PORTLAND, Ore. — In April, real estate mogul and philanthropist Jordan Schnitzer met with Portland city council candidate Rene Gonzalez at Schnitzer's office in downtown Portland.
"I said, 'By the way, I've got some vacancy that I've had for two years across the street if you need some office space,' and (Gonzalez) said, 'That'd be great,'" Schnitzer said. "I said, 'Fine, you're welcome to have it, we'd like to see the space activated and some activity there.'"
Gonzalez signed a month-to-month lease on the 3,185-square-foot property for $250 per month, plus utilities. An online leasing advertisement for the full office space at 1010 Southwest 11th Avenue listed a rate of $26 per square foot, or an estimated $6,900 per month.
The significant discount prompted Portland's small donor election program to fine Gonzalez $77,140 for accepting a prohibited political contribution and failing to report it.
Schnitzer told KGW he offered Gonzalez a cheap deal after being impressed by his background and his political philosophies.
"From my standpoint, I would’ve done that deal with any nonprofit or political candidate that had views that I thought were important and constructive to our city," Schnitzer said.
Schnitzer donated to Gonzalez' campaign in May, according to campaign finance records.
Gonzalez is running against Portland commissioner Jo Ann Hardesty for a Portland City Council seat in the upcoming November election.
Schnitzer said the discounted $250 per month lease was a product of a lack of interest in the commercial office space.
"There is virtually no leasing activity in downtown Portland, which is part of a much bigger issue," he said. "From my standpoint, (Gonzalez) did us a favor by taking the space and having people come and go."
Gonzalez plans to appeal the ruling, and a campaign spokesperson said he "strongly disagrees that the rent is too low given the dismal state of downtown."
The campaign added: "Landlords are having to offer substantial amounts of free rent months, secured parking and invest in tenant improvements to get tenants to even consider renting downtown right now."
KGW asked Schnitzer, if the office space had been marketed at $250 per month, wouldn't that have created more interest in the property?
He answered by re-emphasizing the lack of interest in the office space over the past two years.
“There’s been no discussion of price because there haven’t been any visits," Schnitzer said. "I’m saying now publicly, you can put this on the air, if there are nonprofits or political candidates or for-profit businesses that want to get some space at bargain rents, we’ve got some space."
Portland's small donor elections program matches small donations from Portland residents in an effort to give individual contributions more weight in politics.
The program's director, Susan Mottet, said Wednesday that the ordered penalty is meant to deter future violations.
"When you violate the prohibition on large contributions and accept a contribution of $33,000, that goes against the point of the program to ensure our democracy is strong and healthy and accountable to the people," Mottet said.
As Gonzalez prepares to file an appeal of the penalty, Schnitzer said he would adjust the rent to meet any agreement between the sides.
"If there’s a need for some modification that helps them work out the issue with the group, that’s fine, we’ll accommodate that, it’s only a couple more months," Schnitzer said.
Schnitzer said Gonzalez' campaign only used part of the full office space and worked with the understanding that if someone showed interest in leasing the property, they'd move out.