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Landlord fighting to keep utility from relocating to a new building in Portland.

PORTLAND TRIBUNE: JONATHAN HOUSE - NW Natural, which settled in the hard-scrabble Old Town Chinatown neighborhood before most companies would consider it, wants to move out when its lease expires.Northwest Natural has decided to move out of its Old Town headquarters and is considering two proposals for a new office building that it would lease.

The company's landlord is not willing to let the move happen without a fight, however. Merlo Equities is waging a campaign to convince the board of directors to change its mind, in part by urging customers to tell the state Public Utility Commission that a new building will require higher natural gas rates than staying in place.

"Instead of using our money wisely, NW Natural is planning to blow millions on a ritzy new office building in a 'better neighborhood.' And then stick ratepayers with the bill with a hefty rate hike. Shame on them," reads a website and Facebook page financed by the Palo Alto, California-based property management company.

Melissa Moore, NW Natural's senior communications manager, disputes the charge, however. She says the company has carefully studied what to do when its existing lease expires in 2020, and cost "is a top criteria."

Moore would not disclose any details about how the cost of financing a new headquarters compares to its current and potential lease payments. Nor would she reveal the locations of the two properties under consideration for a new headquarters, except to say they are both within a ten minute drive of its current headquarters in One Pacific Square, located at 220 N.W. 2nd Ave.

Moore did take exception to claims by Menlo Equities Vice Chairman Richard Holstrom that one reason the company wants to move is the character of the Old Town/Chinatown neighborhood, the location of many social service agencies that is frequented by a large number of the homeless people. Holmstrom tells the Portland Tribune company officials and its representatives have repeatedly mentioned the problematic nature of the neighborhood over the years.

"NW Natural has been a strong partner here for 30+ years. We've supported the OTCT association, the Chinese Garden, Transition Projects, Street Roots, The Mission, The Blanchet House and other worthwhile and inspiring causes," Moore said in an email to the Portland Tribune.

In addition to the website and Facebook page, Holmstrom raised the same issues in a March 16 letter to NW Natural's board of directors.

"As corporate leaders and strategic advisors with a fiduciary responsibility, I hope you will step back, reconsider the mistaken decision and direction being pursued, and do what is best for your ratepayers, investors and the Portland community at large," says the seven-page letter.

You can read the letter at here.

Among other things, the letter says NW Natural has told Holmstrom the company is concerned about the safety of the building in the event of a Cascadia Subduction earthquake. Holmstrom says those concerns are being addressed with a planned seismic upgrade that will bring the building up to current standards for hospitals. But Moore says the company is concerned about the damage that could happen to the surrounding area, which studies show has a high likelihood of soil liquefaction in such a large quake.

"We are looking at seismic readiness not only of the building itself but of the surrounding area as well since we are a critical service provider and our employees will need to immediately respond should an earthquake occur," wrote Moore.

Moore says the final relocation decision will be made later this year. If it falls through, the company still has the option of extending its current lease five years, she says. Michael Dougherty, the PUC's chief operating officer, says the company will have to demonstrate it did its due diligence and made a cost-effective decision to win approval.

To read an earlier Portland Tribune story, visit

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