Turning Crowne Plaza Hotel Into Homeless Shelter Could Cost as Much as $149.4 Million, County Says

Buying the Crowne Plaza Hotel near Moda Center in Northeast Portland and turning it permanently into a shelter for homeless people would cost as much as $149.4 million, according to a county assessment, mostly because of the high price for earthquake retrofitting.

That’s the price for turning the hotel into a shelter as its permanent use and remodeling 30% of the rooms to become “short-term housing units,” the county said. Turning all of the 241 rooms into housing units would cost $165.7 million, the county said, or $688,000 per door.

County Commissioner Sharon Meieran has called for the county to put a $25 million down payment on the 10-story, 241-unit hotel, using $50 million of unanticipated revenue coming to the county from Metro’s supportive housing services measure to turn it into housing for homeless people.

“These units are up to current code and are nicely furnished,” Meieran wrote in her proposal. “The rooms could be used as deeply affordable single room occupancy units (SROs) or easily converted into studios, and they could be used as bridge housing or even longer-term supportive housing.”

The hotel is open. Rooms go for $118 a night.

Meieran figured the purchase price at $50 million. Dan Zalkow, director of the county’s Facilities and Property Management division, agreed on that number, putting the price at $40 million to $55 million.

But Meieran and Zalkow differ from there.

Meieran says Crowne Plaza is “truly move-in ready, and would not need to undergo a long permitting process, architectural planning, or significant renovation.”

Zalkow says turning Crowne Plaza into a shelter temporarily, a much lighter lift, would cost between $5.9 million and $6.9 million. Among the improvements: replacing carpet and filling the pool and hot tub.

To remake the 1970s-vintage hotel permanently into a shelter, with 30% of the rooms renovated for short-term housing, would cost far more: $65.2 million to $94.4 million, Zalkow said in an Aug. 15 memo to Chris Fick, chief of staff to County Chair Jessica Vega Pederson. (Pederson and Meieran ran against one another for the chair’s seat last year.)

The bulk of that cost is for earthquake retrofits that become necessary anytime occupancy status changes for a building. In this case, it would go from short-term to long-term occupancy, Zalkow wrote.

“The greatest cost is a seismic upgrade, estimated at between $50 and $75 million, which is likely required to obtain a residential occupancy permit and might significantly impact operations during construction,” Zalkow wrote.

At the highest sales price and estimate for earthquake retrofits (with just one-third of the rooms becoming short-term housing units), converting Crowne Plaza would cost $149.4 million. At the low end of both, it would run $105.2 million, Zalkow wrote.

Meieran took issue with that estimate.

“There are elements of their review that may be relevant, but unfortunately they were evaluating for a very different use than what I’ve proposed,” Meieran said. “I wish the chair had shared with me that the team was going to be visiting the facility so that we could all have been on the same page.”

Crowne Plaza is owned by PH Properties LLC, according to county records. The LLC, in turn, is managed by Marlo Hollander, chief executive of Hollander Hospitality in Bellingham, Wash.

Crowne Plaza’s market value is $14.2 million, according to the county assessor’s office.

The Joint Office of Homeless Services, funded and managed by the city and the county, could afford the project at just about any price. It has a budget of $282 million this year and has been slow to deploy cash in the past. Some $72 million remains unspent from last year.

On Aug. 10, the Multnomah County Board of Commissioners discussed how to spend $50 million of unanticipated revenue from Metro’s supportive housing services measure. Meieran repeated her call for a $25 million down payment on Crowne Plaza, conveniently located in the Lloyd District between the Hooper Detoxification Stabilization Center and Legacy’s Unity Center for Behavioral Health.

“This should be a no-brainer: acting at a scale that will make a difference,” Meieran said at the meeting. “Do we or do we not have a desperate need for recovery housing?”