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HILLSBORO, OR-The City of Hillsboro and Specht Development have completed negotiations for the development of its new Downtown Civic Center, which is scheduled to break ground in May. Changes from Specht’s original winning proposal dropped the cost of the project by $2.7 million, from $36.4 million to $33.7 million.

Under the agreement, Specht Development will build two plazas, a City Hall and a library for a guaranteed maximum price of nearly $29 million, including a 5.75% development fee that Specht lowered from 6.50% in exchange for 25% of any ultimate cost savings and a nearby two-acre parcel for which apartments are planned. The rest of the project’s development cost will be spent outfitting the space.

In April, the city asked Specht, the high bidder and winner of its Downtown civic center design-build competition, to shave $5 million off its $36.4-million proposal in order to bring it in line with a budget that was kept secret during the competition for the project, which includes a new city hall, a library, a public plaza and mixed-use development.

“We were hoping to give them creative license, but we missed on a couple of key features,” Hillsboro Capital Planning Director Marion Hemphill told GlobeSt.com at the time. “It probably had to do with we haven’t built this big before.”

Hemphill said the city’s per-sf estimate was fine, but by the time the mechanicals and the elevators were figured in, the city’s needs didn’t fit into the space everyone thought they would fit into. “We thought it would come in at 72,000 sf and it came in at 92,000 sf,” said Hemphill, explaining that the second miscalculation was on the parking structure. “They seem to come in a variety of flavors and this one is a little extensive.”

As a result, the city asked the Specht-led team to redesign to a dollar figure–just what it was trying to avoid by not revealing the budget during the competition. Greg Specht told GlobeSt.com in April that the $5 million cut realistically meant a shorter City Hall and a shorter parking garage than proposed. Hemphill said that, in turn, meant other tough decisions would have to be made.

“Initially this project was to be built to last us until 2020 and be designed to easily allow for a 50,000-sf expansion,” said Hemphill in April. “By taking off a floor we will have to cozy up and look at expansion sooner or we leave some of the departments out that we wanted to bring in.” The first choice for exclusion would probably be the Police and Fire departments. “It will be unfortunate if we have to do that,” says Hemphill, “but if that’s the only way we can fit, we will.”

Details were not immediately available Wednesday on exactly where cuts were made to lower the cost of the project by $2.7 million. The Specht-led team’s original winning proposal was to spend $18.7 million on City Hall, $7.6 million on parking, $4.8 million on the library, $4.2 million on two public plazas, $934,000 on retail space and $100,000 on an emergency operations center. In addition to being the most expensive proposal, the Specht plan was the only one with a five-story City Hall, a public library all on one floor and a maximum price guarantee.

Demolition of existing structures is set to begin May 20, with construction beginning June 23. A grand opening is scheduled for April 13, 2005.

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