Bag&Baggage site
The future site of Bag&Baggage, if the Hillsboro City Council approves a deal under which the city would help the theater company purchase the long-vacant Wells Fargo Bank building near 4th Main.
(Dillon Pilorget / The Oregonian)
Hillsboro has reached a tentative deal with Bag&Baggage Productions under which the city would loan the theater company $775,000 to buy the former Wells Fargo Bank building on East Main Street.
The Hillsboro City Council, acting as the Economic Development Council because the deal involves urban renewal dollars, will vote on the deal at its July 7 meeting.
"We're excited," said Hillsboro Economic Development Director Mark Clemons. "We think this is a great deal."
Bag&Baggage currently rents performance space in the Venetian Theatre but has been exploring options for its own building since the Venetian went up for sale in 2013. Artistic director Scott Palmer said the company still plans on holding its bigger shows, such as the annual Christmas special, at the Venetian because of its large capacity.
The former Wells Fargo bank, at 350 E. Main St., is part of the site now home to the $16.5 million 4th Main building. Tokola Properties, the Gresham-based developer of 4th Main, owns the land and is supportive of Bag&Baggage's deal with the city, Palmer said. Bag&Baggage wants to turn the site into a 150-seat black box theater. Palmer called that capacity "a dream number for us."
The property has been appraised at $830,000 and would be worth $1.1 million with the improvements, according to a document released Monday by the city.
The 20-year, $775,000 loan would come with a 1 percent interest rate, and the first payment would be due in 2017. If Bag&Baggage repaid at least half of the loan balance within the first three years, the city would forgive the first two years of interest. The city would hold the building as collateral.
The city emphasized that it isn't trying to make money off of the deal but rather keep Bag&Baggage in downtown Hillsboro and help the company succeed in the new building. The nonprofit wouldn't have been able to afford to buy the building without help from taxpayers, according to a February study commissioned by the city. Palmer said the organization has an annual economic impact on Hillsboro of at least $1.4 million.
With its own building, Bag&Baggage could centralize its performances, rehearsals, storage and office space. The company now is headquartered at 400 E. Main St. The nonprofit could also extend runs of successful shows and make money off of concessions, which it can't do at the Venetian.
The city has already helped finance 4th Main. Over $2.2 million in public subsidies from Hillsboro and Metro - including a decade's worth of system development fees and taxes from the city for Tokola - made the project possible. Part of that money is the $650,000 the city and Metro spent to purchase the property in 1998, using transit-oriented grant funding from the Federal Transit Administration.
The loan will be funded out of reserves from Hillsboro's downtown urban renewal district. Suzanne Linneen, the city's finance director, said the city has seen growth in the urban renewal fund over the past couple of years as property values have increased.
-- Luke Hammill
lhammill@oregonian.com
503-294-4029
@HlsboroReporter