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Archive for the ‘data centers’ Category

Industrial Development Increases in Sunset Corridor

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HealthDex (hospital/provider|managed care|equipment)

Westside

Home Instead Senior Care – 9320 SW Barbur Blvd | 1,879 SF

Central Business District

Howell Weinstein and Whitney – 1220 SW Morrison St. | 1,254 SF

GeneralBizDex (consulting|finance|insurance|legal|other)

Eastside

The Counting Co. – 2951 NW Division St. Gresham | 2,101 SF

Central Business District

Troutman Sanders – Fox Tower | 805 SW Broadway | 6,186 SF

Eastside

BeavEx – 7911 NE 33rd Dr | 5,000 SF

ServPro – Nelson Biz Center | 6713 S W Bonita Rd | 2,505 SF

Solus – 1820 NE Glisan | 5,260 SF

Westside

Pinnacle Risk Management – 9320 SW Barbur Blvd | 12,486 SF

TechDex (apps|provider| hardware|var)

Central Business District

Affinity Web Development – 1410 SW Morrison St | 3,656 SF

Westside

XO Communications – Cascade Business Ctr | 10575 SW Cascade Blvd | 20,927 SF

Eastside

T-Mobile West – Airport Biz Center | 6620 NE 79th Ct | 6,600 SF

Vancouver

Anewin LLC – EastRidge Biz Pk | 12606 NE 95th | 2,061 SF

DM2 Software – Greenwood Office Ctr | 7700 NE Greenwood Dr | 6,698 SF renewal

NonProfDex (charitable|educational|trade assoc)

Eastside

Maple Star Oregon – 825 NE 20th Ave | 3,880 SF

MediaDex (traditional|digital|research)

Central Business District

Inkwell Creative – Albers Mill | 1200 NW Naito Pkwy | 3,157 SF

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HealthDex (hospital/provider|managed care|equipment)

Westside

Apex Laboratories – Park 217 | 12232 S W Garden Place | 6,000 SF expansion

GeneralBizDex (consulting|finance|insurance|legal|other)

Westside

Anderson & Yamada – Peterkort Centre II | 9755 SW Barnes Rd | 2,806 SF

Bank of America – 6000 Meadows Rd | 5,084 SF renewal

Hoffman Stewart Schmidt – 4900 Meadows | 4900 Meadows Rd | 12,014 SF

Cooney & Crew – 4949 Meadows | 4949 Meadows Rd | 3,922 SF renewal

Central Business District

EGT Development – One Main Place | 101 SW Main St | 5,384 SF

Princeton Review – Westfal Building | 421 SW Hall | 3,500 SF

Eastside

Splash Northwest – Olympic Mills Commerce Ctr | 107 SE Washington St | 2,902 SF

Chemical Logistics – 2730 NE Riverside Way | 16,000 SF renewal

TechDex (apps|provider|hardware|var)

Westside

NetApp – Kruse Oaks II | 5400 Meadows Rd | 3,497 SF

System Maintenance Svs Holding – Allen Biz Pk | 9665 SW Allen Blvd | 3,463 SF

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Leasing activity is on the rise. Companies are modestly hiring, driving up transaction activity as tenants slowly start the process of renewing leases, searching for good deals and making other occupancy decisions postponed during the last 2+ years.  This isn’t to say we are through all the pain (debt is looming), but certainly businesses are at least coming out from under the bed and facing a new day.

It is likely office vacancy rates have peaked nationally, meaning Portland probably has six more months of climbing vacancy in most submarkets. The downtown (Central Business District or CBD) submarket would be the exception. Thanks to some big moves by the GSA and other companies moving in downtown as emerging industries like green tech gain momentum, the CBD is starting to tighten on office space, particularly for larger tenants.

Office rents are expected to begin rising in most U.S. markets by the middle of next year.  But again, the Portland CBD may hit that pace sooner. The suburban markets will lag.  Across the country, Landlords are not likely to see significant growth in net operating income for years to come, think 2015.  Nominal rents adjusted for inflation have decreased every quarter since early 2008. They are now down 20% from a decade ago, from over $24/SF to $19/SF nationwide.  On a 5,000 SF lease that’s a difference of almost $2,100/month.

First quarter 2009 was the worst three-month period for leasing in a decade. Many tenants delayed decisions to sign a new lease or renew as the market continued to add vacancy and drop rates.  However, first quarter 2010 is shaping up to be one of the strongest leasing quarters in five years. All of this good news doesn’t necessarily translate into positive absorption just yet, as 50% of the top 20 markets showed negative absorption.

All of this is good news considering the dismal performance of 2008 and 2009. But there are still big challenges ahead that will likely cause a recovery stall or value drop in the commercial real estate market.

source: CoStar

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GeneralBizDex (consulting|finance|insurance|legal|other)

Central Business District

UTI Worldwide – 400 SW Sixth Ave | 20,238 SF sublease of Avenue A/Razorfish space

Citicaster Co – 4949 SW Macadam Ave | 29,992 SF

Heiling Dwyer – Terminal Sales Bldg | 1220 SW Morrison | 3,794 SF

Inside Track – Crown Plaza | 1500 SW First Ave | 3,100 SF renewal

Westside

Guardian Life Insurance – Tigard Triangle Commons | 11850 SW 68th | 4,589 SF

Prime Lending – Creekside Corp Park | 8905 SW Nimbus | 1,850 SF

Aguilar & Bobadilla – Park Place Center | 4915 SW Griffith Dr | 1,665 SF

Eastside

Jonathan Education Ctr – Three Town Center | 10121 SE Sunnyside Rd | 1,610 SF

Cognitive Enhancement Ctr – 604 SE Water Ave | 5,947 SF

NonProfDex (charitable|education|trade assoc)

Westside

Oregon Assoc of Plumbing – 300 Oswego Pointe Dr | 2,235 SF

Blue Mountain Community – Tanasbourne Commons | 17933 NW Evergreen Pkwy | 1,831 SF

Central Business District

National Fish & Wildlife – Commonwealth Bldg | 421 SW Sixth Ave | 3,039 SF

GovDex (government agencies)

Central Business District

Mexican Consulate – Forrester Bldg | 1305 SW 12th Ave | 10,440 SF

TechDex (apps|provider|hardware|var)

Westside

Focus Enhancements – Sunset Corp Park | 22867 NW Bennett | 10,900 SF

FEI – 5665 B NW Wagon Way | 21,000 SF

Cochran Inc – SW Commerce Ctr | 7550 SW Tech Center Dr | 21,250 SF

Eastside

Sponsored Link Management – Ford Building | 2505 SE 11th Ave | 3,053 SF

Archive Systems – Birtcher Ctr Fairview | Townsend Way & NE 230th | 40,000 SF

FT Material Solutions – Birtcher Ctr Fairview | Townsend Way & NE 230th | 40,000 SF

HealthDex (hospital/provider|managed care|equipment)

Central Business District

Legacy Health Systems – Fremont Place II | 1650 NW Naito Pkwy | 3,423 SF

Westside

Human Services Research Institute – South Center III | 7690 SW Mohawk | 3,785 SF

Eastside

Advanced Health Care Ctr – 4000 SE 82nd Ave | 1,468 SF

DesignDex (A/E|consulting|graphic d)

Central Business District

Waterscapes – 735 NW 18th St | 8,365 SF

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Many industry experts are predicting 2010 as one of the best year’s for tenants in a long, long time. Why? Because as more commercial properties exchange hands (whether through foreclosure or preemptive moves by distressed owners/banks) the cost basis for new owners will be significantly lower than for the previous asset holders. This will, in turn, push rents down as new owners no longer have such high cash flow needs to cover the debt on the building, called the Debt Coverage Ratio or DCR. This is a comparison between the monthly income of the property and the monthly debt payment on it. If the debt is lower, then the monthly income can be lower.

The escalating prices of an overheated market caused the value of commercial loans to rise dramatically over the last 3 years and thus drove up rents as the income on buildings had to increase in order to cover operations plus the cost of the loan.  As scores of owners walk away from their investments over the next year or two, banks will be forced to put up properties for sale at much lower prices than in 2006-2007.  Lower purchase prices, means buyers will be in a much healthier position to build a good tenant base through competitive rates and still meet their obligations as well as see a return on investment (albeit a much smaller return these days).

For landlords who can weather this transition and hold onto their properties, they face the dilemna of lowering their rents in order to be competitive.  While several owners already have a low cost basis and can be aggressive with rates (have owned their properties for a long time), others (who have purchased in recent years) will be facing losses for a period of time while they either (1) cut their rates and actually lose money on the front end or (2) hold on rates and see little leasing activity as a result.

The message here is take advantage of these unusual market conditions if and while you can. If you have a lease expiring within the next two years, you may want to start looking at the market now and exploring your options.

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Recent Building Sales

Westside

Buyer: Fit Right Northwest
Seller:  American Industries
Property: 2258 NW Raleigh, Portland, OR 97210
Size: 5,000 SF
Price: $800,000

SustainDex (environmental|sustainable|clean_biotech)

Central Business District

SunPower – The LoveJoy | 1331 NW Lovejoy | 2,458 SF

Eastside

Solar Nation – Columbia Gorge Corp Ctr | 17116 NE Sandy | 8,375 SF

GeneralBizDex (consulting|finance|insurance|legal|other)

Central Business District

Benefit Partners – Bank of America | 121 SW Morrison | 2,450 SF

Eastside

Nationwide Mutual Insurance – 847 NE 19th | 24,405 sf renewal

Scottrade – Sunnyside Plaza | 10001 SE Sunnyside Rd | 1,400 SF

Westside

Mark E. Landstrom – Kruse Way Plaza II | 4550 Kruse Way | 1,217 SF

Infinity Impressions – Parkside Business Ctr | 8082 SW Nimbus | 3,500 SF

Premier Property Group – 5000 Meadows Rd | 1,995 SF

Vancouver

Sacagawea Inc – Columbia Tech Center | 1301 SE Tech Center Dr | 10,692 SF

TechDex (apps|provider|hardware|var)

Westside

Softsource Consulting – 2 Lincoln | 10220 SW Greenburg Rd | 4,847 SF

HealthDex (hospital|provider|managed care|equipment)

Westside

Lake Oswego Counseling – Kruse Park | 3990 SW Collins Way  1,334 SF

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