Trammell Crow Co. and Diamond Realty Investments have completed Mid I-5, the largest speculative industrial facility ever built in the Pacific Northwest region. Project partners were civil engineer Gibbs & Olson, general contractor Sierra Construction and HPA Architecture. Construction began in August 2023.

The 1,185,327-square-foot building and soon-to-be LEED-certified property is at 2700 Talley Way in Kelso, Wash. The location is adjacent to Interstate 5 and the busy Exit 36, 2 miles north of the Washington-Oregon state line and less than 50 miles from Portland, Ore.

READ ALSO: Industrial Sector Settles After Supply Surge

The single-story, cross-dock facility has 8,000 amps of electrical service, 40-foot clear heights, 650 feet of building depth, 348 trailer parking stalls, 427 auto parking stalls and 219 dock doors.

There’s enough connected land to accommodate 475 additional trailer stalls, a yard area or 225,000 square feet of additional building space. Cara Nolan of CBRE Portland and Andrew Stark of CBRE Seattle handle the marketing and leasing efforts at the property.

“Portland has seen industrial development migrate further north and south along I-5 as developable property has become increasingly hard to find or problematic to develop,” Tyler Sheils, SIOR, senior managing director – Logistics and Industrial at JLL, told Commercial Property Executive.

He added the region has also seen an increase in tenant requirements or owner/user build-to-suits of more than 500,000 square feet over the last 10 or so years.

Low supply for large industrial spaces

In 2024, the wider Portland metro area saw three occupiers commit to spaces of more than 500,000 square feet.

“The Mid I-5 Industrial Park is the only project that could accommodate a 500,000-square-foot tenant in a modern Class A facility that is currently available,” Sheils said. “There is one additional project under construction that will deliver in 2025. Users of this size will have very few options to consider.”

Despite Portland experiencing negative absorption in 2024, direct rents continued to climb largely due to new construction, according to JLL research. They increased modestly in the third quarter to reach $0.87 per square foot on the shell, marking a 3.6 percent year-over-year increase.

After the market saw new sublease space increase by 80 basis points over the past two quarters, JLL reported that sublease availabilities have slowed substantially, adding a marginal 16,000 square feet in Q4.

The post Trammell Crow JV Delivers Northwest’s Largest Industrial Facility appeared first on Commercial Property Executive.

Alterra IOS has acquired three industrial outdoor storage sites totaling 23 usable acres in metro Portland, Ore. With this acquisition, the company’s regional footprint comprises six such assets, while its national portfolio features more than 280 sites spread across 30 states as of September.

The current sale included properties in Milwaukie, Ore., Portland and Hubbard, Ore.

The facility at 6433 SE Lake Road in Milwaukie is a 20,965-square-foot warehouse that includes a driver’s lounge on an 11-acre site. The property is fully occupied by a regional building materials suppliers and allows easy access to Oregon routes 224 and 99, while being 15 miles from Portland International Airport.

The second asset at 4000 NE Columbia Blvd. in Portland features a 9,189-square-foot warehouse and paved parking area on 4.4 usable acres. A large equipment rental company has occupied the property for the past two decades. The asset allows easy access throughout the Portland metro area via interstates 5 and 205.

The third property is at 17804 Shank Road NE in Hubbard and features a 31,000-square-foot industrial building on nearly 8 usable acres, leased to multiple tenants. The asset is close to Oregon State Routes 99E and 551N.

Capacity Commercial Group provided assistance on the first acquisition, while Collier’s Vice President Tom Knecht was in charge of the second deal and Macadam Forbes’ Broker Zach Reichle facilitated the third one.

Steady demand in the IOS sector

The traditionally niche IOS market is continuing to evolve, characterized by a continued growth in demand from institutional investors, according to a June report from American Realty Advisors. The rise of e-commerce sales, that accounted for 15.9 percent of all sales by the end of the first quarter of 2024, is one factor that fuels the demand for more IOS space.

Alterra IOS’s recent acquisitions include the purchase of a seven-property portfolio with assets in Dallas, Minneapolis, Indianapolis, Chicago, Nashville, Tenn., Cleveland and St. Louis metro areas. The portfolio comprises 23 acres and is fully leased.

In September, the company picked up four properties in the Greater Houston area, in a deal brokered by Lee & Associates and Partners Real Estate. The assets totaled 17 acres.

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Blackstone Real Estate Partners X has entered an agreement with Retail Opportunity Investments Corp. to acquire all of its outstanding common shares and debt for $4 billion. The deal is set to be an all-cash transaction and represents a 34 percent premium to ROIC’s closing share price in July of this year.

ROIC’s portfolio is made up of 93 grocery-anchored retail properties. They are located in Los Angeles, San Francisco, Seattle and Portland and total 10.5 million square feet.

In prepared remarks, Jacob Werner, co-head of Americas acquisitions at Blackstone Real Estate, said that the deal reflects the company’s bullish outlook on necessity-based, grocery-anchored retail. Specifically, the company is optimistic on demand for these types of assets in densely populated areas where there are very low levels of new supply.

READ ALSO: Will CRE Market Conditions Improve?

Pending customary closing conditions, including the approval of Blackstone common stockholders, the deal is set to close in the first quarter of next year. ROIC’s Board of Directors has already approved the transaction.

ROIC’s financial advisor was J.P. Morgan and its legal counsel was Clifford Chance US LLP. BofA Securities, Morgan Stanley & Co. LLC, Newmark and Eastdil Secured were Blackstone’s financial advisors while Simpson Thacher & Bartlett LLP was the company’s legal counsel.

The deal is the latest in a series of major Blackstone real estate acquisitions this year. In April, the firm signed a $10 billion deal to acquire Apartment Income REIT. The portfolio comprised 76 multifamily communities primarily in coastal markets.

Also, Blackstone-owned QTS expanded its presence recently with plans for a 3 million-square-foot data center campus in Phoenix. It is set to include 16 buildings of 180,000 square feet each.  

The post Blackstone to Acquire Retail Opportunity Investments Corp. for $4B appeared first on Commercial Property Executive.

EQT Exeter has acquired a 312,604-square-foot, three-building infill industrial portfolio in Seattle and Portland, Ore., for $49.9 million. Prologis sold the assets, public records show, with the assistance of CBRE.

Northwest Corporate Park Building 11 is the largest asset in the portfolio. Prologis had acquired the 207,082-square-foot distribution center in Portland for $26.5 million in 2018, CommercialEdge data shows.

The distribution center features 54 dock-high and 13 rail doors, four grade ramps and 27,971 square feet of office space, as well as an optional 7,300 square feet of showroom and 25,000 square feet of cooler space.

READ ALSO: Infill Logistics Demand to Last

Carrying the address 3601-3621 NW Yeon Ave., the last-mile facility is about 4 miles northwest of downtown Portland, while Portland International Airport operates some 14 miles northeast.

EQT also purchased two buildings in Greater Seattle, dubbed Kent 36 and 39. The former is a 63,500-square-foot distribution center and the latter a 42,022-square-foot shallow-bay industrial property.

Located at 7620 S. 192nd St. and 8041 S. 228th St. in Kent, Wash., the duo is roughly 3 miles from one another. The Seattle-Tacoma International Airport is less than 8 miles away and downtown Seattle is about 20 miles northwest.

CBRE Vice Chairman Brett Hartzell and Senior Vice President Cara Nolan, together with Executive Vice Presidents Paige Morgan, Andrew Stark and Stuart Skaug, represented Prologis.

EQT Exeter’s industrial expansion

Last July, EQT Exeter closed its Industrial Value Fund VI at $4.9 billion, exceeding its target of $4.0 billion. The investment vehicle recently financed the acquisition of about 5.1 million square feet throughout metro Minneapolis-St. Paul. Prologis was the seller in that deal as well and the industrial portfolio commanded more than $285 million.

Later that year, EQT launched EQT Exeter Real Estate Income Trust Inc. The REIT targets mainly investments in industrial and life science properties, with only 20 percent of its funds to be allocated for multifamily or self-storage assets.

Earlier this month, EQT Exeter REIT paid some $82 million for an Amazon-leased property also located in metro Seattle. Dermody Properties sold the last-mile asset.

Investors all in on Western industrial markets

As of August, Western industrial markets claimed eight of the top 10 national spots for per-square-foot prices, a CommercialEdge report shows. The Bay Area topped the charts with assets trading for $483 per square foot. Both Seattle and Portland made the list with $207 and $173 per square foot, respectively, ahead of the national average of $132 per square foot.

In terms of industrial transaction volume, Seattle and Portland witnessed $679 million and $252 million year-to-date through August, respectively, the same source shows. Once again, the Bay Area occupied the first position, with more than $2.7 billion in sales.

Should market conditions hold, the total industrial deal volume in 2024 is expected to overshadow last year’s, according to CommercialEdge. Moreover, 18 of the 120 markets already surpassed their 2023 volume in August. Denver—also a Western market—was one of them, with $818 million in industrial transactions during the first eight months of the year, as opposed to 2023’s total figure of $523 million.

The post EQT Exeter Pays $50M for Western Industrial Portfolio appeared first on Commercial Property Executive.

The joint venture of Bain Capital and Evergreen Medical Properties has purchased a 60,000-square-foot medical office building in Lake Oswego, Ore. Shorenstein sold the asset for $14 million, and the buyer took out a $2 million acquisition loan from Columbia Community Credit Union, public records show.

The Lake Oswego submarket is facing an under-supply issue from a health-care facility perspective, hence the decision to invest in this asset, said Evergreen Medical Properties President Josh Richmond in prepared remarks. Demand for medical office buildings continues to be on the rise across markets nationwide.

The property was previously subject to a loan received in 2023 from Bank of America, which had a maturity date set for 2026. The asset last changed hands in 2007, as part of a $1.1 billion portfolio transaction in which Shorenstein purchased 46 properties from EQ Office, incorporating 3,882,036 square feet of office space in the Portland market, according to CommercialEdge.

A renovated facility near downtown Portland

Part of the Kruse Woods Corporate Park, the three-story building came online in 1996 and went through cosmetic renovations in 2003 and 2022. The facility features two passenger elevators, a conference room, has access to a fitness center and provides 204 car parking spaces.

Providence Health is the anchor tenant. The property was 73 percent leased at the time of the transaction. Medical services provided at the facility include primary and pediatric care, behavioral health, diabetes education and gynecology, among others.

Located at 4004 Kruse Way Place on 3.3 acres, the property has access to Interstate 5 and is some 10 miles southeast of downtown Portland. Medical providers in the surrounding area include Peak Medical Northwest, Providence ExpressCare and Bauer Medical.

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The deal means Panattoni’s bet on the Vancouver submarket of metro Portland, Ore., a project started about two years ago as the market for industrial properties seemed limitless, has paid off.

The single-building property, on more than 38 acres at 5920 NE 162nd Ave., was completed last year by Panattoni, which tasked Colliers’ Portland office with leasing the property, after that company had brokered the original land acquisition and participated in the development process. Colliers’ team includes Vice Chairman Jerry Matson, Senior Vice President Brian Yoakum and Vice President Tom Knecht.

The deal is the largest spec industrial lease-up in metro Portland history, according to the brokerage.

In fact, Colliers states, the structure is the largest spec industrial building ever built in metro Portland.

Burnt Creek Logistics Center includes a 40-foot clear height, 128 docks, and four grade-level doors, making it suited for large-scale logistics operations.

READ ALSO: Why Light Industrial Properties Will Continue to Shine

The transaction underscores the future of Southwest Washington state as a logistics hub, Matson commented in a statement, with large industrial spaces still in demand. The only other recent industrial deal in the entire Portland market that comes close to Burnt Creek is Wymore Transfer’s lease of 516,000 square feet at the Wilsonville Distribution Center in the I-5 South submarket in the second quarter.

Metro Portland industrial cools

The Burnt Creek Logistics Center promises to impact the Greater Portland market’s industrial leasing numbers in the third quarter, but for now the leasing trend is one of negative absorption, which has gone on for four consecutive quarters—a year of tenants returning space to the market—according to Colliers data.

In the second quarter of 2024, negative absorption marketwise was 993,000 square feet in metro Portland, Colliers reported. So far this year, 1.5 million square feet have returned to the market, pushing vacancies up to 5.6 percent, which was the average rate between 2010 and 2019.

There is also a considerable amount of space still in the works, with 3.3 million square feet under construction during the second quarter of 2024—actually a little more than the 3.2 million square feet underway a year earlier, according to Colliers. Of the 1.1 million square feet delivered so far in 2024, two-thirds of it (66 percent) has been delivered vacant.  

The post Panattoni Signs Landmark Lease in Metro Portland appeared first on Commercial Property Executive.

An entity associated with Menashe Properties has acquired Montgomery Park, a 768,443-square-foot office building in Portland, Ore. Natixis sold the asset for $33 million, Multnomah County records show, in a deal arranged by Newmark.

Unico Properties and Partners Group had purchased the property for $255 million in 2019. Two years later, the owners envisioned a 2 million-square-foot adaptive reuse development including office, retail and multifamily spaces for the 17-acre site where Montgomery Park rises.

However, the owners defaulted on debt totaling $149.7 million in September 2023 and a foreclosure auction was held this February. With no outside bidder participating in the auction, Natixis—the asset’s lender at the time—took over the office campus via its $37.7 million credit bid filled in advance.

READ ALSO: It’s Time for Investors to Get Off the Sidelines

The nine-story Montgomery Park features 79,657-square-foot floorplates, 2,293 grade-level parking spaces, as well as a gym and 16,900 square feet of retail space. Current tenants include Daimler Trucks North America and Konica Minolta Business Solutions, according to CommercialEdge information.

Due to its energy-efficient operations and design—such as a solar array installed in 2017—and water-use reduction, as well as enhanced indoor environmental quality, the building achieved Energy Star and LEED Gold certifications.

Located at 2701 NW Vaughn St., the property is less than 1 mile from U.S. Route 30 and roughly 3 miles northwest of downtown Portland. Several transit stops, restaurants and a 5,200-acre park are within walking distance.

Newmark Vice Chairman Nick Kucha and Senior Managing Director James Childress, together with Directors Kellen Kollmorgen and Jakob Nicholls, represented Natixis.

From a warehouse to Portland’s third-largest office building

The asset initially debuted in 1921 as a warehouse for Montgomery Ward & Co., serving as a distribution center for the retail company. An effort to repurpose the building to office use took place in 1989. The property also includes a historic warehouse and a 3-acre development site.

Following its office reposition, Montgomery Park became metro Portland’s third-largest office building, outshined by the Wells Fargo Center and U.S. Bancorp Tower, according to the Portland Business Journal. Unico Properties and UBS own the latter.

Portland’s office market marches on

Metro Portland’s office vacancy rate stood at 17.1 percent in June, 100 basis points lower than the national average of 18.1 percent, a recent CommercialEdge report reveals. As Rose City’s office-using job count slid by nearly 4 percent year-over-year as of May, its office vacancy rate inched upward by 130 basis points year-over-year as of June, the report goes on to show.

The metro’s asking rental rates also dipped, decreasing by 4 percent year-over-year. Meanwhile, investors traded $40 million in office assets throughout Portland year-to-date through June, averaging $182 per square foot—slightly above the national average of $172 during the same interval—the report shows.

The post Menashe Buys 3rd Largest Office Building in Portland appeared first on Commercial Property Executive.

BKM Capital Partners has paid $62.7 million for Columbia Commerce Park, a 10-building, 375,429-square-foot light industrial campus in Portland, Ore. Clarion Partners was the seller, having owned the property since 2005, according to CommercialEdge information.

Following the acquisition, the firm plans to invest approximately $3 million in upgrades to parking lots, landscaping, roofs, interior finishes, HVAC systems and signage.

According to BKM, the improvements are meant to rectify a 21 percent shortfall in occupancy and to bring most the Class B campus’ rents up to market rate. Additionally, the company intends to re-tenant some of the existing units. The property was 93 percent leased at the time of sale to a diverse mix of tenants.

READ ALSO: I.CON East Special Report: Industrial Opportunity Snapshot

Completed in 1998, the property houses 30 shallow- and mid-bay units that range from 1,882 to 49,525 square feet, each having up to 22-foot clear heights. The campus totals 68 dock-high and 26 grade-level loading doors. As part of the renovations, BKM plans to partition a 30,000-square-foot unit into two 15,000-square-foot shallow-bay spaces.

Located at 5743 NE Columbia Blvd., the campus is adjacent to U.S. Route 30, which feeds into intersections with interstates 5, 84 and 205. Downtown Portland is 5 miles southwest, while the city’s international airport is 3 miles away, across the Columbia River.

BKM’s been keeping busy

Columbia Commerce Park is BKM’s fourth industrial acquisition this year, and its second in Portland. In February, the firm partnered with BMA Capital Corp. for the purchase of Airport Way Corporate Park, a three-building, 140,693-square-foot industrial campus also slated for capital improvements. BKM’s local portfolio currently totals 1.5 million square feet across seven properties.

Earlier this year, the Newport Beach, Calif.-based buyer acquired industrial spaces in San Diego, San Jose, Denver and Fort Lauderdale, Fla. The firm has absorbed more than 2.4 million square feet of space in the Western and Southeastern U.S. since the beginning of 2024.

BKM has also been busy on the disposition side. Just last week, the firm sold Broadwood Business Centre, a 165,154-square-foot light industrial property in Mesa, Ariz. The property sold for nearly $33 million.

The post BKM Pays $63M for Portland Industrial Park appeared first on Commercial Property Executive.

A Class A warehouse and distribution facility in Portland, Ore., sold for $32.5 million. The 212,000-square-foot asset, Cutter Circle FedEx facility, is fully occupied by FedEx.

Gantry secured a $16.3 million acquisition loan on behalf of the new owner. The property’s seller is a family office. The long-term, fixed-rate loan is half-term interest only, followed by a 30-year amortization period. It was secured through one of Gantry’s correspondent life company lenders.

The buyer of the Cutter Circle FedEx facility is HCA Management, according to CommercialEdge data. The lender is State Farm.

READ ALSO: Higher for Longer: Accepting Reality of CRE

Redeveloped in 2015, the industrial building is a cross-docked facility. It features 126 doors on an approximately 22-acre lot, the same data shows.

Located at 6447 N. Cutter Circle, the asset is situated in the Swan Island industrial submarket. Tenants are in proximity to the Port of Portland, Interstate 5, Union Pacific Railroad and the Portland International Airport. Downtown Portland is within approximately 6 miles from the property.

Camille Renshaw, Scott Scurich and William Brooks with B+E procured the buyer and represented the seller in the transaction. Gantry San Francisco’s Tony Kaufmann, principal, and Joe Foley, associate, represented the borrower in the deal.

Gantry makes lending moves

Gantry, the largest independent commercial mortgage banking firm in the U.S., has had a busy year thus far with lending. In the first quarter, the privately held firm provided a $10.5 million bridge loan for a mixed-use redevelopment project in San Jose, Calf. The San Francisco production office represented the borrower in the deal.

Gantry’s Kaufmann and Foley also led the team that secured the refinancing of a pair of adjacent industrial campuses in Tempe, Ariz., earlier this year. The eight-year loans amounted to $30 million.

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In one swift move, Northmarq will be expanding into the investment management and advisory sectors.

Northmarq will merge with investment management company Morrison Street Capital. Upon closing, the Oregon-based firm will be renamed Northmarq Fund Management.

“We recognize that Morrison Street Capital would be the ideal partner for us to grow Northmarq Fund Management,” Northmarq chief financial officer Shawn Power told Commercial Property Executive. “The capital in our new fund will help bridge gaps to allow our clients to close deals in this challenging market.”

As part of the same transaction, Northmarq is acquiring NBS Real Estate Consulting, a boutique business affiliate of Morrison Street Capital. The company will continue to provide real estate advisory services as Northmarq Advisory Services.

“This is an exciting opportunity for our combined companies to expand and enhance the services we offer to our investors and clients,” the Power said.

The Morrison Street Fund series, made up of three closed-end funds and one open-end investment vehicle, will continue to run under the same management post-merger. The Morrison Street Capital team will remain in Lake Oswego, Ore.

The companies involved, up close

Founded in 2002, Morrison Street Capital has $740 million of fund capital invested in more than 300 properties. Morrison Street Fund targets various property types including retail, office, industrial and multifamily.

Commercial real estate capital markets giant Northmarq has a transaction volume of more than $37 billion annually. The company also has a loan servicing portfolio of nearly $77 billion.

Outside of mergers and acquisitions, Northmarq has already had a busy year. It recently arranged a $40 million acquisition loan for a 621,000-square-foot Houston industrial portfolio. And earlier in 2024, Northmarq also arranged the $13 million acquisition loan of an industrial campus in Cleveland.

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A joint venture between BKM Capital Partners and BMA Capital Corp. has acquired Airport Way Corporate Park, a three-building, 140,693-square-foot industrial campus in Portland, Ore., for $24.5 million. The property will be rebranded as PDX Distribution Center.

Stockbridge Capital Group sold the asset, according to CommercialEdge data. CBRE worked on behalf of the seller, while the buyer was represented in-house.

Stockbridge acquired the facility in 2018 for $22.5 million, the same source shows.

BKM plans to implement a $1.3 million capital improvements program over the next eight months. The owner is targeting speculative tenant improvements and upgrades to roofs, parking lots and HVAC systems. A vacant office unit will be converted into a warehouse.

A total of 15 tenants occupied 97 percent of the property at the time of sale, according to DJC Oregon. The buildings, completed between 1992 and 2008, feature 16 units ranging from 3,666 to 32,533 square feet, 19 dock-high loading doors, 22 drive-in doors and up to 26-foot clear heights. About 36 percent of the space is office.

The tenant roster includes Vestas and Cardinal Health, which occupy a third of the campus. The park is at 12021 NE Airport Way, next to Portland International Airport and 3 miles from the Port of Portland. Downtown Portland is within 11 miles.

BKM’s Portland industrial inventory

BKM Capital Partners’ industrial portfolio now encompasses 11 properties in the Portland metro, totaling nearly 950,000 square feet, according to CommercialEdge information.

Last year, the company acquired a five-building industrial park in Beaverton in an off-market transaction. The 451,062-square-foot asset traded for $67 million and was fully leased at the time of sale.

The post BKM Capital JV Buys Portland Industrial Campus appeared first on Commercial Property Executive.

Killian Pacific, a Portland development company that had owned a portion of the land since 2006, is likely to be the buyer, The Columbian reported.

Newmark arranged the sale of the leased fee interest in the land, with Vice Chairman Nick Kucha, Executive Vice Chairman Steven Golubchik and Associate Directors Kellen Kollmorgen, Jakob Nicholls and Grant Gooding, and Colliers’ Vice Chairman Jerry Matson and Senior Vice President Brian Yoakum working on behalf of the seller.

Columbia Business Center encompasses more than 220 acres of waterfront property. Built in the 1940s, the park includes light industrial, flex and heavy industrial space with 2 million square feet of outdoor storage, extensive multi-carrier broadband/telecommunication infrastructure and more than 1,800 parking spaces. It also has 27 buildings that weren’t part of the sale. The space is leased to more than 100 tenants.

The heavy industrial area has access to a rail spur directly connected to the Burlington Northern Santa Fe mainline, as well as two barge slips which can accommodate river and ocean-going vessels up to 400 feet.

A location accessible by water, land and rail

Located along the Columbia River, the property is accessible by water, land and rail. It sits along Interstate 5, which allows easy access across the greater Portland and Vancouver markets.

Columbia Business Center accounts for approximately $2 billion in annual revenue and provides more than 3,300 jobs county-wide, according to Killian. The property is considered to be one of the largest privately-owned industrial parks on the West Coast.

Portland’s industrial pipeline remained healthy, with more than 2.8 million square feet underway as of the fourth quarter of last year, according to a recent JLL report. Current economic headwinds are already resulting in a decline of new construction starts, with speculative development taking a pause, according to experts interviewed by Commercial Property Executive.

The post Newmark, Colliers Broker Record $96M Land Sale appeared first on Commercial Property Executive.

Aerial view of 217 Distribution Center. Image courtesy of BKM Capital Partners

BKM Capital Partners has acquired a five-building, 451,062-square-foot industrial park in Beaverton, Ore., in an off-market transaction. Kansas City Life Insurance Co. sold the asset for $67 million, according to the Daily Journal of Commerce Oregon.

Completed in the 1970s, the light industrial campus features 68 dual-dock-high and 12 grade-level loading capabilities, up to 24-foot-clear heights and access to 14 railway dock doors. Less than 9 percent of its total size consists of office space.

At the time of the sale, 217 Distribution Center was fully leased to primarily credit tenants such as Nike, Blue Ocean Logistics, Rexel and the Beaverton Police Department. BKM is set to invest $4 million in capital improvements at the campus; upgrades will target landscaping, signage, roofing, HVAC systems and parking lots.

READ ALSO: EV Boom Reshapes US Industrial Landscape

Located at 1095–11065 SW 11th St., the property is in proximity to Highway 217, providing distribution access to Portland and the larger Oregon and northwestern territories. Downtown Portland is less than 9 miles from the property while Portland International Airport is approximately 20 miles away.

The campus is also less than 1 mile from a recently upgraded 121,426-square-foot industrial property that BKM sold to STAG Industrial in August. The asset changed hands for nearly $21 million.

BKM continues to expand

Brett Turner, senior managing director of acquisitions and dispositions at BKM, said in prepared remarks that the industrial park, located in a target market, was purchased at an almost 50 percent discount to replacement cost.

Throughout the year, BKM has purchased 14 properties totaling 2.2 million square feet. Those recent acquisitions brought the company’s portfolio to a six-state footprint.

In one of the firm’s largest investment deals of 2023, BKM partnered with an affiliate of Investcorp for the purchase of a 740,000-square-foot light industrial portfolio in Las Vegas. Terry York Properties sold the assets for some $158 million.

After several months, BKM formed a partnership with StepStone Real Estate for a GP-led secondary direct transaction. The deal included ownership in Pacific Business Center, a 748,000-square-foot industrial park in Henderson, Nev.

The post BKM Capital Pays $67M for Portland-Area Industrial Center appeared first on Commercial Property Executive.

The new Gensco facility will feature concrete tilt walls with a steel roof structure. Image courtesy of Scannell Properties

Scannell Properties has broken ground on a 479,000-square-foot distribution and manufacturing facility at the Scannell Logistics Park in Salem, Ore. Completion is slated for Spring 2025. Developed on behalf of Gensco Inc., the building will mark the second built-to-suit project at the location.

Mackezie designed the asset, while Perlo Construction serves as general contractor. The single-story 399,000-square-foot building will incorporate 306,000 square feet of storage and distribution, 93,000 square feet of manufacturing, 6,400 square feet of office space on the north and south ends and 68,000 square feet of storage.

Gensco’s facility will rise at 4710 Mill Creek Drive S.E. Scannell estimates that the development will generate roughly 450 jobs and additional economic impact in the region. The facility is near Interstate 5, which provides direct access to downtown Portland.

In March, a few months after completing Airport Distribution Center in West Columbia, S.C., Scannell sold the 247,000-square-foot industrial property. Cooperative Electric Energy Utility Supply Inc. purchased it, with the total investment in estimated at around $52 million.

A few months later, Scannell signed a 234,000-square-foot lease with NVH Korea at Gardner Logistics Park in Locust Grove, Ga.

The post Scannell Properties Breaks Ground on 479 KSF Oregon Project appeared first on Commercial Property Executive.

A Portland landmark, Lloyd Center will be transformed into a mixed-use complex. Image courtesy of ZGF and Field Operations

The redevelopment of Lloyd Center, a 1.2 million-square-foot mall in Portland, Ore., moves forward. The owners, Urban Renaissance Group and KKR Real Estate Finance Trust, have revealed the conceptual master plan that will transform the retail asset into a mixed-use property.

According to KGW8, plans for the reimagined property—estimated to cost around $1 billion—could include the demolition of parts of the mall, followed by the development of as many as 5,000 residential units, a restaurant and other entertainment venues and experiential retail, alongside a commercial office campus, in a years-long process.

READ ALSO: Real Estate Market Sentiment Improves

The redevelopment also calls for connecting the city’s street grid with improved transportation networks for cars, bikes and pedestrians, as well as maintaining the mall’s ice-skating rink. Located at 2201 Lloyd Center, the property is across Holladay Park and less than 2 miles from downtown Portland.

URG and KREF have owned Lloyd Center since December 2021. In October that year, KREF announced it will foreclose on the outstanding balance of a $117 million loan it provided to EB Arrow for the mall in 2015, a loan that had been in non-accrual status since October 2020. A transfer of ownership followed.

EB Arrow had purchased the asset in 2013 for $148 million, according to CommercialEdge data. OPB reported that in the following years, several tenant anchors closed their stores, including Sears, Nordstrom and Macy’s.

Over the past two years, however, the property’s roster has expanded with 32 new leases and 90 percent of the existing tenants have renewed their commitments, bringing the total to 120 tenants. Trackers Earth and Joe Brown’s Carmel Corn are among the businesses taking space at the mall. The developers are planning to keep the mall open during the renovation process.

Revitalizing a Portland landmark

Lloyd Center first opened in 1960 and later in 1990 was remodeled and covered. URG and KREF now have submitted an application for a DAR meeting with the City’s Design Commission which will then be followed by a formal Central City master Plan land use application.

The development team includes ZGF, serving as lead master planner, together with architectural and urban design firm Field Operations. DOWL (civil engineering), KPFF (structural engineering), DKS Associates (transportation engineering) and Radler White Parks & Alexander LLP (land use counsel) are also on board.

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This will be the largest speculative industrial facility in the Pacific Northwest region. Image courtesy of Trammell Crow Co.

Trammell Crow Co., together with joint venture partner Diamond Realty Investments, has started construction on a 1.2 million-square-foot industrial project in Kelso, Wash. The development is slated to become the largest speculative industrial property in the Pacific Northwest region, with delivery scheduled for late 2024. Sumitomo Mitsui Trust Bank provided $86.1 million in construction financing, Cowlitz County public records show.

The development team also includes HPA Architecture as architect and Sierra Construction as general contractor. CBRE has been appointed as exclusive leasing agent for the property.

READ ALSO: Manufacturing Thrives Amid Construction Surges

Plans call for a single-story facility that will include 40-foot clear heights, 219 dock door positions, 351 trailer parking spots and 514 vehicle parking spots. An adjacent site will allow for a possible building expansion, an additional yard or more parking spots. The project was designed to accommodate a wide range of users, TCC Principal Kirk Olsen noted in prepared remarks. CBRE Senior Vice President Cara Noland and Executive Vice President Andrew Stark are the appointed leasing brokers.

The property is taking shape on 82 acres at 2700 Talley Way, close to U.S. Highway 432 and Interstate 5. The industrial building will be 36 miles from Vancouver, Wash., and 45 miles from Portland, Ore.

More in the pipeline

TCC currently has $13.4 billion worth of projects in various stages of construction in its pipeline. In March, the company, together with partner Washington Capital Management, completed the second phase of a 1.5 million-square-foot Inland Empire project.

That same month, the developer wrapped up 104th Commerce Park‘s first phase, delivering 571,000 square feet of industrial space in metro Denver. The 89.6-acre campus will encompass 1.2 million square feet at full build-out.

The post Trammell Crow JV Starts Northwest’s Biggest Spec Project appeared first on Commercial Property Executive.

Recent renovations were completed at Beaverton Industrial Center. Image courtesy of Cushman & Wakefield

STAG Industrial has purchased Beaverton Industrial Center, a recently upgraded 121,426-square-foot industrial campus in Beaverton, Ore., for $20.6 million. Cushman & Wakefield negotiated on behalf of the seller, BKM Capital Partners. The property previously changed hands in 2021 for $15.4 million, according to CommercialEdge.

BKM Capital made several purchases in 2023. One major deal involved a 740,000-square-foot light industrial portfolio that the firm acquired for nearly $158 million in partnership with Investcorp.

A recently renovated industrial campus near Portland

The two-building industrial complex came online in 1966 at 5805 and 5807 SW 107th Ave. and underwent extensive renovations in 2021. The property features 28-foot clear heights, ESFR sprinkler systems, 23 dock-high doors, three grade-level doors and ample parking, the same source shows. The facilities were fully leased at the time of sale.

Beaverton Industrial Center occupies 6 acres off U.S. Highway 217, close to Interstate 5. The location is 7 miles from Portland, Ore., 19 miles from Portland International Airport and 20 miles from The Port of Portland.

Cushman & Wakefield Executive Vice Chairmen Jeff Chiate and Jeffrey Cole, Vice Chairman Bryce Aberg and Rick Ellison, Director Mike Adey, Senior Associate Zach Harman and Associate Brad Brandenburg represented BKM Capital Partners. The company’s Executive Managing Director Aaron Watt and Executive Director Keegan Clay also assisted with local market expertise.

In terms of industrial rent growth, the West scored significant increases as of June, maintaining its position as the priciest market, a recent CommercialEdge report shows. With the national rate up 7.4 percent year-over-year, Portland made it in top 10 markets by year-over-year change in average rents, with a 7.7 percent gain.

The post STAG Industrial Picks Up Portland Industrial Center appeared first on Commercial Property Executive.

Flexential’s campus in Douglasville, Ga. Photo courtesy of Flexential

Flexential has broken ground on new developments in Portland, Ore., and Atlanta. The company plans to expand its FlexAnywhere service platform, adding data centers totaling 110 megawatts in the two markets. The firm expects to bring a total of 40.5 megawatts online this year.

Flexential has two projects underway in the Atlanta metro, both at the company’s Douglasville, Ga., campus. Douglasville-1, which broke ground in the fourth quarter of last year and will add 22.5 megawatts across 205,000 square feet of raised floor space, will come online later this year.

Earlier this year, the company started work on Douglasville-2, which will be constructed in several phases and add 36 megawatts across 240,000 square feet of raised floor space.

Atlanta has long been the gateway for all network traffic traversing the Southeast, making data centers a strong sector within the metro. “As an economic- and business-friendly metro, it has a large talent pool and high density of universities, attracting businesses of all sizes,” Flexential Senior Vice President of Platform Product Management Sherri Harrell told Commercial Property Executive.

“Geographically, the metro remains a strong location for mission-critical enterprise workloads in the Southeast that desire less volatile weather, as opposed to Florida, for example, which is prone to weather disruptions,” said Harrell. Atlanta is also an alternative to North Virginia, which also has some power constraints.

Flexential is also building two data centers in the Portland metro, both in Hillsboro, Ore. The company broke ground on Hillsboro-4 last year, announcing plans to construct its fifth facility on its campus there—together, Hillsboro-4 and a newer facility, Hillsboro-5, will bring a total of 54 megawatts online.

The 18-megawatt Hillsboro-4 data center is nearing completion and will be available for clients in the fall of this year. Shell construction started on Hillsboro-5 early this year. That project will deliver an additional 36 megawatts across 240,000 square feet of raised floor space.

Both data centers are on Flexential’s campus in Hillsboro and will leverage the market’s rich network connectivity. “Strong demand in the market has been driven by a combination of tax advantages for businesses, along with dense networking options,” Harrell told CPE. Hillsboro is the main Network Access Point of the Northwest, home to two subsea cable landing stations, further granting access to the Asia-Pacific region.

A new generation of data center design

All four new facilities will be constructed to Flexential’s latest standards of sustainable design. The data centers will operate at a power usage efficiency of 1.4 and will have zero water usage efficiency, requirements that need to be met to qualify for the company’s Green Finance Framework, for which it obtained a $2.1 billion securitization in 2021.

Flexential also plans to take advantage of the growth of artificial intelligence tools. “Our fifth-generation design is optimized to support the rapidly growing power and density requirements of AI and GPU-driven high performance compute deployments,” said Harrell.

The post Flexential Adds 110 MW With New Data Centers appeared first on Commercial Property Executive.

PAE Living Building. Image by Lara Swimmer via ZGF Architects

Mass timber is a contemporary alluring muse, inspiring innovation across industries. Its natural beauty, strength and versatility make architects and designers dream passionately about its warmth and sophistication, capturing their imagination. Builders then take these fantasies and turn them into palpable structures and finishing materials.

Sustainable and regenerative design has long been at the core of ZGF Architects‘ work. Today, Associate Principal Jacob Dunn is involved in the design of the 1 million-square-foot expansion of the Portland International Airport, which includes a 380,000-square-foot curved mass timber roof. The architect also contributed to the design of the PAE Living Building, the first in Portland, Ore., to meet the strict requirements of the Living Building Challenge. Additionally, together with specialists at the University of Washington’s Applied Research Consortium, Dunn, in collaboration with ZGF, created a wood lifecycle calculator, an open-source tool that helps designers evaluate how their choices affect a project’s sustainability profile.

Why is sustainably sourced timber so important for the future of the construction industry? Dunn replies to this question and many more in the interview below.

When did you begin working with mass timber and what do you like most about it? 

Jacob Dunn, Associate Principal, ZGF Architects. Image courtesy of ZGF Architects

Dunn: My first mass timber project was also the first project I worked on when starting at ZGF—the PDX New Main Terminal. I started on the plan during the beginning of schematic design back in 2018, being tasked with making the wood roof ‘the most sustainable version of mass timber’ possible. This led me down the journey of discovering what this could actually mean, and engaging in this question continues to be what I like most about working with mass timber.

‘The most sustainable version of mass timber’ could mean so many things, from ecological sourcing to social equity, to economic development, to resilient ecosystems, to climate-smart forestry—the list keeps growing the more I go down this rabbit hole. Not to mention the scale of this project, its civic importance, and the amount of people it could impact—35 million per year, once the terminal reopens—gives the project a gravity and importance that make it incredibly meaningful to the region.

Have you finalized installing the prefabricated roof at the PDX Airport project? Can you share details about the project’s timeline and sustainability features?

Dunn: We started moving the 18 prefabricated wood roof ‘cassettes’ back on Aug. 25, 2022. Each cassette takes three days to move and secure, and the 14th cassette was moved into place back in January 2023, which represents the last of phase one. The remaining four cassettes will be installed in 2024 for the phase two opening.

Sustainability features are multiple and quite diverse. We reduced the energy in the new building by 57 percent, so we basically doubled the size of the project while still reducing the overall energy consumption. Moreover, an open loop ground source heat pump helped cut energy use while electrifying the heating of the project. This allows PDX to ride the greening of the utility grid to meet deep operational carbon reductions all the way to their 2030 goal of 45 percent under 1990 levels.

The project is targeting a 30 percent reduction in the embodied carbon of new materials by using mass timber, optimized concrete mixes, and low-energy production of local steel. If the reuse of the existing structure is factored in, we’d achieve roughly 69 percent savings over the construction of a new airport.

READ ALSO: Advocating for Widespread Adoption of Mass Timber in Construction

A million board feet—this is the amount of wood that can be directly traced back by Oregon and Washington small family foresters, tribal sources, non-profits and universities. About 95 percent of the 2.6 million board feet in the wood roof’s beams and lattice was sourced from sustainably managed forests through Forest Stewardship Council certification or direct sourcing from regional exemplary forestry.

The new terminal design prioritized biophilia as a way of reducing passenger stress and improving the experience of its workers—more than 69 trees will be planted inside the new space to provide direct experiences of nature throughout the journey.

All these made the project target LEED Gold certification.

Let’s move on to the PAE Living Building project. What makes it unique? What do you like most about it?

Dunn: What makes the PAE Living project unique is that it is a collaboration of all the most stringent requirements in the industry. The Living Building Challenge is the most rigorous third-party sustainability standard imaginable, as it requires a project to be net positive energy, waste and water, which must be proven after a year of measured data.

Furthermore, the project is located in a historic district, which limited both design and efficiency. It is a developer-driven project delivered at market rate, so we couldn’t use outrageous budgets to solve these challenges. It will be the largest commercial living building in the country once it achieves certification this summer. Most importantly, the occupants of the building love their space and feel connected to its design, story and mission.

Tell us about the wood lifecycle calculator you have created in partnership with the University of Washington’s Applied Research Consortium. In what way does it help the users?

Dunn: Using wood in lieu of more carbon-intensive materials like steel or concrete can save embodied carbon in three ways. First, it takes less energy and carbon to harvest trees and uses saws to cut them down into building products, versus cement production or using an electric arc furnace to melt recycled steel into new shapes.

Second, trees sequester carbon dioxide out of the atmosphere during their own growth phase, and some of that carbon gets transferred into the built environment as “biogenic carbon storage” in building products. If we steward this carbon long enough as durable, reusable, or recyclable wood products, it stays out of the landfill or incinerator by the time the forest regenerates, and thus we can claim it as a carbon benefit. Finally, if we source from climate-smart forestry that increases the carbon on the landscape while producing wood products, that represents a third potential benefit of using wood products.

READ ALSO: DC Project Raises Timber to New Heights

The last two ways that wood saves carbon are tricky to model, as they rely on many assumptions, making a big impact on the final number. Most software tools make it hard to understand exactly what kinds of end-of-life scenarios you are modeling and often do not allow you to change this input. Additionally, forest carbon was left out of the equation entirely because current standards don’t provide methodologies to connect forests to wood products.

Thus, we worked with the University of Washington to make the UpStream Forest Carbon & LCA Tool to give users the ability to model a variety of end-of-life scenarios with different datasets. It also allows users to define forest carbon impacts using research from sources like Ecotrust. The goal of the tool is to be able to give designers an understanding of the variability of wood and the range of carbon possibilities that might transpire due to our decisions around designing for disassembly and wood sourcing procurement choices.

As the usage of mass timber increases, can the supply of sustainably sourced timber become a challenge?

Dunn: Like most things in the natural world, health can be closely related to one thing: diversity. For forest health, this means diversity in species, diversity of geometric structure—both horizontally across the landscape and vertically up the canopy—age diversity, and the list goes on. This structural complexity versus uniformity unlocks the forest’s ability to provide ecosystem services, such as cleaning water, purifying air, providing habitat, and being resilient against natural disturbances like drought or wildfire.

Sustainably sourced timber comes from forests that try to balance the inefficiencies of more ecologically focused forestry with the productivity of more intensive forest management. This can go as far as sourcing from forest restoration on one side of the spectrum, to sourcing from slightly better clear-cuts on the other side. Slightly better clear-cuts can be smaller than legal minimum requirements, have an older average rotation age than the norm, or leave more trees behind as ecological legacies that help stabilize soils and naturally regenerate the landscape. In most cases, this results in less efficient production, so meeting future supply needs can come from one of two approaches.

First, we can increase the average rotation age of some forest types, which both increases the amount of wood produced per acre, and the ecological function of that forest. Although transitioning to longer rotations can be financially difficult for some landowner types and needs coordinated policy support and incentives.

Second, we can scale up forest restoration efforts by creating robust mass timber markets that focus on utilizing restoration outputs. This helps support the financial case to actively manage forests that need health treatments that would simultaneously increase building product outputs at the same time.

What is the cost difference between mass timber buildings and conventional ones? Could mass timber become cheaper than concrete and steel in the future?

Dunn: It’s rare and may be a product of the variable escalation during the pandemic, but we’re finding that there are some instances where mass timber can be cost-neutral with steel and concrete. With the right building code classification, the number of stories, building size, and program, we’ve seen some projects come in at low to no cost premiums over baseline steel structural comparisons.

Other than that, we’ve seen that the premiums over direct construction costs can range up to 20 percent, depending on the situation and also on the level of mass timber experience of your contractor/estimator.  Cost neutrality is more of a possibility for contractors that can take into account the schedule benefits of mass timber, reduced site work, smaller foundations, and simplification or elimination of finishes due to exposure of structural elements.

Is it hard to find and train employees to work with mass timber? Are special skills required?

Dunn: It’s not hard to find employees who want to work with mass timber as it is becoming very popular, and architects have loved to design and build with this material for a long time. Some special skills are required, as with any new structural system—i.e. mass timber glulams, CLT, etc. 

For instance, the way we think about structure is fundamentally different. Grid sizing must be rethought to respect both mass timber’s structural and product efficiencies. Connection to design is both an art and science, which can impact designing for disassembly at the end of the building’s lifespan.

Finally, and perhaps most critically, navigating the building and fire codes can make or break a project. Perhaps skills are the wrong way to think about it, rather, a new way of thinking about structure, skin, and tectonics is required.

Mass timber has gained popularity fast, but is it popular enough? What barriers are still in the path of greater adoption?

Dunn: It depends on what ‘popular enough’ is referring to. In the world of sustainability and helping to mitigate climate change, as mass timber ascends, we can really mess things up in one of two ways. 

First, we can adopt mass timber too fast without thoughtfully considering the kinds of forestry we’re supporting and their impact on the environment. Second, we don’t adopt it fast enough.

We know there are carbon benefits to using mass timber, even if some of them can’t be precisely modeled at the moment. Thus, if we want to fulfill the promise of mass timber as a climate solution, we need to accelerate both the transition to more mass timber buildings and toward more sustainable sourcing practices.

The post Inside the Mass Timber Playbook appeared first on Commercial Property Executive.

Image by Sven Mieke via Unsplash.com

A joint venture of PCCP and Panattoni Development Co. plans to develop two Class A infill industrial parks totaling 625,320 square feet in Vancouver, Wash. The project includes Vancouver Logistics II and Hidden Glen Logistics.

The venture acquired the land for the development of Vancouver Logistics II for $10.1 million, with Zions Bancorporation providing a $30.9 million construction loan, Clark County records show. According to the same source, Hidden Glen Logistics is subject to a $27.2 million construction loan originated by HTLF Bank and the land purchase was financed with $10.8 million.

Vancouver Logistics II will include two buildings, of 163,676 and 175,044 square feet, and will feature 32-foot clear heights. According to Clark County Today, Panattoni previously completed Vancouver Logistics I in September 2022. The 170,089-square-foot building was leased to Thermal Supply Co. a month later.

Upon completion, Hidden Glen Logistics will total 286,600 square feet across 16.6 acres and will feature an approximately 1-acre trailer yard.

The two properties will be located at 7600 Northeast 88th St. and 6920 NE Saint Johns Road, 2 miles from each other. The development sites are situated in the Portland, Ore., market, roughly 16 miles from downtown, with access to interstates 5 and 205. The Port of Vancouver, Wash., and Portland International Airport are approximately 14 miles from the locations.

This project represents the latest partnership between PCCP and Panattoni. The two companies previously teamed up in the beginning of 2022 to develop Tyger Ridge Logistics Center, a 1.5 million-square-foot logistics park in Duncan, S.C. The industrial park is scheduled for delivery in the second quarter of 2023.

Portland’s industrial development potential

PCCP Senior Vice President Matt Cochran mentioned in prepared remarks that the characteristics of the Portland market, such as a limited supply pipeline and low vacancy rates, which in turn can lead to significant rent growth and tenant demand, are turning the area into an advantageous market for industrial development.

As of February, Portland had a vacancy rate of 4.3 percent, higher than the national rate of 3.9 percent, according to the latest CommercialEdge report. The market’s development pipeline had 1.6 million square feet under construction, representing 0.8 percent of stock.

The post PCCP JV Brings Industrial Project to Portland appeared first on Commercial Property Executive.

The Streets of Tanasbourne. Image courtesy of Newmark

Balboa Retail Partners has acquired The Streets of Tanasbourne, a 371,791-square-foot outdoor shopping mall in Hillsboro, Ore. Public records show that the buyer paid $53.5 million for the asset.

CommercialEdge identified DWS Group as the seller of the 93 percent leased property. Newmark brokered the transaction.

Located at 19350 NW Emma Way, within the Silicon Forest tech cluster, the mall serves a population of 101,000 residents. Occupying a 17.7-acre site and featuring a free-standing, four-level structured parking garage, The Streets of Tanasbourne is anchored by Macy’s, H&M, REI and Sephora.

The shopping mall features a range of national and regional retailers, offering a variety of dining, shopping and service options. Downtown Hillsboro is some 7 miles from the property.

Newmark Vice Chairmen Nicholas Bicardo and Nick Kucha, along with Associate Director Cheyne Bloch facilitated the sale of The Streets of Tanasbourne.

Newmark reported that, among all property sectors, retail was the sole sector to exhibit a rise in U.S. investment sales on a yearly basis. By the end of 2022, investment sales in all property sectors saw a decrease of 15 percent year-over-year, while retail sales grew by 4 percent to reach $85.7 billion, marking the highest yearly total since 2018.

In a prepared statement, Bicardo said that The Streets of Tanasbourne provides the buyer with a favorable combination of consistent income and significant potential for growth in both the anchors and inline suites.

The post Balboa Acquires $54M Portland-Area Mall appeared first on Commercial Property Executive.

5 MLK

Newmark has been appointed to lease more than 115,000 square feet of office space at 5 MLK, a mixed-use property in Portland, Ore. Executive Vice President & Managing Director Dave Squire, Director Travis Parrott, and Associate Director Michael Goetz will be marketing the space on behalf of owner The Green Cities Co.

Located at 5 SE Martin Luther King Jr. Blvd., the 17-story, 720,106-square-foot property encompasses four floors of Class A office space available for lease, 220 rental units spread across 11 floors, and 15,000 square feet of retail space. The building’s amenities package includes a business center, a fitness center, lockers and a yoga studio, a lounge, a conference room, a swimming pool, as well as indoor and outdoor common areas. Additionally, the mixed-use asset also features 180 parking spots and electric vehicle charging stations, according to CommercialEdge data.

Situated on a 1.4-acre lot in Portland’s Central Eastside neighborhood, 5 MLK is across Willamette River and the historic Burnside Bridge, roughly 2 miles from downtown Portland and within 10 miles of Portland International Airport.

Designed with health and wellness in mind

Built in 2021, GREC Architects designed 5 MLK with a focus on biophilic elements and sustainable features, supporting its occupants’ health and wellness needs. The LEED Gold certified property is the first mixed-use building in the country to achieve Fitwel certification.

In a prepared statement, Parrott mentioned that 5 MLK will likely benefit from the ongoing flight-to-quality trend among office users.

The post Newmark Tapped to Lease Office Space at Portland Mixed-Use Asset appeared first on Commercial Property Executive.

9280 SE Sunnybrook Blvd. Image courtesy of Anchor Health Properties

Anchor Health Properties has acquired a 19,916-square-foot medical office building in Clackamas, Ore., through its Chestnut Healthcare Fund II, a discretionary equity investment vehicle co-managed with Chestnut Funds. Synovus Bank provided debt financing for the asset that was sold by Providence Health.

Completed in 2009, the property is part of a two-building campus totaling 55,000 square feet, each facility being individually managed, according to CommercialEdge data.

The fully leased building is anchored by Clackamas Radiation Oncology Center, a joint venture between Providence Health and The Oregon Clinic division of Radiation Oncology. The health-care provider features a linear particle accelerator used for precision treatment of cancerous tumors. The tenant roster also includes the Cancer Institute & Breast Surgery Clinic and Mt. Scott ENT & Sleep Medicine.

READ ALSO: Medical Office Sector Resists Adversity

Located at 9280 SE Sunnybrook Blvd., the property is 11 miles from downtown Portland, Ore., having access to Interstate 205. Other medical facilities in the surrounding area include Providence Milwaukie Hospital, Providence Willamette Falls Medical Center and Kaiser Permanente Sunnyside Medical Center.

Newmark Executive Managing Director Garth Hogan, together with Colliers Executive Vice President Mark Schuessler, represented the seller. Vice President of Investment Elliott Sellers and Investment Associate Robert Rumer led the acquisition process for Anchor Health Properties.

Expanding portfolio through fund acquisitions

Through its Chestnut Healthcare Fund II, Anchor Health has made several medical office acquisitions in the past few months, especially in October. The firm purchased a 96,357-square-foot building partially repurposed for medical office use in metro Atlanta and a 47,350-square-foot asset in Braintree, Mass.

Also in October, the company expanded its Miami footprint with the purchase of a 31,886-square-foot facility in Delray Beach, Fla. The property is 6 miles from Boca Raton, Fla., just east of South Military Trail.

The post Anchor Health Expands Portfolio With Portland Buy appeared first on Commercial Property Executive.

Law firm Jordan Ramis has signed a full-floor lease at Lincoln Property Co.’s PacWest Center in downtown Portland, Ore. With move-in planned by the end of the year, the tenant will relocate its headquarters to the entire 27th floor of the 30-story Class A office tower.

Cushman & Wakefield Managing Directors Lana Baldock and Dan Swift represented the landlord in the lease signing, while JLL Managing Directors Andrew Rosengarten and Chris Elsenbach worked on behalf of the tenant.

The top two floors of the 522,161-square-foot office tower are still available for lease, a first in the last two decades, as noted by Swift in a prepared statement. Baldock added that PacWest Center offers a workplace setting to meet the post-pandemic “flight to quality” trend.

The law firm will move its headquarters from Lake Oswego, Ore., where it has been operating since 1993. Jordan Ramis will complement the existing tenant roster at the property, which includes AlphaMedia, KeyBank, Perkins & Co., The Commerce Bank of Oregon and Starbucks, among many others.

Focus on tenant experience

According to CommercialEdge, the owner picked up the asset in 2016 for $170 million. The same source reveals that the LEED Silver-certified building was completed in 1984 and underwent cosmetic renovations in 2002, 2011 and 2019, the last upgrade being under Lincoln Property Co.’s ownership, aimed at enhancing tenant experience.

On-site amenities include conference and meeting centers, as well as a tenant lounge incorporating an outdoor terrace. A fitness center, steam rooms, shower and locker facilities, along with an indoor bicycle hub are also among the amenities at the location. Additionally, the same data provider shows that the property also comprises 16,000 square feet of retail space.

Located at 1211 SW 5th Ave. roughly 10 miles from the Portland International Airport, the transit-oriented office tower offers access to 11 metro stations. The downtown location also provides connectivity to an array of retail, dining and entertainment offerings.

According to a recent CommercialEdge report, office vacancy rates pursue an upward trajectory at a national level. As of November, Portland had a 15.6 percent vacancy, slightly lower than the national average, which hit 16.2 percent that month.

The post Lincoln Property Inks Full-Floor Lease in Portland appeared first on Commercial Property Executive.

Cedar Hills Crossing. Image courtesy of Gantry

C.E. John Co. has obtained a $61 million in permanent financing for Cedar Hills Crossing, a 477,000-square-foot retail center located at 3205 SW Cedar Hills Blvd. in Beaverton, Ore. Working on behalf of the borrower, Gantry Inc. secured the 10-year, fixed-rate loan that also includes a 12-month forward rate lock.

The Gantry team that negotiated the deal included Principal Blake Hering and Associate Heather Kegler. Putting the financing transaction in context, Hering told Commercial Property Executive that “Cedar Hills Crossing is a double grocery-anchored neighborhood shopping center that serves as a destination location for Beaverton. This center has historically outperformed the broader retail market.”

In another recent transaction, Gantry arranged $267 million for the financing of U.S. Department of Veterans Affairs-operated medical facilities in Florida, New Jersey, California and Virginia.

A retail landmark in a thriving market

Completed in 1969, Cedar Hills Crossing comprises 10 buildings across 38.6 acres, according to CommercialEdge data, and has undergone extensive renovations during the past 5 years. Since 2017, the owner has also added some 190,000 square feet of retail, restaurant and medical use space to the existing construction. The center is anchored by a diverse array of retailers such as Best Buy, Office Depot, New Seasons and Winco.

Located 8 miles west of downtown Portland, the property sits along a major retail corridor, attracting some 30,000 daily visits. In addition, the center is roughly 1 mile from Tektronix and Nike’s World Headquarters.

Overall, Portland’s retail market has posted strong, stable growth, even as many companies encounter deep complexities in their investment and development endeavors due to higher interest rates and seemingly less lucrative loan offers.

As of the third quarter of 2022, Portland had 461,333 square feet of retail space in its pipeline, 15.4 percent higher year-over-year, with 134,929 square feet being absorbed by new leases, according to a Kidder Mathews report. Furthermore, the metro’s vacancy rate has fallen to 3.6 percent, witnessing a 10 percent improvement over the year as both new space comes online and demand tightens.

The post Gantry Secures $61M for Portland Retail Center appeared first on Commercial Property Executive.

Image by panumas nikhomkhai via Pexels.com

Denver-based STACK Infrastructure has acquired additional land in the Portland, Ore., area to nearly double the size of its flagship campus in Hillsboro, Ore., one of the nation’s fastest growing data center markets, to 50 acres and 200MW.

The expansion will bring the total available and in-development capacity for STACK in Hillsboro to more than 230MW. The contiguous campus expansion solidifies STACK’s commitment to offering maximum scalability in this high-demand location that is quickly becoming a core Pacific Northwest hyperscale market.

Located in Hillsboro adjacent to PGE’s Shute Substation, the campus features direct access to extensive fiber, benefits from Hillsboro’s Enterprise Zone and its property tax abatement policies and sustainable power practices with 100 percent renewable energy delivered across STACK facilities.

READ ALSO: The Metaverse and Why CRE Should Care

Brian Cox, CEO of STACK Americas, said in a prepared statement that STACK, one of the first data center developers to locate in Hillsboro, is dedicated to continually addressing the demand for available capacity in the rapidly expanding region.

STACK Infrastructure delivered a 24MW, 180,000-square-foot facility in Hillsboro in January. Known as POR03, it was the first building at STACK’s flagship 84MW campus in the Portland area and added to STACK’s footprint in Hillsboro that was already at more than 50MW capacity. STACK also owns POR01, a 12MW facility, and POR02, which offers 24MW, in the area.

Growing markets

CBRE’s North American Data Center Trends H2 2021 report noted that cloud service providers and social media companies were responsible for most of the leasing activity last year, particularly in Hillsboro, Northern Virginia, Atlanta, Phoenix, Chicago and Dallas. The report stated Hillsboro posted the highest absorption total in the second half of 2021 with 6.6MW among secondary markets.

The market grew rapidly in 2021 and saw a large amount of preleasing—199.0 MW—heading into 2022. CBRE said Hillsboro has a large construction pipeline but most of the future supply—85 percent of the 234.8MW—has already been preleased.

STACK is also growing in markets around the globe in 2022. In addition to delivering the 24MW Hillsboro facility in January, STACK announced its entrance into three new markets in Australia, multiple expansions into the EMEA market with data centers in the Nordics, Italy and Switzerland and a 36MW Inzai, Japan, campus.

In the U.S., STACK announced in January it was adding an 84MW campus in Northern Virginia, bringing its current and under-development capacity to more than 600MW in the region. Citing increased client demand, STACK said it planned to add three new buildings on an 80-acre campus in Sterling, Va., where the provider would bring more than 1 million square feet of space in three new buildings to the market. NVAL2 will have a potential capacity of 216MW upon full build-out.

STACK is also building a 125-acre hyperscale campus in Manassas, Va., in partnership with Peterson Cos. that will have more than 4 million square feet of space and deliver more than 250MW of critical load for large users.

The post STACK to Expand Portland-Area Data Center Campus appeared first on Commercial Property Executive.

224 Logistics Park. Image courtesy of H.I.G. Realty

A joint venture between Specht Development Inc. and funds managed by Ares Management LP has landed financing for 224 Logistics Park, an industrial warehouse complex in Milwaukie, Ore. H.I.G. Realty Partners provided the joint venture with an $80.5 million loan for the 1 million-square-foot Portland-area asset.

224 Logistics Park occupies a 62-acre site at 6433 S.E. Lake Road, less than 10 miles outside of Portland’s central business district.

Originally developed in 1953, the property last changed ownership in 2018, when Specht and Ares acquired it in a short-term sale-leaseback transaction with a grocery wholesaler for $48.5 million.

The joint venture wasted little time transforming the asset once it was vacated by the tenant, investing in renovations from new roofing to structural upgrades to site improvements. The modernization of the property was one of the factors that attracted H.I.G. to the financing opportunity.

READ ALSO: What Lies Ahead for CRE Investment

The sponsor had already created tremendous value in a short period of time, Michael Mestel, managing director with H.I.G. Realty Partners, said in a prepared statement.

As a result of the joint venture’s efforts, 224 Logistics Park now features best-in-class warehouse, distribution and cold storage space, as well as a separate 117,000-square-foot freezer space, a 48,000-square-foot headquarters office, a 1,800-square-foot free-standing office structure and a 24,000-square-foot truck maintenance shop.

The multi-structure complex presently holds the distinction of being the largest existing available industrial asset in metropolitan Portland. Tenants include Heritage Specialty Foods, which inked a lease for approximately 132,400 square feet in October 2021, with plans to take occupancy in January 2022.

Spreading the wealth

H.I.G. Realty was impartial in its distribution of loans in the commercial real estate sector in 2021, handing out financing to worthy borrowers and assets in a variety of sectors for a variety of purposes.

Notable transactions include a loan to Harrison Street to finance the lease-up of 114 Pacifica, a 110,000-square-foot medical office building in Irvine, Calif., that is presently undergoing renovations. The firm also originated a loan on behalf of a joint venture between entities owned by J. Small Investments and others for the redevelopment of the 23-acre Pegasus Park in Dallas, former home of Exxon Mobil, into a biotech and social impact office campus.

While H.I.G. Realty did not disclose the financial details of the 114 Pacifica and Pegasus Park transactions, the firm did reveal that in June 2021, it had provided a $185 million loan to a joint venture between entities owned by Blackstone and Worth Real Estate Group to finance the lease-up of fashion retailer Forever 21’s former Los Angeles headquarters at 3880 N. Mission, a 1.5 million-square-foot industrial and office property located downtown.

The post H.I.G. Provides $81M Loan for Portland-Area Industrial Asset appeared first on Commercial Property Executive.

The Meadows Road properties in Lake Oswego, Ore. Image courtesy of CBRE

Seattle-based Unico Properties LLC has acquired 5800 and 6000 Meadows Road, a two-building Class A office property totaling about 203,000 square feet in Lake Oswego, Ore., from Shorenstein. The buildings are within the Kruse Woods Corporate Park that San Francisco-based real estate investment firm Shorenstein acquired in March 2007.

CBRE’s Pacific Northwest Capital Markets team led by Charles Safley, Paige Morgan and Tom Pehl, represented the seller in the transaction. Nick Santangelo of CBRE’s debt and structured finance team arranged the acquisition loan for the buyer, a subsidiary of Unico Investment Group LLC. The sale price and the loan amount were not disclosed.

READ ALSO: Top Gateway Markets for Office Vacancy

The two buildings were originally constructed in 1999. Located in the Kruse Way submarket, about 8 miles southwest of Portland, Ore., the properties are close to I-5 and OR 217, connecting Lake Oswego to the rest of the Portland region.

Kruse Way is known as the premier suburban office market of Portland, with rental prices second only to Portland’s CBD. The properties are 21 miles from the Portland International Airport and are both within several miles of the Tigard Transit Center Commuter Rail and Tualatin Commuter Rail, both part of the Westside Express Service.

The two multi-tenant buildings share a courtyard and were more than 90 percent occupied at the time of the sale. The five-story 6000 Meadows Road totals 112,250 square feet and features a conference center and shower facilities. The building has about 440 surface parking spaces and some covered parking. The four-story building at 5800 Meadows Road has nearly 89,000 square feet of space. The asset has a Starbucks on the ground floor and about 440 surface parking spaces as well as some covered parking.

Safley said in a prepared statement that the stability of the asset, strong surrounding demographics and improving market fundamentals fueled significant interest in the property. The opportunity to buy in the best-performing office submarket in the region, Santangelo added, was well-received by the lending community, and CBRE was able to secure competitive financing for Unico.

Earlier deals

Unico, a private equity real estate investment firm, currently owns and operates about 18 million square feet of office, mixed-use and multifamily properties across the U.S. Earlier this year, Unico completed Bouldin Creek, a 165,000-square-foot, five-story office building in South Austin, Texas, with co-developers Manifold Real Estate and OakPoint Real Estate.

In January, Unico and Partners Group topped out on a 211,066-square-foot office and life science development in downtown Seattle that is slated to be completed this summer.

READ ALSO: Can CRE Investment Rebound in H2?

Last fall, Shorenstein disposed of another Oregon office property. The real estate investment firm sold Nimbus Corporate Center, a 691,036-square-foot office campus in Beaverton, Ore., to a joint venture between Prescott Partners and a DRA Advisors-controlled firm for $130 million. The Beaverton property was also acquired by Shorenstein in 2007 as part of a $1.1 billion portfolio transaction. Shorenstein had purchased the extensive Oregon portfolio from Blackstone Group, which had acquired the Oregon holdings as part of the record-setting $39 billion acquisition of Sam Zell’s Equity Office Properties Trust in early 2007. EOP was the nation’s largest publicly held office building owner and manager at the time with 513 properties across 100 million square feet of space. Blackstone began selling off many of the properties immediately including more than 4 million square feet of office space in the Portland region.

In December 2019, CBRE’s Safley and Morgan along with Trevor Kafoury represented Shorenstein in the sale of another Oregon office asset. Clarity Real Estate acquired River Forum, a two-building office campus in Portland, from Shorenstein for $57.5 million.

The post Unico Properties Buys Portland-Area Office Buildings appeared first on Commercial Property Executive.

Gresham Station Medical Plaza

Gresham Station Medical Plaza, a four-building, 100,419-square-foot medical office campus in Gresham, Ore., has changed hands. Public records show a joint venture between Kayne Anderson Real Estate Advisors and Remedy Medical Properties paid $30.9 million for the Class B asset, or $308 per square foot.

According to CommercialEdge data, the previous owner was Stockdale Capital Partners, which had acquired the value-add property in 2017 for $23.5 million. CBRE U.S. Healthcare & Life Sciences assisted the seller in the current deal.

Situated on nearly 5 acres at 1867 NW Civic Drive, Gresham Station Medical Plaza consists of one-, two- and three-story buildings completed in 2004. According to CBRE, the property was 79 percent leased at the time of the sale to a mix of health-care providers offering a wide range of specialties, including cardiology, nephrology, physical therapy, imaging and dentistry.

A tenant at the property since its opening, Adventist Health Portland anchors the facility, recently signing a 10-year, 35,361-square-foot lease through March 2030. Other occupants include Providence Health & Services and DaVita.

The medical campus is 14 miles east of downtown Portland in a Qualified Opportunity Zone. Legacy Mount Hood Medical Center is less than 3 miles northeast.

CBRE’s Chris Bodnar, Lee Asher, Ryan Lindsley, Jordan Selbiger, Sabrina Solomiany and Zack Holderman worked together with Brian Norton representing Stockdale. Apart from Norton, the same team was also instrumental in the sale of a 69,169-square-foot medical asset in Everett, Wash., last summer.

Slow to no deal velocity

Portland’s medical office market was quiet in the first quarter, with no major deals closing, CommercialEdge data shows. In the fourth quarter of 2020, only two major transactions occurred in the sector, according to a Cushman & Wakefield report.

In one of those deals, Anchor Health Properties entered the Portland market with the $15.4 million purchase of Mt. Scott Professional Center, a 38,858-square-foot medical office building in Happy Valley, Ore. That transaction closed as part of a wider acquisition round involving a 27,000-square-foot Newnan, Ga., asset and a 93,000-square-foot medical building in New Jersey.

The post Kayne Anderson JV Buys Portland-Area MOB Campus appeared first on Commercial Property Executive.

Bybee Lake Logistic Center I & II. Image courtesy of CBRE

PCCP LLC, of Los Angeles, has acquired a 729,610-square-foot, two-building industrial complex in Portland, Ore. CBRE represented the seller, Seattle-based investment firm Washington Capital, on behalf of its clients, in the $82.5 million transaction.

READ ALSO: Industrial Real Estate 2021 Expectations

Bybee Lake Logistic Center I & II consists of two adjacent Class A industrial buildings at 7820–7832 N. Leadbetter Road and 14601–14621 N. Bybee Lake Court.

The 37.7-acre project is subject to a long-term ground lease from the Port of Portland and is fully leased to six tenants: Iron Mountain, CJ Logistics, OIA Global Logistics, Independent Dispatch, Bridgetown Enterprises, as well as Mergenthaler Transfer and Storage.

The Bybee Lake Logistic Center I & II buildings were developed in 2006 and are less than a mile from the Port of Portland in the city’s Rivergate Industrial District.

Bybee Lake Logistic Center I & II. Image courtesy of CBRE

The property provides immediate access to major highways and freeways, including I-5, SR-120, SR-14 and SR-30. The site is roughly 10 miles from Portland International Airport.

The CBRE team representing the seller included Brett Hartzell, Paige Morgan, Darla Longo, Barbara Perrier, Rebecca Perlmutter, Joe Cesta and Eric Cox.

In addition, CBRE’s Val Achtemeier arranged a $55.8 million floating-rate loan with MetLife on behalf of the buyer.

PCCP could not be reached for comment on the transaction.

Tight submarket

The Portland industrial real estate market is seeing unprecedented appreciation due to a lack of available land for development, accelerating rent growth and an overall attractiveness as a destination, Morgan said in a prepared statement.

Of Portland’s total 191.4-million-square-foot industrial portfolio, about 15.7 million square feet of space is in the Rivergate submarket. There, total net year-to-date absorption was 124,000 square feet, leaving a vacancy rate of 3.0 percent, according to a fourth-quarter report from JLL. Only about 41,000 square feet of warehouse/distribution space is currently under construction in the submarket.

Despite the difficult headwinds over the past year or so for the commercial real estate sector and the overall economy, PCCP has been active as a purchaser (of an office portfolio in Orlando), a seller (of a 475,800-square-foot industrial building in Pennsylvania’s Lehigh Valley), a lender (for the acquisition of a logistics center in the Bay Area) and an advisor (on a nearly $1 billion loan package for a 7 million-square-foot nationwide office, industrial and multifamily portfolio).

The post PCCP Pays $83M for Portland Industrial Asset appeared first on Commercial Property Executive.

Historic Bank Block. Image courtesy of CBRE

An entity owned by funds managed by real estate investment firm Westport Capital Partners has refinanced the Historic Bank Block, a three-building, 212,705-square-foot creative office property in downtown Portland, Ore., with a $51 million loan.

READ ALSO: 3 Tips for Reimagining the Physical Workplace

Mark McGovern and Brian Cruz of CBRE’s debt and structured finance team in San Diego, arranged the refinancing on behalf of the owner. Further information on the loan and the lender was not disclosed.

Located at 303-317 SW 6th Ave., the property comprises three buildings and spans an entire city block in the heart of the tech hub in Portland’s CBD. Westport Capital Partners purchased the property in 2018, according to CBRE. In February 2019, the sale was 5th on Commercial Property Executive’s list of the top 10 Portland office transactions for 2018. CPE reported the property had changed hands for $53.9 million in the first quarter of 2018, after four years of ownership by ScanlanKemperBard Cos. The property is listed on the National Register of Historic Places and includes the Wells Fargo Building, which was completed in 1907 and is considered the city’s first skyscraper. The US Bank building was completed in 1917 and expanded in 1925. The third building, the US Motor Bank, was constructed in 1956 and includes a three-level parking garage and two floors of office space. The property is managed by Interurban Real Estate.

The asset was renovated in 1999 and 2015, before the new Westport ownership spent more than $20 million to upgrade the property to Class A creative office space. The property is within one half-mile from both I-5 and I-405 for easy commuter access. Amenities include a fitness center, a locker room with showers, bike storage and bike workshop area, event space and a fifth-floor game room.

McGovern said in a prepared statement the property is a unique office project with distinctive office suites that are not found elsewhere in the city. He said that despite the challenges in 2020, Westport strategically managed the asset and finished the capital improvement program that will allow it to compete effectively during the recovery. 

Westport deals

Westport, which has offices in Los Angeles and Stamford, Conn., has a variety of funds that attract domestic and international investors and target distressed, opportunistic and core-plus real estate assets. In August, a joint venture of Westport and Cannae Partners sold Sycamore Technology Park, a three-building office/R&D campus in Milpitas, Calif., to Vertical Ventures for $45.5 million. The partnership had owned the property since 2016. In July, Westport was part of a joint venture led by Redrock Developments and Wharton Industrial that sold Florida Crossroads Logistics Center, a 617,000-square-foot industrial facility in Ocala, Fla., to Lexington Realty Trust in a deal valued at $58.4 million.

The post Portland’s Historic Bank Block Obtains $51M Refi appeared first on Commercial Property Executive.

Image by geralt via Pixabay.com

Digital Fortress, a Seattle-based colocation services provider, has expanded its national footprint to 10 data center facilities with the acquisition of the colocation business of Atmosera Inc. and its three Oregon assets. The amount of the deal was not released.

READ ALSO: Portland’s Internet Exchange Building Trades for $326M

The acquisition allows Digital Fortress to expand its colocation, network and cloud services for large and mid-sized enterprises. It also strengthens the company’s stronghold in the Pacific Northwest and solidifies its position as one of the largest privately held U.S. providers by revenue. The acquisition adds three data center facilities located in Beaverton, Ore., and downtown Portland, with more than 100 colocation customers. The downtown Portland facility is adjacent to the Pittock Building, which has the second-largest density of fiber networks and carriers in the Pacific Northwest. Portland is positioned as a connectivity gateway to Asia-Pacific, with direct access to seven subsea cables.

Over the past 18 months, Digital Fortress has been growing its business, including the acquisition of colocation properties in Chicago, Denver and Piscataway, N.J. Purchase of the Atmosera properties gives Digital Fortress the ability to provide colocation services to customers from facilities in Washington, Oregon, Colorado, Illinois and New Jersey. Most of the company’s assets are located in Washington, specifically in Seattle, Spokane, Lynnwood and Tukwila.

Juan Saca, Digital Fortress’ new CEO, called the Atmosera deal a transformative acquisition. He said in prepared remarks the transaction expands the company’s geographic and infrastructure footprint, adds important customers in a highly strategic locations and provides expansion opportunities in the Portland region.

Ryan Randall, CFO of Beaverton-based Atmosera, said in a prepared statement selling the three data centers and its colocation business to Digital Fortress was an intentional step to focus fully on its growing Microsoft Azure cloud-computing services strategy. Jon Thomsen, Atmosera CEO, said Digital Fortress was well positioned to maximize the opportunities the three facilities represent for businesses seeking colocation and data center services.

The post Digital Fortress Grows Pacific Northwest Colocation Portfolio appeared first on Commercial Property Executive.

Pittock Block. Image courtesy of JLL

Alco Investment Co. has finalized the $326 million disposition of the Pittock Block, a 302,262-square-foot carrier hotel in Portland’s central business district. A partnership between Harrison Street and fifteenfortyseven Critical Systems Realty acquired the historic building, which is one of only two primary internet exchanges in the Northwest.

The transaction is the highest priced single-property deal in Oregon since 2015, according to JLL. The new owner received a $163.5 million acquisition loan from JPMorgan Chase, public records show.

Located on 1 acre at 921 SW Washington St., the eight-story property was built in 1914 for the cost of $1 million, according to The Oregonian. In 1999, Alco renovated the building to better accommodate tenants with digital needs, the company’s Chief Investment Officer Doug Rosen noted in a prepared statement.

The carrier hotel hosts cloud-based and e-commerce companies and has 16 fiber-optic carriers and 179 service providers. Additionally, the property has office space and is the home of the Oregon Symphony’s administrative offices, Hennebery Eddy Architects and the City Club of Portland.

The JLL team that negotiated on behalf of the seller and sourced the buyer included Managing Director Buzz Ellis, Managing Director Conan Lee and Director Adam Taylor.

In October, Harrison Street and fifteenfortyseven Critical Systems Realty acquired the historic Wells Building, a 165,000-square-foot carrier hotel and data center in downtown Milwaukee. Ascendant Holdings sold the asset for $7.3 million.

The post Portland’s Internet Exchange Building Trades for $326M appeared first on Commercial Property Executive.

SecureSpace North East Portland. Image courtesy of InSite Property Group

InSite Property Group has finalized the acquisition of a two-property self storage portfolio encompassing 2,250 units in Portland, Ore. Leon Capital Group sold the newly built facilities for a total of $47 million, according to Multnomah County records. The purchase is the first closing of a larger portfolio deal between the two companies.

The buyer secured a $200 million line of credit from Goldman Sachs to fund the current acquisition, as well as future transactions, according to a prepared statement from InSite Property Group Partner Keith Wetzel. The mortgage is set to mature in January 2023, public records show.

Located on 2 acres at 16017 SE Division St., the three-story facility called SecureSpace Centennial spans 110,000 square feet and encompasses more than 1,000 climate-controlled units. In February 2019, Leon Capital Group funded the construction of the property with an $11.9 million loan from Comerica Bank, according to Yardi Matrix data.

The second facility occupies nearly 3.5 acres at 3737 NE Columbia Blvd. The new owner will rename the three-story building SecureSpace North East Portland. The 140,000-square-foot property is fully climate-controlled and provides more than 1,250 units. In 2018, Zions Bank originated a $28.1 million development loan for the project, the same data provider shows. The site is less than 2 miles from Portland International Airport.

In December, Insite Property Group paid $20.5 million for a 92,000-square-foot self storage facility in Spring Valley, Calif. Frontera Real Estate sold the 2019-built asset.

The post InSite Property Group Pays $47M for Portland Storage Portfolio appeared first on Commercial Property Executive.

20 Francis Way. Image courtesy of Anchor Health Properties

In separate deals, Anchor Health Properties has purchased three fully leased medical office buildings in Happy Valley, Ore., marking its entry in the metro Portland market, as well as Newnan, Ga. and Bridgewater, N.J. Anchor acquired the assets for an undisclosed price from undisclosed sellers.

READ ALSO: Welltower, Wafra Form $550M Medical Office JV

The portfolio totals 158,858 square feet of Class A medical office space. Anchor found joint venture partners for each of the acquisitions, with Capital One providing debt financing services for each transaction. Anchor will also run the property management programs for all three medical office assets.

Mt. Scott Professional Center. Image courtesy of Anchor Health Properties

Anchor made its first metro Portland investment by acquiring the Mt. Scott Professional Center. The 38,858-square-foot medical office building is located in Happy Valley, Ore., at 9200 SE. 91st Ave., nearby the Adventist Medical Center and Providence Portland Medical Center. The property is 100 percent occupied and includes anchor tenant East Portland Surgical Center, alongside The Oregon Clinic and Clearview MRI. The medical office space offers capabilities for cosmetic surgery, ENT, GI, gynecology, neurosurgery, ophthalmology, orthopedic, general pain and urology.  

In Georgia, Anchor acquired 20 Francis Way, a 27,000-square-foot medical office building that is fully leased to Piedmont Healthcare. According to Anchor, the property was built specifically for Piedmont-affiliated physicians in 2008 and offers many services including cardiology, physical therapy, physical rehabilitation, and has a state certificate for imaging services.

The Bridgewater Medical Office Building & Ambulatory Surgery Center. Image courtesy of Anchor Health Properties

Anchor’s largest asset acquired in the transaction was in Bridgewater, N.J. The company formed a joint venture with The Carlyle Group to purchase The Bridgewater Medical Office Building & Ambulatory Surgery Center. The 93,000-square-foot medical office building is also fully leased, anchored by Atlantic Health System and Hunterdon Healthcare. The property offers services including an imaging center, four operating rooms, physical and occupational therapy, gastroenterology and nutrition, and heart and vascular care.

In the market for MOBs

James Schmid, Anchor’s CIO & managing partner, said in prepared remarks that the Oregon acquisition is the type of deal that Anchor looks for, an off-market property that’s fully leased, with high-quality, long-term regional tenancy in a market that has high barriers to entry.

The company focuses exclusively on health-care facilities and has been very active in the sector this year. In November, Anchor acquired three fully leased medical office buildings totaling around 100,000 square feet in Charlotte, N.C. for roughly $50 million. Two months prior, the company also acquired a 24,000-square-foot medical office building in Watkinsville, Ga. In total, Anchor closed on approximately 769,000 square feet of health-care facilities with a combined value of more than $400 million in 2020, Schmid told Commercial Property Executive.

The post Anchor Health Properties Buys 3 MOB Assets appeared first on Commercial Property Executive.

Nimbus Corporate Center

Shorenstein Properties has sold Nimbus Corporate Center, a 691,036-square-foot office campus in Beaverton, Ore., for $130 million. The new owner, a joint venture between Prescott Partners and a DRA Advisors-controlled firm, financed the acquisition through a three-year, $100 million line of credit from RBC Capital Markets, public records show.

The property last traded in 2007 as part of a $1.1 billion portfolio transaction, according to Yardi Matrix data. The sale from EQ Office included some 3.9 million square feet in the wider Portland, Ore., market.  

Comprising 16 buildings across 47.5 acres, the property is located at 8910-9775 SW Gemini Drive and 9203-9790 SW Nimbus Ave., adjacent to the Washington Square Mall and a mile from highway 217. The asset is 10 miles from downtown Portland and 1 mile from the Hall/Nimbus WES Station. Completed between 1984 and 1991, the campus has a tenant roster hailing from diverse sectors, including technology, telecommunications, financial services, insurance and government.

JLL Managing Director Buzz Ellis, Senior Managing Director Michel Seifer, Senior Director Logan Greer, Director Adam Taylor and Associate Kaden Eichmeier worked on behalf of the seller. According to Ellis, the transaction is reflective of increasing demand for suburban office space as Millennial renters move further from urban zones.

The post Shorenstein Sells Portland Office Campus for $130M appeared first on Commercial Property Executive.

A diverse economy also calls for diverse asset types. The pipeline includes Portland’s first biotech facilities—both developed by Summit Development Group—its first luxury hotel, a massive lifestyle community, and the largest project since U.S. Bancorp Tower. More than 1.1 million square feet of office space is scheduled for completion by year-end, with the bulk expected to come online in 2022 due to a delay in construction attributed to the pandemic. The list below includes the largest office projects underway in the metro, based on Yardi Matrix data.

5. PGE Integrated Operations Center

Portland General Electric’s Integrated Operations Center is an upcoming facility taking shape at 12150 SW Tualatin Sherwood Road in Tualatin, Ore. The company broke ground on the 108,000-square-foot building in February 2020, with completion scheduled for the end of 2021. The $200 million project—designed by Dreyfuss + Blackford Architecture and SERA Architects—is expected to house between 250 and 350 PGE employees. 

4. 5 MLK

5 MLK. Rendering courtesy of GREC Architects

Gerding Edlen is currently working on 5 MLK, a 440,000-square-foot mixed-use project in Portland’s Central Eastside neighborhood. The property encompasses 120,400 square feet of office space, 15,000 square feet of first-floor retail and 11 stories of residential space. The local developer broke ground on the 17-story building in November 2017 and plans to complete it by year-end.

Bank OZK provided construction financing through a $79.4 million line of credit. The GREC Architects-designed project is situated at 5 SE Martin Luther King Jr. Blvd., at the base of the Burnside Bridge, an area popular for its vibrant nightlife, restaurants, breweries and distilleries.

3. Block 216 Tower

Block 216 Tower. Rendering courtesy of GBD Architects

BPM Real Estate Group’s Block 216 is the largest project in Portland in a decade. The asset totals a little over 1 million square feet, which encompass 180,000 square feet of office space and 7,800 square feet of ground-floor retail. Additionally, the development will include a 251-key Ritz Carlton Hotel, the city’s first luxury hotel, as well as 138 Ritz Carlton-branded condominium residences. 

Construction on the 35-story tower started in July 2019, with completion scheduled for the third quarter of 2022. Mosaic Real Estate Investors originated $460 million in construction financing. Howard S. Wright serves as the general contractor, GBD Architects designed the project’s exterior, HKS Architects worked on the interior design and Idaho-based PLACE served as the landscape architect. Located at 936 SW Washington St., the building is taking shape on the last undeveloped full block in downtown Portland.

2. NIR Center

NIR Center. Rendering courtesy of Summit Development Group

What Portland lacks, Summit Development Group delivers. The company is currently developing the only life science project in the metro, aiming to provide the much-needed space the regional biotech industry needs. The largest one is NIR Center, a 314,889-square-foot facility encompassing flexible laboratory space, creative office, a ground-floor retail component, and a  private courtyard. The 10-story timber and steel structure consists of two identical towers joined by a central core. Development started in March 2020, with completion scheduled for the second quarter of 2021.

The developer selected Hennebery Eddy Architects to design both of its lab science and research facilities. The first one, Eastside Innovation Hub, is just two blocks from the upcoming NIR Center, which is emerging at 920 SE Stark St. The facilities are situated in the heart of the Portland Innovation Quadrant, close to various science and tech communities.

1. Nike World Headquarters – Serena Williams Building

Nike World Headquarters expansion. Rendering courtesy of Skylab Architecture

Nike is expanding its campus with the addition of four new structures. The largest one is The Serena Williams Building, a 1 million-square-foot building spreading across three city blocks at 1 Bowerman Drive in Beaverton, Ore. The four-story asset will include 762,000 square feet of office and 238,000 square feet of auxiliary space and is scheduled for completion in the last quarter of 2020.

The design plans were spearheaded by ZGF Architects, SRG Partnership and Skylab Architecture, while PLACE handled the landscape architecture. Hoffman Construction is providing construction services. Additionally, the facility will feature a parking garage with 1,400 spaces inspired by the sporting heritage of New York City.

The post Top 5 Office Projects Under Construction in Portland appeared first on Commercial Property Executive.

Portland-Hillsboro 3. Image courtesy of Flexential

Flexential has announced it will kick off construction on its third data center in Hillsboro, Ore., on Oct. 1. Dubbed Portland-Hilsboro 3, the property has an estimated cost of $64 million.

Plans call for the development of a 358,000-square-foot building, which will provide 36 MW and have a power density of 1,500 watts per square foot. The new facility will occupy a 20-acre parcel at 4091 NE Constable St., roughly 1 mile west of Hillsboro 2.

The building will have a structural steel core and a primary facade of concrete tilt panels. The Tier III data center will run entirely on renewable energy and is designed for high cooling efficiency and zero water usage. The property will have access to existing and upcoming facilities in the market through metro fiber rings and will service seven transpacific subsea cables.

Flexential first unveiled plans for the data center in May. Skanska serves as the general contractor for the project, which is slated for completion in September 2021. The Mulhern Group, which also designed the company’s first two Hillsboro facilities, is the architect. The team assisting the developer will also include kW Engineering and Sturgeon Electric.

The post Flexential to Build $64M Portland-Area Data Center appeared first on Commercial Property Executive.

Tanner Point

CBRE has arranged a 22,599-square-foot lease at Tanner Point, a 183,052-square-foot office property in Portland, Ore. The firm’s Trevor Kafoury, Kevin Kaufman and Autumn Brice and DLA Piper’s Casey Sobhani negotiated on behalf of the owner, CBRE Global Investors. Colin Russell and Seth Platsman of Macadam Forbes assisted the tenant, Brainium Studios, a mobile game developer. 

Located at 1250 NW Ninth Ave. in the Pearl District, the eight-story building delivered in 2018. Last year, the owner executed a $1.3 million capital improvement plan at the LEED Silver-certified property. Amenities include conference rooms, a modern gym, changing rooms and showers and an Italian-style marketplace and dining hall. Tanner Point is 10 miles southwest of Portland International Airport and 2 miles north of the city center. The asset is across the street from a 223-key Residence Inn which changed hands in a deal late last year. 

The tenant will relocate from 1022 NW Marshall St., with plans to begin using the new space in spring 2021. The company’s headquarters will occupy an entire floor in the building. This year, two other tenants signed commitments totaling 45,000 square feet at Tanner Point, according to DLA Piper’s Sobhani.

The post CBRE Signs 23 KSF Portland Office Lease appeared first on Commercial Property Executive.

Mason Ehrman Building and Annex. Image courtesy of SKB

ScanlanKemperBard and Harbert Management Corp. have acquired a warehouse-turned-creative office building in Portland, Ore. The joint venture purchased the Mason Ehrman Building and Annex from an entity related to Gaw Capital for $25 million, SKB President Todd Gooding told Commercial Property Executive. Gooding also told CPE that SHS Advisors’ Marc Spiegelman represented both the buyer and seller.

READ ALSO: Top 10 Workplace Trends for 2020, According to JLL

The historic Portland property offers a total of 97,006 rentable square feet split between a seven-story 69,796-square-foot building and an attached two-story, 27,210-square-foot annex building. The property has attracted a variety of tenants including marketing, engineering, design and digital media firms. Gooding also told CPE that the property is currently 40 percent leased.

Located at 222 NW 5th Ave., The Mason Ehrman Building was developed in 1908 as a 30,000-square-foot warehouse. In 2017, Gaw Capital and Beam Development began an adaptive reuse project on the property, transforming the warehouse into creative office space with ground-floor retail. The renovation incorporated elements from the building’s former life by highlighting exposed concrete and heavy timber structural elements, while adding modern amenities to serve a new tenant mix. The project also completed the seismic upgrade of the Mason Ehrman Building to meet the city’s seismic design requirements.

History with historic Portland properties

Gooding told CPE that at the purchase price of roughly $245 per square foot, the joint venture was able to acquire ”essentially a brand new building” for half the cost of building a new office. The purchase of the Mason Ehrman Building adds another historic Portland property that was converted into creative offices to SKB’s portfolio. Alongside Lionstone Investments, SKB also owns the American Bank Building in Portland that recently landed a refinancing with the help of JLL Capital Markets.

As the new owner of the Mason Ehrman Building, SKB will be implementing a lease-up plan that includes incorporating market-leading lease terms and amenity enhancements. Gooding told CPE that the company plans to add a 3,000-square-foot rooftop deck and perform some light cosmetic renovations to the lobbies.

The post Gaw Capital Affiliate Sells Creative Office Asset in Portland appeared first on Commercial Property Executive.

American Bank Building. Image courtesy of JLL

Joint venture partners Lionstone Investments and ScanlanKemperBard have refinanced the American Bank Building, an approximately 170,400-square-foot creative office property in the central business district of Portland, Ore. With the assistance of JLL Capital Markets, the partners obtained an undisclosed amount of financing for the historic property through CIBC.

READ ALSO: Revisiting Risk and Return in the Face of Uncertainty

Carrying the address of 621 S.W. Morrison St., the American Bank Building has been at the center of downtown Portland since it first opened its doors in 1913. Since its debut, the 14-story property has maintained its prominence as a desirable office location via a series of upgrades, including extensive renovations in 1936, 1979 and 2012 and additional updates in 2015. Today, the property features approximately 144,500 square feet of office space, 54 percent of which is leased, as well as 24,000 square feet of fully occupied ground floor and mezzanine level retail offerings.

JLL Capital Markets’ Tom Wilson, Colby Mueck and Laura Sellingsloh represented the joint venture in the transaction with CIBC. The American Bank Building, although not currently stabilized, possesses a great many features that likely proved attractive to the lending community, including the solid sponsorship. SKB’s relationship with the American Bank Building dates to 2002, when it first purchased the property. SKB later sold the asset in 2008, before acquiring it again in 2014 in a joint venture with Chilean pension fund Independencia for $45.1 million. In 2017, SKB partnered with Lionstone on the ownership of the asset in a $53 million transaction.

Funding a new phase

SKB and Lionstone plan to utilize proceeds from the refinancing of the American Bank Building to complete tenant improvements at the office tower and invest in capital improvements, most notably the expansion of the building to approximately 176,000 square feet. SKB will also direct funds toward the property’s stabilization.

The Portland office market had a great year in 2018, a solid year in 2019 and a positive beginning to 2020 before taking an unavoidable hit, courtesy of the consequences of the COVID-19 pandemic. However, the second quarter of 2020 brought some rays of positivity, according to a JLL report, with a sizeable State of Oregon lease, as well as tech tenant activity, including Google’s expansion into 80,000 square feet in the central business district.

The post Portland’s Historic American Bank Building Lands Refi appeared first on Commercial Property Executive.

Image via Pixabay

Portland General Electric Co. will launch this fall a pilot program that will incentivize installation and connection of more than 500 residential energy storage batteries. These batteries will act as a virtual power plant, which the utility provider will be able to operate individually or combined, in accordance with the grid’s needs.

The 525 home batteries will have storage capacity ranging from 12kWh to 16kWh; combined, they will exceed 4 megawatts of energy. The partnership will prove beneficial especially during power outages when participating customers will be able to rely on the batteries as a backup power resource.

The batteries in the pilot program will be complemented by new smart-grid control devices across its distribution system that will allow a two-way exchange between PGE and the test’s participants. Specifically, these controls will actively manage how the electricity is distributed across PGE’s system to incorporate energy generated by customer’s installations, such as solar panels, while also meeting power demand, which is increasingly less predictable due to the growing interest in electric vehicles.

READ ALSO: California’s Record-Setting Virtual Power Plant

Residential customers who already have a battery or plan to get one can participate by allowing PGE to use their system for grid services. In return, they will get a monthly $40 rebate on their bills, or a $20 rebate if the battery is solar charged.

The pilot program will also be integrated Solar Within Reach, an existing solar program in partnership with Energy Trust, which gives incentives to income-qualified households to go solar, offering $5,000 rebate off the cost of home battery storage. Furthermore, those living within the PGE Smart Grid Test Bed who purchase a battery will receive an instant rebate, in addition to the monthly bill credit of $40 or $30. This is especially important as it will allow PGE to test the localized grid impact of having a larger concentration of battery storage devices available on one substation.

The post Portland Pilot Program Eyes Virtual Power Plant appeared first on Commercial Property Executive.

Image via Pixabay.com

Flexential has unveiled plans to develop its largest data center to date, a 36 MW facility in Portland, Ore. Flexential expects to break ground on the 358,000-square-foot project this summer. The development aims to meet heightened demand during a time when COVID-19 has raised challenges for data centers.

The building, branded Portland-Hillsboro 3, will be the company’s third in the city, providing a total of 700,000 square feet of space and 60 MW of combined power. Hillsboro 3 will take shape on 20 acres at 4091 NE Constable St., according to PropertyShark. The company acquired the land for $3.2 million from a private investor in 2019. The facility will have access to all network carriers within Portland as well as the Wave metro fiber system, which will provide connections to 14 existing or planned data centers and seven trans-Pacific subsea cable systems.

Additionally, the property will connect to Hillsboro 2 through 1,728 strands of fiber optic network. This month, Flexential also plans to expand Hillsboro 2 by 66,000 square feet and add 5 MW of power. Hillsboro 2 is located at 5737 NE Huffman St., just 2 miles east of the new project. Flexential’s data centers are situated in Hillsboro’s Enterprise Zone region, which features a lower threat of earthquakes, according to Flexential CEO Chris Downie, and is a no-sale tax zone.

The post Flexential to Develop 3rd Portland Data Center appeared first on Commercial Property Executive.

Ryan Parkin, Founder & Managing Partner, RevOZ Capital. Image courtesy of RevOZ

The Opportunity Zones program has gained momentum since the Internal Revenue Service clarified some key regulations last year. To shed light on this promising and often challenging initiative, CPN asked Ryan Parkin, founder & managing principal at real estate investment and development company RevOZ Capital, to share his insights.  

Parkin’s company is working on two Opportunity Zone projects, a medical center and a boutique hotel, is seeing more deal flow now that some key rules have been clarified. His advice for those who are new to Opportunity Zones: Stick to the types of projects that you know best, and evaluate each one carefully on a risk-adjusted basis, as the program is not for every investor. 

READ ALSO: Final Round of Opportunity Zone Rules Unveiled

You’ve invested in at least two projects in opportunity zones (San Bernardino Medical Center in California and SCP Redmond in Oregon). How has your experience with the program and existing legislation been so far?

Parkin: The Opportunity Zone program is an exciting policy that brings private capital into underserved communities throughout the U.S. By delivering increased capital and development into historically underprivileged areas, it enables our industry to have a hand in improving communities and creating lasting social good.

This, coupled with the unprecedented tax benefits in the form of capital gains tax deferral and exemptions, is why RevOZ Capital has chosen to focus our business on Opportunity Zone acquisitions, developments and recapitalizations. The San Bernardino Medical Center, which broke ground in January, and the recently completed SCP Hotel Redmond in Oregon, are two Opportunity Zone projects that we identified as having strong fundamentals and attractive risk profiles with compelling potential for community impact.

In December, the U.S. Treasury Department clarified a host of regulations surrounding the Opportunity Zone program, providing detailed guidelines that are likely to spur further investment in Opportunity Zone projects in 2020 and beyond. I find it exciting that a bipartisan policy is leading to actual activity, particularly given today’s divided times. 

What advice do you have for emerging developers that are thinking about building in an opportunity zone? What are the biggest challenges they could be facing?

Parkin: Nuances, nuances, nuances! The rules are complex and very technical, so it’s critical that developers surround themselves with professionals who are well versed in and focused on the Opportunity Zone program. Given the complexity of the regulations, much of the program is too difficult to learn on your own. Quality advisers and partners who think commercially, but have sound technical know-how, are crucial. We like to think that’s something we can offer our development partners—sophisticated, nuanced understanding communicated in a simple and actionable manner.

What should emerging developers know about/before accessing capital for an OZ project?

Parkin: With Opportunity Zone investments, the primary goal should be earning a market return for the capital. Some parallels have been made to the EB-5 program, but we think the two are quite different. Most EB-5 investors’ primary goal is citizenship and returns come second. With Opportunity Zones, returns come first and taxes are just a sweetener.

Would you advise developers starting their first investment in an Opportunity Zone to opt for a ground-up project or a redevelopment? What are the advantages and disadvantages of each type of project? 

Parkin: I recommend that developers stay the course with their area of expertise, whether ground-up or redevelopment. Stick to what you know and what you do best. We are capitalizing both types of deals and assess each deal on a risk-adjusted basis. We sometimes see investors focused on absolute returns, but, with our disciplined institutional orientation, we price risk and see a place for both types of deals in a balanced opportunity zone portfolio. 

Tell us a bit about your most recent investment, San Bernardino Medical Center. Why a medical center and why San Bernardino?

Parkin: We partnered with Sudweeks Development and Investment Co. to build an 11,325-square-foot, pre-leased, build-to-suit medical office building situated on nearly 2 acres in San Bernardino, California, in an Opportunity Zone. Sudweeks Development has developed $50 million of similar projects in SoCal since 2018, which made them an ideal partner for the project.

This public-private partnership (P3) shows how underserved communities can leverage the Opportunity Zone program to attract investors while providing positive community benefits. While we believe this is a solid long-term investment, it also serves an important role in providing critical services to families in the San Bernardino community.

The post Keys to Opportunity Zone Development Success appeared first on Commercial Property Executive.

11632 NE Ainsworth Circle. Image via Google Maps

Stockbridge has sold a 126,303-square-foot industrial facility in Portland, Ore., for $16.2 million. The asset last changed hands in 2014, when the company acquired it for $27.8 million, in a portfolio sale from Industrial Property Trust, according to public records. JLL Capital Markets represented the seller in the transaction.

Located at 11632 NE Ainsworth Circle, the property is triple-net leased to Johnstone Supply Inc., which has occupied the facility since its construction in 1991. Currently serving as the firm’s global headquarters, the distribution center features 24-foot clear heights, 18 dock-high doors, one drive-in grade-level door and office space.

The warehouse is in the NE Columbia Corridor Submarket, roughly 3 miles from Portland International Airport and 11 miles from the Port of Portland’s Terminals Two, Four, Five and Six. Additionally, the property is less than 1 mile east of Interstate 205 and approximately 3 miles from its interchange with Interstate 84.

JLL Managing Directors Mark Detmer, Bo Mills and Buzz Ellis, along with Senior Director Ryan Sitov and Director Adam Taylor, negotiated the deal on behalf of the seller. Last November, Stockbridge expanded its industrial footprint with the acquisition of an 8.7 million-square-foot logistics portfolio featuring 17 fully stabilized properties in nine U.S. markets.

The post Stockbridge Sells Fully Leased Portland Industrial Asset appeared first on Commercial Property Executive.

Rendering of the Athletic Lifestyle Resort. Image courtesy of Life Time

Life Time has broken ground on a new mixed-use property in Beaverton, Ore. The coworking and athletic resort development is scheduled for completion in late 2021 and will bring a country club-style, family recreation and spa to the area.

Located at the SW corner of Barnes Road and Cedar Hills Boulevard, the project will feature a three-story, 140,000-square-foot athletic club including training areas with cycle, yoga, pilates and barre studios, Kids Academy, LifeSpa, LifeCafe, basketball courts and indoor aquatic center. Additionally, a 400,000-square-foot outdoor beach club with lap and leisure pools, whirlpools, lounge areas and a bistro will be available on site.

The coworking side of the property will include Life Time Work, a 45,000-square-foot shared workspace offering offices, open desks and lounge spaces. Membership also includes Diamond-level access to all Life Time destinations. The newest development will bring roughly 300 new jobs to the community, said in a press statement Aaron Koehler, Life Time’s vice president of real estate and development.

The post First Portland Athletic Lifestyle Resort Starts Construction appeared first on Commercial Property Executive.

Hyatt Regency Portland at the Oregon Convention Center. Image courtesy of Hyatt

Hyatt Hotels Corp. has opened Hyatt Regency Portland at the Oregon Convention Center, a 600-key hotel in Portland, Ore. Apart from being the company’s first full-service property in Portland, this is the City of Roses’ first convention center hotel. Xenia Hotels & Resorts Inc. has acquired the asset for $190 million, or $317,000 per key, making it the 10th Hyatt-branded hotel under its management. 

Located at 375 NE Holladay St., the 14-story building is situated steps from the Oregon Convention Center, which recently completed a $40 million renovation by upgrading its accessibility throughout the one-million-square-foot facility, as well as a flexible outdoor space for events. Additionally, the hotel offers convenient access to Portland’s Waterfront Loop with paved running and bike trails, Legacy Medical Research Institute, Moda Center, Veterans Memorial Colosseum, Lloyd Center and various dining and shopping venues. 

Hyatt Regency Portland at the Oregon Convention Center also includes 16 suites and common-area amenities such as a fitness center, three food and beverage outlets, as well as 20 event rooms totaling 39,000 square feet:

• The Regency Ballroom, a 11,822-square foot venue for up to 1,200 people;
• Deschutes Ballroom, includes 5,000 square feet of space for 350 guests;
• Unity-Q, an open-concept restaurant;
• Spoke & Fork, the lobby restaurant and bar;
• The Market, a 24-hour grab-and-go retail space with cafe;
• 18 meeting rooms ranging from 110 to 1,400 square feet.

The transaction costs include the development price, the pre-opening and startup costs, working capital, as well as all the supplies. Portland-based developer Mortenson in partnership with ESG Architects built the hotel which has achieved Gold Leadership in Energy and Environmental Design certification. A few weeks ago, Hyatt Hotels Corp. opened the largest Hyatt Place hotel in the world: Hyatt Place New York City/Time Square, a 520-key property in New York City.

The post Newly Opened Hyatt Regency Hotel Trades for $190M appeared first on Commercial Property Executive.

River Forum. Image courtesy of CBRE

Shorenstein Properties has sold River Forum, a two-building office campus in Portland to Clarity Real Estate. The purchase price was $57.5 million, according to Multnomah County public records. Combined, the two buildings at 4380 & 4386 SW Macadam Ave. comprise 209,000 square feet of Class A office space, spread across 10,000- to 29,000-square-foot floorplates.

READ ALSO: Shorenstein Properties Obtains $350M for Iconic Manhattan Address

Shorenstein purchased the River Forum as part of a larger portfolio acquisition in 2007 and then conducted a capital improvement plan to improve the property. The renovations included the addition of secure-entry parking, outdoor patios, river access, a fitness center and a large lobby. The property also has a conference center that can fit up to 25 guests and is equipped with a kitchen.

The major renovations have attracted a healthy tenant roster list, as River Forum is currently 90 percent leased. While most of the tenants are taking up smaller floorplates, two notable tenants include Harris myCFO, the wealth management division of BMO Harris Bank, and home-building company D.R. Horton, according to sources familiar with the deal.

The River Forum campus is located near the Portland Streetcar, MAX Orange Line, OHSU Aerial Tram and Tilikum Crossing Bridge. It was one of the few properties Shorenstein maintained in Oregon, but the company’s portfolio still includes Lincoln Center, a 723,000-square-foot office building in Portland, as well as Nimbus Corporate Center, a 692,000-square-foot asset in Beaverton, Ore. Outside Oregon, Shorenstein is also working on a similar value-add strategy with 1407 Broadway in New York City that has just received a $350 million loan.

While CBRE’s Charles Safley, Paige Morgan and Trevor Kafoury represented Shorenstein, Clarity did not have broker representation, according to sources.

The power of Portland

Dave Seeley, a principal at Clarity, said Portland is one of the top growing markets for Clarity and the River Forum represents an irreplaceable waterfront property, in an area with a strong demand for office space.

According to Cushman & Wakefield’s third quarter report on Portland’s office market, the metro is getting a lot of attention from developers and tech companies. Currently, Portland has approximately 1 million square feet of development under construction—up from last year’s 679,000 square feet during the same quarter—and can expect more by the end of 2020. The metro’s vacancy rate also dropped to 10.2 percent, down from 2018’s third quarter of 11.4 percent, with tech companies like Google leasing 80,000 square feet in Portland’s Meier & Frank Building.

The post Shorenstein Properties’ Portland Strategy appeared first on Commercial Property Executive.

Power and Light Building

Beacon Capital has sold the Power + Light Building, a 265,000-square-foot Class B office mid-rise in Portland, Ore., to Gerding Edlen for $131.5 million, according to Yardi Matrix data. The seller had owned the 16-story property, also known as the Public Service Building, for more than 25 years, paying $3 million for the structure in mid-1992.

The seller had extensively renovated the property in 1999, per Yardi Matrix data, with additional updates completed in 2018. Following the improvements, the building now has an upgraded lobby and a modern amenity mix including a conference center, rooftop deck and fitness center.

Located at 920 S.W. Sixth Ave., the building is in the heart of downtown Portland, half a mile from Interstate 405 and five blocks west of the Willamette River. The mid-rise is three blocks west of 250 Taylor, a nearly 200,000-square-foot ground-up development which sold in October for $141.3 million, Yardi Matrix shows.

The Power + Light Building was constructed in 1928 as the city’s primary electric station. Today, the structure is home to a diverse mix of tenants. WeWork, the largest, occupies 70,190 square feet across five floors. The property’s tenant mix also includes TVA Architects, Beech Creek Financial Group and Gallatin Public Affairs. In addition to its office component, the building has approximately 11,000 square feet of above- and below-ground retail space.

The post Gerding Edlen Pays $132M for Historic Portland Asset appeared first on Commercial Property Executive.

Wells Fargo Center. Image courtesy of CBRE

CBRE has secured leasing for more than 27,000 square feet of space at Wells Fargo Center, an office tower in Portland, Ore., totaling more than 611,000 square feet. Campbell Global signed a lease for 17,520 square feet and plans to move its headquarters, while Gordon Rees Scully Mansukhani leased 10,068 square feet at the property.

Cushman & Wakefield’s Doug Deurwaarder worked on behalf of Campbell Global, while CBRE’s Trevor Kafoury represented Gordon Rees Scully Mansukhani. CBRE’s Trevor Kafoury, Michelle Franceschi, Al Kennedy and Autumn Brice negotiated both transactions on behalf of the landlord.

Located at 1300 SW 5^th Ave., Wells Fargo Center provides convenient access to transit and various parking options. The office tower is currently undergoing major renovations and is set to include new dining venues, new conference facility and tenant lounge, secure bike parking hub and a state-of-the-art fitness center with lockers and showers. Additionally, the property offers roughly 48,000 square feet of retail space, Yardi Matrix data shows. 

Back in April, Pacific West Bank also committed to nearly 11,000 square feet. According to Yardi Matrix data, the property last traded in 2017, when Starwood Property Trust acquired the asset for $188 million.

The post Wells Fargo Center Inks New Leases appeared first on Commercial Property Executive.

Residence Inn Portland Downtown/Pearl District. Image via Google Street View

JLL Hotels & Hospitality has secured the sale of the Residence Inn Portland Downtown/Pearl District, a 223-key hotel in one of Portland’s upscale neighborhoods, Pearl District. Washington Holdings LLC acquired the asset. JLL’s Executive Vice President Mark Fraioli and Senior Vice President Melvin Chu led the company’s team on the transaction.

Located at 1150 NW 9^th Ave., the property provides convenient access to more than 11.6 million square feet of Class A office space, as well various dining, shopping and entertainment venues such as The Fields Park, Jamison Square, Portland Japanese Garden, Roseland Theater and Old Town Chinatown.

The six-floor Residence Inn Portland Downtown/Pearl District features common-area amenities including five meeting rooms totaling more than 4,000 square feet, full-service restaurant and bar, an outdoor courtyard with a lounge, fire pit and grills, a 24-hour fitness center and an indoor swimming pool.

The post Marriott’s Residence Inn in Portland Changes Hands appeared first on Commercial Property Executive.

Hal Keever, Vice President of Land Development, Atwell. Image courtesy of Atwell

Atwell has hired Hal Keever as vice president of its land development operations. Keever will support Atwell’s activities in Portland with the aim to expand and strengthen the company’s presence in the Pacific Northwest.

Prior to joining Atwell, Keever has served as vice president of land and site development at David Evans and Associates, where he was responsible for expanding the firm’s national land development practices. During this period, Keever worked with various departments to help them clarify their focus and maximize their effort. Earlier in his career, he served as president of WHPacific.

Keever has 25 years of experience in the real estate and land development industry and has thorough financial, sales, and strategic planning knowledge. Keever’s focus includes developing growth initiatives for businesses in emerging markets. Keever holds a Bachelor of Science degree from the School of Liberal Arts at Oregon State University and completed a master’s degree at the School of Design of North Carolina State University.

The post Atwell Adds New Vice President appeared first on Commercial Property Executive.

7150 SW Sandburg St.

A private investor has sold a 34,760-square-foot office property near Portland, Ore., for $6.5 million to National Loan Acquisitions Co., according to Yardi Matrix. The buyer provided itself with a three-year, $4.2 million bridge loan to finance the deal.

Located at 7150 SW Sandburg St. in the suburb of Tigard, Ore., the building is 10 miles southwest of downtown Portland, in a primarily industrial and office district. There is approximately 3.1 million square feet of office space within a mile of the asset, according to Yardi Matrix. In addition to the nearby Interstate 5 and Beaverton-Tigard Highway, several public bus routes connect the area to the urban core.

The Class B asset, constructed in 1978, comprises a ground floor above a lower level. The property, at one point home to KeyBank of Oregon, was owned and occupied by Progressive Insurance for some 20 years until the firm sold the asset for $4.2 million in June 2018. The structure has remained vacant since.

Yardi Matrix shows Portland’s office investment this year has already topped $1 billion, similar to 2018’s total transaction volume. At the beginning of the year, Meriwether Partners purchased a three-building portfolio a mile north of National Loan’s acquisition.

The post Suburban Portland Office Property Changes Hands appeared first on Commercial Property Executive.

250 Taylor development site. Image via Google Maps

Arthur Mutal has sold 250 Taylor, a 191,500-square-foot office development in Portland, Ore., to Prospect Ridge, according to data from Yardi Matrix. ACORE Capital provided the buyer with $97.9 million in acquisition financing through a 10.5-year, fixed-rate mortgage, according to Commercial Observer. The project broke ground in early 2018, with delivery slated for early 2020.

Located downtown, the 10-story development is two blocks from the Willamette River between the Morrison and Hawthorn bridges. A station on the city’s light rail system is one block north of the 0.3-acre project site. Portland’s central business district has seen its share of investment this year: in June, PCCP LLC paid $96.5 million for a nearly 300,000-square-foot office property half a mile south of 250 Taylor.

Plans for the building call for 9 floors of office space above 10,603 square feet of street retail. The development is designed to achieve LEED Gold certification. The property is fully leased to NW Natural, which will shift its headquarters to the property upon delivery. The natural gas distributor presently operates out of New York Life’s One Pacific Square 1 mile north.

The post Portland Office Development Changes Hands appeared first on Commercial Property Executive.

12800 SW Pacific Highway. Image via Google Maps

The William Warren Group has opened two StorQuest branded storage facilities totaling 208,650 square feet in Hillsboro and Tigard, Ore. Earlier this year the company also completed a 97,570-square-foot facility in Portland and acquired a 524-unit asset in Buckeye, Ariz., for $9.1 million.

Located at 750 NE Cornelius Pass Road, the Hillsboro facility occupies around 5 acres near Freeway 26, in a densely populated area. Approximately 123,000 people are living within a 3-mile radius, according to Yardi Matrix. Features of the building include climate control, gated entry and security cameras. The three-story building was subject to a $9.1 million construction loan provided by Banner Bank in 2017.

The Tigard asset sits on a 1.4-acre lot at 12800 SW Pacific Highway, near the intersection of Interstate 5 and freeways 217 and 99W. The four-story building features 76,875 rentable square feet and comprises units ranging from 25 to 250 square feet, Yardi Matrix shows. The development was funded with a $9.5 million loan through TCF National Bank in 2016.

The post The William Warren Group Opens Two Storage Facilities appeared first on Commercial Property Executive.

6Y. Image courtesy of Collier International

Deka Immobilien, the real estate investment division of Deka Group, has acquired 6Y, an 11-story creative office building in Portland. A joint venture between KBS and True North Management Group sold the Class A property for $47.5 million.

READ ALSO: Portland Mixed-Use Project Moves Ahead With $460M Loan

The 116,244-square-foot building is located at 811 SW Sixth Ave., in the city’s central business district. The property has been renovated into creative office space and now includes a tenant lounge, a new lobby with a high-end coffee operator, bike parking, showers on every floor and locker rooms.

Deka’s recent Portland office purchase marks its third U.S. acquisition in the last nine months. The company has also purchased a 50,000-square-foot grocery-anchored retail at 60 N. RT 17 in Paramus, N.J., for $37 million and a 12-story, 68,000-square-foot office building at 1100 Vermont Ave. in Washington, D.C., for $41 million, according to Robert Stamm, Collier International’s Investment Advisory Group executive managing director, who represented Deka in the acquisition. Collier’s team also included Andres Roldan, managing director, and Chris Johnson, executive vice president from the Portland office.

Stamm, who has represented Deka for a decade, explained to Commercial Property Executive that “Deka is very selective in its investments and employs significant vetting upfront” and 6Y represented a perfect fit due to its creative label and central location.

“The DINA fund is in full growth mode with significant allocation of capital to invest,” Stamm told CPE, referring to Deka’s North America Fund name. “The success to date has drawn the attention of the investment community both in the U.S. and back home in Europe.”

KBS’ selling streak

KBS and the White Plains, N.Y.,-based investment company True North Management Group were represented by a Newmark Knight Frank team led by Vice Chairman Nick Kucha, alongside Directors James Childress and Bill DeLacy.

KBS is continuing its selling streak with 6Y in Portland, which comes on the heels of the $205 million sale of Palo Alto Technology Center in California, the disposition of a 300,000-square-foot Raleigh office and the sale of a 10-story South Florida office, all of which were announced in July.

The post Deka Group Enters Portland With $48M Buy appeared first on Commercial Property Executive.

Rivergate Corporate Center. Image courtesy of Kidder Mathews

BentallGreenOak, formed from a merger between Bentall Kennedy and GreenOak Real Estate earlier in July, has selected Kidder Mathews to oversee property operations at two industrial parks in Portland, Ore., totaling 2.9 million square feet across 13 buildings. The assets bring the firm’s management portfolio to 12.5 million square feet in the metro.

The largest of the two parks, the 2.1 million-square-foot Rivergate Corporate Center I-IV, is located at 14005-15750 N. Lombard St. in Portland’s Rivergate Industrial District, near two freight railroad networks operated by Union Pacific and BNSF. The property opened in phases between 2003 and 2011, with the final two structures achieving LEED Silver certification.

The Alderwood Corporate Center I-III, located at 8530-8934 N.E. Alderwood Road, is part of the larger Portland International Center adjacent to the city’s airport. The park is less than 3 miles from the intersection of interstates 84 and 205. The eight industrial buildings are leased to a mix of tenants including Mission Foods, Kintetsu World Express and Forward Air. 

Alderwood Corporate Center. Image via Google Maps

Kidder Mathews Senior Property Manager Tara Platt will head the management team for the assets. The firm’s Steven Klein and Peter Stalick will market the buildings to future tenants—they had begun overseen leasing efforts at part of the portfolio 11 years ago.

Outside of Portland, the company has also recently expanded its presence in other western markets. Kidder Mathews opened its fourth office in the Los Angeles metro at the end of last year, focusing on providing brokerage services for several different asset types in West L.A.

The post Kidder Mathews to Manage 3 MSF Portland Portfolio appeared first on Commercial Property Executive.

CommonGrounds Minneapolis Skyway Workplace. Image courtesy of CommonGrounds Workplace

CommonGrounds Workplace has opened two coworking office properties: CommonGrounds Minneapolis Skyway Workplace, a 27,478-square-foot flexible office space in Minneapolis and The CommonGrounds Pearl Workplace, a 14,239-square-foot property in Portland, Ore.

Located at 801 Marquette, in the heart of downtown, CommonGrounds Minneapolis Skyway Workplace offers convenient access to various dining, shopping and entertainment venues. The 84-year-old building was transformed by Perkins+Will in 2017 into a four-story coworking office space. Common-area amenities include a rooftop deck for events, a training and conference center, fitness center and Zip Car access. The property will serve 423 members with private offices, team rooms and coworking areas and will also include eight acoustically sound, video-enabled conference rooms, a communal pantry and living room, and phone rooms. Meet Minneapolis is the other tenant in the building.

The CommonGrounds Pearl Workplace is located at 630 Northwest 14^th Ave., in Portland’s Pearl District submarket. The property is part of Irving Street Lofts, an eight-story, 140,000-square-foot condominium building, and includes the entire ground floor and a second level of the property. The flexible office space features common-area amenities including private offices, team rooms and coworking spaces, with four video-enabled conference rooms, casual meeting and collaboration spaces and an Invita barista.

These locations mark CommonGrounds Workplace’s second and third ones opened this year as part of its $100 million Series A funding expansion program. The company recently signed an 11-year lease for 29,509 square feet of Class A office building in Washington, D.C.

The post CommonGrounds Workplace Expands Footprint appeared first on Commercial Property Executive.

Block 216. Image courtesy of Mosaic Real Estate Investors

Block 216, a 1.1 million-square-foot mixed-use development in downtown Portland that will feature a 35-story tower with a hotel, residential units, office and retail space, is moving forward with a $460 million four-year construction loan secured by George Smith Partners from Mosaic Real Estate Investors. With the funding in place, developer BPM Real Estate Group expects to break ground this summer and complete construction in 2023. A ceremonial groundbreaking is scheduled for Friday, July 12.

The development, which takes up a full city block, will have 140,000 square feet of Class A office space, a 251-key Ritz Carlton Hotel, 138 Ritz Carlton-branded residences and 7,800 square feet of ground-level retail that will open up to a pedestrian “festival street.”

The Ritz Carlton will be the city’s first five-star hotel. Located at the intersection of the central business and Pearl districts, the tower will be Portland’s fifth-tallest building. In addition to locally based BPM, the construction team includes Howard S. Wright, general contractor; GBD Architects for the core and shell; HKS architects for the interiors; and PLACE, landscape architect.

Malcolm Davies, principal & managing director of George Smith Partners, and George Smith Partners Senior Vice President Zachary Streit arranged the financing on behalf of BPM founder Walter Bowen. Davies said the loan was challenging because of the complexity of the project due to its size and scope.  Streit noted they reached out to more than 150 capital partners over a four-month period, holding more than 50 in-person meetings and conducting 15 site visits.

Mosaic deals

Davies said BPM selected Mosaic because the Los Angeles-based firm shared the same vision and philosophy for the project. Mosaic Real Estate Investors and its debt platform, Mosaic Real Estate Credit, was founded in 2015 by industry veterans Ethan Penner and Vicky Schiff. Mosaic has originated more than $1.5 billion in transaction volume since its inception, with approximately $800 million in originations since the beginning of this year. Most recently, Mosaic provided Santa Monica, Calif.-based developer Columbus Pacific with $165 million in senior construction debt for the development of a 233-key luxury condo hotel in Park City, Utah. Pendry Park City will also offer condominium units.

In January, Mosaic provided a three-year, $212.3 million senior construction loan arranged by George Smith Partners to the Robert Green Co. for development of the SilverRock Resort and Residences in La Quinta, Calif. The financing will fund predevelopment and construction costs of a 140-key Montage Resort, 200-key Pendry Resort, 10 luxury golf villas, a service and conference facility and golf clubhouse. A month earlier, Mosaic had provided a $50.9 million construction loan for Oceans V to convert a Los Angeles office building into a 180-key Cambria Hotel & Suites.

BPM keeps busy

In December, BPM completed work on Broadway Tower, a 19-story mixed-use tower also in downtown Portland. Howard S. Wright was the contractor and GBD Architects designed the $158 million project that includes a 180-key Radisson Red hotel on the first eight floors. Class A office space was constructed on the top 11 floors, with approximately 2,200 square feet of retail space on the ground floor. 

BPM received a $115 million loan in November from 3650 REIT to build a 12-story, 326-key Radisson Blu hotel in Anaheim, Calif. George Smith Partners also arranged that loan.

The post Portland Mixed-Use Project Moves Ahead With $460M Loan appeared first on Commercial Property Executive.

Meanwhile, Portland is a distant second, with 1.8 million square feet sold for $578 million. The metro’s development activity has picked up pace and there are some 2.2 million square feet under construction across the metro, 22.0 percent of which is scheduled for completion this year.

5. Dexter Horton Building

After paying $124.4 million for the Dexter Horton Building in Seattle from Gerding Edlen in November 2015, Pacific Eagle Holdings sold the Class A, 336,000-square-foot asset in January to CIM Group for $151 million or $448.91 per square feet. This deal was subject to a $100 million loan from ING Group.

Located at 710 Second Ave. in the city’s CBD, the asset is LEED Gold certified and includes 3,000 square feet of retail space, a conference room and bike locker. The 15-story property is home to, among others, King County Public Defense Department, CollinsWoerman, The Climate Corp. and Vix Technology. The property was completed in 1922 and most recently underwent cosmetic renovations in 2015.

4. Bellevue Corporate Plaza

Bellevue Corporate Plaza. Image courtesy of Yardi Matrix

Amazon, which recently detailed plans for its HQ2 campus in Arlington, Va., purchased Bellevue Corporate Plaza in downtown Belleview, Wash., and an adjacent 650-stall parking structure. Equity Commonwealth sold the 257,000-square-foot building for $758.87 per square foot or $194.9 million. This was Amazon’s first purchase on the Eastside and the second-largest price per square foot for any Seattle office buildings sold this year so far. The e-commerce giant now owns more than 4 million square feet in Seattle, with an additional 2.4 million square feet currently in the works in the Denny Triangle submarket.

The 10-story property, located at 600 108th Ave. NE, came online in 1980 and was renovated in 2014 and 2016. It is situated within walking distance of The Expedia Building, where Amazon signed a long-term, 440,500-square-foot lease.

3. Montgomery Park

Coming in at No. 3 is Unico Properties’ acquisition of Montgomery Park in Portland from Bill Naito Co. The $225 million deal closed in April. The 850,540-square-foot building encompasses some 17,000 square feet of retail, conference rooms and 2,293 parking spaces. Earlier this year, the company also acquired the Colman Building on Seattle’s Waterfront.

Located at 2701 N.W. Vaughn St. in Portland’s Northwest District, the nine-floor, Class A asset was completed in 1921 and converted to office in 1986. Most recently, the property underwent cosmetic renovations in 2016. Montgomery Park is currently fully leased to such tenants as Kaiser Permanente, Wells Fargo, McCleary Realty and TransDevelopment Group.

2. Amazon Houdini North & South

Amazon Houdini South. Image courtesy of Yardi Matrix

In March, Urban Renaissance Group sold Amazon Houdini in Seattle to Ponte Gadea for $740 million or a record $948.85 per square foot. The 780,000-square-foot asset, previously known as the Troy Block, is LEED Gold certified, includes some 1,050 parking spaces and is fully leased by Amazon.

The two buildings, located at 307 and 399 Fairview Ave. N., came online is 2016 and 2017 with the help of a $198.9 million construction loan from Regions Bank. The property is situated within walking distance of Amazon’s campus on Terry and Boren avenues, as well as 1 mile from the Rufus 2.0 campus on Seventh Avenue, where the tech giant owns more than 2 million square feet of office space.

1. 800 Fifth Avenue

This January, EQ Office expanded its Seattle footprint by 935,000 square feet with the purchase of 800 Fifth Avenue. Hines Interests sold the Class A asset for $540.4 million or $578.03 per square foot. The deal was subject to a $327.6 million loan provided by Deutsche Bank. The buyer’s office portfolio in the metro includes 1.5 million square feet in the city’s CBD and Bothell submarkets.

Completed in 1981 and renovated in 2016, the 42-story building is LEED Platinum and includes 17,000 square feet of retail and more than 600 parking spaces. Tenants at 800 Fifth Avenue include Bank of America, Providence Health & Services, PopCap Games and Regus. The transit-oriented property is 4.4% vacant.

The post Top 5 Pacific Northwest Office Transactions appeared first on Commercial Property Executive.

Graduate Eugene. Image via Google Street View

Graduate Hotels has opened Graduate Eugene, a 275-key hotel in Eugene, Ore. Adventurous Journeys Capital Partners, the owner of the property, started transforming the previously known Eugene Hilton hotel into Graduate Eugene, in June of last year.

Located on 6^th Ave., adjacent to the Hult Center, the property is close to the University of Oregon. Other nearby attractions include Studio West Glassblowing Studio and Gallery, Maude Kerns Art Center and Pacific Rim Art Guild. Graduate Eugene includes common-area amenities such as a swimming pool, parking garage, The Fir—a lobby-level restaurant with outdoor beer garden, a Topgolf Swing Suite—and Poindexter, an all-day café.

The 12-story hotel features 30,000 square feet of event space for up to 1,800 people fully equipped with business gatherings, as well as smaller rooms. Additionally, Graduate Eugene offers Vistas Ballroom, a private rooftop event space on the 12^th floor.

The post Graduate Hotels Expands in OR appeared first on Commercial Property Executive.

Park Square. Image courtesy of PCCP LLC

PCCP LLC has acquired Park Square, a two-building, 296,000-square-foot, Class A office property in Portland’s central business district for $96.5 million. The real estate finance and investment management firm did not disclose the seller of the asset. In recent years, the property was sold at least twice, according to Yardi Matrix data. Cambia Health Solutions, one of the property’s tenants, sold it to CalSTRS in December 2013 for $48.8 million, or $165 per square foot. CalSTRS sold the property to WealthCap in October 2016 for $94.4 million, or $319 per square foot.

In November 2016, Commercial Property Executive reported the property had been marketed by HFF on behalf of Clarion Partners LLC, which was acting as an advisor to a separate account client. The purchaser at that time was identified as a European separate account client advised by CBRE Global Investors.

Park Square, which is nearly fully leased, was substantially repositioned in 2016, when its 8,000-square-foot lobby/great room was renovated. The property has two buildings connected by the lobby/great room, which includes multiple seating areas, a fireplace, lounge area and Garden Bar, as well as a local soup and salad bar.

The first six-story building has 181,049 square feet and a single tenant. Located at 1621 SW 1^st Ave., the project was constructed in 1984 as a build-to-suit for the tenant. The second property was built in 1964 at 100 SW Market St. and has 113,719 square feet. The seven-story building has three investment-grade credit tenants. One of the tenants is the Oregon Department of Justice, which leases 51,620 square feet, according to Yardi Matrix.

Park Square is adjacent to the SW Portland Pedestrian trail, a half-mile, tree-lined walking trail that connects SW Market and SW Lincoln streets. It is also three blocks from the Tom McCall Waterfront Park that has views of the Willamette River and running and biking trails. It is located on the south end of the city’s CBD and also near Portland State University, Oregon’s largest university, as well as major freeways.

Urban Renaissance Group will manage the asset for PCCP. URG is one of the top real estate operators in the Pacific Northwest, with more than 8 million square feet owned or managed in Portland, Seattle and Denver.

PCCP deals

In February, PCCP acquired a 137,393-square-foot, Class A office building in San Francisco from Lexington Realty Trust for $120 million. The four-story office property is located at 350 Rhode Island St. in the city’s Potrero Hill neighborhood and within the Showplace Square office submarket. It was fully occupied at the time of sale.

In November, a joint venture of PCCP and SteelWave acquired Canyon Business Center, a 17-building, 632,591-square-foot property in the Seattle suburb of Bothell, Wash.

More recently, in April, the firm provided a $103 million senior loan to Renault & Handley Mid-Peninsula Joint Venture to develop 600 Clyde Ave., a 190,000-square-foot office building in Mountain View, Calif. Google will be the sole tenant in the new Silicon Valley office building.

The post PCCP Buys Portland Office Property for $97M appeared first on Commercial Property Executive.

Tigard Medical Plaza. Image via Google Street View

Following the arrangement of $1.25 billion sale of a 55-building portfolio sale, HFF has secured the sale of Tigard Medical Plaza, a 20,994-square-foot medical office building in Tigard, Ore. A private investor acquired the property for $14.5 million in a 1031 exchange. HFF worked on behalf of seller.

Built in 2005, the office and ambulatory surgery center is 100 percent leased as a strategic medical office and outpatient surgery center. Located on approximately 1.7 acres at 13200 S.W. Pacific Highway, near Interstate 5, the property offers convenient access to other medical facilities including Providence Laboratory, Providence Bridgeport Health Center and Legacy Hospital.

Managing Director Evan Kovac, Director Andrew Milne, Senior Associate Trent Jemmett and Analyst Maris Poyer were part of HFF’s national medical office capital markets team that represented the seller. Director Logan Greer provided local market expertise, while Managing Director Casey Davidson and Senior Director John Chun secured debt advisory services.

The post HFF Arranges Portland Medical Office Sale appeared first on Commercial Property Executive.

SE First Avenue and S. Walnut, Portland. Ore. Image courtesy of Trammell Crow Co.

Columbia Distributing, together with Meritage and Trammell Crow Co., has plans to open an industrial facility in Canby, Ore. The roughly 530,000-square-foot property will become the company’s new Portland metro area warehouse, consolidating its three current locations in Northwest Portland. Perlo Construction will be the general contractor for the project, while VLMK Engineering + Design has been handling design and permitting services. 

Located at SE First Avenue and South Walnut on approximately 43 acres, the single-story warehouse and beverage distribution facility is expected to include an additional 16,600 square feet of office space and could be expanded by approximately 224,600 square feet in a future phase, according to documents from the Canby Planning Commission.

Senior Vice President Allen Patterson of Commercial Group and Terry Tolls of T.N. Tolls Co. represented TCC and the sellers in the sale of the land. Upon completion, in fall 2020, the warehouse is expected to employ approximately 200 people.

TCC, which acquired the property, will develop the half-million-square-foot facility, which is set to be the largest in Canby and one of the largest under construction in the metro. The company, in a joint venture with Clarion Partners, recently signed a lease agreement with Federal Express Corp. for a built-to-suit facility in Austin, Texas.

The post TCC Joint Venture to Develop Industrial Property South of Portland appeared first on Commercial Property Executive.

Field Office. Image courtesy of Project^

Field Office, a creative office campus in Portland, has come under new ownership just one year after its opening. With the assistance of Newmark Knight Frank, developers Project^ and National Real Estate Advisors LLC sold the 304,500-square-foot property to a venture of Goldman Sachs’ Merchant Banking Division and Lincoln Property Co. for $118 million.

Project^ and National Real Estate Advisors LLC invested approximately $108 million in the development of Field Office, aided by a $65 million construction loan from Bank OZK. Located on 2.3 acres fronting River Promenade, the LEED Platinum-certified complex encompasses two six-story buildings carrying the addresses of 1895 and 2035 N.W. Front Ave. In addition to 279,200 square feet of premier office space, the property features 25,300 square feet of ground-level retail offerings and a below-grade parking facility.

Project^ had conceived the Hacker Architects-designed Field Office as a destination for businesses growing beyond the start-up phase in the area. Tech firms Adpearance and Ampere were among the firms that pre-leased space at the property, where JLL oversees office leasing. In the sale transaction, NKF’s Kevin Shannon, Nick Kucha, Steven Golubchik, James Childress and Bill DeLacy represented the sellers, while the buyers represented themselves.

Billion-dollar magnet

The investment community has been quite keen on the Portland office market for the last few years, and experts expect the sentiment to continue in 2019. According to a first-quarter 2019 report by NKF, “With approximately $239.2 million in major office building transactions in the first quarter and several known pending sales, Portland is on track to achieve total sales of $1 billion this year, the same as in 2017 and 2018.”

The post Portland Office Campus Trades for $118M appeared first on Commercial Property Executive.

The Hotel Zags Portland. Image courtesy of Pebblebrook Hotel Trust

Pebblebrook Hotel Trust has opened The Hotel Zags Portland, previously known as Hotel Modera, after it underwent major renovation and rebranding. This marks the sixth “Z” hotel in the company’s collection. Sage Hospitality will continue to manage the property.

Located at 515 S.W. Clay St., The Hotel Zags Portland features 174 keys and includes a courtyard with fireplace and a green roof. Additionally, the hotel features The Colosseum, an adult game room which includes table top shuffleboard, a pool table, video games and darts.

“The active nature and distinctive culture of Portland make this hotel the perfect addition to our already unique experiential portfolio of ‘Z’ named hotels. Business and leisure travelers alike can connect with the environment and experience Portland while enjoying our property’s modern elements and fun design,” Jon Bortz, chairman, president & CEO of Pebblebrook Hotel Trust, said in a prepared statement. “The eco-friendly and artistic features and focus of the hotel appeals to all who appreciate a unique, but socially relevant experience.”

Hotel Zetta San Francisco, Hotel Zelos San Francisco, Hotel Zeppelin San Francisco, Hotel Zephyr Fisherman’s Wharf, Hotel Zoe Fisherman’s Wharf and The Hotel Zags Portland are part of Pebblebrook Hotel Trust’s “Unofficial Z Collection”.

The post Portland Hotel Opens After Renovation appeared first on Commercial Property Executive.

South East Powell Boulevard

Talonvest Capital has secured $23.7 million in financing on behalf of Leon Capital Group for the construction of two storage facilities in Portland, Ore. The two developments have separate, uncrossed loans featuring limited recourse and 42-month loan terms with interest-only payments and an 18-month extension option.

The developments will be located in Portland’s undersupplied trade areas on South East Division Street and South East Powell Boulevard, within 10 miles of the city’s downtown and around 8 miles from Portland International Airport. The first property on South East Division Street will encompass 113,115 net rentable square feet and the second facility will have 102,692 net rentable square feet.

“Talonvest secured our last construction portfolio loan and they delivered once again. They’re a valuable leverage point for our team and drive better pricing, terms, and structure through competition and negotiation,” said Jake Walker, chief operating officer at Leon Capital Group, in prepared remarks.

Talonvest’s team representing the borrower included Kim Bishop, Eric Snyder and Jim Davies. In February, the firm also arranged a $29.6 million, seven-year, fixed-rate construction loan for the development of a 188,600-square-foot self storage facility in Los Angeles.

Rendering courtesy of Talonvest Capital

The post Talonvest Arranges $24M Loan appeared first on Commercial Property Executive.

Howard Johnson Inn

Hotel Brokers International’s member Crystal Investment Property (CIP) has brokered the sale of Howard Johnson Inn, a 69-key hotel in Salem, Ore. CIP worked on behalf of both the seller and the buyer in the transaction.

Located at 2250 SE Mission St., 1 mile from downtown Salem, the property offers convenient access to Interstate 5 and Highway 22. Various dining, shopping and entertainment venues are in close proximity to the hotel. Additionally, Oregon State Capital, Oregon Expo Center and Willamette University are nearby.

Howard Johnson Inn includes common-area amenities such as:

• 24-hour reception desk
• outdoor swimming pool
• fitness center
• guest laundry
• business center
• free Wi-Fi
• free breakfast
• parking spaces

CIP’s President Joseph Kennedy worked with the buyer and the seller, as well as the parties’ other professionals. Last year in August, another member of Hotel Brokers International secured the sale of a 130-key Rodeway Inn in Estes Park, Colo.

Image via Google Street View

The post CIP Brokers Oregon Hotel Sale appeared first on Commercial Property Executive.

According to Yardi Matrix data, 35 office properties changed hands in the metro through 2018’s first 11 months, totaling more than 3.3 million square feet. The total sales volume, however, dipped to approximately $670 million as, with a few exceptions, the majority of sales remained under the $50 million benchmark. 

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5. Historic US National Bank Block ($53.9 million)

Historic US National Bank Block

The downtown building changed hands in the first quarter after four years of ownership under ScanlanKemperBard Cos. The new owner is Westport Capital Partners, with property management duties handled by Interurban. The 208,000 square-foot office building is located at 309 S.W. 6th Ave. and has major exposure on S.W. Broadway. Development began in 1906 and was continued during three other phases: 1917, 1925 and 1956. The property was renovated twice, in 1999 and 2015, and has approximately 85,000 square feet available for lease. Kidder Mathews is the leasing manager.

4. 38 Davis ($54.3 million)

Unico Properties, Portland’s top office buyer in 2018, bought 38 Davis at the beginning of 2018 from Gerding Edlen for $54.3 million. The 90,991 square-foot property was completed in 2015 and features 5,400 square feet of ground floor retail space, as well as 35,000 square feet of residential space at its top two floors. Part of the acquisition price was covered via a $32 million loan provided by Thrivent Financial. Apex Real Estate is in charge of leasing and managing the building at 38 N.W. Davis St.   

3. Towne Storage Building ($62.8 million)

Towne Storage Building

Originally a paper mill, the Towne Storage Building was completed in 1916 and was converted to office last year, when Westport Capital Partners sold it to CBRE Global Investors for $62.8 million. NKF Capital Markets arranged the deal on behalf of the seller. Located at 17 S.E. 3rd Ave., in the Central Eastside submarket, the 100,000 square-foot property provides exposure on Ankeny and East Burnside Bridge streets. Immediately prior to its repositioning, it used to provide mini storage units and rentable space for artists and small businesses. It is currently fully leased by Autodesk Inc.

2. 9North ($76.6 million)

Another 2018 delivery on the Portland commercial real estate market, 9North entered CBRE Global Investors’ portfolio in October, just before its official opening. The 183,000 square-foot building is located at 1250 N.W. 9th Ave. in the popular Pearl District submarket and is almost entirely available for lease. It includes more than 5,000 square feet of retail space as well as an on-site conference center, rooftop terrace, fitness center, bike parking and a bike repair station. The seller is Miller Global Properties Fund, which had tapped developer William & Dame, Hacker Architects, GBD Architects and Howard S. Wright Construction to deliver the asset. Floor plates go from 19,600 to 28,800 square feet.

1. Moda Tower ($180 million)

Moda Tower

In the fall, Unico Properties, also the owner of Congress Center, closed another strong office sale in Portland, the largest transaction in the metro year-to-date. The company paid $180 million to UBS Realty Investors for the 400,000 square-foot downtown office building. Completed in 1998 at 601 S.W. 2nd Ave., Moda Tower underwent cosmetic renovations in 2009 and later became LEED certified to the Silver level. The property includes 20,000 square feet of retail space on the first two floors and has approximately 40,000 square feet of space available for lease. Floor plates encompass 21,664 square feet.  

Images courtesy of Yardi Matrix

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Buzz Ellis, Managing Director, JLL

Portland’s strong economy, led by a healthy job market, is attracting companies looking for a more affordable option to the Bay Area. There are roughly 3 million square feet of office space currently under construction in the metro, where global brands such as Nike have established their headquarters. 

According to a JLL report, leasing activity in suburban submarkets has picked up recently and, as a result, vacancy figures are falling below urban vacancy levels for the first time in the past 15 years. Investors are also looking into outer submarkets for increased profits. “We’ve seen liquidity increasingly willing to venture outside downtown, where yield is better, but if it’s a suburban deal, it has to be well-located suburban and it can’t be commodity product,” JLL’s Managing Director Buzz Ellis told Commercial Property Executive. In the interview below, he shares his predictions for Portland’s office market in 2019, as well as the trending amenities in the sector.

What drives demand for office space in the metro? How do you see this changing in the coming 12 months?

Ellis: A mix of homegrown companies expanding their operations and companies from tech centers establishing outposts in Portland. With San Francisco and Seattle—two of the tightest markets in the country—and with average asking rents in those cities well above Portland, the metro is well situated to capture firms who are being priced out of those two markets, but still need to be geographically close.

Which Portland submarkets are the most sought after by investors and why?

Ellis: Historically it’s been Portland’s Central Business District, specifically the Class A towers, and the west side suburban office parks. Between 2015 and 2017, 75 percent of sales were in the CBD. That changed in 2018 with more sales in the greater urban core—65 percent—and the suburbs.

What challenges will Portland’s office market face this year?

Ellis: Vastly increased supply due to new construction and repositionings means that landlords will face a lot more competition for tenants that they have not experienced for quite some time, especially in the large block space, with some large spaces sitting vacant and/or coming back to the market, coupled with new supply struggling to get leased. New construction costs are still rising at a break neck pace and office buildout costs are rising with those construction costs, putting pressure on landlords to offer higher concessions in order to land tenants.

How did technology impact the Portland office market so far?

Ellis: The tech sector was primarily responsible for the upswing in Portland’s urban core that started between 2011 and 2012. Major tech growth in Portland has come mostly from homegrown companies gradually ramping up their operations, followed by outside investment or acquisitions. In general, Portland is seen as a second outpost city for tech companies, not a “full-company, headquarters relocation” city. So when companies come from other markets like the Bay Area, they tend to set up a small office to start and test the Portland talent pool. Once they realize that Portland is a viable alternative to the Bay Area or Seattle, they tend to offer relocation opportunities to their employees, which grows their Portland operations.

What trends should we expect to see in 2019 in terms of office amenities ?

Ellis: Continued focus on shared amenity spaces like bike parking, gyms, showers, pet-friendly areas and retail options like coffee shops. We’re seeing some landlords looking to offer tenants regular activities like meditation or yoga classes, happy hours, spa days etc. as a billable amenity extra.

What are your predictions for Portland’s office market for the next 12 months?

Ellis: Steady demand from tenants but likely to fall below this cycle’s average absorption.

• A slowdown in rent growth at the top end of the market as vacancy has increased and new construction leasing has been mixed.
• A push by tenants to increase concessions as landlords look to preserve face rates.
• As the expansion stretches into its 10th year, tech investors are putting a greater emphasis on profitability versus growth at all costs, so we are seeing tech companies scrutinizing their real estate decisions a lot more than in years past. Should see more companies rightsizing and becoming more efficient.

What can you tell us about the future investment trends in the metro?

Ellis: Expect much of the same, but with pressure on prices as cap rates rise in an increasing interest rate environment. There are a number of large deals currently in process that will provide a solid start for 2019 sales volumes, and we expect that there will be a few additional trades of buildings that sold earlier in the cycle trading again, as those owners look to lock in returns from this current cycle.

Image courtesy of JLL

The post Portland Office Market Set for Strong Start in 2019 appeared first on Commercial Property Executive.

Tigard Corporate Center

JLL’s Capital Markets has secured the sale of Tigard Corporate Center buildings A, B and C located in Portland, Ore. The company worked on behalf of the buyer, Meriwether Partners. JLL manages the property.

Located at 12123 SW 69^th Ave., the two-story buildings added more than 123,000 square feet of Class A office space to Meriwether Partners’ portfolio. The properties offer convenient access to various medical office buildings, Interstate 5, and highways 99 and 217. Additionally, Tigard Corporate Center is adjacent to the recently announced expansion of Trimet’s MAX light rail line.

The properties are 100 percent leased to two tenants, Rocky Mountain Cancer Center LLC—operated by Compass Oncology—and Consumer Cellular Inc. Compass Oncology signed a ten-year lease on Building A, and is currently developing an oncology center at the property. Built in 2000, Tigard Corporate Center includes 694 parking spaces

“Tigard Corporate Center presented an opportunity for investors to purchase a trio of well-maintained, institutional quality office assets, 100 percent leased on a triple-net basis, with long-term income security,” JLL Capital Markets Managing Director Paige Morgan said in a prepared statement.

Managing Directors Morgan and Buzz Ellis were part of JLL’s team that represented the buyer on the sale. In another recent deal, JLL’s Managing Directors Chris Schaaf and Jim Thorp represented the tenant in the acquisition of Capital Towers, two office buildings totaling more than 477,000 square feet.

Image courtesy of Yardi Matrix

The post Portland Office Assets Change Hands appeared first on Commercial Property Executive.

One of the largest projects in the Pearl District submarket—the 183,000-square-foot 9North creative office building—has reached completion and has already found a buyer. According to real estate data provider Yardi Matrix, CBRE Global Investors bought the asset from Miller Global Properties Fund VIII for $76.6 million. 

Pearl District is one of Portland’s high-profile submarkets and is attracting both investors and developers. Williams & Dame broke ground on 9North at the end of 2016. Hacker Architects, GBD Architects and Howard S. Wright Construction were also part of the development team.

9North is located at 1250 N.W. 9th Ave., minutes away from the high-end Canopy by Hilton Hotel, which opened last year. The eight-story property provides six floors of office space above 5,100 square feet of ground floor retail space and a structured parking, and is proposed for LEED Silver Certification. Amenities include an on-site conference center, rooftop terrace, fitness center, bike parking and a bike repair station as well as showers and locker rooms.

The office property can be accessed via interstates 405 and 5 as well as highway 30 and Martin Luther King Boulevard. The area is highly transited and provides access to a variety of dining venues.

The post Miller Global Properties Sells Portland Office Building appeared first on Commercial Property Executive.

Broadway Tower

Developer BPM Real Estate Group has completed work on Broadway Tower, a 19-story building in Portland, Ore., according to Yardi Matrix data. Howard S. Wright, a Balfour Beatty company, was the contractor, while GBD Architects designed the $158 million project. 

Located at 1455 S.W. Broadway St., the mixed-use tower is in the city’s central business district, within walking distance of some of Portland’s best restaurants, shops and art galleries as well as South Park Blocks and Portland State University. Several streetcar and light rail stops are located within two blocks of the site.

A 180-key Radisson Red hotel occupies the building’s first eight floors. Atop, 11 floors of Class A office space were built. According to Portland Business Journal, several tenants had signed leases for 94 percent of the tower’s office space as of mid-October. Amazon, Lawyers Title and law firm Markowitz Herbold are three of the building’s tenants.

Roughly 2,200 square feet were set aside as ground-floor retail space. The 260-foot-tall building includes 247 parking spaces on four underground parking levels. Construction of the tower began in June 2016. Kidder Mathews serves as leasing agent.

Image courtesy of Yardi Matrix

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2175 N.W. Raleigh St.

Independent Microsoft software vendor Jet Global, formerly known as Jet Reports, has moved to a new corporate office. The company relocated from Tigard, Ore., to Slabtown—a newer district of the Portland, Ore., area.

Located at 2175 N.W. Raleigh St., Jet Global’s new headquarters is within a 10-minute drive of downtown Portland, with easy access to Interstate 450. The office is in a newly renovated, adaptive reuse building in a part of the city that is rapidly becoming a hip new center for artisans, businesses and retailers. The property features sky porches, rooftop decks, an urban plaza and a commuter bike area.  

“The new office has all the makings of great workspace—exposed beams and concrete, ample natural light and flexible, collaborative spaces that create opportunity for innovation. Tigard reflected the family nature of Jet Reports, but now that we’re Jet Global, we need something a little more us—modern, excited and adaptable,” said George Brown, vice president of sales and marketing for Jet Global, in prepared remarks.  

At the beginning of this year, vacation rental management company Vacasa also relocated its corporate headquarters to Heatline, a five-story development in Portland.

Image via Google Earth

The post Microsoft Vendor Relocates Portland HQ appeared first on Commercial Property Executive.

Thurman Building

Thurman Building in Portland’s Goose Hollow submarket has changed ownership, according to data available on Yardi Matrix. Goldman Sachs bought the 65,000-square-foot office asset from Melvin Mark Cos. in a $25.7 million transaction. The price is twice the previous owner paid for the property in 2013. Melvin Mark will continue to manage the building and lead all leasing efforts.

The four-story development is located at 1631 N.W. Thurman St. near the Willamette River. It was originally built in 1900 as an industrial facility known as Bridgetown Building and converted to office in 1998, when a fourth floor was added. The building underwent cosmetic renovations in 2012.  

Thurman Building is located across the street from Polaris Dance Theater and a few blocks from MODA Tower, one of the largest office developments in downtown Portland. The property can be accessed via Interstate 405. Its tenant roster includes company names such as Ambrosini Design, Christenson Corp. and CMD.

Image courtesy of Yardi Matrix  

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Oswego Village

HFF has secured the sale of Oswego Village, a nearly 103,000-square-foot retail center in Lake Oswego, Ore. Asana Partners acquired the asset free and clear of existing debt for an undisclosed price from an institutional seller.

Located at 11 S. State St. on almost 8 acres, Oswego Village is along State Highway 43, providing convenient access to downtown Portland, Ore. The five-building center is 85 percent leased to Whole Foods 365, Ace Hardware, Laughing Planet, Subway, Banfield Pet Hospital, North Lake Physical Therapy and others. Asana Partners plans to upgrade the property and push leasing efforts in order to fill the center with tenants. The Lake Oswego suburb has roughly 40,000 residents with an average annual household income of $158,761. 

“Oswego Village is a generational piece of real estate. Asana Partners will make significant enhancements, including aesthetic upgrades and attracting retailers that complement and connect with the surrounding community,” said HFF Senior Director Nick Kassab, in a prepared statement. Kassab and Managing Director Bryan Ley were part of the investment advisory team that represented the seller.

In another recent deal, HFF also worked on behalf of the seller in the disposition of a $54.8 million-square-foot Atlanta retail asset.

Image via Google Street View

The post HFF Arranges Sale of Portland Retail Center appeared first on Commercial Property Executive.

6433 SE Lake Road

A joint venture between Specht Development Inc. and Ares Management LP has acquired a 992,190-square-foot industrial property in Milwaukie, Ore., for $48.5 million.

The property is currently home to a SUPERVALU distribution center, which will continue occupying the facility.

“The story of industrial product in the Portland metro area is the story of a lack of land,” Greg Specht, Specht Development’s CEO, told Commercial Property Executive. “We’ve built millions of square feet over the years and we have very tight restricted land use regulations we have to adhere to, and there are very few large sites available for development.”

That’s why when this property came to Specht Development’s attention, the company quickly went to work to add it to its portfolio.

“We were able to negotiate a sale agreement and a lease back at a price point that was attractive and lease-back terms that were reasonable for us,” Specht said. “It allows us to go through the entitlement process to drag this facility, which has been built in phases over many decades, into the 21^st century.”

The property comprises warehouse, distribution and manufacturing space, as well as freezer/cooler space and a separate 48,000-square-foot office.

Located inside the I-205 freeway at 6433 SE Lake Road in Milwaukie, Ore., a submarket of Portland, the location was a major point of appeal to Specht Development.

“It’s 62 acres and within two five-irons of the CBD, inside the beltway,” Specht said. “It’s got ample room for trailer storage and truck maneuvering and it’s around a million square feet, so we thought it was a deal we needed to do.”

A bright future

According to Specht, general industrial market vacancy rates, combined with historically low vacancy in the Clackamas/Milwaukie region, bode well for the industrial property’s future absorption.

At the end of the grocery wholesaler’s lease, the new owners plan to renovate and modernize the property. Changes ahead include replacement of the roofs and the asphalt, the addition of dock doors and painting throughout.

“We have plenty of time to go through the design entitlement phase, and once SUPERVALU vacates, we’ll begin the work,” Specht said. “It’s just a good play. The market is very active with vacancies in the low single-digits, and we believe we can be very competitive on the pricing.”

Don Ossey with Capacity Commercial Group served as the sole real estate broker on the transaction and brought the off-market opportunity to the joint venture.

Last December, Specht Development completed the largest speculative industrial development in the Portland region ever launched in a single phase with the 732,824-square-foot Vista Logistics Park, comprising three buildings, including the metro’s largest single vacant industrial space under one roof.

Image courtesy of Specht Development

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MODA Tower

A joint venture between American Realty Advisors and Unico Properties LLC has acquired MODA Tower, a 398,412-square-foot office building in downtown Portland, Ore. UBS Realty Investors was the seller, according to Yardi Matrix.

These companies also teamed on last year’s purchase of the Congress Center, a 23-story Class A office high-rise located in the heart of Portland’s CBD. Their latest acquisition is currently 90 percent leased.

“Portland’s CBD has quickly emerged as one of the nation’s fastest growing tech and innovation hubs,” Albert Pura, ARA’s senior director, said in a prepared statement. “Firms are continuing to migrate to the region in search of strong value alternatives as compared to San Francisco, Los Angeles and Seattle. MODA Tower will benefit from this ongoing economic growth and migration of jobs, driving long-term demand for the property and placing upward pressure on rents.”

Rare asset in the market

MODA Tower is ideally situated in Portland’s bustling central business district, and boasts high-quality finishes, panoramic views, an on-site Nordstrom Rack and a five-level parking garage. 

The building’s unique design creates six corner offices on every floor and amenities at the property include an on-site daycare facility, gourmet coffee and food service, bike storage, exterior terraces and unobstructed views of Mt. Hood and Willamette River.

Located at 601 SW 2nd Ave., the 24-story tower was built in 1998 and is one of the few office properties delivered in the area in the past 20 years.

“Most of the office buildings throughout the region are of older vintage and require significant capital investment in order to remain competitive,” Pura said. “This was a rare opportunity to acquire a newer asset with strong in-place cash flow, one of the most prestigious business addresses in the city, and very limited opportunities for new development of an office property of this scale due to a lack of available sites.”

The Class A building offers direct access to the MAX light rail transit system.

Leasing strategy

MODA Tower is home to original tenants MODA Health and Lane Powell. According to Pura, the joint venture’s approach is to purchase buildings that will deliver long-term value to investors and be sustainable in times of economic volatility. Therefore, the property’s contractual long-term leases, variety of revenue streams, and overall market fundamentals fit those needs perfectly.

“We strategically target properties that have proven track records and strong in-place occupancy,” he said. “At 90 percent occupancy, the asset has immediate stabilized cash flow with opportunities to increase NOI through leasing remaining vacant space, as well as taking advantage of ancillary revenue opportunities within the five levels of parking.”

Jason Flynn at Eastdil Secured represented the seller in the deal.

ARA currently has more than $8.7 billion in assets under management. Unico Properties’ portfolio consists of 17 million square feet of commercial properties. Both companies have been active recently. In September, Unico Properties acquired One Nashville Place, a 24-story, Class A office tower in Nashville, Tenn. In August, ARA acquired Northshore, a mixed-use tower in Austin, Texas. 

Image courtesy of American Realty Advisors and Unico Properties

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The Water Tower Complex

In a joint venture with WHI Real Estate Partners, ScanlanKemperBard Cos. has acquired the Water Tower Complex in Portland’s neighborhood of John’s Landing, for $24.8 million. The new owners intend to implement an extensive capital improvements plan to elevate the property to a Class A mixed-use office and retail destination. This purchase marks the partners’ second investment in this neighborhood, following the acquisition of Riverside Center and 5550 Macadam in January 2017. 

The property comprises two buildings totaling 123,188 square feet. Constructed in 1903 as a furniture warehouse, the asset was redeveloped in the 1970s by John Grey into a retail marketplace. In 2008, a Melvin Mark partnership purchased the complex and made it home to a mix of office and retail tenants. Currently 93 percent leased, the Water Tower kept its historic architectural features, such as the reinforced concrete, exposed timer beams and fir floors. The Bailey Building was also included in the sale and offers redevelopment potential, with its flexible zoning in the surrounding land. 

“We are grateful to Melvin Mark for the opportunity to acquire this asset as we are firm believers in the John’s Landing submarket. The water views, neighborhood amenities and historical architectural features provide a unique urban experience at a price point and parking ratio typically found in the suburbs,” said Todd Gooding, president of SKB, in a prepared statement. 

In May, a joint venture between WHI and EverWest Real Estate Investors secured $19.9 million in financing to convert a warehouse property in Austin into creative office space. 

Image courtesy of ScanlanKemperBard Cos. 

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Officials from Pacific Power, Facebook, Crook County and the City of Prineville, and Governor Kate Brown

Pacific Power and Invenergy have partnered with Facebook for the construction of 437 megawatts of solar projects in an effort to supply Facebook’s Prineville data center with 100 percent renewable energy. Two facilities, totaling 100 megawatts, will be located in the Prineville, Ore., area and will be developed by Invenergy.

Facebook opened its first data center in Prineville in 2011. The social media giant’s presence in the region pushed down the unemployment rate from 17 percent to 6.5 percent today and improved the infrastructure with new roads, parks and an elementary school. In addition, education got a boost through grants, including support from Facebook, as well as upgrades to school curricula, including more STEM education opportunities.

The two solar parks will be located in Crook County and will include the 55-megawatt Prineville Solar and the 45-megawatt Millican Solar. Both are slated to come online in late 2020 and are expected to create approximately 100 jobs at each site during construction.

“Invenergy’s two new solar projects were a great fit to power our Prineville Data Center and also help us further contribute to the city’s prosperity,” said Peter Freed, Facebook energy strategy manager, in a prepared statement. “Prineville was our first data center and we are thrilled to be adding it to our list of hyper-efficient facilities supported by 100 percent renewable energy.”

Images courtesy of Pacific Power

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Sunset Corporate Park III

Crown Realty & Development has acquired Sunset Corporate Park III, an office property in Hillsboro, Ore., for $32.3 million. NKF Capital Markets represented the seller, Washington Capital Management, in the transaction. 

Located at 21375 Bennett St., the asset comprises 103,279 square feet and is 100 percent leased to Wells Fargo. The building is situated next to Intel’s Ronler Acres Campus and within the Sunset Corridor submarket, which is also home to Nike, Genentech, Salesforce, Epson, Oracle and Kaiser Permanente. Built in 1999, the property features one story, above standard ceiling heights, an on-site conference room and 723 parking spaces.   

NKF Capital Markets Co-Head of U.S. Capital Markets Kevin Shannon, Vice Chairman Nick Kucha, Executive Managing Directors Ken White and Dave Squire, and Directors James Childress and Bill DeLacy worked on behalf of the seller. The buyer was represented by its own Chief Operating Officer Kreg Groat. 

“This offering was well received, in part because of the credit tenant profile of Wells Fargo, the strong occupancy history of the property, and the strong fundamentals of the submarket,” said DeLacy, in a prepared statement. “We are seeing newfound capital interest in the suburbs for well-located assets with compelling tenant profiles or mark-to-market opportunities.” 

Also this week, Shannon, along with other members of the NKF Capital Markets team, arranged the $29.9 million sale of Empire Towers V, a 124,529-square-foot Class A office building in the Inland Empire, on behalf of TA Associates. 

Image courtesy of NKF Capital Markets 

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The list highlights the Pacific Northwest’s top 10 largest office buildings based on square footage as of May 2018. The ranking is based on Yardi Matrix data.

10. U.S. Bancorp Tower in Portland, Ore.

UBS Realty Investors’ 1,073,000-square-foot asset is the second tallest office tower in Portland, spreading across 42 floors in the city’s central business district. Built in phases in 1973 and 1983, it underwent multimillion-dollar renovations in 2002 and 2014. Although it is the last property on our ranking, it is Oregon’s largest office building in terms of volume.

Located at 111 SW 5^th Ave., the tower originally served as U.S. Bancorp‘s national headquarters. The LEED Silver-certified asset is dubbed “Big Pink” due to the Spanish granite and pink-glazed plate glass covering the structure.

9. Rufus 2.0 – Block 14 in Seattle

Rufus 2.0 – Block 14 in Seattle

The 1,090,000-square-foot building houses Amazon’s corporate headquarters and goes by many names: Rufus 2.0 – Block 14, Doppler or Amazon Tower. Completed in 2016, it is part of a three-property office campus developed by Amazon in the Denny Triangle neighborhood. The 37-floor building sits at 2021 7^th Ave. and features a five-story meeting room center, a 2000-seat stadium-style amphitheater and stage, as well as a six-story underground parking.

8. Two Union Square in Seattle

Located at 601 Union St. in downtown Seattle, the 56-story Two Union Square spreads across 1,126,428 square feet and is the third-tallest building in the city. Washington Holdings has been owning the 1989-built asset since 1992 and currently handles its property management and leasing services.

The tower is part of the Union Square office complex, which includes the smaller One Union Square, and features a 1,100-stall parking garage, a courtyard, a three-story retail plaza and an underground pedestrian concourse connecting Fifth Avenue Theater and Rainier Square. Additionally, the complex has received LEED Platinum in 2015 and houses a series of prestigious tenants such as HomeStreet Bank, Apple and JLL.

7. 1201 Third in Seattle

1201 Third in Seattle

Built in 1988, 1201 Third comprises 1,128,575 square feet across 55 stories. A MetLife Real Estate Investment and Clarion Partners joint venture acquired it in 2012. The LEED Platinum-certified asset is located at 1201 3^rd Ave. in Seattle’s CBD and was developed by Wright Runstad & Co. It also served as Washington Mutual’s world headquarters from its completion in 1988 to 2006. Amenities include a transit tunnel in the building with access to light rail and buses and a three-story outdoor plaza with retailers, services and eateries.

6. Rufus 2.0 – Block 19 in Seattle

Amazon’s 1,130,790-square-foot office tower is another testimony to the tech giant’s taste for massive facilities and its expansive Seattle footprint. The 55-story tower is situated at 2101 7^th Ave. and is the largest asset within the landlord-occupied recently completed campus. The building is also known as Day 1, Amazon’s prior South Lake Union campus, or Amazon Tower II. It features three intersecting glass and steel spheres totaling 65,000 square feet across five floors capable to house 1,800 employees, as well as retail space.

5. Intel Jones Farm Campus in Hillsboro, Ore.

Intel Jones Farm Campus in Hillsboro, Ore.

Intel’s 1.3 million-square-foot campus sits on 116 acres at 2111 NE 25^th Ave. in Hillsboro and encompasses five fully occupied buildings. The campus was built in phases in 1990, 1994 and 2000. It features a cafeteria and a direct shuttle to the Hillsboro airport, located less than 2 miles away.

4. Columbia Center in Seattle

Downtown Properties acquired the 1,527,101-square-foot Columbia Center in 2015 for no less than $711 million. At 937 feet, the LEED Platinum asset was originally completed in 1985 and underwent renovations in 2004 and 2013. It spreads across 76 floors and includes 50,000 square feet of retail, bike locker, conference center, dry cleaning and showers. Located at 701 5th Ave. in downtown Seattle, Columbia Center houses a diverse tenant roster including Government Services Administration, U.S. Department of Health and Human Services, City of Seattle, Dorsey & Whitney and Dropbox.

3. Starbucks Center in Seattle

Starbucks Center in Seattle

The asset, owned by Notze-Stagen, was formerly known as the SODO Center and is situated at 2401 Utah Ave. S. in SoDo, Seattle’s industrial district. The 2.1 million-square-foot asset achieved LEED Gold certification in 2007 and is the largest and oldest building in the U.S. to earn a national green certification. It was originally built in 1912 and previously served as a Sears location.

Following a 1992 adaptive reuse, Starbucks moved its administrative offices to the facility and then its headquarters in 1997. The property encompasses three buildings of six, nine and 10 stories. It also features a 100,000-square-foot retail and a large industrial component.

2. Microsoft Redmond Main Campus in Redmond, Wash.

The campus totals 2,454,879 square feet across 35 buildings erected between 1986 and 2007. Located at 16255 N.E. 36th Way in Redmond, Wash., on more than 231 acres, it is surrounded by greenery and has direct exposure to Route 520. Microsoft has been occupying the campus since 1986 and acquired six of the buildings in 2002 from Safeco Insurance. Following the acquisition, the owner merged the existing campus with the recent purchase, rebranding it as Microsoft Redmond Main Campus.

1. Microsoft World Headquarters – West Campus in Redmond, Wash.

Microsoft World Headquarters – West Campus in Redmond, Wash.

The largest property on our list encompasses 2,525,860 square feet of office space and carries 16 addresses along 40th St. in Redmond. It is located in the close vicinity of the Microsoft Redmond Main Campus and comprises 18 buildings on 88 acres. It is a mixture of suburban corporate offices and landscaped parks. Besides cafeterias or high-tech meeting rooms, the complex features interactive exhibits such as giant screens and games, Surface displays with multi-touch technology, as well as a company store.

Images courtesy of Yardi Matrix

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Skanska is building a new $186 million high school for the Sherwood School District in Portland, Ore.

Skanska has begun construction of a new $186 million high school for the Sherwood School District in Portland, Ore., that is expected to be completed for the 2020-2021 school year. The 352,000-square-foot building will be constructed on a 73-acre campus and accommodate up to 2,400 students.

The new school, which was funded by a bond measure approved by district voters in November 2016, is replacing the current overcrowded Sherwood High School. That building will be transformed into a middle school and two current middle schools will become elementary schools. In addition to new science and technology classrooms and multiple gymnasiums, the high school will feature a 600-seat performing arts center, more than doubling the current seating capacity. The campus will also have seven sports fields and a football complex.

The facility was designed by BRIC Architecture of Portland. Cornerstone MG represents the school district during the project.

Skanska said it had signed a contract for $77 million to construct the school and plans to include the payment in its U.S. order bookings for the second quarter of 2018.

One of the leading construction and development companies in the United States, the Sweden-based firm specializes in building construction, civil infrastructure, public-private partnerships and commercial property developments.

Higher Education Projects Underway

This spring, Skanska took on two higher-education projects in the Southeast U.S. The company signed a $106 million contract in April with North Carolina State University to build a new engineering facility at its NC State Centennial Campus in Raleigh, N.C. The 226,042-square-foot building will be home to engineering labs, administrative offices and classrooms and is scheduled for completion by July 2020.

Also in April, Skanska said it had signed a $63 million contract to build the 380,000-square-foot University of South Florida (USF) Morsani College of Medicine and Heart Institute Tower at Channelside Drive and Meridian Avenue in downtown Tampa Bay, Fla. It is the first building in the $3 billion Water Street Tampa project and is expected to be ready for 1,800 students, faculty, researchers and staff by 2019.

Images courtesy of BRIC Architecture

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Hilton Eugene

Chicago-based hospitality company AJ Capital Partners has acquired the Hilton Eugene, a 275-key hotel in downtown Eugene, Ore. The property will be operated as a Hilton-branded hotel until the end of the year, when it will undergo major renovations in order to convert the hotel into Graduate Eugene, part of the Graduate Hotels’ collection. AJ Capital selected Starwood Property Trust Inc. to provide financing for the project.

Located at 66 E. 6^th Ave., Hilton Eugene offers convenient access to University of Oregon’s campus, Eugene City Hall, the Hult Center for Performing Arts and various shopping, dining and entertainment venues. Additionally, the hotel is walking distance to sports venues such as Autzen Stadium, Matthew Knight Arena and Hayward Field.

The 12-story property features common area amenities such as:

• business center
• bar area
• laundry/valet service
• fitness center
• swimming pool

Upgrades will be made to the guestrooms, common areas, restaurant and  the hotel’s 20,000-square-foot meeting and event space. The comprehensive renovations are expected to be completed by summer 2019. The hotel will remain open during this time. Graduate Hotels has 11 open and operating hotels across the U.S. and seven additional under development properties set to be open by 2020.

Image via Google Street View

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The Cubes at Troutdale

CRG will develop The Cubes at Troutdale, a 350,000-square-foot speculative industrial and logistics facility in Portland, Ore. BatesForum, a subsidiary of Clayco, is serving as the architect on the project and construction is scheduled to start sometime this month, with occupancy coming available around September 2019.

The property will be located on the east side of Portland in Troutdale Reynolds Industrial Park (TRIP) along Interstate 84. The facility will also be in close proximity to the FedEx Ground hub, the Amazon fulfillment center and the Troutdale Airport.

“We liked the investment dynamics of Portland. It’s one of the most supply constrained markets on the West Coast and there’s very strong demand fundamentals there with a good balance of manufacturing and distribution users in that market that are growing or looking to move into more modern facilities,” Mike Wurtsbaugh, CRG’s senior vice president, told Commercial Property Executive. “What’s unique about the West Coast, and Portland in particular, is that it’s a very supply-constrained market and not a lot of land available.”

CRG already had investments in Seattle and see both cities as major markets for its operations and strategy going forward.

“The company philosophy is to grow in primary strategic markets and we view the Pacific Northwest as a primarily logistics hub,” Wurtsbaugh said. “Both Portland and Seattle have a strong regional focus and we’re looking to invest in the top 10 primarily logistic markets where there is strong tenant demand, reasonable supply balance and where capital partners desire to own these properties long-term.”

The Cubes way

The Cubes at Troutdale will be the fifth industrial park under “The Cubes” brand, which follows its strategy of developing for the future and anticipating the enhanced needs of next-generation industrial users.

“What makes this facility stand out is that this is a new, modern bulk distribution facility with truck parking, 36-foot clear building height, cross dock capability, ample trailer storage and car parks,” Wurtsbaugh added. “A lot of the older buildings are under 30-foot clear height, so ours is more typical of the modern area so tenants can go vertical in their cubic space, which makes it more cost-effective.”

According to Wurtsbaugh, e-commerce is driving business at CRG, as the industry demands more modern industrial buildings to accommodate consumer-centric strategies, and only 11 percent of total inventory has been delivered in the last 10 years.

“Our location is well-located on the Interstate Network system, where Portland can serve a regional market, so the majority of our tenants will have some logistic-related operation going on,” Wurtsbaugh said. “And in this new e-commerce world, users want to have the technology and modernization and ability to order product online and have it shipped. Not every company can invest in that level of technology, so they partner with third-party logistics providers, and we see a demand from them.”

CRG has been busy in May, having recently sold a newly constructed, 1 million-square-foot industrial asset to Griffin Capital Co. in Savannah, Ga., for $57 million. In January, CRG acquired DuPont Corporate Center, a former Intel campus located south of Seattle.

Rendering courtesy of CRG

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Courtyard Portland Downtown Convention Center Hotel

CSM Lodging has completed renovations for Courtyard Portland Downtown Convention Center Hotel, a 202-key property situated in downtown Portland. CSM Corp. owns and operates the asset.

Located at 435 NE Wasco St., on the eastside of downtown, Courtyard Portland Downtown Convention Center Hotel offers convenient access to the Oregon Convention Center, Moda Center and MAX rail line. The asset is also a short drive from Multnomah Falls and Oregon Wine Country, nine miles from Portland International Airport, close to Lloyd Center shopping mall and a five-mile drive to the Oregon Zoo and Hoyt Arboretum.

The newly renovated hotel features 5,000 square feet of event space and a Pacific Northwest-inspired restaurant and lounge. Rooms now feature new seating, desks, dressers, carpet and wall coverings, as well as new tile, vanity and glass-enclosed showers. Common-area amenities include a business center, free W-Fi, on-site laundry, valet dry-cleaning, free downtown area shuttle service, fitness center and indoor swimming pool.

In April, Marriott opened an 118-key Courtyard by Marriott Austin Northwest/Lakeline, following nearly three years of construction work.

Image via Google Street View

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Towne Storage

CBRE Global Investors has acquired Towne Storage, a 100,022-square-foot Class A office building in Portland, Ore. NKF Capital Markets arranged the sale on behalf of the seller, an entity owned by certain funds managed by Westport Capital Partners LLC. The buyer was self represented in the deal.

Located at 17 SE 3^rd Ave. the property is alongside the Burnside Bridge, near the NE M L King & E. Burnside light rail and bus stop. The office building also provides access to Interstate 84.

Towne Storage is a more than 100-year-old warehouse that has recently been renovated and repositioned as an office building. The property is currently occupied by Autodesk Inc. Before the repositioning, Towne Storage provided mini storage units and rentable space for artists and small businesses, according to Next Portland, a website dedicated to providing insights on what’s being built in Portland.

“The sale of Towne Storage is a testament to Portland’s ongoing appeal to institutional investors’ appetite for best-of-class investment opportunities,” said Nick Kucha, vice chairman of NKF Capital Markets.

Image courtesy of NKF Capital Markets

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1620 NW Mulholland Drive, Roseburg, Or.

Hilton has opened a new Hampton Inn by Hilton hotel in Roseburg, Ore. Hampton Inn by Hilton Roseburg is an 84-key property owned by Hanna Hospitality VII. InnSight Management Group manages the property.

“InnSight is pleased to partner with Hanna Hospitality to bring the first Hampton Inn & Suites to the Roseburg area. Guests will appreciate the custom design and artwork this property features,” Liz Dahlager, VP of sales & marketing at InnSight, said in prepared remarks.

Located at 1620 NW Mulholland Drive, Hampton Inn by Hilton Roseburg is close to Interstate 5 and offers convenient access to the VA Roseburg Health Care System, Mercy Medical Hospital and downtown Roseburg. Additionally, Mahlon Sweet Field Airport is 80 miles away.

The new hotel features a mix of rooms and studio suites with sofa beds, 594 square feet of meeting rooms, a heated indoor swimming pool, treats shop and hot beverages in the lobby. Other common-area amenities include a business center, baggage storage, fitness center and a laundry/valet service.

Image via Google Street View

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Montecito Medical Real Estate has bought WVP The Doctors’ Clinic, a 34,554 square-foot, two-story medical office building in Salem, Ore., located at the intersection of Skyline Road and Kuebler Boulevard.

Constructed between 1996 and 1999, the building is fully occupied by WVP The Doctors’ Clinic. Founded in 1903, the facility specializes in a variety of procedures, including family medicine, internal medicine, cardiac testing, lab work and minor surgery. Having 90 employees, including 20 medical providers, 14 physicians, three physician assistants and three nurse practitioners, the building also contains a CT scanner and a fully digital radiology department.

“The physician owners of Doctors’ Clinic Building Co. carefully considered multiple offers and were deeply satisfied with Montecito as a purchaser both in terms of the comprehensive offer and because of Montecito’s mission as an owner of medical real estate,” said Steven Nord, administrator of The Doctors’ Clinic Building Co., in a prepared statement.

The asset is approximately 50 miles south of Portland, Ore. Kaiser Permanente is also located nearby.

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Pioneer Tower, Portland, Ore.

Pioneer Tower, a JLL Income Property Trust Class A office property in Portland, Ore., achieved LEED Silver certification. The building had also recently earned the U.S. EPA ENERGY STAR certification, for which the REIT completed an energy audit that identified several energy conservation measures to meet the prerequisite.

The 17-story, multi-tenant office building is located in Portland’s CBD, offering easy access to the Transit Mall and Pioneer Place. Pioneer Tower is currently 95 percent leased to a diverse roster of professional services tenants whose average tenure is about 14 years. JLL Income Property Trust acquired the asset in July 2016 and since early 2017 has been working toward the goal of earning the LEED Silver award. For the project to be eligible, various contributions were made from the local property team, a sustainability consultancy and in-house energy and sustainability experts.

What makes a tower green?

Project highlights include: 100 percent of durable goods diverted from landfills; green-cleaning program that minimizes the use of chemicals, while providing increased air quality; replacement of all lamps with higher mercury content with either LED or low-mercury content bulbs; replacement of older restroom fixtures to achieve maximum indoor water efficiency; increased recycling diversion rates among the tenants, as well as alternative transportation methods. In addition, the ENERGY STAR certification places Pioneer Tower in the top 25 percent of similar facilities nationwide for energy efficiency and meets strict energy efficiency performance levels set by the EPA.

“Much like the approach at Pioneer Tower, we will continue to seek out cost-effective methods to achieve certifications across JLL Income Property Trust’s portfolio through initiatives such as our LEED Volume Program, which achieves certification at half of the cost of historical LEED projects,” noted Eric Duchon, Global Head of Sustainability with LaSalle, in prepared remarks.

Image courtesy of JLL Income Property Trust

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Lauren Peng, CBRE

CBRE has appointed Lauren Peng as associate director of asset services for the firm’s Portland, Ore. office. Peng is relocating from Charlotte, N.C., where she held the same position. In her new role, Peng will lead a team of over 25 real estate management professionals.

Peng brings more than 18 years of industry experience to her role and has been with the company for over nine years. She has a background in management of complex properties, development, lease-ups and operations. One of her major projects included NASCAR Plaza in Charlotte, a 20-story LEED-certified office tower that shares a city block and facilities with the NASCAR Hall of Fame and Convention Center ballroom. The project featured mission-critical operations of NASCAR Media Group, housing studios and production facilities for live television shows.

Peng holds a Bachelor of Science degree from Bob Jones University. She served as the president of the Carolinas/West Virginia BOMA Chapter and is a member of the U.S. Green Building Council.

Image courtesy of CBRE

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Rendering of Heartline in Portland, Ore.

Vacasa, a vacation rental management company, signed a 61,000-square-foot lease to relocate its corporate headquarters to Security Properties’ Heatline, a five-story development in Portland, Ore. The firm will keep its existing 36,000-square-foot lease at the adjacent RiverTec building, also owned by Security Properties.

Located at 1241 N.W. Johnson St., the upcoming building will feature more than 10,000 square feet of retail space. Developed to meet LEED Gold standards, the office mid-rise is slated to open for occupancy by the end of June. The property is situated less than a mile from Interstate 405 and next to multiple bus stations, restaurants and hotels, including Giorgio’s Restaurant, Andina and Hampton Inn & Suites.

Downtown Portland has seen an increased number of deals in recent months. In January, Menlo Equities sold One Pacific Square, a 239,000-square-foot Portland office building located less than a mile from Heatline.

Image courtesy of Vacasa

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Glisan Corporate Park

A joint venture between Trammell Crow Co. and Principal Real Estate Investors has finished the development of Glisan Corporate Park, a three-building, 504,528-square-foot speculative development in Gresham, Ore.

“Portland is experiencing historically low vacancy rates, and with a constrained supply of additional development, we believe that Glisan Corporate Park is well positioned to accommodate high quality tenants looking for space in this tight market; nearly 4.4 million square feet is currently under construction, however 72 percent of that is preleased,” Steve Wells, Trammell Crow Co.’s senior managing director of its Portland office, said in a prepared release.

Situated on 28.5 acres, the property marks the first LEED-certified industrial speculative development completed since 2012.

According to Louis Fontenot, Jr., Trammell Crow Co.’s LEED AP and vice president in Portland, the LEED certification creates value for tenants and the community in several ways.

“The energy and water efficiency standards employed in the buildings will reduce utility costs on an ongoing basis,” he said. “Second, the indoor environmental quality measures implemented inside the building will create a healthier, more productive workplace for staff, and lastly, the LEED certification of this park demonstrate our commitment to a healthy environment for employees, neighbors and the community.”

The trio of buildings contains industrial space ranging from 139,727 to 200,701 square feet, and boasts 30 to 32-foot clear heights. There’s also plentiful parking and storage for trailers, and each building sits on its own parcel, with utilities (water/sewer) to serve each.

Glisan Corporate Park is in a neighborhood that includes a Subaru distribution center and ON-Semiconductor facility, which adds to its visibility in the area.

Already drawing interest 

CBRE Portland’s Cara Nolan and Stuart Skaug are serving as the exclusive listing agents for the property and noted that there’s already an impressive mix of prospective tenants that are either new to the Portland market or looking to expand current operations.

In February, Trammell Crow Co. developed a new 302,000-square-foot Toyota dealership in Los Angeles for Lithia Motors.

Overall, Trammell Crow Co. has developed or acquired more than 2,600 buildings valued at nearly $60 billion and totaling more than 565 million square feet. The company was named the top development firm by Commercial Property Executive and Multi-Housing News in 2017.

Image courtesy of Trammell Crow Co.

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The Porter

Hamburg-based Union Investment has purchased The Porter, a 294-key boutique and lifestyle hotel in Portland, Ore., for approximately $149 million (EUR 120 million). The acquisition was made on behalf of open-ended real estate fund, Unlimmo: Global. The hotel is part of the Curio Collection by Hilton brand, and Widewaters Hotel LLC is the developer, vendor and operator of the property. The acquisition marks Union Investment’s sixth hotel acquisition in the U.S.

At the intersection of SW 2^nd Ave. and SW Columbia St., The Porter is located in downtown Portland, the city’s central business district. The Porter is a 16-story building, with 13 floors of guest rooms. The hotel also features a restaurant, a coffee bar and a grab-and-go market, as well as a rooftop restaurant with a lounge. Additional amenities include approximately 12,916 square feet of conference space, heated indoor pool and fitness center with individual meditation and yoga rooms.

“With its high construction quality, exceptional high-end accommodation concept and excellent location in Portland’s business district, The Porter is the ideal addition to our U.S. portfolio, which is set to grow at a similar pace going forward as in recent years,” said Andreas Löcher, head of investment management hospitality at Union Investment, in prepared remarks.

Image courtesy of Union Investment

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Office-using employment in Portland, click to enlarge

During the last four quarters, Portland’s office market has been in a kind of expectation state, trying to adjust to the changes in the tech sector: a focus shift from electronics hardware and manufacturing toward software and web services; the sale of companies such as Cascade Microtech, Planar Systems and TriQuint Semiconductor; and a slowing startup sector. Although tech companies continue to see Portland as a more lucrative alternative to more expensive West Coast cities, employment in the information segment registered a 3.9 percent decrease in November.

To retain employees and find new talent, several businesses have relocated from the suburbs to the better-transited, highly amenitized Central Business District (CBD) and Pearl District. Vacancy rates in these submarkets were lower than the average, at 5.2 percent and 9.7 percent. On the other hand, startup- and entrepreneur-friendly suburban locations such as the Sunset Corridor and Beaverton posted vacancy rates as high as 12.8 percent and 17.1 percent. The metro’s overall 10.5 percent vacancy might decrease further as new supply is limited and companies such as Amazon, WeWork and Adidas are drafting lease agreements for business expansion.

Demand for new Class A office space remains healthy, especially in high-profile submarkets such as the CBD and Pearl District. Nearly 1.1 million square feet was under construction at the end of December, and another 4 million is in the planning or permitting stage.

Transaction activity has been robust, with almost $1 billion in sales volume.

Read the full Yardi Matrix report.

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The Radiator Building

HFF has arranged an $8 million loan for the acquisition of The Radiator, a 34,327-square-foot office building located in Portland, Ore. Senior Director Jordan Angel and Associate Zachary Kersten were part of the debt placement team that represented the borrower, Manchester Capital Management. HFF will also service the 11-year, fixed-rate loan.

Located at 3530 N. Vancouver Ave., at the gateway to North Portland, The Radiator is close to various shopping, dining and entertainment venues such as New Seasons Market Williams, Denorval Unthank City Park and Dawson Park. Additionally, the Legacy Emanuel Medical Center and American Red Cross Blood Donation Center are less than one mile from the office building.

Wood-framed building

Built in 2014, the fully leased, five-story property was designated the tallest wood-framed building in Oregon. The office building features two ground-floor retail spaces. The Radiator is anchored by The Kartini Clinic, a pediatric eating disorder treatment program company. Additional amenities include bike storage, showers on every floor and 10 on-site, ground-floor parking spots.

PATH Architecture Inc., served as the design architecture firm and Kaiser Group Inc., handled the construction of the project. Recently, HFF secured the acquisition of Palladian Corporate Center, a Class A office building in Durham, N.C., on behalf of an institutional owner advised by Clarion Partners.

“As the first all-timber building to be built in a century, the Radiator Building is on the cutting edge of design and is the first new office building in the dynamic North Williams Corridor of Portland,” Kersten said in prepared remarks.

Image via Google Street View

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One Pacific Square in Portland, Ore.

Menlo Equities has sold One Pacific Square, a 239,000-square-foot office tower in Portland, Ore, to an institutional investor.

One Pacific Square, located at 220 N.W. Second Ave., served as NW Natural’s headquarters since the building opened for occupancy in 1983. The natural gas distributor will relocate to 250 Taylor St. The new owner is set to modernize the lobby, add first-floor shared tenant amenities and activate existing retail spaces. The LEED certified office high-rise is situated in the north end of Portland’s CBD, 1.5 miles from Interstate 5. The property offers convenient access to multiple bus stations, restaurants and hotels, including Theo’s, The Society Hotel and The Benson.

HFF’s Logan Greer, Michael Leggett, Gerry Rohm, Ben Bullock, Dave Otis, Jeff Hodson and Kevin Freels represented the seller in the transaction. Specht Development negotiated the deal on behalf of the buyer. The transaction comes a few months after HFF secured more than $40 million for the disposition and recapitalization of CH2M Center, a 227,000-square-foot Portland office tower.

According to Yardi Matrix data, Menlo Equities purchased One Pacific Square in 2015 from The Ashforth Co. as part of a multi-state portfolio sale.

Image courtesy of Yardi Matrix

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Savier Street Flats

Kennedy Wilson has purchased Savier Street Flats, a 179-unit community in Portland, Ore., for $60 million. This transaction marks the company’s third large deal in the Portland area in recent months. Kennedy Wilson secured an eight-year loan for $33 million at a fixed rate of 3.5 percent and invested $27 million in equity. Greystar manages the asset.

Located at 2270 NW Savier St., in Portland’s Northwest neighborhood, the property is close to various shopping, dining and entertainment venues. Additionally, the Portland International Airport is approximately 15 miles away from the community.  

The two four-story buildings feature a mix of studios, one- and two-bedroom units ranging in size from 511 to 1,135 square feet. Each unit provides amenities such as a dishwasher, walk-in closet, air conditioning and energy-efficient lighting. Additionally, the first floor includes more than 6,000 square feet of retail space. Common area amenities include:

• entertainment room with kitchen
• TV lounge
• pet wash
• bicycle storage
• bicycle repair room
• fitness center
• outdoor entertainment lounge with fire pit
• outdoor grills and projection screen
• business center
• community room

According to data provider Yardi Matrix, the community was 95 percent occupied as of October and has an average rental rate of $1,851. Kennedy Wilson’s latest transaction was the acquisition of a 343-unit community in Issaquah, Wash., for $135 million.

“With its relatively low cost of doing business, high quality of living and highly educated population, Portland has become one of the country’s strongest economies anchored by high-tech growth,” Kennedy Wilson Managing Director Shem Streeter said in a statement. “Like many of the major urban markets along the West Coast, all signs point to an increased need for well-located housing like what we are offering at Savier Street Flats.”

Image courtesy of Yardi Matrix

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Vista Logistics Park in Gresham, Ore.

Specht Development Inc. has completed the largest speculative industrial development in the Portland region ever launched in a single phase. The 732,824-square-foot project comprising three buildings includes the metro’s largest single vacant industrial space under one roof.

Leasing at Vista Logistics Park, located on 37.42 acres at SE 223^rd and Stark streets in Gresham, Ore., has begun.

“Based on our research, Vista Logistics Park is the largest single-phase speculative development ever constructed in the Portland metropolitan area,” Don Ossey, principal of the leasing firm Capacity Commercial Group, said in a prepared statement. “The project also offers the largest single vacant industrial space under one roof, with one of the buildings consisting of 494,464 square feet. But for this project, buildings larger than 300,000 square feet do not exist in our area.”

Vista Logistics Park Building C

That building has a minimum clear height of 36 feet. The two smaller buildings—112,940 and 124,420 square feet respectively—both have clear heights of 30 feet. The site, purchased for $9.3 million from the Port of Portland, has easy access to Interstate 84. The Port of Portland worked closely with the city of Gresham to allow Specht to break ground in August 2016, less than two months after the purchase and sale agreement was signed.

“This project would not have moved forward when it did without the outstanding cooperation of the Port of Portland and the City of Gresham. We are grateful for their partnership in this project,” Todd Sheaffer, president of Portland-based Specht Development said in a prepared statement.

New York Life Real Estate Investors is the primary equity partner in the project.

Ossey and David Ellis are leading the Capacity Commercial Group brokerage team that is leasing the property.

Mackenzie was the project architect and engineer and Perlo Construction was the general contractor.

Specht’s Active Pipeline

Specht and its affiliate entities have developed or provided project and construction management on more than 9.5 million square feet of commercial and industrial real estate since it was formed in 1992. Since June 2014, Specht and its investment partners have begun construction on a total of nearly 1.6 million square feet of speculative industrial developments in metro Portland, including Vista Logistics Park.

In July, Specht Development and its institutional capital partner, Pacific Coast Capital Partners LLC, sold the Interstate Crossroads Distribution Center, a 492,554-square-foot warehouse and distribution center in the Airport Way submarket of Portland, for $56 million to WPT Industrial REIT. The property was fully leased to Staples and LKQ, a nationwide wholesaler of used and refurbished auto parts. One of the last developable sites in that corridor, the property has easy access to the Port of Portland, Portland International Airport and Interstates 84, 205 and 5.

Image courtesy of Specht Development

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172nd NE and Sandy Blvd, Gresham, Ore.

CBRE represented Panattoni Development in the sale of a 12.6-acre industrial site at Panattoni’s Portland Portal Distribution Center in Gresham, Ore. Andy Kangas, CBRE’s President worked on behalf of the seller. Macadam Forbes’ brokers Rod Brokenshire and Stu Peterson worked on behalf of the buyer, a local food distributor.

Located at 172^nd NE and Sandy Blvd, the Portland Portal Distribution Center is a few minutes north of Interstate 84. The building is close to U.S. Bank, Pacific Northwest Carpenters Institute and CEVA Logistics. Additionally, the Portland International Airport is seven miles from the distribution center.

The development marks the third major build-to-suit project in the Northeast submarket in the past 24 months. The company sold the asset under a fee development arrangement, which made it attractive for the buyer.

This transaction marks Panattoni’s second in Portland’s Northeast submarket in the past year. The company’s latest transaction included the sale of Mary’s Gone Crackers, a Class A manufacturing and distribution center in Reno, Nev.  

Image via Google Street View

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