Other than the cupola and the overly-reflective glass, I like this project. Plus it has an impeccable mission. I'm especially excited about the new Marco Fife restaurant.
Vanport Square Near Complete
By Lee Perlman/The Portland Observer
24-Hour Fitness next in line for major MLK development
"At this moment, things are looking great," Ray Leary says.
The reference is to the local African-American leader's Vanport Square, a major development of minority-owned business in the heart of northeast Portland's black community.
The first store coming to an entirely remolded block at 5225 N.E. Martin Luther King Jr. Blvd. will be the beauty supply outlet Living Color, set to open this month. Fourteen other commercial spaces in the block's 30,000 square foot structure have been sold and are expected to open by the end of December.
In addition, demolition has begun on what will be the site of Phase II of Vanport Square: the Pacific Northwest's first Magic Johnson 24-Hour Fitness facility, a signature sports fitness endeavor owned by the former Los Angeles Lakers star. It will take up an entire block north of Alberta Street on MLK with two gymnasiums and full line of athletic equipment.
Other businesses waiting to open in the first phase are Marco Shaw, owner and head chef of Fife restaurant, who will establish his new Hard Shell restaurant in Vanport; Alem Grebrehiwat, owner of the Queen of Sheba Ethiopian restaurant; Edwardo Norell, who will move his Norell Design bilingual sign business from his garage to Vanport; Laurie Cary Design; Nghi Tran's State Farm office; C.P.A. Rick Harris; and Hung Kim's Living Color.
In a pioneering move, most of the new businesses will also own their sections of building, making Vanport Phase I, a commercial condominium.
Vanport Square is a triumph for Leary and his partner, northeast Portland resident Jeana Woolley, but a hard-fought one. When the Portland Development Commission selected them to develop the site in 1999, they were part of a development team that featured the Gerding-Edlen Co., creator of the Pearl District's five square block Brewery Blocks project, and one of the city's largest and most prolific developers.
The original plans were for a 500,000 square foot mega-project that included rental housing, town homes, retail and office, and a 60,000 square foot grocery. At the time, Leary wasn't even an independent agent; he was an employee of Adidas, for whom he had helped an outlet store on Northeast MLK and Alberta Street.
But when no major grocery or other anchor could be found, Gerding-Edlen dropped out. When Leary and Woolley secured a calling center to occupy the space, neighbors who had bought into the original concept felt betrayed; not only did they oppose the new plan, but some of they called for Leary and Woolley to be replaced as developers.
Leary defended himself and his plan, only to see the calling center anchor drop away. The PDC granted several extensions of the development deadline, but they became visibly uneasy about the project's lack of progress and the agency's commitment of $10 million in cash and tax credits.
It was the lure of the commercial-condominium concept that finally allowed the project to succeed, even without a major retail anchor.
"It was the chance for ownership that was the catalyst," Leary says. "People will happily pay to own their own space at a rate they would balk at to rent that space." Even so, it wasn't an overnight success.
"Each deal was a challenge in and of itself" he says. "We had to fight financial constraints and politics. Vanport used all nine of its lives."
That it succeeded was due not just to Leary and Woolley's perseverance and the validity of the concept, but the loyalty of their backers.
"It comes down to relationships," Leary says. "We were able to establish champions that saw this as vital to PDC's mission and jumped into our corner. We also had buyers who signed on five or six years ago and stayed with us every step of the way."
The community and the city have just begun to realize the potential for this sort of business self-ownership, Leary says.
Commercial rents on MLK are now running in "the high teens" per square foot. Leary said in order to make major redevelopment possible, it would have to climb to about $25 per square foot, "and we're not there yet." But they are getting closer; the Magic Johnson Fitness Center is paying the same rate for its space that it would pay in other parts of the city.
He said ownership opportunities are a premium that can increase the value of development projects.
"This will be a catalyst, not just for small, infill development, but for larger projects. It will bring privately financed development to MLK. You'll see projects that are attractive enough to lure regional and national companies," Leary says.
Would Leary have signed on to the Vanport Project back in 1999 if he had foreseen what eight years would bring?
Smiling ruefully he says, "I'm glad I didn't know what was coming. The converse is that ignorance kicked into perseverance and that eventually led me to opportunities I'd only thought about."