It's not to say we're through the difficulty just yet. Unemployment remains high, both nationally and especially in Oregon. Development in downtown has lately been symbolized by a giant hole in the ground where the Park Avenue West tower was supposed to be built before construction stalled. And investments or other help from the federal government may be coming to a halt after Tuesday's elections.
But there are also signs of a thaw. On the national level, the Labor Department said today that the American economy showed a net gain of 151,000 jobs last month. (Yet the fickle electorate remained restless.) And here in Portland, Jeff Manning reported in Wednesday's Oregonian that not only may developer Tom Moyer's Park Avenue West by TVA Architects finally be resuscitated, but new downtown office towers are being pitched to meet increasing demand. After all, the city has a downtown office vacancy rate of less than 10 percent. And several large tenants may be looking for new space.
"Because we've been in such a difficult economic environment for a couple years, people haven't wanted to play a lot of offense," David Squire, managing director of the Grubb & Ellis commercial real estate office in Portland, told Manning. "But if you look at the numbers, it's tight out there. If you're a large user needing 50,000 square feet or more, you're out of options."
Among those said to be looking for new space of this size are the Miller Nash law firm and KPFF Consulting Engineers. Iberdrola Renewables is looking for at least 100,000 square feet, Manning reports, and the Army Corps of Engineers needs 125,000. Although new office buildings like First & Main One Main Place have arrived recently, they've been offset by the emptying out of the Edith Green Wendell Wyatt federal building for renovations.
If any new office buildings see groundbreaking in the year ahead, two of the likeliest seem to be planned for the West End.
Manning reports Harsch Development, headed by Jordan Schnitzer, is looking at building a new 15-story office tower at the intersection of Southwest 10th Avenue and Stark Street, on a surface parking lot adjacent to the former Federal Reserve building. This would be an ideal location given the energy of the block across 10th Avenue that includes the Ace Hotel, Kenny & Zuke's Deli, and Living Room Theaters, not to mention Powell's Books and the Brewery Blocks two blocks north.
Developer Gerding Edlen may also be considering a project called 11 West, at the corner of Southwest 12th Avenue and Washington Street on a City Center Parking surface lot. The adjacent building, the ZGF Architects-designed 12 West mixed-use tower, Gerding developed in partnership with City Center Parking on one of the company's other surface lots. It has become the most successful major buiding project of the past two years, with a host of office, retail and housing tenants accrued even amidst the Great Recession. It also was named to the AIA Committee on the Environment's national Top 10 Green Projects list. Given that 12 West enjoys first-rate sustainability credentials, with its LEED Platinum rating and the nation's first-ever use of wind turbines on a high-density urban tower, perhaps Gerding has shown (as they did with the Brewery Blocks) that top level sustainability gives companies and developers a proven market advantage.
However, when I spoke with Gerding Edlen leader Mark Edlen this morning by phone (I happened to be interviewing him for another story), he called a groundbreaking announcement for 11 West "premature". If the economy really is picking up, Edlen knows it is a tentative, slow recovery at best. And he knows there is still a giant sink hole a block away from Pioneer Courthouse Square that is yet to be filled with steel and glass, let alone tenants.
One other potential project was mentioned in Manning's story, one that has been in gestation now for nearly a decade: One Waterfront Place. I remember seeing a presentation on this building as far back as the Greenbuild conference in 2002. Developed by Jim Winkler and Bob Naito, the 12-story, 250,000 square-foot building would be constructed on a site at Northwest Naito Parkway just north of the Broadway Bridge with a LEED Platinum rating.
Given how a new streetcar line is being planned to cross the bridge and much development is planned for the Rose Quarter, One Waterfront could be ideally positioned. But that's something which was said of the building many years before. That's the thing about the speculative office market, I guess. Anything we say before ground is broken is just that: speculation.