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Helen Silvis of The Skanner News
Published: 05 September 2012

The circled sites are publicly owned.  One option in the Mortensen proposal would build on the site to the east of the Oregon Convention Center

A favorite has emerged in the bidding to build a Convention Center hotel. Metro's evaluation committee has recommended a proposal by Portland's Schlesinger Companies, working with the Minneapolis developer Mortenson, to build a Hyatt hotel.

Next step for the proposal will be votes by the Portland Development Commission board, Sept. 12, and by Metro's board of Commissioners, Sept. 13. After that, if both boards approve, Multnomah County and the City Of Portland will weigh in on negotiations to hammer out the finances.

The Schlesinger/Mortensen/Hyatt team offered four proposals on two different sites – a Schlesinger-owned site immediately north of the Convention Center on N.E. Holladay and on a site owned by the Portland Development Commission to the east of the center.

 "We didn't choose any one of the four proposed options," said evaluation committee member Teri Dresler. "We don't have a decision point yet."

One proposal would build two side-by-side hotels:  a 420-room Hyatt Regency and a 181-room Hyatt Place on the north site. Another would build a 600-room Hyatt Regency hotel. At least 500 beds would be available for booking by large conventions. A survey by Travel Portland found that at least 30 convention bookers had bypassed Portland largely because they couldn't find enough beds close to the center.

Dresler, director of Metro's visitor venues, said the committee was impressed by the amount of thought and detail in the Mortensen proposal. The team proposed to fund the development privately, but would request two public subsidies: a one-time payment of $10.3 million, and a waiver of city hotel room occupancy taxes.

"We felt they had the best financing arrangements already in place," Dresler said. "That was impressive.

"They had the most substantial development proposal and we had great confidence that we could work together to achieve our goal of gaining the best possible convention center hotel for Portland with minimal public subsidies."

Metro staff say the hotel could cost between $157million and $200 million, depending on the site chosen.  The full agreement could be hammered out as early as December, or could take up to six months, with the goal of completing construction in 2015. View the evaluation committee report here.

The Mortensen/Schlesinger/ Hyatt team has another hurdle to cross to land the contract. The team must negotiate a "Labor Peace agreement" with the hotel workers union, UniteHere. The union represents Hyatt workers in 14 cities, and in three cities workers are in dispute with the hotel chain and working without a contract. The union has called for a boycott of the Hyatt hotels in dispute.

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