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West End Building Sale and Rezoning

On October 8, 2013 the City Council authorized the City Manager to sign a Purchase and Sale Agreement with Kensington Investment Group LLC for the sale of the West End Building (WEB) for $16.5 million.  The final agreement can be found below under Supporting Documents titled West End Building Purchase and Sale Agreement.

Rezoning Process

The sale of the property is contingent upon the City rezoning the property to General Commercial by April, 2014.  That process is currently underway.  The General Commercial (GC) zone provides a broader range of uses when compared to the existing OC/R-3 zone or alternatives such as Campus Research and Development (CR&D). A FAQ about the zone change can be found here.

Update (3/20/14):

Kensington Pulls Out of West End Building Sale

The prospective buyer of the City’s West End Building, the Kensington Investment Group, has decided to terminate its purchase and sale agreement with the City.  In November, Kensington and the City had agreed to a sale price of $16.5 million for the property - contingent on Kensington being satisfied with its inspection of the property.  On March 6, Kensington notified the City that it was unable to come up with a development plan that would financially work, and thus, the company would need to cancel the agreement.

At its March 18 meeting, City Council reaffirmed its intention of selling the West End property.  Mr. Nick Bunick, a Lake Oswego developer, has previously proposed to purchase the site, along with an adjacent City parcel immediately to the west, for $20 million.  City officials will be considering this proposal in the coming weeks as well as hiring a commercial realtor to assist with the sale of the property.

The City’s proposed zone change of the West End property from Office Campus to General Commercial is on hold until the commercial realtor can advise the City.

For additional information, please contact Brant Williams, Redevelopment Director, at 503-635-6138.

For further updates, see the Land Use project page for LU-13-0053:

Use and Potential Development of Property

At this time, Kensington Investment Group has not indicated any specific plans for the use of the property. Any use or potential redevelopment of the property would be subject to the city's development review process, with opportunity for public involvement. The development review process would begin once Kensington submits their development application.

Once a development review application is submitted by Kensington, and once the application is determined to be complete, a Development Review Commission meeting and public hearing will be scheduled.

West End Building Chronology

The WEB property, formerly owned by Safeco Insurance, was acquired by the City in 2006 for $20 million for the purchase of a community center. A conceptual plan for a community center was developed over the following two years; however, the plan did not receive broad public support. Since that time, the City Council also considered a new City Hall, Police/911 facility, and a new main or branch Public Library as permanent public uses for the property.

The City originally financed the purchase of the property with a short term line of credit.  In 2008, voters turned down a bond measure that would have provided permanent financing for the purchase.

Over the last several years, the City completed extensive studies on a variety of options for meeting its facility needs, including possible uses for the West End property.  Several of these reports can be found in the attachments section below.

The following is a chronology of studies, votes, and opinion research on the West End Building and City Facility needs:

July 2007 Community Center Steering Committee Report
November 2007 Advisory vote to retain ownership of the WEB passed 7,870 to 6,648
May 2008 Bond issue to refinance the WEB failed 6,059 to 8,070
October 2008 Municipal Facilities and Space Planning Analysis Report by SERA Architects
October 2008 Summary Property Appraisal Report by Mueller and Company, Inc.
November 2008 Lake Oswego West End Building Strategic Look by the Urban Land Institute
December 2008 Community Conversation Report by Davis, Hibbitts & Midghall, Inc.
January 2009 Real Estate Analysis - City of Lake Oswego by CB Richard Ellis.
February 2009 West End Building Decision Process Report and Scenarios Cost Analysis
June 2009 Initial Strategy for the WEB and Other City Facilities adopted by Council
April 2010 WEB Space and Facility Analysis for Potential Staff Relocation from City Hall
June 2010 WEB Debt Refinancing Options Memorandum
July 2010 2010 Community Attitudes Survey
September 2010 City Facilities Focus Group Report by Davis, Hibbitts & Midghall, Inc.
September 2010 WEB Site Study Work Group Report
February 2011 City Facilities Survey by Davis, Hibbitts & Midghall, Inc.
March 2011 Revised Strategy for the WEB and Other City Facilities adopted by Council
September 2011 Police/LOCOM/Courts Site Selection Study by Brian Jackson
February 2012 Public Safety Facility Site Selection Refinement Study by Group Mackenzie
March 2012 Major Capital Facility Financing Analysis Report
February 2013 City Council adopts 2013 Action Plan with a goal of making a decision on the West End property.
October 2013 City Council approves the Sale and Purchase Agreement with Kensington Investment Group LLC for the sale of the West End property for $16.5 million.
November 2013 Planning Commission Public Hearing – Zone Change from EC/RO to GC
December 2013 Planning Commission recommendation to the City to deny the zone change