Developers put price on rebuilt downtown.

Byline: Sherri Buri McDonald The Register-Guard

The proposal to revitalize West Broadway with new housing, offices and shops could be a massive undertaking, spanning more than 700,000 square feet of space downtown and costing more than $180 million, according to preliminary estimates from Tom Connor, one of the developers.

That's about five times the size of Broadway Place, a housing/retail development downtown, and the cost of 2 1/2 federal courthouses or of six Eugene public libraries.

Local developers Connor and Don Woolley, in partnership with the Minneapolis-based Opus Group, revealed plans earlier this month to redevelop property that Connor and Woolley own from Willamette to Charnelton streets, including the former J.C. Penney, Bon Marche and Kaufman's stores.

The developers have been closelipped about the size and the cost of the project, saying in early June that more details would be available in 90 days.

But Connor disclosed preliminary estimates for the project in a June 14 letter of support included in the city of Eugene's application for a Brownfields Economic Development Initiative grant from the U.S. Department of Housing and Urban Development.

Neither Connor nor an Opus representative returned phone calls requesting comment on Friday.

Other letters of support were from Dan Giustina, managing partner of the G Group LLC, which is working to bring a 52,000-square-foot Whole Foods natural foods store to East Broadway. The G Group is partnering with Portland-based Gerding/Edlen Development on the $11 million project, Giustina wrote.

The city sent in its application for a $2 million brownfields grant on Wednesday and hopes to get a decision in 60 days, said Mike Sullivan, Eugene community development division manager. The city also plans to apply in the fall for nearly $8 million in Section 108 loans, a related HUD program, he said.

This is the first time the city has applied for these funds, which are eagerly sought by cities around the country.

`We've been advised by HUD that the (brownfields grant) resources are limited and the competition is very stiff,' Sullivan said.

However, the prospects for receiving Section 108 loan funds are quite good, he said.

If HUD finds that Eugene's application meets basic underwriting requirements, "we have every reason to believe it would be approved," Sullivan said.

The brownfields grants help cities redevelop abandoned, idled and underused industrial and commercial properties that are hampered by "real or potential" environmental contami- nation.

In its application, the city describes five redevelopment sites in its downtown and riverfront urban renewal zones that it said may be contaminated by previous uses, such as industrial factories, auto repair shops and underground fuel tanks:

The former Sears building, where Oregon Research Institute plans to construct a $22 million, 80,000-square-foot office building.

The former 9-acre Agripac/Chiquita food processing facility that closed in 2001. A new federal courthouse will be constructed on 4.4 acres of the site.

Eugene Water & Electric Board's 19-acre site along the Willamette River on the east side of downtown. Numerous former industrial and repair shops used to be located on the property. Triad Hospitals Inc. wants to buy the site and build a new McKenzie-Willamette Medical Center there.

A stretch of vacant storefronts along West Broadway, from Willamette to Charnelton streets. The property is owned by local businessmen Connor and Woolley, who plan a major mixed-use development.

A site at Broadway and Mill Street, where G Group LLC is working to bring in the Whole Foods natural foods store.

These projects are potential recipients of Section 108 loans, and help illustrate the magnitude of the activity downtown, Sullivan said. But "we have no specific plans to put Section 108 money into any of those projects," he said.

Eugene hopes to win approval for Section 108 money and to create a loan pool for prospective downtown projects, Sullivan said.

The city has considered applying for Section 108 funds in the past few years, he said.

The city decided to apply this year because urban renewal plans and the downtown plan were updated, and the council asked staff to identify other potential tools to support redevelopment in the downtown core, Sullivan said.

The Section 108 loan essentially gives a city an advance on its community development block grants. Each year, Eugene receives nearly $1.6 million in the block grants. As long as the city is current on the Section 108 loan repayments, it would continue to receive each year's block grant, Sullivan said.

Most of Eugene's block grants are used for grants to social services agencies through the Lane County Human Services Commission. They support such services as affordable housing, accessibility improvements, and business development loans for job creation.

The primary risk to the city is that if it doesn't provide ample security for each project, and have secondary sources of repayment, such as existing loan portfolios, it could lose some future block grant revenues, Sullivan said.

But the city will require loan recipients to provide adequate security and it will set up reserve funds and have other sources for loan repayment, he said.