Western Real Estate Business

OCT 2018

Western Real Estate Business magazine covers the multifamily, retail, office, healthcare, industrial and hospitality sectors in the Western United States.

Issue link: https://westernrealestatebusiness.epubxp.com/i/1037966

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M A R K E T H I G H L I G H T: P O R T L A N D www.REBusinessOnline.com Western Real Estate Business • October 2018 • 31 PDX'S OFFICE MARKET ATTRACTS USERS LOOKING FOR LOWER-COSTS ALTERNATIVES As anyone working in the real estate business on the West Coast in the past nine years will tell you, the market has been great. Portland is no strang- er to the massive amount of growth cities in the Western region have ex- perienced. The prolonged real estate cycle has contributed to the Portland office market's robust growth. Vacan- cy has tightened, rental rates have in- creased and sales per square foot have achieved all-time highs. In response, Portland has seen a strong uptick in new office product deliveries over the past 18 months, but even the increase in new inventory hasn't slowed the market down. As rents have risen across the West Coast, Portland continues to be the low-cost alternative to cities like San Diego, Seattle and San Francisco. Oc- cupancy costs for Portland are sub- stantially lower than those other cit- ies and, as a result, many companies, especially in the high-tech space, have looked to either open a satellite office or relocate entirely to the Portland market. In response to the increased demand for creative office space, lo- cal developers have been rehabilitat- ing or even building office product to meet the demands of these creative and high-tech office users. These buildings are often highly amenitized with bike parking, exercise facilities, community rooms, cafes, restaurants, and dog-friendly touches like dog runs and dog washing stations. Another interesting trend that has emerged in the past real estate cycle is companies seeking to occupy their own buildings rather than opting to be in a traditional office tower. This has allowed smaller local developers to thrive in this market by building unique office projects in interesting and non-traditional office markets. The local developers that are arguably more in tune with trends have an un- derstanding of the local planning and entitlement process. This has allowed them to push the boundaries of office buildings into areas that have tradi- tionally been residential and retail corridors. In contrast to the local develop- ers, large institutional partners have also turned their sights on Portland as they seek to reenergize the Cen- tral Business District. Armed with plenty of capital and an appetite for growth, older office towers that were once the jewel of the office market are being snatched up. Through a combi- nation of neglect, functional obsoles- cence and changing preferences, these building have fallen out of favor. There is now a big gap between these projects and new Class A office rents. Institutional partners see compara- tively higher returns in Portland over other West Coast markets. The strat- Heather James-Wyrick 404-832-8262 hwyrick@francemediainc.com R E G I S T R A T I O N & G E N E R A L I N F O : S P O N S O R S H I P & S P E A K I N G O p p o r t u n i t i e s : Scott France 404-832-8262 scott@francemediainc.com Kristi Procopio 858-775-7297 kprocopio@francemediainc.com Robin Reimold 949-922-6961 rreimold@francemediainc.com Western Real Estate Business and the InterFace Conference Group are pleased to announce the annual InterFace Salt Lake City Industrial Real Estate conference on November 29th at the Little America Hotel in Salt Lake City. The big event will include those who are buying, selling, developing, redeveloping, leasing or financing industrial properties in the Utah area. The conference will explore the latest trends in leasing, management and operations, as well as economic and demographic trends that impact the industrial real estate market in Salt Lake City. Western Real Estate Business and the InterFace Conference Group are pleased to announce the annual InterFace Salt Lake City Multi- family conference on November 29th at the Little America Hotel in Salt Lake City. The event will include those who are buying, selling, developing, redeveloping, or financing multifamily properties in the Utah area. The conference will explore the latest trends in leasing, management and operations, as well as economic and demographic trends that impact the multifamily market in Salt Lake City. A C T N O W ! R e g i s t r at i o n f o r e a c h e v e n t i s $1 2 5 ON-SITE REGISTRATION WILL BE $150 N o v e m b e r 2 9 » 7 : 3 0 - 1 1 : 0 0 a m » L I T T L E A M E R I C A H O T E L N o v e m b e r 2 9 » 1 2 : 3 0 - 3 : 3 0 p m » L I T T L E A M E R I C A H O T E L A N N U A L I N T E R F A C E S A L T L A K E C I T Y I N D U S T R I A L R E A L E S T A T E A N N U A L I N T E R F A C E S A L T L A K E C I T Y M U L T I F A M I LY P R O D U C E D B Y I N T E R F A C E C O N F E R E N C E G R O U P & F R A N C E M E D I A P R O D U C E D B Y I N T E R F A C E C O N F E R E N C E G R O U P & F R A N C E M E D I A i n t e r f a c e c o n f e r e n c e g r o u p. c o m Riley Henderson Broker, NAI Elliott Matt Bassist Broker, NAI Elliott egy is to reposition these buildings with major lob- by renovations, exterior façade improvements and new modern amenities to bring excitement back to these properties. Portland's long-term office trajectory looks strong. Despite rising rents, the market continues to offer the lowest comparative occupancy costs on the West Coast in a market with a variety of office products. Whether it's starting a new busi- ness, expanding or relocating, the value proposi- tion for businesses is strong in Portland, keeping the office market healthy.

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