91视频

Brian Owendoff arrived in Portland in 2008. He left a real estate career in Cleveland, where, in his words, he was beating the green drum and no one was listening.

He has since participated in major projects such as Park 19 and Ladd Tower, as well as community efforts including the redevelopment of the Rose Quarter properties and the annexation of West Hayden Island.

Owendoff held the reins of local offices of both Opus Northwest and CB Richard Ellis, but in February was relieved from his duties at the latter firm after he was outed as a critical commenter on local websites.

But he later became a vice president at Capacity Commercial Group. The 91视频 recently asked Owendoff about his new job, the Portland market and what he has learned during the economic downturn.

91视频: You had started your own firm before going to Capacity. What made you decide to join Capacity rather than do your own thing or go somewhere else?

Brian Owendoff: After 19 years of creating wealth for other real estate companies, I decided to venture out on my own and start a firm focused on real estate consulting and development of urban infill apartments. After a few months, I soon realized that I am not a lone wolf but very much a pack animal. Through my prior experience of leading teams that ranged from 28 to 100 associates, I found I missed the daily interaction and creativity of being surrounded by other professionals.

I had been approached by other national brokerage firms about leading a new Portland office. Due to the fact that Greater Portland only has two Fortune 500 companies and few private firms with sales over one billion dollars, there is not enough demand in marketplace for another large brokerage firm. My view is the brokerage world is bifurcating into two to three mega firms that look to be all things to all Fortune 500 companies in all places.

The other end of the spectrum will be high-quality boutique firms that service local and regional clients on a more personal basis. Those firms stuck in the middle may struggle. Real estate has been and will continue to be a local business. I was attracted to Capacity Commercial because they have deep bench strength of seasoned office and industrial professionals and an entrepreneurial environment. With 28 associates they are big enough to service large institutional owners but small enough to provide superior customer service to a Portland-based client.

91视频: You’re going to focus on multifamily and student housing at Capacity, a firm focused primarily on industrial. Why are those appealing market sectors for both you and the company?

Owendoff: The Portland apartment market is one of the tightest in the nation. The overall Greater Portland market has an occupancy rate of 97 percent, with some submarkets at 100 percent occupancy. Portland has one of the lowest vacancy rates in the country.

Over the past 20 years, Portland has averaged approximately 4,000 new apartment units a year. 2010 saw the delivery of less than 600 units. Approximately 1,500 units will be delivered in 2011. There is currently a shortfall of 10,000 to 12,000 units.

Portland’s high occupancy has three main causes: Oregon’s land-use laws, and costly and time-consuming entitlement for new construction restricts supply and increases cost for construction; increases in renter demand from demographics and challenges associated with securing a home mortgage; and rate of new construction at its lowest levels due to challenges in securing construction loans.

Greater Portland continues to attract a high number of generation 鈥榊’ that wants to rent apartments in the urban core. Almost 10,000 continue to move in each year.

Additionally, 10,000 (baby) boomers are turning 65 years old every day in the U.S. Many boomers are downsizing and selling homes to move into smaller living spaces. Portland is attracting retirees that also want to live in an urban core. Many are choosing the flexibility of renting an apartment vs. the risk of ownership of a condominium.

The same holds true for student housing. 2011 marked the third year in a row of record freshman matriculation at U.S. colleges and university. For the first time Oregon is expected to have over 100,000 students, in 2011. Locally, PSU will still be short over 3,000 beds even with the delivery of American Campus Communities’ 900-bed facility in the fall of 2012.

Portland is the pretty girl at the dance, and there is tremendous institutional ownership interest in newly constructed apartment and student housing projects. Due to the lack of supply, several newer apartment projects have recently sold at all-time low cap rates.

91视频: Talk to me about potential projects you guys are looking into. Is there anything in the near future?

Owendoff: Ninety percent of the Portland apartment market is in sales below $10 million. My focus will be on the brokerage of existing apartments. I will also leverage my development experience to tee up new urban infill projects of minimum half-block sites that will range from 100 to 150 units. I am working with both existing local and new regional companies as the point for market entry into the Greater Portland market.

91视频: You’ve been a devout preacher in the areas of job creation and having enough land to do so. What needs to happen in Oregon, and more specifically Portland, to create jobs? How do real estate professionals help?

Owendoff: Jobs can only be created when there is market demand for products and services, adequate capital and entrepreneurial culture. Land is the raw material needed to accommodate the built environment.聽聽 In my opinion, large bulk distribution and manufacturing facilities will be the next market segment to need new construction.聽 Few blocks of space over 150,000 square feet exist in Greater Portland.聽 Unfortunately, there are few shovel ready land parcels available to meet market demand.

In 2010, I completed a survey of shovel ready industrial land of less than 25 acres.聽 Based on historic absorption rates over the past twenty years, we have less than a 5 year supply of land to accommodate growth of existing Oregon companies.聽 The Portland Business Alliance and NAIOP are conducting a similar survey for large parcel, greater than 25 acres, which will be released later this year.聽 I expect similar outcome that will factually show we have less than a five year supply of large parcel land to accommodate the next Intel, Solopower or Subaru.

On a regular basis, I work with large office and industrial users on site searches from a local, regional and national basis. Many times Greater Portland is eliminated early from consideration due to lack of immediately available office and warehouse space and immediately buildable land. Portland needs to grow its supply of industrial land, not reduce it.

With respect to the apartment market, even if 10,000 new units broke ground in the spring of 2012, this new product would not be delivered until 2013-2014.聽 There are currently nine urban and three suburban projects that have broken ground or are in the planning process that will deliver just 2,200 units in 2012 and 2013.

Over the next three years, rents will increase from 10 to 20 percent. Free rent and free underground parking will be non-existent. Landlords will not spend any money on marketing, as the demand will far outpace supply. Landlords will be shooting fish in a barrel.

Moving forward, cities that can expedite the approval process for new construction, waive and/or reduce system development charges and potentially think out of the box with approving new construction methods that could result in lower construction costs that could better meet market demand and be more cost effective. Less costs for developers will result in lower rent for apartment residents and finally make new warehouse construction pencil out economically for developers and tenants.

Ninety percent of life is just showing up.聽 Real estate professionals can help by showing up to City Council and community meetings to show support for the business community.聽 Many times the business community is not represented at planning meetings because no one takes the time to show up.聽 We cannot change the anti-business culture without greater participation by the real estate community.

91视频: You’re involved heavily in the planning of both West Hayden Island and the Rose Quarter Properties. Where do those projects sit currently? Any thoughts on them moving forward?

Owendoff: West Hayden Island was brought into the Urban Growth Boundary in 1983 to serve marine industrial needs. The west side of Hayden Island is not currently included in the City of Portland boundaries. Annexation by the city is a requirement in order for urban services to be provided to the site.

The city of Portland is conducting a public process to explore annexation and creation of a long-range land use plan for West Hayden Island. It is an undeveloped 800+ acre site, located west of the BNSF Railroad.

In February 2009, Mayor Adams convened a Community Working Group to advise Portland City Council on the best mix of uses for West Hayden Island.聽 I am a member of it.

Over the past 18 months, the group reviewed consultant work and discussed their charge, which is to advise City Council on how marine industrial, habitat and recreational uses might be reconciled; and if the group determines that a mix of uses is possible, to recommend a preferred concept plan.

This collaborative planning is a good way to coordinate with efforts currently underway to plan for the Columbia River Crossing project and the east side of Hayden Island. It is also the best way to ensure that the island can be improved for open space and natural resource enhancement, while also providing a designated area for future marine related development. Reaching regional agreement on a balanced approach will allow planning, management and enhancement efforts to proceed.

Based on the work of the group, the decision to annex or not annex West Hayden Island will occur in 2012.聽 One out of 10 jobs in our region is tied to the port.聽 I believe that Mayor Adams will be the first mayor in a quarter century to succeed in bringing West Hayden Island into the city.聽 This will be a great accomplishment, and be one of his legacies to Greater Portland.

The Memorial Coliseum will receive an upgrade of exterior landscaping and improvements to the existing war memorials.聽 Additionally, the city is close to securing a long term commitment from the Winterhawks to be a tenant in the Veterans Memorial Coliseum.聽 The VMC will be renovated with money from both the city and the Winterhawks.聽 This is a great first step to make capital improvement to a facility that is utilized over 150 times a year by Greater Portlanders.

91视频: Your time in Portland has been filled with ups and downs. What keeps you out here? Have you thought about leaving? How does it differ from anywhere else you’ve been?

Owendoff: The recession has seen approximately one-third of the area’s developers either leave the region or go out of business. I see great potential in the need for real estate development and consulting expertise once the market recovers. While I have had several opportunities to move back east, I chose to remain in Portland because of the quality of life and potential our region has to become a world leader in sustainable development and construction practices, manufacturing and information technology.聽 I have also been blessed with some great friends and business associates that went out of their way to say 鈥榩lease stay in Portland.’

Being located north of the seventh largest economy in the world, California, Oregon should be positioned well to capitalize on companies wanting to flee high cost of living, tax and congestion to relocate to a place like Portland. Portland’s great restaurants and Oregon’s world-class natural beauty are also reasons we remain.

Portland differs from other parts of the country from its stringent land-use laws. These land-use laws have done more good than harm; however, it is hindering Oregon’s ability to respond to market demand for the built environment due in large part to lack of available land. Anything in life that is to an extreme is not healthy. We need a balance and also need to remember that the 鈥楧’ in LCDC is 鈥榙evelopment.’ Many in our state have been focused for 30 years on only the 鈥楥,’ which is 鈥榗onservation.’

91视频: The markets have been challenging, to say the least, over the past few years. What have you learned over the last year about yourself and about real estate?

Owendoff: The old rule of thumb was to have six months of living expenses in savings and always have a good plan B. Today you need 24 months of living expenses and have plans C, D and E. I have learned that we are all human and we make mistakes. Those that can learn from their mistakes will grow. Those that cannot let go will not move forward.

Real estate professionals have been sucking from the firehouse of humility for the past three years. Unfortunately, it will be a few more years before the hose is turned off. The old saying in real estate was 鈥榣ocation, location, location.’ Now it is 鈥榣ocation, leverage and market timing.鈥�

Personally, I have learned that you can gain wisdom and accelerate self-improvement from learning from your mistakes. No one is perfect. We are all human and make mistakes. Most people believe the opposite of success is failure. To me, the opposite of success is mediocrity. Failure is part of the journey towards success.

The important thing is to view mistakes as a useful stepping stone to a higher reality and better outlook on life. This has caused me to focus on the most important aspect of my life: being the best husband I can be to my wife, best father to my children and best friend to those I have been blessed to become close to in Portland.