An effort to build a wooden high-rise in Portland’s Pearl District has been called off after developers failed to find a way to pay for the pricey experiment.
The 12-story Framework tower would have been the tallest mass timber building in the U.S., serving as a valuable proof of concept for a burgeoning family of forest products the state hopes will bring new jobs to the state’s timber industry.
It would have housed the local offices for Beneficial State Bank and also included 60 subsidized apartments affordable to residents earning 60 percent or less of the area’s median income.
But it was criticized for its unusually high $480,000-per-unit cost, particularly given the substantial public investment in the affordable units. Willamette Week, which first reported the project had shelved, wrote in January that the city’s decision to invest in the project ignored Portland Housing Bureau cost guidelines.
The Framework project leaned heavily on local subsidies. Mayor Ted Wheeler had committed $6 million toward the $29 million housing project, while the housing authority Home Forward committed $6.5 million.
The project was to be largely funded with affordable housing tax credits. The value of those tax credits, however, was diminished ahead of last year’s federal tax reform, which reduced corporate tax rates. That’s left developers of affordable housing scrambling to fill funding gaps.
The Framework project was short $2 million earlier this year, and developer Project^, a Portland firm, said it was seeking more funding from the state, which has heavily promoted mass timber development.
Engineered mass timber products use glue and a high-pressure manufacturing process to create wood panels and beams with the strength of steel. State economic development officials have backed the industry in hopes of reviving the timber industry and cornering the market early.
Project^ said rising construction costs further contributed to the proposal’s financial woes.
Beneficial State Bank, which owns the site, said in a statement it plans to pursue a new iteration of the project.