Real Estate Broker R. Tom Smith, ABR, GRI, EMS, RECS has joined NAI Norris, Beggs & Simpson’s Vancouver office to specialize in retail and investment sales. He was most recently the Designated Broker at Columbia Pacific Commercial and has 14 years’ experience in brokerage of commercial property. In addition, R. Tom has 18 years’ experience of commercial property and asset management for residential, office and retail properties. He is a licensed managing broker in the state of Washington.
Eight Norris, Beggs & Simpson Companies employees were awarded advanced titles at the company’s annual Awards Banquet on January 24.
In the administrative division, Birgit Layne was named Associate Vice President and Adele Copp was promoted to Assistant Manager of Loan Administration. Kelly Sullivan was named Senior Brokerage Assistant, Christa Herr was awarded Senior Property Management Assistant and Victoria Petkau received the new title of Senior Property Management Accounting Assistant.
Alexandra Ionescu Henderson specializes in the leasing and sales of suburban and Central City office properties, with an emphasis on conventional and medical office properties. She was nominated for the Portland Business Journal’s 40 under 40 for 2015.
Josh Rutter has been with NAI Norris, Beggs & Simpson since 2008. He earned his Certified Property Manager (CPM) designation in 2014. Currently based in Bend, Oregon, Josh is a licensed real estate broker in both Oregon and Washington as well as a Certified Green Broker.
Maija Mueller joined NAI Norris, Beggs & Simpson in 2014 with over 25 years in commercial real estate industry. She is a Certified Property Manager (CPM) and her impressive career includes property management, development, acquisition and disposition, leasing and financing.
Birgit Layne joined NAI Norris, Beggs & Simpson in 2006. She currently provides support and direction on the Property Management team as well as Norris, Beggs & Simpson’s Multifamily Management division.
Adele Copp joined NBS Financial Services in 2010. She is responsible for closing loans originated by the loan origination staff, and facilitates communication between lenders and borrowers to ensure that all documentation, titles and contracts are in order and satisfy both the lender’s and borrower’s expectations.
Kelly Sullivan joined the Brokerage team in 2007. As Senior Brokerage Assistant, she supports several brokers and assists with departmental operations, research and administrative responsibilities.
Christa Herr started her career with Norris, Beggs & Simpson in 2011 and she assists in the day-to-day operations of retail, office and industrial commercial properties. She most notably assists with the 262,975 sf office property, the Lincoln Building, located in downtown Portland.
Victoria Petkau joined the Property Management Accounting team in 2013. She currently provides support to multiple property managers by assisting in the accounting needs of several office, retail and industrial properties.
Berkshire Hathaway HomeServices Northwest, a residential real estate firm, signed a 4,873 sf lease at the end of December and will now be operating its regional hub for the east side at Mt. Scott Center. Located at 9201 SE 92nd Ave. in Portland, OR, Mt. Scott Center is a mixed use building featuring ground floor retail and office space with excellent exposure and accessibility. NAI Norris, Beggs & Simpson Real Estate Broker Alexandra Ionescu represented the lessor, Mt. Scott Center, LLC. Tom Hanacek of Berkshire Hathaway represented the lessee.
- Among the world’s major economies, the United States had the strongest growth in 2014. The government announced that the U.S. economy grew at a rapid annual rate of 5% in the Third Quarter, which was the fastest pace in more than a decade. Such widespread growth precipitated Wall Street’s record highs for both the Dow Jones Industrial and S&P 500 at year end. The labor market also greatly benefited. Employers hired nearly 3 million workers in 2014, which was the most since 1999. Fourth Quarter’s unemployment rate steadied at 5.8%, a full percentage point lower than at 2014’s start. Yet, for all the actual tightening in the job market, wage growth barely improved. The yearly trend in nominal hourly wage growth remained at about 2%, where it has been since 2010.
- Starting in 2015, the Federal Reserve is expected to gradually raise interest rates to curb excessive borrowing; however, there is concern that this could stifle the economic momentum gained in 2014. Fed officials project the domestic economy to grow at a rate between 2.6% and 3% in 2015 and the unemployment rate to benchmark 5.2% or 5.3%.
- For the past six years, inflation has been stabilized well below 2%. Yet, with labor market gains and current tumbling oil prices, inflation may actually decline in 2015. Lower oil prices also acted as a temporary financial stimulus during Fourth Quarter, leaving more immediate money in consumers’ pockets. As a result, holiday shopping consumer optimism rose to an 8-year high.
- Oregon’s minimum hourly wage is second highest in the nation at $9.10 and will increase to $9.25 on January 1 due to the state’s laws requiring an annual adjustment tied to inflation.
- Oregonians can also expect another change in 2015 as voters passed Measure 91, which authorized the personal use and possession of marijuana starting on July 1, 2015.
- The booming Portland housing market is forecasted to remain robust in 2015, despite the expected seasonal slump during the winter months. 685 homes sold in November, which was 6.4% higher than the year previous. Motivated by the onslaught of millennial first-time buyers, builders are anxious to respond to the impending housing demand. Millennials are projected to become the largest demographic of home buyers within the next 5 years.
- Portland’s Central City vacancy rate tumbled from 10.58% Third Quarter to 9.01% Fourth Quarter with 260,146 sf absorption.
- An additional 381,380 sf is currently under construction in the Central Business District and Northwest submarkets; however, such sharp increases in demand can risk outpacing the city’s limited supply.
- Suburban’s vacancy rate decreased to 13.52% with 79,468 sf absorption. Nike filed expansion plans to add 1.3 million sf to its existing 2.2 million sf campus.
- Benchmarking another historical low, Portland’s industrial vacancy fell to 6.8% during Fourth Quarter with 1,012,124 sf absorbed.
- The quarter’s major activity proved that demand for smaller “industrial lite” space has surpassed demand for large boxes of space.
- During Fourth Quarter, the retail vacancy rate dipped to 6.06% with 153,007 sf of absorption.
- The 257,399 sf of current construction throughout the metro-area includes the highly anticipated Kruse Village in Lake Oswego, which is slated to deliver by January 2015.
- Portland’s multifamily market steadied its momentum Fourth Quarter, increasing its vacancy rate to 2.79%. The average rent for a 2-bedroom, 1-bathroom apartment bumped up to $1,030. Rental rates, permits and construction also increased.
- Now at the end of 2014, institutional developers continue to flood the market, motivated by Portland’s high rent, high occupancy and low cap rates driven by enormous capital. With the bulk of today’s land sales concentrated in Multnomah County, Portland has approximately 26,000 new units in the current pipeline.
As part of Academy Square Shopping Center’s upgrade and expanding efforts, Connect Wireless, an AT&T authorized retailer, has leased approximately 3,000 square feet. NAI Norris, Beggs & Simpson Associate Vice President Jack Gallagher represented the lessor, Academy Square, LLC.
“AT&T Wireless’ commitment to Academy Square Shopping Center highlights the growing trend of well-selected and active tenants anchoring shopping centers,” said Dennis Curtis on behalf of Academy Square, LLC. “Their strategic placement often guarantees increased foot traffic and sales.”
Academy Square Shopping Center is ideally located on Lancaster Drive NE at the signalized intersection with ‘D’ street, strategically across from Salem’s largest regional mall, Lancaster Mall. With convenient customer parking, Academy Square Shopping Center provides easy access and is at the heart of the area’s best shops and restaurants.
“As the retail market strengthens, landlords are definitely more focused on tenant selection and this move was reflective of that trend,” explained Jack Gallagher.
AT&T Wireless is expected to move-in first quarter 2015.
In a recent column for the Daily Journal of Commerce, three NAI NBS brokers gave an inside look into the current market:
Brandon Frank on Office
If Portland’s office market were to name its golden child, the Pearl District would be it without question. With a broad base of tenants ranging from traditional law and accounting firms to creative tech startups, the Pearl District reigns supreme. 2014 saw a migration surge of tech companies escaping the oversaturated safe havens of San Francisco and Seattle, but it wasn’t just tech companies opting for Portland’s deep talent pool and comparatively low cost of living. Many different types of office users sought new space or expansion options this year. After all, the city’s lifeblood is Portland’s rare 24/7 vibrancy and at its epicenter is the Pearl District.
Whereas Portland on the whole balances urban luxury and rural sanctuary, the Pearl District is a concentration of culture. The Pearl District’s unique experiences have birthed the term ‘Pearl Envy’ in which other cities try to model their urban development upon the success found in the Pearl. As such, the Pearl District boasts the highest lease rates in the city as a lifestyle destination. The proliferation of multifamily development is countered by new restaurants, fun specialty boutiques, and exciting arts and entertainment. Office tenants prefer the Pearl’s accessibility and seamless transition between family friendly parks, work and play. With easy transportation options and numerous bike lanes, the Pearl District is also attractive to a wide age spectrum spanning from young professionals to retirees.
As more discover and flock to the Pearl, there is concern if it can accommodate and sustain such robust growth. Though Portland’s office market is currently battling limited space options with low vacancy and higher rates, the Pearl District is also the target for the city’s newest development plans between housing projects, residential towers and mixed-use high-rises. This new development will ensure the Pearl’s future as a thriving capital of commerce and culture.
Scott MacLean on Industrial
Between staggering amounts of speculative development proposals and new construction projects, Portland is experiencing a tremendous industrial growth spurt. Of course, it’s greatly needed as high demand currently outpaces the city’s supply. Yet, existing close-in industrial properties are also undergoing significant change. As traditional industrial users expand their presence with new development, close-in properties are now attractive and available to a new breed of modernized industrial tenant.
Technology has undoubtedly revolutionized manufacturing trades, refining processes and production to an art. Today’s industrial tenants are a combination of their predecessors with less unwieldy machines and more efficient equipment. As such, this tenant is oftentimes a creative office user too. With obvious competing wants and needs between industrial and office space usage, today’s industrial tenant requires the best of both worlds.
In the past few years, the perfect balance between industrial and office was discovered in flex space, and more specifically, renovated warehouses. Offering large blocks of contiguous, unadulterated space, renovated warehouses are an idyllic solution for tenants wanting build to suits. Warehouse space provides operable windows, loading docks, and useful freight elevators; all ideal amenities for the ‘manufacturer-lite’ or tech startup. Additionally, multistory buildings can be retrofitted to downsize space for smaller businesses.
However, repurposing existing buildings for its large space options hasn’t just been the trend, but has become today’s standard. New industrial construction is now cognizant of this new type of tenant’s needs. The most recent development of this kind is the six-story New York building, a clear game changer as the first new high-rise industrial building in Portland in 60 years. With over 100,000 square feet of open floor space, the New York building proved that a spectrum of tenants is willing to pay more for the quintessential open industrial space, and that this is the expectation moving forward.
Jack Gallagher on Retail
Portland’s retail market continued to show revitalized strength at the start of the holiday shopping season. This was primarily due to Portland’s affinity for local businesses and preference for lifestyle centers and specialty stores in enclosed malls.
Portland metro consumers are primarily staunch supporters of niche small businesses, which account for over 85 percent of all businesses in the city. The wild success of ‘Little Boxes’, an iPhone app that encourages users to discover and shop the local retail scene, is evidence to Portland’s serious commitment to small businesses. According to the app’s data results, Little Boxes was credited for 4,200 visits at the 200+ participating stores on Black Friday and more than 1,600 subsequent purchases.
The trend of Little Boxes and similar retail apps is congruent with technology’s increasing influence on brick and mortar stores. Many retailers now provide free wifi and supplement in-store experiences with staggering online inventories and delivery options, catering beyond the consumer’s initial need. These centers, such as Bridgeport Village and Nyberg Rivers’ 100,000 square foot Cabela’s, have become shopping destinations. In addition, the November opening of Grant Park Village, an apartment complex anchored by the new 34,500 square foot New Seasons Market, highlights the growing demand for urban lifestyle centers.
Due to their ultimate urban convenience, lifestyle centers are expected to increase significantly. In order to compete with this trend, existing shopping centers must be strategic with their tenant placement. Clackamas Town Center’s recent 36,000 square foot addition of Dave and Buster’s is a direct result of strategic tenant selection. After all, well-selected, active tenants drive customer traffic and sales, which will ultimately drive rents. As this type of development continues in 2015, the retail market can expect landlords becoming more focused on their tenant selection.
Brandon Frank specializes in the leasing and sales of office properties throughout the Portland metropolitan area at NAI Norris, Beggs & Simpson, a real estate brokerage and asset/property management company. Contact him at 503-273-0358 or email@example.com.
Scott MacLean specializes in the leasing and sales of industrial properties throughout the Portland metropolitan area at NAI Norris, Beggs & Simpson, a real estate brokerage and asset/property management company. Contact him at 503-273-0321 or firstname.lastname@example.org.
Jack Gallagher specializes in the leasing and sales of retail properties throughout the Portland metropolitan area at NAI Norris, Beggs & Simpson, a real estate brokerage and asset/property management company. Contact her at 503-273-0327
Eagle Home Mortgage has leased 8,340 sf at the 805 Broadway Building, Vancouver’s largest and most iconic Class A office tower. NAI Norris, Beggs & Simpson Associate Vice President Doug Bartocci and Vice President Tamara Fuller represented the lessor, RS Holdings, LLC. Cresa Portland Principal Eric Turner represented the lessee.
Eagle Home Mortgage is a subsidiary of Universal American Mortgage Company, which is a division of Lennar Corporation, a S&P 500 real estate and financial services leader. The 805 Broadway Building will provide a flagship location for Eagle Home Mortgage, who is a top lender for the SW Washington region.
“It was the perfect timing for a great opportunity,” remarked Doug Bartocci. “Eagle Home Mortgage needed professional offices and a quick move-in and a responsive, community-based Landlord. RS Holdings was able to deliver.”
RS Holdings, LLC, is a part of Schlesinger Companies, Now in its’ fourth generation, Schlesinger Companies preserves a rich heritage of developing, acquiring and managing landmark properties in the Pacific Northwest. This includes the 805 Broadway Building, which was built in 1982 and remains a quintessential part of the Vancouver skyline.
Upon completion of the tenant improvements, Eagle Home Mortgage is expected to move in by January 1, 2015.
The 83,145 sf, three property portfolio comprised of the Norton House, Captain Couch and Merchant Hotel Buildings has sold. NAI Norris, Beggs & Simpson Senior Vice President MaryKay West and President Chris Johnson represented the seller, the Bill Naito Company. CBRE Senior Vice President Trevor Kafoury represented the buyer, John Beardsley of Beardsley Development
Located in the heart of Old Town Chinatown, the portfolio offers quintessential creative office space with large operable windows, open ceilings and exposed brick. Together, the three properties have an iconic presence in Old Town Chinatown, and their charm and appeal is congruent with the neighborhood’s most recent revitalization efforts.
“The seller sought a buyer that understood and appreciated the neighborhood’s challenges and potential,” explained MaryKay West.
Built in 1875, the 2-story, 13,900 sf Norton House is the oldest property in the portfolio. The 17,000 sf, 2-story Captain Couch was completed in 1904 and the 52,100 sf Merchant Hotel debuted in 1880 as a luxury hotel and its brick courtyard and fountain is reminiscent of its former Victorian Italianate splendor. All three buildings are ground floor retail with creative office above.
The portfolio was purchased by seasoned Portland developer John Beardsley, who is known for renovating historic downtown buildings. “This deal came full circle,” West remarked. “It’s taken over two years, but the timing and buyer had to be right.”
The portfolio will continue to run as multi-tenant buildings.
The Overland Warehouse Company (OWC) building, a 30,000 sf property located at 205-219 NW 4th Avenue, has sold for $1.64M. NAI Norris, Beggs & Simpson Senior Vice President Robert Black represented the buyer, Will Sing, LLC, in its purchase of the historical building. Redevelopment to be managed by Urban Development Partners(UD+P) is the latest in a string of renovations in Portland’s Old Town Chinatown neighborhood.
For decades the OWC was home to the Magic Garden, a lounge club, as well as a series of nightclubs. The OWC, just one in a proliferation of bars and strip joints in the neighborhood, was largely considered a major challenge to the community’s revitalization efforts. In recent years, the OWC was abandoned and then suffered reports from Portland Fire & Rescue noting its overwhelming structural dangers. Then in early 2014, the OWC received major backlash again over more strip club proposals.
“It was obvious that the neighborhood demanded change,” Robert Black explained. “Will Sing and UD+P not only recognized the opportunity to salvage the building but to also improve upon the community.”
Built in 1889, the OWC is impressive in size and scale. Improvements will expose its enormous natural timbers with open floor plans and enhanced seismic upgrades. Two floors of office will sit atop ground floor retail as a strategic measure to build accessible community.
“Groups like NAITO and Innovative Housing, Inc. really lead the charge in transforming Old Town Chinatown and in turn, UD+P stepped up their commitment to the neighborhood,” continued Black. “It’s a positive domino effect with lasting impact on the community.”
Logan’s Market has leased approximately 42,000 sf at Nolan Town Center (NTC) with plans to open and operate as one store with TrueValue Hardware. NAI Norris, Beggs & Simpson Chief Operating Officer H. Roger Qualman was the court-appointed receiver representing the property. The Pennbrook Company represented the tenant.
Located at 2276 SW Highland Avenue, NTC is a class-A multi-tenant shopping center. Built in 2005, NTC was the perfect solution to Redmond’s increasing volume of foot traffic from neighboring tourist hotspot, Bend. Yet in 2013, former anchor tenant Ray’s Food Place went bankrupt and vacated its prime space. NTC went into foreclosure and Roger Qualman was tasked to run the property.
“The ideal replacement tenant was another grocer,” explained Qualman. “Logan’s Market was a perfect fit. Not only does it reestablish the center as a destination, but it’s a successful local grocer that will generate new business.”
Owned and operated as one store, Logan’s Market will also feature TrueValue Hardware. Together they join several existing NTC tenants including McDonald’s, Starbucks, Great Clips and Country Financial.
“We’re excited to join the Redmond community,” said Logan Hamilton, proprietor of Logan’s Market. “We believe that our combination of services with TrueValue Hardware will be valuable to our customers.”
With 4 other stores throughout the Northwest, Logan’s Markets is expected to open its new Redmond location in December 2014.