City may be perfect downtown partner.

Byline: Joe Harwood The Register-Guard

West Broadway in downtown Eugene boasts new city-funded pavement, sidewalks, planters, trees and flowers - and rows of old, privately owned empty storefronts.

The business partnership wanting to redevelop those vacant buildings and bring them in line with their publicly funded surroundings is likely to find that Eugene officials are eager to give their blessing.

Eugene may have a reputation as a tough place to do business, but when it comes to downtown, the city has a history of working hard and spending heavily in the hope of revitalization.

The Opus Group, a national developer based in Minnesota, last week said it is planning to team up with Eugene-based developers Tom Connor and Don Woolley to create a large mixed-use development covering several downtown blocks. Connor and Woolley own many of the buildings in the targeted area along Broadway between Willamette and Charnelton streets.

The development team is still hashing out specifics. But in general, the proposal could include 200 to 300 apartment or condominium units, plus stores, offices and restaurants, an Opus executive said. The team hasn't announced any tenants yet.

Observers expect the developers to seek tax breaks for housing, and public funding of infrastructure work, including possibly a parking garage.

"A development of this magnitude will require incredible infrastructure support," said Mike Sullivan, Eugene's Community Development Division manager.

"That points to the need for an active partnership between private and public parties," he said. "I'm sure they will look to the city to provide some assistance."

But a mix of commercial business and new housing in the downtown core goes to the heart of two long-standing city government policies: the revitalization of a woefully underused city center, and the fostering of compact residential development in order to minimize suburban sprawl.

Boosted by more than a decade of Eugene ordinances adopted to support such redevelopment, the Opus team may sail through the local approval process. Securing local approvals may prove even easier than lining up financing or occupants.

The downtown properties owned by Connor and Woolley are zoned for commercial uses. Under that commercial designation, uses ranging from apartments and offices to retail shops and restaurants don't require a lengthy land use application process, said Steve Nystrom, Eugene's interim planning director.

Mixed-use with retail on the ground floor, offices on the second story and housing units above, or any variation of those uses, "are outright permitted," Nystrom said.

That would mean the Opus team would simply have to submit building permits and wait six to 10 weeks for processing. The city would require additional processing time if the developers sought any exceptions or waivers to local ordinances.

The Broadway area of downtown is also in a special zone in which developers of buildings are not required to provide parking spaces in proportion to square footage of buildings, Nystrom said. But it is likely that the developers would want to create more parking as an amenity to lure tenants and customers.

Government financial aid also is available.

Eugene's Downtown Plan, adopted by the city last year, asserts that developing housing in the urban core is more expensive (due to higher land and construction costs) and often requires public subsidies.

Broadway is in a housing development zone that gives certain developers property tax breaks lasting 10 years.

The city in 2003 adopted tax waivers for developers who build a project consisting of a ground-floor commercial use with one or more floors above for housing. The city grants a property tax exemption of 20 percent of taxes for each floor dedicated to housing, with a maximum waiver of 80 percent of taxes on a single project, said the development division's Sullivan.

Another city program for downtown apartments or condos - but those without a commercial business at street level - grants a full waiver of property taxes for up to a decade.

The downtown area is inside an urban renewal zone that allows the city to offer low-interest loans that are often used to leverage private sector financing, and an array of city-paid public improvements.

The urban renewal zone collects property tax dollars that are dedicated to public improvement work in the zone. That work can include building streets and sidewalks, landscaping, moving utilities, creating open spaces and building parking garages.

Eugene has used urban renewal money to help several public-private developments. Most recently, the city offered to spend $12 million or more on street improvements in an effort to persuade McKenzie-Willamette Medical Center to build a new hospital on the Eugene Water & Electric Board's riverfront campus.

Russ Brink, executive director of Downtown Eugene Inc., said the proposed Opus/Connor-Woolley project will require a major public investment.

"They'll need significant parking resources, not just what currently exists," he said, predicting that underground parking, as well as a parking structure, will be needed.

The city has a history of using urban renewal money to build parking garages to support downtown development. It has spent more than $4 million in the past 10 years to build an underground parking garage for the Broadway Place mixed-use development, and for a parking garage at East 10th Avenue and Pearl Street.

Brink said the Opus group will face additional hurdles when it demolishes some of the Connor-Woolley buildings.

"Anytime you dig down in the ground in the downtown area, you never know what you're going to hit," he said.

The Opus/Connor-Woolley group hopes to begin construc- tion in mid-2006.