfield-Apex arrangement was far from a done deal.

"They just got engaged," Graff said. "They didn't get married."

Stephanie Barrow / The Register-Guard