GATEWAY BUSINESS DEVELOPMENT STRATEGY

PFEBRUARY 14, 2011

Prepared for

Portland Development Commission

Prepared by

Applied Development Economics 100 Pringle Avenue, Suite 560 Walnut Creek, California 94596 (925) 934-8712

2150 River Plaza Drive, Suite 168 Sacramento, CA 95833 (916) 923-1562 www.adeusa.com

in association with

Parametrix www.parametrix.com

Marketek www.marketek.com

I. INTRODUCTION

Gateway is a commercial area generally located east of Interstate 205, south of Interstate 84, west of

NE 114th Avenue and north of SE Market. Some of the better-known landmarks in the area include

the Fred Meyer’s, the Oregon Clinic at the Gateway Transit Center, Mall 205 and the Adventist

Medical Center campus. Metro designated the area as a Regional Center in 2000 as part of its 2040

planning process. In 2001, PDC designated the western portion of the area as an Urban Renewal

Area (URA) so as to facilitate higher density mixed use redevelopment of parcels along the MAX

light rail corridors. To support the Metro 2040 Plan’s vision, including redevelopment, the City

changed the planning and zoning designations in Gateway to allow for high-density commercial and

residential development. The purpose of this study is to understand why the development

envisioned by Metro 2040 never came about and to suggest an alternative vision for job growth and

development.

In the 1980s, northeastern Multnomah County (east of 82nd), of which the Gateway commercial area

is a part, was annexed to the City of Portland. At the time of annexation, this area had been

developed in a characteristically mid-century suburban pattern, with relatively large lots and single-

story ranch homes, built primarily during the post-war boom of the 1950s. The Halsey-Wiedler

corridor, which extends east from central Portland through most of northeastern Multnomah

County, is the major commercial corridor. In 1954, the Gateway Shopping Center, anchored by one

of the first Fred Meyer stores in Portland, was developed near the intersection of I-205 and I-84,

giving the broader area the label, ―Gateway.‖

Since annexing the area, the City of Portland has conducted several studies to evaluate the area’s

infrastructure needs and development potential. In 2000, Metro’s 2040 Plan designated Gateway as

a regional center1 primarily to leverage the tremendous transportation infrastructure in the area,

including two interstates and three MAX lines. Gateway is the only regional center in the City of

Portland. Other communities designated as regional centers include Beaverton, Hillsboro,

Clackamas, Oregon City and Vancouver. As part of its 2040 Plan, Metro envisioned high density

employment nodes surrounding Gateway’s three MAX light rail stations.

In 2001, the Portland Development Commission designated the westernmost part of Gateway as an

Urban Renewal Area to begin to focus resources on providing the necessary public infrastructure

improvements to attract private investment.

1 Definition of a Regional Center: ―As centers of commerce and local government services serving a market area of hundreds of thousands of people, regional centers become the focus of transit and highway improvements. They are characterized by two- to four story compact employment and housing development served by high-quality transit. In the growth concept, there are eight regional centers – Gateway serves central Multnomah County; downtown Hillsboro serves the western portion of Washington County; downtown Beaverton and Washington Square serve Eastern Washington County; downtown Oregon City and Clackamas Town Center serve Clackamas County; downtown Gresham serves the eastside of Multnomah County; and downtown Vancouver ,Wash., serves Clark County.‖ Source: METRO, The Nature of 2040, 2000.

Since then, development in Gateway has been modest, despite significant growth throughout the

metropolitan area, especially along the suburban corridors to the west and south of Portland. PDC

commissioned this business development strategy to identify the major barriers to business

development in Gateway and to develop a set of recommendations for attracting development and

job growth to the area.

THE PROCESS

PDC retained the firm, Applied Development Economics, (ADE) of Walnut Creek, CA to prepare

the business development strategy. ADE teamed with two local consulting firms, Parametrix and

Marketek, who had completed earlier studies on the Gateway area, to provide in-depth local analysis.

The study proceeded in two parallel tracks.

One track focused on developing recommendations for stimulating the expansion of existing firms

located in Gateway. This track was comprised of two major activities:

An analysis of current business barriers to growth and expansion; and

An analysis of opportunities for growth and businesses’ requirements to capitalize on those

opportunities.

Another track focused on developing strategies to attract new firms to Gateway. This track was

comprised of the following activities:

A competitiveness assessment that identified and analyzed competitor employment centers

within the Portland metropolitan area;

Identifying specific industries to attract to Gateway through targeted recruitment efforts through

analysis of regional economic specialization and growth projections; and

The identification and assessment of sites within Gateway that have the greatest potential for

development and that would help improve the entire area.

PDC formed a Citizens Advisory Committee (CAC) to provide input into the preparation of the

business development strategy. Three meetings with the CAC were held during mid-2010:

June 8th

July 28th

September 15th

On October 28th, PDC hosted a Stakeholder Summit to present the findings of the study and to

begin the development of the strategic plan.

PDC staff provided updates on the Business Development Strategy at each of the Gateway Urban

Renewal Area Project Advisory Committee (PAC) regular monthly meetings.

Presentations and summaries from each of the meetings were posted on the PDC website and

attached as appendices. These can be found at the project website:

http://www.pdc.us/ura/gateway/membs-mins-notes/businessdev/bds-committee.asp

On January 20, 2011, PDC hosted a final project meeting with project sponsors and stakeholders to

review and discuss consultants’ research findings and proposed strategic initiatives.

GATEWAY BUSINESS DEVELOPMENT STRATEGY PROCESS

II. SUMMARY OF FINDINGS

RESEARCH FINDINGS The Gateway Business Development Strategy (Gateway BDS) is built on a foundation of research

and analysis of demographic, market and economic conditions within the Gateway commercial area

and of the broader Portland metropolitan area. This section presents a summary of that research to

provide context for the Business Development Strategy that follows. Full discussions of the

research referred to in this section are attached as appendices to the full report.

BASELINE ANALYSIS

There are two major components of the baseline analysis. The first is an analysis of demographic

and economic trends in Gateway. Appendix A has more detailed analysis of these trends. The

second is an analysis of regional economic specialization and projections for employment growth by

industry. A more detailed discussion of this analysis can be found in Appendix B.

Gateway Demographic and Economic Conditions

Northeast Portland, of which the Gateway commercial area is a part, is distinguished from the rest

of Portland by its suburban development pattern, greater ethnic diversity and the greater

homogeneity of households in terms of income and earning capacity. Relative to the rest of

Portland, the Gateway area has far fewer households headed by higher-earning professionals.

Gateway’s population increased at a slightly faster pace than for Portland as a whole, primarily due

to larger household and family size. Relative to all of Portland, Gateway has a greater share of

households with more than one child as well as many more elderly households. There is also a

greater diversity in race and ethnicity.

Gateway’s residents have, overall, lower educational attainment and this is reflected in their

occupations. Ten percent of Gateway employed residents are in production; the rate for the city as a

whole is about half that, at 5.7 percent. On the other hand, fewer Gateway residents are in

occupations that require higher levels of education or professional degrees. While 11.3 percent of

Portland residents are in management, architecture and engineering occupations, only 7.4 percent of

Gateway residents are in these occupations.

As of 2009, there were 9,500 jobs in Gateway. About half of all jobs, 4,800, were in education and

health services. Slightly less than one-fifth of all jobs were in Trade, Transportation and Utilities, a

category that includes both retail and wholesale trade. Leisure and Hospitality, which includes

restaurants, comprised 12 percent of all jobs. Major employers include healthcare facilities

(Adventist Medical Center, The Oregon Clinic, and Vibra Specialty Hospital), retailers (Fred Meyer,

Home Depot, Kohls and Target), Education (David Douglas School District, Parkrose School

District, Mt. Hood Community College), Social Services (IRCO), and senior care facilities, such as

Cherrywood Village and Russellville.

Regional Economic Growth and Specialization in the Portland Metro Area and

Implications for Gateway

Metro projects that jobs in the Portland Metropolitan Statistical Area, a region that comprises seven

counties, will grow at an average annual rate of between 1.4 and 1.6 percent over the next 25 years.

Metro projects that the City of Portland will capture between 18 and 36 percent of these new jobs,

or between 100,000 and 200,000 new jobs by 2035. Portland currently has 40 percent of all jobs in

the seven-county region, but between 2000 and 2006, captured only 11 percent of job growth. It is

likely that projecting a capture rate of between 18 and 36 percent could be overly optimistic given

the faster job growth in the surrounding suburban communities. Analysis of job growth by industry

showed that for all of Portland, most job growth would be in health care, education, professional

services, and finance. Metro projected declines in agriculture and some types of manufacturing.

The Economic Opportunities Analysis (EOA) recently completed for City of Portland, estimated

that Gateway would gain 5,000 additional jobs by 2035. This represents a capture rate of between

2.5 and 5.0 percent of the City’s job growth over the next 25 years. Currently, Gateway comprises

2.4 percent of all of Portland’s jobs. To accommodate 5,000 additional jobs, the area would require

additional commercial and industrial space. The EOA estimated that an addition of approximately

1.8 million square feet of commercial and industrial space would be needed to accommodate 5,000

additional jobs. Assuming an average development Floor Area Ratio of .532, this would require 80

acres of land.

Target Industries for Gateway

There are four industry clusters3 (interrelated groups of industries) that have concentrated

employment in the Portland metropolitan area and for which Portland provides some competitive

advantages as a business location. These industry clusters are Athletic and Outdoor Industry,

Software, Clean Technology and Advanced Manufacturing. The PDC has identified the

component industries within these clusters for targeted business expansion and recruitment activities

and provides services to the four cluster organizations relative to identifying and implementing

business expansion strategies. Though the component sectors of these clusters, which include

Business and Professional Services, Design, Marketing, Sales and Production, would otherwise be

appropriate targets for the Gateway area, PDC has been actively targeting these industries for other

Urban Renewal Areas within Portland, such as Central East Side and the Rose Quarter. This is partly

because members of these four clusters have demonstrated a desire to locate in or near the Central

Business District. It is also because Gateway does not yet have the amenities favored or desired by

the employees these cluster firms want to attract, including easy bicycle access, variety in restaurants

and cafes, a pedestrian environment and places to socialize.

2 This FAR of .53 was used by ED Hovee in estimating space requirements for projected job growth in the City of Portland EOA. However, minimum FARs in Gateway are currently higher than this. 3 An industry cluster is a geographic concentration (some economists use the term agglomeration) of inter-related and competing firms that compete in similar markets and have common issues relative to workforce, infrastructure, market access, and access to specialized services. For instance, the wine cluster would include not only wineries, but also grape growers, bottle and cork manufacturers, bottlers, packaging equipment suppliers, wine making equipment manufacturers and distributors, etc.

Over the next two decades, employment in health care will more than double in response to the

aging of the generation of baby-boomers who are now between 50 and 70 years of age. As people

age, they require and demand more health care services. As noted earlier, half of Gateway’s current

employment is in health and education services. These will remain important sectors to target for

expansion and recruitment to the Gateway area over the next 20 years.

Also, as housing is developed in and around Gateway, there will be greater opportunities for more

neighborhood-serving professional services.

LOCAL CAPACITY FOR BUSINESS GROWTH

Business Capacity and Requirements for Growth

The ADE Team conducted a set of interviews with 19 businesses located in the Gateway area. The

purpose of these interviews was to identify opportunities for and barriers to business expansion in

the area. Of these 19 businesses, 14 had fewer than 20 employees. The industries represented by

these businesses include retail, food service, communications, business services, such as banking and

personal services. Of these, only five discussed plans for expansion while the others were either

maintaining steady business or declining somewhat; fairly good news given the high unemployment

in the state. Gateway has multiple, large retail/commercial nodes from the Gateway Shopping

Center and the Halsey-Weidler couplet to Mall 205 that contribute to the diffuse and auto-oriented

nature of the commercial base.

Businesses identified Gateway’s competitive assets as transportation access, including highway and

transit, proximity to the airport, current business improvement activity, an active neighborhood

business association and a ready workforce. The Halsey-Weidler couplet is home to both new and

expanding businesses, with several eager for physical improvements.

However, the businesses also discussed barriers to expansion which include the following:

Current downturn in the economy and lack of access to capital;

Competition from other areas;

Lack of space for expansion;

Limited spending power of local residents due to large amount of low-income housing;

Lack of knowledge about how to cater to immigrant population; and

Zoning limitations.

Addition concerns mentioned included:

Crime, public safety and a transient population are significant concerns of businesses and

directly impact Gateway’s image and the confidence of business owners for expansion.

Gateway’s image is linked to its physical appearance which is dominated by concrete, asphalt and

run-down business exteriors on major corridors. The 102nd Avenue streetscape improvements

model the image for the future including street furnishings and street trees.

Gateway lacks a concerted, comprehensive marketing program that would help transform its

image, help established businesses succeed and attract new business.

Other findings from the business interviews:

While providing parking for customers and patients is critical to the success of Gateway; the

multi-modal accessibility of Gateway is its key competitive advantage over suburban areas.

The consumer market is highly complex and challenges business owners to focus their products,

services and marketing. Target markets include residents, employees, highway travelers and

passers-through. The immigrant marketplace is particularly challenging to business owners in

terms of marketing and product orientation.

There is a concentration of certain types of businesses. These include: home furnishings:

hardware, paint, furniture, consignment; restaurants and entertainment; recreation (golf, fly

fishing, bikes, tack, etc.); consignment and thrift centers; locally-owned businesses; and Health

care retail/services—from wig shop to arch fitters.

As a whole, business owners are unaware of PDC and other technical assistance provider

resources available to them to help them succeed, but are open if not eager for more

information. As is true for small business owners everywhere, face-to-face communication is

often the best way to capture their attention.

The Gateway Area Business Association (GABA) is well respected, has established strategic

goals and a vision, and is working pro-actively to improve Gateway as a shopper and business

destination. GABA’s four-point plan focuses on: Advocacy, Partnership, Education, and

Membership.

COMPETITIVENESS ASSESSMENT AND ANALYSIS OF STRENGTHS, WEAKNESSES,

OPPORTUNITIES AND THREATS

To assess Gateway’s competitiveness relative to other employment centers in the Portland

metropolitan area, ADE and PDC identified four employment centers within the Portland

metropolitan area that would compete with Gateway for new development. These four employment

centers are Lloyd Center, Clackamas, Kruse Way and the Rt. 26 Corridor at Rt. 217. Of the five

centers, Gateway is the smallest, with only 9,500 jobs. Clackamas has the largest and most

diversified employment base. Of its over 32,000 jobs, less than one-fourth are office jobs. Kruse

Way, a major business park in Lake Oswego has a little over 15,000 jobs, but more than half are

office jobs, with a majority of these in finance, insurance and real estate. Lloyd Center with 26,000

jobs and the 26 Corridor with 14,000 jobs have similar concentrations of office employment, 36

percent and 31 percent respectively.

In terms of building space, Kruse Way is, by far, the largest of the centers, with between 2.3 and 6.1

million square feet, depending on which areas are included in the inventory. Since Kruse Way’s

employment was concentrated in finance, insurance and real estate, the sectors most impacted by the

last recession, vacancy rates there are currently around 30 percent. In comparison, Gateway has

approximately 508,000 square feet of commercial space (retail and office). Though Gateway is not

over-built relative to commercial space, its vacancy rates are still relatively high ranging from 8 to 13

percent, possibly explained by the opening of additional space in the CBD at competitive lease rates.

Lloyd Center, which benefits by its proximity to downtown, but with easier access and more parking

has healthy vacancy rates of between 5 and 10 percent. Like Lloyd Center, Clackamas, with its

diversified product offering, also has lower vacancy rates, between 8 and 16 percent. Similar to

Kruse Way, however, the Rt. 26 Corridor at 217 had higher vacancy rates, between 17 and 25

percent. It is thought that this may be due to a movement on many firms to the CBD to take

advantage of a decline in lease rates there. (For a more detailed discussion of this competitiveness

assessment, please see Appendix C.)

An early focus of this analysis was on the feasibility of high density office development in Gateway.

Due to the glut of Class A office space in the broader Portland metropolitan area, it is not likely that

Gateway could attract high density office employment as envisioned by the Metro 2040 Plan for at

least a decade. Gateway would not compete well against areas such as Lloyd Center, Sunset

Highway, Hillsboro or Kruse Way where the vacancy rates for office space range from 15 to 30

percent.

STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS MATRIX

The ADE Team completed an analysis of Gateway’s Strengths, Weaknesses, Opportunities and

Threats (SWOT) as a potential business location. The information used to complete this analysis

was obtained in multiple ways: key informant interviews, the analysis of opportunity sites, local

business interviews, economic base analysis, and analysis of competitor real estate markets. A

detailed SWOT analysis is attached in Appendix C.

TABLE 1. ANALYSIS OF STRENGTHS, WEAKNESSES, OPPORTUNITIES, THREATS

Strengths

Transit and highway access

Availability of parking

Access to growing markets

Proximity to Airport

Housing relatively affordable

Local technically trained workforce

High quality, accessible health care

Opportunities

Small-scale industrial activity priced out of gentrifying

areas, such as Central Eastside

Increasing demand for technical training

Growing demand for specialized medical care

Turnover in housing ownership

New parklands

Weaknesses

Lacks well-defined boundaries and brand

Redevelopment requires parcel aggregation,

Higher crime rate in area

No common vision for development

Lack of integrated and focused marketing program

Outdated physical appearance

Preponderance of subsidized housing

Threats

Glut of Class A office space in region

Competitor cities’ marketing programs

Limited access to credit for expansion

Limited public funds

ANALYSIS OF OPPORTUNITY SITES.

Together with PDC, the ADE Team identified 16 sites within Gateway that had potential for future

redevelopment so as to attract new businesses and jobs to the area. The selected opportunity sites

met several criteria such as: location within the Urban Renewal Area (URA); highly visible and

accessible; vacant or under-developed, and potential to induce further new development in the area.

Together, the 16 sites, some consisting of multiple parcels, comprise about 120 acres. (This analysis,

together with maps and zoning definitions, is attached to the full report as Appendix E.)

TABLE 2. GATEWAY OPPORTUNITY SITES

Number Size Zoning Ownership Short - Term (1-5 years)

Mid - Term (5

-10 years)

Long - Term (10 years +)

1 1.0 CS PDC 1.0

2* 32.0 CX Public/Private 32.0

3 6.4 CX PDC 6.4

4 14.0 CX & RX Public/Private 14.0

5 2.5 RX Private 2.5

6 0.8 CX Private 0.8

7 1.2 CS Private 1.2

8 2.9 CX & CM Private 2.9

9 3.6 EX Private

10 3.0 EX Private 3.0

11 7.0 EX Private

12 1.5 EX Private 1.5

13 3.2 EX Private 3.2

14 2.1 CX Private 2.1

15 38.0 CX Private 38.0

16 1.0 CX Private 1.0

Total 120.0 62.6 8.9 38.0

Source: Parametrix, 2010 * Ideally, this site would be developed in conjunction with Sites 3 & 4 to allow a ―master-planned‖ effect.

For the short term, within the next five years, PDC and its economic development partners should

focus on nine sites comprising approximately 62 acres. The sites are 1, 2, 3, 4, 5, 7, 10, 12, and 16.

Site 2, Gateway Center, is adjacent to the Gateway Transit Center and consists of approximately 32

acres with multiple owners. Using a master planning approach, this site, combined with sites 3 and 4

could be developed jointly so as to ensure connections to the proposed Gateway Green project, the

Transit Center and the medical clinics.

For this analysis, the ADE Team conducted interviews with 14 real estate brokers, developers, and

land owners to identify major barriers to redevelopment, types of businesses expressing interest in

locating in Gateway, and ideas for improving the business climate in the area.

Retail. The two major freeways, I-205 and I-84 provide excellent access to the area and make it

attractive for large retailers. According to interviewees, large-format retailers had shown some

interest in the area, but appropriately-sized vacant parcels were not available at the time. Given the

large number of retail vacancies throughout the Metro area, it is more likely that large format

retailers would locate in existing vacant spaces before building new space. Also, the perception of

relatively low disposable income due to the high percent of low income and subsidized housing in

the area keeps retailers away.

Professional Services. Several small firms, including startups, primarily in professional services

fields, have shown interest in locating in Gateway and several office buildings have had no problem

leasing space. A key attractor is the availability of parking. Buildings that are having trouble leasing

space are either not well-maintained, are adjacent to incompatible uses or have restricted parking

supply. Class A office space could be developed in this area, but not on a speculative basis. This is

due to the large vacancy rates for Class A space in other parts of the Metro area. (For more detail

about the Opportunities Analysis, please see Appendix C.)

III. STRATEGIC INITIATIVES

The following five strategic initiatives are the result of research, interviews with local businesses,

meetings with the Citizens Advisory Committee and the Project Area Committee as well as

interviews and meetings with developers, real estate professionals, business executives outside of

Gateway and other knowledge experts.

At the January 20, 2011 meeting with project sponsors (PDC, Tri-Met, Metro, Bureau of Planning

and Sustainability) and stakeholders, including members of the CAC and PAC as well as other

businesses and non-profits from the Gateway Area, a summary of the final report findings were

presented by ADE. The discussion pointed out that there is a need for this strategic plan to build

on the current momentum relative to development plans by private sector and institutional interests.

ADE has prioritized the strategic initiatives to take full advantage of private sector and institutional

interests in developing in Gateway. The strategic initiatives are listed below followed by a more

detailed list of recommended activities.

1. Identify Larger-Scale Institutional/Campus Development Opportunities

2. Create a Sense of Community by Clustering Neighborhood Retail and Services along the Halsey-

Weidler Couplet Corridor

3. Support the Expansion of Existing Gateway Businesses

4. Encourage Development of Small and Medium Scale, Multi-tenant Office and Industrial

Buildings in Central Gateway, Avoiding Conflicts with Campus Style Developments in South

and North Gateway

5. Design and Implement a Business Attraction Campaign Targeting Specific Industries

1. IDENTIFY LARGER-SCALE INSTITUTIONAL/CAMPUS DEVELOPMENT

OPPORTUNITIES

The health care industry will continue to grow faster than the regional growth rate, primarily due to

the growth in the senior and elderly population.

Adventist Medical Center is the largest employer in Gateway and needs to expand its facilities in

order to meet the needs of a growing population.

IRCO, the Immigrant Resource Center, currently located in Gateway, needs additional space to

accommodate the needs of a growing immigrant population.

The Oregon Clinic, as well as other medical facilities located in Gateway, have expressed a desire to

expand within Gateway.

Mt. Hood Community College, David Douglas School District and Parkrose School District have

been working on creating an Education Center to meet the growing need for vocational training

within Portland.

a. Design separate development approaches for the three major commercial

areas of Gateway: Gateway Transit Center; Adventist Campus; and Central

Gateway.

Gateway Transit Center. This area includes Gateway Transit Center and the Gilbert/ODOT

properties south of Pacific. This area has about 15 acres of available developable land, in public and

private ownership. An initiative to build an education center on one of the parcels has begun. The

existing master plan for part of the area provides for air rights and additions to parking garage and

Oregon Clinic. Careful development of the area would improve connections to Halsey-Weidler and

the proposed Gateway Green, would be visible and accessible and would create a reason to go to

Gateway. To activate the area more, consider including hospitality and entertainment uses, such as a

hotel, a movie theater, small business opportunities, and cultural attractions. Better connectivity

throughout the area is needed, but must still allow for freight mobility and access needs as a major

asset for the Gateway Area is vehicular access. An overall plan with design-build and key

infrastructure opportunities identified/prioritized.

Form an alliance of property owners, developers, city and regional economic development and

redevelopment agencies to discuss development opportunities around the Gateway Transit Center.

The alliance could include Metro, TriMet, PDC, Portland Sustainability Institute, Parks and

Recreation, PacTrust, Fred Meyer, Oregon Clinic, Gilbert Bros., PSU, MHCC, David Douglas

School District, Portland Public Schools, Warner Pacific College and others as appropriate.

Conduct a visioning exercise or charette to develop ideas for the physical development of the area.

Sponsor a design competition for the site.

Adventist Campus. Both the Adventist Academy and the Adventist Medical Center wishes to

expand to meet the needs of a growing population. The campus expansion, including a senior care

center, school expansion, smaller medical clinics, adding 100+ physicians plus support staff could be

linked to the Main Street Light Rail station. A portion of the large employee base at Adventist would

be able to use MAX. Current zoning would not allow this expansion.

Central Gateway. This area is south of Burnside, directly east of I-205 and includes the Light Rail

station at 102nd. This area could be redeveloped as a TOD, branded with the Eco-District concept,

and developed with green streets, wind generators on power poles and solar panels to power street

lights. The area has several Brownfield sites that would need to be re-mediated and the street grid

would need to be completed. Development could be facilitated with use of the DOS program, but

gap financing would be needed for the new projects.

2. CREATE A SENSE OF COMMUNITY BY CLUSTERING NEIGHBORHOOD RETAIL AND

SERVICES ALONG THE HALSEY- WEIDLER COUPLET CORRIDOR

Form an alliance of businesses located along the Halsey-Weidler couplet to conduct joint marketing.

This alliance could be a sub-set of the GABA membership. Consider funding joint marketing and

other local activities through the formation of an Economic Improvement District. Inventory

ground-floor commercial space available along the couplet and post on the GABA website.

Adopt National Main Street Program practices to improve the Halsey-Weidler couplet. Advocate

for Gateway to actively participate in PDC’s Neighborhood Economic Development Roadmap

implementation process.

Leverage the existing concentration of senior citizens to attract retail and service businesses that

cater to the senior population, including orthopedic shoe stores, medical equipment, ice-cream, arts

and crafts, etc. Coordinate with medical centers and service providers by planning and holding a

senior health fair.

Focus placemaking and physical improvements along the couplet working on storefront

improvements, the addition of greenery and general cleanup.

3. SUPPORT THE EXPANSION OF EXISTING GATEWAY BUSINESSES

a. Provide pro-active support to businesses wishing to expand.

Establish a full-time, on-the-ground business outreach/assistance staff position to provide assistance

to businesses wishing to expand and to provide guidance with meeting permit approval and

development code requirements. Develop and maintain on-going relationships with Gateway

businesses as well as with providers of business services and business assistance resources. Link

Gateway businesses to real estate brokers, financing resources and technical assistance resources.

Conduct one-on-one site visits with local businesses on an on-going basis to share information

about programs, activities and initiatives and develop long-term relationships to encourage business

adaptation to a changing marketplace. Prepare a one-page handout of tools and resources to hand

out and post on the website. Provide information in multiple languages to reflect the growing

cultural diversity of the Gateway area.

b. Link existing businesses with technical assistance resources.

Establish a business incubator to assist start-ups. A business incubator not only provides low-cost

space to new businesses, it also provides mentoring in business planning, expansion financing, tax

planning, workforce recruitment and other issues.

Regularly update a ―what’s new‖ section on the website and/or create and distribute an e-newsletter

on a regular basis. Provide information in multiple languages. Market PDC’s Storefront

Improvement Grant program and other services to existing businesses.

To help generate more local business development, coordinate with the Small Business

Development Center, SCORE, Oregon Biz, Portland State U., GABA, Chambers and City to plan

and hold a ―start your business fair.‖

c. Implement an on-going media campaign of positive news stories and

initiatives in Gateway.

Focus articles, press releases and promotion efforts on new businesses, innovative business owners,

businesses that have made significant new investment, businesses unique to Gateway and leaders of

various initiatives that are making a difference for Gateway. (See Marketek report in Appendix for

more detail.)

d. Increase crime prevention efforts by partnering with Police department as

much as possible.

Design new buildings and renovated buildings with crime prevention as an important element.

Focus business recruitment efforts on businesses that are not associated with high crime.

e. Build on the Eco-District concept by providing energy and resource efficiency

technical assistance to local businesses.

Inform local businesses about weatherization and energy-efficient equipment incentives and

financing offered through the Northwest Energy Efficiency Alliance (NEEA) and the Energy Trust

of Oregon, Inc. Provide information in multiple languages. Link local businesses with technical

assistance in six-sigma, lean manufacturing and other forms of operational efficiencies through local

colleges and technical assistance agencies, such as Northwest Energy Efficiency Alliance (NEEA).

Incorporate Eco-District recommendations in renewal efforts. Incorporate use of MAX as part of

GABA, neighborhood and school events.

4. ENCOURAGE DEVELOPMENT OF SMALL AND MEDIUM-SCALE, MULTI-TENANT

OFFICE AND INDUSTRIAL BUILDINGS TO SUPPORT THE ATTRACTION OF TARGET

INDUSTRIES AND INCREASE EMPLOYMENT DENSITIES

Potential tenants include: medical services, supplies and equipment; educational services, supplies

and equipment; professional services, including software development, design, business services,

engineering and architecture; finance, insurance and real estate services; government services; small-

scale fabrication, assembly and manufacturing, and clean-tech.

a. Work with existing businesses and property owners of opportunity sites to

proactively plan for future development.

Provide pro-active support to businesses wishing to build new facilities within Gateway or

developers wishing to invest in and build in Gateway. Provide assistance with entitlement and

construction permits and financing packages. Provide financial and development guidance.

b. Encourage development with competitive incentive packages.

Identify all potential incentives that could be offered to developers in Portland. These may include

tax abatements, fee reductions, reduction of system development charges, construction of necessary

infrastructure, land-banking and environmental remediation. Offer more gap financing. Identify

possible sources of funding. Market the availability of incentives for development in Gateway.

c. Re-evaluate effectiveness of existing zoning and development regulations

and consider revisions to allow more flexibility and smaller-scale development

activity.

Focus revisions on Floor Area Ratios (FAR), parking requirements and required off-site public

improvements.

Streamline the permit approval process and increase transparency and predictability in the process.

Revise development regulations to increase predictability and speed.

5. DESIGN AND IMPLEMENT A BUSINESS ATTRACTION CAMPAIGN TARGETING

SPECIFIC INDUSTRIES

While the Gateway area should continually promote its assets and strengths relative to other

commercial areas, a fully developed and integrated business attraction campaign would be more

successful after Gateway has completed some of the projects currently underway or made more

progress on initiatives, such as Gateway Green, The Education Village and the proposed expansion

of the Adventist Medical Center campus. The analysis completed as part of this study identified

several potential target industries that could be successfully recruited to the Gateway area. These

potential industry targets include: medical services, supplies and equipment; educational services,

supplies and equipment; professional services, including software development, design, engineering

and architecture and business services; finance, insurance and real estate services; government

services; small-scale fabrication, assembly and manufacturing, especially for food processing, clean-

tech, athletic and outdoor.

To be successful, an industry recruitment effort should be focused on a finite set of industries. The

highest priority industries to target, as identified in the previously mentioned analysis, would be:

Health care and related services;

Education services and higher education;

Business services;

Finance and insurance;

Clean technology.

a. Promote the Gateway brand

Two major ideas for a Gateway brand have been discussed. One builds off the combination of

Gateway’s designation as an Eco-District and the initiative to create the Gateway Green, an outdoor

bike recreation facility on land owned by Oregon Department of Transportation. The other builds

on Gateway’s proximity to the Airport, its extensive transportation access and its growing multi-

cultural population. Gateway is unique among Portland neighborhoods in its concentration of

immigrants. A brand that would leverage this unique characteristic of Gateway’s would be

―International Business Opportunity.‖

By branding Gateway as an area of international business opportunity, the City would encourage

investment from international sources. This could help stimulate development despite the current

downturn in construction financing. For instance, the United States Department of Homeland

Security administers a program, EB-5 (Employment Based fifth visa preference category) that

provides immigrants permanent green cards in exchange for investment in a new commercial

enterprise that will benefit the U.S. economy and create at least 10 full-time jobs.

Use multiple channels to promote the Gateway Brand. Channels should include industry

associations, whose membership includes target industry firms; PDC cluster groups, including

Athletic and Outdoor, Advanced Manufacturing, Software and Clean Technology; PDC website;

GABA website; press releases on PR Wire or similar; and articles written for targeted magazines,

including industry association magazines.

b. Use local cluster networks and business associations to promote

opportunities for expansion in Gateway.

Attend target industry cluster and industry association meetings to promote the Gateway brand and

message.

Coordinate with industry cluster and industry associations on school-to-career activities to link

regional industry with local schools. For instance link local medical centers with school-based

programs in sports medicine or link the Athletic and Outdoor cluster with the David Douglas

fashion design program.

Coordinate with industry cluster organizations and industry associations on joint-marketing efforts.

c. Develop and implement a protocol for responding to business and developer

inquiries regarding Gateway’s opportunities.

Clarify roles and responsibilities among partner organizations in responding to developer and site

selector inquiries about Gateway opportunities. Ensure that all marketing messages and collateral are

consistent and have the phone number and/or email address for the initial contact.

d. Market business expansion and re-location opportunities to commercial

brokers and commercial/industrial developers.

Inventory available properties, including broker contact information; housing rental rates and sale

prices; K-12 education opportunities and specializations; higher education opportunities;

transportation access; financial incentives; tax rates; who to contact. Post this inventory of assets on

both the GABA website and the PDC website.

Plan and hold an event to showcase Gateway opportunities to brokers and developers.