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PORTLAND-Nobody wants to talk about Pearl Technology Center, a 320,000-sf historic former department store warehouse that FowlerFlanagan Tech Partners paid $14 million in 2000 and then hired DPR Construction to renovate it for use as a telco hotel. The telecom market started to waver in 2001 before any tenant could be signed for the project and then general economic collapse and Sept. 11 ensured that the telecom market wouldn’t be necessary in second-tier markets like Portland for a long time.

In August 2001, GlobeSt.com reported that sources in a position to know about the project said FFTP hadn’t been making loan payments and was trying to refinance or find additional backing to stay out of bankruptcy. Now, sources tell GlobeSt.com that FFTP is largely disbanded, DPR Construction has a $3.5-million lien against the property and Lehman Bros., the lender on the project, is now in control of the building and has several heads together exploring options for the property.

Greg Fowler did not return repeated phone calls seeking confirmation of this information and neither did several top-level officials listed on the FFTP Web site but no longer with the firm. A spokesman for Lehman Bros. also has not yet answered GlobeSt.com queries. A DPR representative declined to confirm the lien on the building, saying only that “demand for that particular market has dried up.”

FowlerFlanagan Tech Partners was launched in 1999 by Fowler Shore Flanagan, one of the top 50 owners of real estate in the world. Sources who know Greg Fowler say Fowler got into the telco hotel business after some of his wealthy investors who had already made other successful investments in the niche in first-tier cities like Dallas asked Fowler to take their money and, using the company’s nationwide network of acquisition people, invest it in telecom hotels in top second-tier markets, which hadn’t yet been penetrated.

Sources who know the industry say current bandwidth demand simply hasn’t climbed enough to fill telco hotel space in secondary markets, as was expected. They also say that it will take a lot of money to make the building fit for multiple uses such as residential over retail. “It’s going to take a creative lender that has patience and flexibility to take it in chunks,” says one source. “Lehman almost needs to discount the notes to zero, start a partnership with the right group and basically give them the property and gamble for a piece of the upside on the back end.”

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