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EUGENE, Ore. (AP) — The foundation that manages the University of Oregon's endowment has stunned civic leaders by pulling out of a project to turn the former operations yard of the local public utility into a mix of riverfront apartments, condos, offices, shops and restaurants.
Citing risks, the foundation's board voted unanimously Monday to stop efforts to buy the 17 acres owned by the Eugene Water & Electric Board, The Register-Guard (http://bit.ly/1cON62i) reports.
Residents and civic leaders have long hoped to redevelop the expanse of asphalt and industrial buildings along the Willamette River as a pedestrian-friendly neighborhood.
The public utility hopes to use proceeds from the sale to pay down debt. Last year, it chose the university foundation as the master developer. It said the foundation's local ties gave it a leg up on private developers.
The foundation manages a $700 million endowment and tries to earn a minimum of 5 percent a year, plus the rate of inflation, on its investments.
But a foundation executive said it's found enough problems to stop working on a deal: The disruption that 25 loud trains daily would cause in a multiuse public space, the lack of a parking garage in the master plan for the land and the unknown costs of dealing with contaminated soil at the site.
"There are risks that we identified over time, none of which is serious enough on its own to cause us alarm," said Jay Namyet, the foundation chief investment officer. "But because there are numerous ones in aggregate, they cause us to feel that the risks are too extreme."
He said the utility and the foundation hadn't agreed on a sale price, but that wasn't an issue.
"I certainly was taken by surprise at this turn of events," said Mayor Kitty Piercy. "Nonetheless, I have confidence that EWEB and the city of Eugene, with private partners, will hit the restart button and move forward to bring this riverfront development to reality."
In October, the utility chose the foundation over Trammel Crow, and Williams & Dame Development, both of Portland. A development group led by Dan Neal of Eugene did not make it as a finalist.
The utility will likely inform the private companies to see if they are still interested, said Chairman Steve Mital.
"We'll know more about our options in a month or so," he said.
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Information from: The Register-Guard, http://www.registerguard.com
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