Request for Proposals for Design and Development of the Sparrow Site

The City of Milwaukie is seeking qualified developers to submit proposals for the design and construction of affordable homeownership units on the city-owned "Sparrow Site" located at SE 26th Ave and SE Sparrow Street in the Island Station Neighborhood. The project aims to maximize density potential within zoning code limits, focusing on creating affordable housing units. Proposers must attend a mandatory site walk and pre-proposal meeting on Tuesday, September 9, 2025, with electronic proposals due by 2:00 p.m. PDT on Wednesday, October 22, 2025, through the Bonfire eProcurement platform. Environmental assessments indicate the site contains soil contamination requiring remediation, with previous studies revealing potential impacts from polycyclic aromatic hydrocarbons, heavy metals, and other contaminants. The city will require the selected developer to develop a Contaminated Media Management Plan and work within the framework of an existing Consent Judgment with the Oregon Department of Environmental Quality to prepare the site for residential development.

The procurement appears to have several potential incentives for developers, including a lease write-down option, Construction Excise Tax (CET) waiver for affordable housing, potential CET revenue allocation, and access to State of Oregon LIFT funding for affordable housing projects. The development is specifically targeted at creating housing for households earning 80% or less of the median household income, with a preference for projects that can quickly place housing units in service. Preliminary geotechnical reports suggest the 1.96-acre site is suitable for multi-family residential development, with approximately 1.09 acres considered developable. The site includes two lots with varying topographical challenges, including steep slopes on the western and southern portions. While no specific budget range is explicitly stated, the city is offering multiple financial and procedural support mechanisms to facilitate the affordable housing development, indicating a strong commitment to making the project financially viable for the selected developer.