Portland is at a crossroads on its way to becoming a true metropolis

Nov 21, 2016

Portland Business Journal 

By Jean-Pierre Veillet –

Starting in the 1980s, Portland became a sort of northwestern refuge, attracting migrants from cities that were increasingly unlivable. That unlivability stemmed from several factors, including poorly planned density, high costs, decrepit urban infrastructure and city institutions unable to fix anything, from potholes to schools. In those days, Portland was the antithesis to all that. The city’s identity developed from a timber, farming and salmon-fishing town into a modern Arcadia, with an attractive combination of human-centered planning, access to nature and a low-overhead economy that nurtured individual creative ambition into long-term success.

From the heart of downtown, you saw forests and mountain peaks. The citizens had rallied to tear out a freeway and create a waterfront park. A middle class salary bought you a family home. The young and the restless came to forge their future in a land of optimism and possibility. As a Portland native, I watched the whole process with pride.

Portland today is at a different crossroads. Make no mistake, our current growth phase isn’t ending soon; it’s part of a worldwide urbanization trend, made more acute by the city’s desirability as a place to live and work. In its transition to large metro status, Portland is suffering a variety of growing pains, including the housing crisis facing us today.

We’ve officially departed the Arcadian era of Tom McCall, and are evolving into . . .well, it’s up to us. Portland’s utopian identity could easily be dismantled by the choices we make as developers. On the other hand, this crossroads is an opportunity to grow Portland into a true metropolis while retaining what made it great in the first place.

Cities become great for reasons that are both economic and cultural, and economy and culture depend on people. We can’t have a great city without addressing the “missing middle” population that brings our lofty ideas of urban culture into being.

Which Portland industry faces the toughest road under the Trump administration?

To center and preserve Portland’s identity as we grow into a city of 2 million or more, there is nothing more important than providing homes for people earning a $40,000-60,000 annual salary: the teachers, students, artists, chefs and myriad small business makers and service providers that keep Portland creative and livable. This kind of housing will provide a stable, bankable pathway between old Portland and new.

It’s probably not going to be single-family homes, though. If we want to continue reining in sprawl and preserving our urban growth boundary, we need density-friendly solutions. If Portland culture is to thrive in the future, owner-operated, four- and five-story urban infill is where it’s going to live.

So far, this kind of development has been slow to materialize, relative to demand, and what’s produced is often well beyond what the “missing middle” can afford. As a developer, I’ve watched this process firsthand, and gotten uncomfortably familiar with the pressures that make it so ineffective.

For one thing, construction costs money, and we need to get smarter about how we spend it. Traditional construction techniques go back decades or even centuries, when materials were expensive and labor was cheap. Today, with that math reversed, we need to get innovative with more streamlined construction methods — modular and otherwise — that get us to high-quality buildings more quickly.

Our biggest obstacle to affordable middle class housing, though, isn’t construction costs or even (in most cases) the greed of developers. It’s lost time. Housing development is an investment in future returns, and delays in that return cost money, which often gets recouped in the sales price. Today, a typical mixed-use development in a close-in neighborhood takes about three years from initial design to ribbon-cutting. This long timeline delays return, and since markets are difficult to predict so far out, it adds risk as well.

Only about a third of that time is taken up by construction. The rest is spent in review, permitting and approval, by multiple levels of city bureaus, often with conflicting agendas and poorly-aligned policies. Permitting is absolutely necessary to make sure we’re building safely and in accordance with community guidelines, but the system’s current inefficiency has little to do with building quality; even a perfectly designed building, from an experienced architect and developer, cannot hope to get through the system any faster. The impact on development costs is dramatic. A project that might cost $150 per square foot to construct can easily exceed $180 per square foot by the time permitting delays are factored in.

What’s needed is a permitting process designed to encourage good development. For one thing, this means demanding that the various city bureaus align on their policy requirements. One historic renovation Siteworks did in 2014 was delayed for three months as we faced conflicting demands from the Bureau of Development Services, the National Park Service and the Oregon energy code on what type of heating and cooling systems were required. Multiply this kind of conflict by the number of steps in a permitting process, and you have a delay that can cost millions, with no benefit to city residents whatsoever.

It doesn’t have to be this way. The city could, for example, lay out its key requirements for new development, turn them into a checklist, and tell developers that if they satisfy the checklist, they’ll have their permit in three months. Do that, and Portland’s housing crisis starts abating tomorrow. The city bureaus could sit down and do the hard, necessary work of comparing their policies and bringing them into alignment.

Garnering the political will to make this happen isn’t trivial though. Portland has spent decades letting vocal minorities dictate far-reaching policy, giving us a system where a wealthy homeowner’s concerns about protecting site lines can outweigh the housing needs of a dozen families. Ostensibly, this is done in the name of preserving the city’s character, but the real Portland isn’t defined by the architecture of its houses, or the absence of apartment buildings on North Williams Avenue.

Instead, Portland — the Portland I grew up in and love — is defined by accessibility, liveability and cultural vibrancy. The people who make all that possible aren’t shouting in neighborhood meetings or defending outdated permitting practices, because they’re busy working two jobs or looking for yet another place to live. We owe it to them, and to this incredible city, to build a future that’s got room for them too.