Executive Summary

Development Pipeline

Industrial Projects

Entitlement Risk

Approval Patterns

• The City Council prioritizes projects that align with the 2025-2027 Economic Development goal, specifically those that revitalize neighborhood hubs .
• Commercial and industrial developments are viewed favorably because they generate a financial surplus for the city, whereas residential permits are currently processed at a financial loss .

Denial Patterns

• There is explicit political resistance to "passive" industrial uses; officials have stated they will seek to influence future industrial sites to avoid "just warehousing" .
• Projects that threaten the city’s 40% tree canopy goal face high mitigation costs or redesign pressure under newly adopted standards .

Zoning Risk

• The city is using a DLCD grant to study the High-Density Residential (RHD) zone, which may involve rezoning or expanding density standards that could bleed into adjacent commercial/industrial edges .
• New regulations for "Business Industrial" zones are being tested through conditional use permits for non-industrial uses like athletic facilities .

Political Risk

• Some council members have identified an "anti-business sentiment" at the state legislative level, particularly concerning diesel truck regulations and employment benefits .
• Tariff instability is cited as a significant risk factor that is currently stalling manufacturing growth despite continued R&D investment in the region .

Community Risk

• Industrial odor control is a sensitive community issue; neighbor complaints regarding the Kellogg plant led to a directive to reschedule maintenance activities to cooler months .
• Residents have voiced concerns that high-density developments do not adequately account for traffic visibility and parking, specifically in "unimproved" industrial-adjacent streets .

Procedural Risk

• The city recently terminated its 10-year rolling solid waste franchise, moving to a 10-year fixed term, which may change the logistics cost structure for industrial waste .
• Development costs have been increased by the implementation of a $7 monthly public safety fee and a 3% card transaction fee on all city payments .

Key Stakeholders

Council Voting Patterns

• Consistent Supporters of "Job Growth": The Council is generally united on seeking high-density employment rather than logistics, with Mayor Batey and Councilor Massie often leading discussions on industrial land use .
• Affordability Bloc: Councilors Koserati and Stavenjord consistently focus on how industrial or commercial development impacts local utility rates and resident affordability .

Key Officials & Positions

• Mayor Lisa Batey: Actively represents the city on regional boards (GPI, MMC) and has expressed skepticism about state overreach in land use .
• Joseph Brillio (Assistant City Manager): The primary lead on economic development goals and the point of contact for the industrial area master planning .
• Alfred Mousali (Urban Forester): A new key official who has advocated for tightening tree preservation codes during the development process .

Active Developers & Consultants

• Black Rock Development: Currently managing the long-term Coho Point "gateway" project and negotiating extensions due to lumber and financing costs .
• Dev Northwest: Recently authorized for the Sparrow site design and development project .
• FCS Group: The primary consultant for updating the city’s System Development Charges (SDC) and utility rate studies .

Analysis & Strategic Insights

• Industrial Pivot: The North Milwaukie Industrial Area (NMIA) is undergoing a strategic shift. Developers should expect high friction for projects categorized as "passive warehousing" and should instead lead with "job density" or "economic mobility" metrics to gain support .
• Tightening Regulatory Environment: The emergency adoption of the new tree code significantly increases the cost of clearing large-diameter trees (30"+), with fees now reaching up to $40,000 for total canopy removal .
• SDC Escalation: The city is currently recalculating Transportation SDCs based on the new TSP. Preliminary data suggests a single-family SDC could rise from $2,470 to $3,982, with similar upward pressure expected for commercial/industrial trip generation .
• Strategic Recommendations:
• Site Positioning: Focus on the International Way corridor where existing large employers (Oregon Tool) provide a precedent for city-supported infrastructure like sidewalk improvements .
• Stakeholder Engagement: Engage early with the new Climate Action Committee (CAC), as they will influence future building decarbonization policies and "carbon pollution fees" for new construction .
• Near-term Watch Items:
• March 2026 Budget Adoption: Will formalize new FTEs for building inspections and code enforcement .
• TSP Final Adoption (January/February): Will trigger the new project prioritization list and subsequent SDC hikes .