Newspaper's woes may be gain for city of Vancouver: Interest expressed in Columbian building

VANCOUVER, Wash. — Vancouver city officials, prepared to spend as much as $40 million building a new city hall near Esther Short Park, put those plans on hold this week after a ready-made alternative materialized just across the street.

Columbian publisher Scott Campbell announced Wednesday that the newspaper will move its business and newsroom operations back to its former facility at 701 W. Eighth Street after just 10 months in the new building.

The sudden availability of a six-story downtown office building caught the full attention of city officials, who have long wanted to consolidate city operations under one roof. Despite tough economic times, which is forcing the city to consider balancing its budget with cuts and tax hikes, Mayor Royce Pollard said he doesn't want to miss an opportunity to secure a base of operations for the next 50 to 100 years.

"Why would you not consider it, since it's available?" Pollard said.

Eric Holmes, the city's economic development director, said the building is the right size, in the right place and the price is close to the $35 million to $40 million the city expects it would cost to expand the Esther Short Building, at 610 Esther St., into a new city hall. The Columbian is asking $41.5 million for the building on the opposite corner, 415 W. Sixth St.

The city still may redevelop the Esther Short Building.

"We're actually very close to issuing a request for proposals for development teams to look at that site," Holmes said. "But with this new information about The Columbian building being listed, the responsible thing for us to do would be to look at it."

With the economy on wobbly footing, Holmes said the city is concerned about the "highly volatile" market for raw materials such as fuel, concrete and steel that could drive up construction costs.

City Manager Pat McDonnell is assembling a panel of real estate experts to consider the Columbian building, which Campbell built for $30 million. Campbell, the third-generation owner of the 118-year-old newspaper, broke ground on the building in March 2006.

The Columbian moved into the building in January, but a severe downturn in advertising revenue and high building costs are forcing the company to move back to Eighth Street. The newspaper also might seek Chapter 11 bankruptcy if it cannot restructure a bank loan used to finance the new building.

Holmes said the city has put away $9 million in cash reserves as a down payment on the anticipated redevelopment of the Esther Short Building. He said the city would save money over the long run by consolidating operations currently spread around five offices — four of them under lease.

Pollard said the city spends $2 million a year leasing space at far-flung locations across town.

"You know the time and money we waste getting together for meetings?" he said. "You always hate to build something new, and this city has to prepare for the future. The time may be now."

Holmes said The Columbian building, with 118,000 square feet, meets the city's criteria for 100,000 to 120,000 square feet of office space to accommodate long-term growth. Tenants in the upper two floors would be unaffected in the short term if the city acquired the building, he said.

"It's important we respect the investments that tenants have made in that building," he said.

Holmes said he could think of no obvious downside to The Columbian building, though the city is a long way from the close scrutiny that would be required of such a purchase.