History of Insider Dealings Dogs Alberta St. Developer

Thursday, October 09, 2014

Shelby Sebens, GoLocalPDX Reporter

The lot at the corner of Northeast Alberta Street and MLK Jr. Blvd has been undeveloped for over a decade. Photo: GoLocalPDX

The Southern California developer of a controversial project on NE Alberta Street has a track record of funneling money to officials who end up in hot water.

Majestic Realty Co. is developing a 20,000-square-foot shopping center with Natural Grocer as the anchor store at the intersection of Alberta and NE Martin Luther King Jr. Streets in Portland. The site sparked controversy earlier this year when the city struck a deal with Trader Joe’s to build a store there. Trader Joe’s eventually pulled out over community concerns of gentrification.

The project is located in an urban renewal district meant to help the low-income community. The special district means Majestic will get the land at a $2.4 million discount.

Critics say the massive developer, who is behind a proposed NFL stadium in Los Angeles, has a history of quid pro quo deals that could spell trouble for Portland.

“These are the types of people that once they get a hold of Portland politicians we’re going to lose control, even the small amount of control we have now,” said Nick Caleb, professor of government at Concordia University.

Calls made to Majestic’s Los Angeles office were not returned.

Quid Pro Quo?

In Colorado and California, Majestic has contributed to more than one public official who ran afoul of campaign finance laws.

In 2012, Adams County, Colo., Assessor Gil Reye was charged with misconduct for lowering taxes on Majestic-owned warehouses after accepting campaign contributions totaling $14,000 from the company, according to The Denver Post.

In 2013 a San Bernadino County, Calif., official was cited for campaign violations after he exceeded campaign finance limits by taking a $7,500 contribution from Majestic, according to Inland Politics.

Majestic is behind a proposed stadium that could host an NFL team and could cost $800 million, according to the Los Angeles Daily News.

California lawmakers in 2009 exempted Majestic’s project from environmental laws, according to the LA Times. Two months later Majestic contributed $300,000 to a ballot measure that would allow term-limited lawmakers to stay in office longer.

Majestic’s past has raised concerns among some Northeast Portland citizens.

“This thing is so powerful, it goes against the values of the city of Portland in an obscene way,” Fred Stewart, a black real estate agent who claims the project is not in the spirit of the urban renewal district. “I don’t think this is white against black.

"I think this is (that) politicians don’t give a damn as long as they’re getting greased.”

A lone art project, memorializing the former neighborhood, on an A-board stands on the Majestic lot.

Majestic has already raised eyebrows in Portland. The executive director of the Portland Development Commission (PDC), which oversees the project, failed to report a $100 meal provided by Majestic officials in October before the commission inked the deal.

The city auditor’s office sent a letter to Majestic in February making them aware of rules requiring lobbyists to register, but Majestic never responded or registered, City Elections Officer Deborah Scroggin said.

While some critics have said the city shouldn’t deal with a company with a track record such as Majestic’s, city officials say Portland is different.

“Other places have a much different culture than here,” said Jillian Detweiler, policy director for Mayor Charlie Hales. “The city doesn’t do business that way. Mayor Hales doesn’t do business that way.”

But critics say big money is seeping into Portland politics.

“(Majestic) demonstrated that this is how they have played politics before,” Caleb said. “There is no reason to suspect that they would come into Portland and reform themselves and think campaign contributions are not going to let them receive a favor.”

There is no public record of campaign contributions from Majestic to city officials in recent races.

Shedding Light

Suspicions about Majestic may be due in part to the long controversial history of the project in the neighborhood.

“A lot of the public was left out of that decision-making process, especially when we felt like we should have been, given that a quasi-public agency owned the land,” said Katrina Holland of the NAACP Portland.

The NAACP and others protested the project earlier this year when Trader Joe’s was considering building on the site. Community activists argued the city failed to prioritize the community’s desire for affordable housing on the site. The city is now allocating $20 million in the area as part of a deal struck with local leaders.

After the dust settled on the Trader Joe’s controversy, officials announced that Natural Grocer would be building a store on the site and that a Project Working Group of citizens would be formed to work on a community benefits agreement and design of the project.

“I feel like we are in a good position to ensure there is transparency and there is clarity on how this process is unfolding and who’s involved in this development,” PDC spokesman Shawn Uhlman said. “We really do want to make it clear that transparency is paramount on this thing as it moves forward.”

Holland said the NAACP is involved with the working group and that the group has “had a pretty good working relationship with Majestic so far.”

Caleb, however, said doing business with big developers like Majestic goes against the interests of the Portland community to stay small and local.

“The city has decided it doesn’t want to do business with Walmart,” he said. “Why would we do business with Majestic when they have similar poor reputations about how they play politics?”