The project that would not die... Glad to know this is still at least a possibility, both for the building itself (parking garage, not so much) as well as the pedestrian bridge over the tracks.
One Waterfront Place may be ready before Park Avenue West, broker claims
By Angela Webber, DJC
November 7th, 2011
TMT Development added some certainty to its big hole in the ground last week, announcing that construction on the Park Avenue West office tower would resume… though likely not before 2013.
That leads us to ask… what’s happening with Portland’s other long-unbuilt office tower, One Waterfront Place?
Melvin Mark brokerage Vice President Tom Becic says the 12-story, 270,000 square-foot office tower project is shovel ready and is just waiting on a large (100,000-square-foot or so) tenant to move forward.
That’s not really new news, of course. One Waterfront Place has been a project on the books since 1999. The office tower and adjacent garage, proposed by developers Jim Winkler and Bob Naito, was the subject of a disposition and development agreement with the Portland Development Commission starting in 2000. Between 2000 and 2010, that DDA was amended or restated eight times. The final PDC agreement expired this January.
Becic says he still expects to see PDC and the city supporting the project when it goes forward, in one way or another. That’s because he believes the building supports the city’s goals of green development as it has been pre-approved at LEED platinum status. He also suspects a tenant, possibly coming from outside the city or state, could bring hundreds of jobs, which is another prospect that could merit local government support.
The Park Avenue West announcement on Friday was a mix of good and bad news: on the one hand, certainty is a good thing – as long as TMT can stick with its 2013 construction restart date. On the other hand, however, the timeline is a sort of resignation on the part of TMT, acknowledging that it doesn’t think it will have a tenant able to move in for another four years (at the end of 2015.)
Becic feels like One Waterfront Place can do better than that, and could even be “ready to go faster” than already-started Park Avenue West, because the One Waterfront Place project doesn’t need to dig a hole for underground parking.
“An advantage for us is that we’re ready to rock and roll with the right tenant,” Becic said. If that happens, permits will be ready in “weeks, not months,” he said, and the building could be open in two years. The project already has financing secured, pending a tenant agreement, Becic said.
(Note: the broker on Park Avenue West said that project could go forward before 2013 if it secured a tenant, as well. Between now and then, however, the team is moving the crane-off the site and constructing an 8-foot wall to serve as an art project for local youth – to make the next two years of presumed inaction more attractive for passersby.)
Representatives on both projects agree that the low Class-A vacancy rate in Portland is positive for their projects. According to Grubb & Ellis’ recent analysis, Portland’s Class A commercial vacancy rate in the third quarter of 2011 was just 6.5 percent, which means that Portland has the second-lowest vacancy rate of any major metropolitan area in the country.
That will be good news for the projects – but only if a large tenant starts looking for space and picks one of those two buildings to move into. In “normal” economic times, financing may have been available for these projects on a speculative basis – that is, without a tenant already on board. For now, the projects will be completely dependent on tenants. Where are they?
PS: Former DJC reporter Nick Bjork predicted that one of these two projects would go forward this year. Is that still a plausible prediction?
