As Portland developer Walt Bowen builds one downtown tower, he’s exiting another.

The office space within the 19-story Broadway Tower has sold to Principal Real Estate Investors for $132.3 million. The price equates to $756 per square foot.

The sale comprises 175,000 square feet of office space on floors nine through 19. The office space was 99 percent leased to tenants including Amazon, Markowitz Herbold, Cable Huston, Chicago Title and Lawyers Title.

The seller was a limited liability company, BDC/Broadway Office, linked to Bowen. His BPM Real Estate Group opened the building in November 2018. BPM is the developer of the Block 216 mixed-use tower now under construction in downtown Portland.

The transaction closed in early March. The purchase does not include the Radisson RED hotel on the first eight floors of Broadway Tower, which is located at 1455 S.W. Broadway, near Portland State University.

The buyer, Principal Real Estate Investors is based in Des Moines, Iowa; it’s a group within Principal Global Investors.

Newmark Knight Frank represented the seller. The sale includes “some of the very highest quality office space that Portland’s seen,” said Nick Kucha, an NKF vice chairman based in Portland.

“There have been very few high-quality modern office towers built in Portland in the last few years,” he said.

Because of that, Broadway Tower attracted high-quality tenants and eager buyers, he said.

Besides Kucha, James Childress (managing director) and Jeff Hodson (director) represented the seller in cooperation with Kevin Shannon (co-head of U.S. capital markets) and James Ikeguchi (senior financial analyst). Principal Real Estate Investors represented itself.

Available office space in the building was being offered at $35 per square foot on a triple-net basis.

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BPM Real Estate Group announced the latest tenants for its 19-story Broadway Tower, which is scheduled to open in downtown Portland before the end of the year.

Cable Huston LLP has signed a long-term lease for the entire 15th floor, which has slightly more than 17,000 square feet. The law firm will vacate its space in the Congress Center, at 1001 S.W. Fifth Ave., in summer 2019.

At the same time, Milliman, a global firm in the actuarial business, will move from the U.S. Bancorp Tower to the Broadway Tower. Together, the two new leases will bring building occupancy to 94 percent, according to BPM Real Estate Group.

The $158 million Broadway Tower was designed by GBD Architects and is being built by general contractor Howard S. Wright, a Balfour Beatty Company. The building has a total floor area of more than 430,000 gross square feet. There are 247 underground parking spots serving a 180-room Radisson RED hotel on the first eight floors. Office space occupies the 10 stories above those.

Cable Huston was represented in negotiations by Andrew Rosengarten of JLL and Milliman was represented by Chris Elsenbach of JLL. The landlord was represented by Kevin Joshi of Kidder Mathews.

Other tenants include law firm Markowitz Herbold PC, which will occupy the top two floors, and Lawyers Title, which will lease 10,000 square feet on the 10th floor. The biggest tenant, however, is Amazon. It’s poised to occupy approximately 85,000 square feet in the new building.

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In downtown Portland, on a half block at the corner of Southwest Broadway and Clay Street, the Broadway Tower project is finally approaching substantial completion. Work started in March 2016 on the project to produce a 19-story, 260-foot-tall structure.

Walter Bowen’s BPM Real Estate Group is the developer of the $158 million building, which will hold a 180-room Radisson Red luxury hotel and approximately 182,000 gross square feet of Class A office space.

Bowen recently answered via email questions from the 91��Ƶ about the Broadway Tower project, its place in Portland and the state of the real estate and development market.

This correspondence has been condensed and edited for clarity.

91��Ƶ: With much of the Broadway Tower pre-leased prior to construction completion, there is still high demand in Portland for Class A office space. How much further can the market go?

Walter Bowen: Broadway Tower is currently 80 percent (leased). We are down to our last two full floors. We have strong activity on the remaining space and expect to open in October with above 90 percent occupancy.

The demand for newly constructed office space downtown will continue for the foreseeable future as the millennials prefer a central business district over the suburbs. Market demand, great location and the right project at the right time are keys to a successful real estate development. While the office sector might be in the eighth inning (with potential of extra innings) of the current cycle, we continue to be bullish on high-quality, well-designed, newly constructed office space in Portland’s urban core.

91��Ƶ: The same is true of hotel space in Portland. What can the market bear, in your opinion?

Bowen: Radisson Red is a perfect fit for Portland. It is a hotel that delivers the amenities and guest services with the elegant style that millennials and entrepreneurs expect when they travel to a city for business or pleasure. In addition, Portland does not have a five-star hotel. There is clearly demand for a five-star hotel that we expect to deliver on Block 216.

91��Ƶ: What are your goals for the Broadway Tower building?

Bowen: The building will be managed by our in-house property management company WCB Commercial Properties. We will hold both the office and hotel components for the near term.

91��Ƶ: Is it true that Portland developers are finding it increasingly sensible to “go big or go home” when it comes to projects?

Bowen: With increasing land and construction costs, you need to develop larger projects to achieve “economies of scale” to get projects to pencil. Real estate development is a margin business. Smaller projects are tougher to make sense economically.

91��Ƶ: What does the Broadway Tower bring to the South Park Blocks that was not previously there?

Bowen: We are the first tower to combine both office and hotel into a single building. This creates an “18 hour” building as the office component is more active on weekdays and the hotel is more active on weeknights and on weekends. Several of our tenants selected Broadway Tower due to the high-quality construction, excellent multimodal location within the center of downtown, and the in-building amenities including 180-key hotel, bar, restaurant and ample on-site auto plus bike parking.

91��Ƶ: Is this a development statement of sorts for BPM Real Estate?

Bowen: I have always erred to the side of delivering the highest quality buildings. Best-of-class buildings outperform the market in good economies and bad.

Broadway Tower continues the tradition of world-class structures at the confluence of Portland’s financial, education and arts districts, on one of Portland’s most historic streets. This exciting, mixed-use building will stand the test of time and be enjoyed by Portlanders for many years to come.

91��Ƶ: What are your upcoming plans?

Bowen: We are in early design and entitlement for a 960,000-square-foot, 35-story mixed-use tower on Block 216. This project will include a 237-key, five-star hotel (with large banquet, restaurant and bar facilities as well as 19th- and 20th-floor pool and spa), 190,000 square feet of office space and 138 high-end, co-branded residential condominium units on the top floors. This will be the largest private-sector building to break ground since the U.S. Bancorp tower (“Big Pink”).

We are delivering a unique product to Portland. Attracting young, millennial talent is a priority for employers. This will be the first office/hotel/residential tower in the city. We’re creating a place for really smart people, for entrepreneurs to live and grow their businesses in downtown Portland.

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Construction of a new mixed-use high-rise within Portland‘s South Park Blocks will soon reach substantial completion.

The Broadway Tower is a 19-story, 260-foot-tall structure rising on a half block at the corner of Southwest Broadway and Clay streets. The building will include a 180-room Radisson Red luxury hotel with a ground-floor lobby, rooms on floors 2-8 and a “world class” bar and restaurant. The ground floor will also have a lobby to serve approximately 182,000 gross square feet of Class A office space on floors 9-19. A 2,200-square-foot retail space will be available at ground level as well.

“Radisson Red is a perfect fit for Portland,” developer Walt Bowen told the 91��Ƶ via email. “It is a hotel that delivers the amenities and guest services with the elegant style that millennials and entrepreneurs expect when they travel to a city for business or pleasure.”

The $158 million project is being overseen by general contractor Howard S. Wright, a Balfour Beatty Company. GBD Architects designed the building.

Ground was broken in March 2016, and the tower topped out some time ago. Currently, work to apply the building’s skin is steadily climbing toward the top floors, and interior work is continuing apace. The hotel portion is scheduled to open in October to allow staff to train and prepare the premises for customers.

“We just took the tower crane down a week and a half ago, last Saturday, and the main lift comes out July 26, I believe,” Howard S. Wright project manager Jake Margheim said. “As far as the hotel component, we just started moving in FF and E (fixtures, furnishings and equipment), and they’re going to be basically doing a floor a week. So six weeks from now we’ll have all the furniture moved in and they’ll be setting up.”

The project team is aiming to obtain a temporary certificate of occupancy by October 15, Margheim said.

“We’d like to get done before that, obviously,” he said. “But once we turn that over, they’ll start moving people in.”

Interior work on the office portion will continue after the hotel opens, and could continue for up to another year.

Currently, there is no high-rise Portland’s central city offering both office and hotel space. Bowen’s BPM Real Estate Group has been touting that fact as it markets the office space.

“This creates an ‘18 hour’ building as the office component is more active on weekdays and the hotel is more active on weeknights and on weekends,” Bowen stated, adding that 80 percent of the office space has been leased.

“Several of our tenants selected Broadway Tower due to the high-quality construction, excellent multi-modal location within the center of downtown, and the in building amenities,” he stated.

Some of them have already been identified. Law firm Markowitz Herbold PC will occupy the top two floors, and Lawyers Title will lease 10,000 square feet of space on the 10th floor.

The biggest name, however, is apparently Amazon. It will occupy approximately 85,000 square feet in the new building, according to numerous media reports earlier this year.

“We are down to our last two full floors (to lease),” Bowen stated. “We have strong activity on the remaining space and expect to open in October above a 90 percent occupancy.”

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The 19-story Broadway Tower will soon offer Portland a unique mix of hotel and office space in a single building. It features eight stories of hotel rooms and another 10 floors of office space topped with a penthouse and communal space on the 19th story. Built by BPM Development and general contractor Howard S. Wright Construction, A Balfour Beatty Company, the building will host law firms, as well as tech giant Amazon. 91��Ƶ photographers toured the job site this week, and the video below will show you a glimpse of what they saw. Check back with the 91��Ƶ website and print editions for a pending photo gallery and feature story about the project.

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Menashe Properties has purchased a full block in downtown Portland for $26 million in an all-cash transaction.

Menashe purchased Unitus Plaza, a 93,947-square-foot office building constructed in 1964, and the surrounding property at 1300 S.W. Sixth Ave. The seller was Erickson Realty Limited, which purchased the property for $15.5 million in 1999, according to public records.

The off-market transaction was negotiated by the parties directly, with no brokers involved. The building has five stories; two underground are devoted to parking.

Barry Menashe, founder and principal of Menashe Properties, said he jumped at the chance to buy a full block in downtown Portland.

“We were just given a lead that they were ready to sell the asset,” he said. “It’s extremely difficult to buy a block anywhere in Portland … There was no hesitation.”

The property is near the Broadway Tower now under construction and other properties that are receiving significant investment, including the Wells Fargo Center and PacWest Center.

Jordan Menashe, a Menashe Properties principal, said Unitus Plaza will be a long-term asset.

“It’s a hold,” he said. “It’s a core asset with a very, very good value-add component.”

The acquisition is part of an aggressive expansion for the Portland firm, which has moved to diversity its portfolio since Jordan, Barry’s son, joined. Jordan’s sister, Lauren, will soon join the firm. She currently serves as manager of business development at Macerich, a major real estate trust based in Santa Monica, California.

Menashe Properties has recently expanded with significant office purchases in the Seattle and Denver markets. The family company has also developed the Canopy by Hilton in the Pearl District and a 62,381-square-foot office building in the West End that has attracted Turner Construction and other tenants.

“We’re ready and willing to go after the next deal,” Barry Menashe said. “We’re looking for larger deals. We’re happy to go after industrial deals and office deals depending on where they are, and we have the ability to make decisions quickly and close quickly.”

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A tall mixed-use building is due to rise in the heart of downtown Portland, now that its design has been approved by the Portland Design Commission.

Commissioners approved the city staff report on the Broadway Tower with conditions as presented by city planner Hillary Adam. Those conditions included trying to salvage materials from demolition of a three-story building on the site, increasing glazing and using a finish plaster coating for the ground-floor sidewall.

To qualify for a greater floor area ratio, the developer, Generations Columbia Property, will give the Portland Parks Foundation $325,000 to help pay for development of a master plan for the South Parks Blocks. In addition, the developer will later build a 60-unit apartment building with 33 percent of the units renting at 80 percent of the median family income for the next 40 years.

Designed by GBD Architects, the Broadway Tower will be 19 stories with 11 floors of office space and 180 hotel rooms; the ground floor will hold a lobby, a restaurant and retail space. Below-grade parking accessible from Southwest Columbia Street will provide spaces for 210 vehicles and 132 bicycles. The loading dock will be accessible from Southwest Clay Street.

Plans also call for improvements to Block 11 in the South Park Blocks, a step still to be finalized with Portland Parks & Recreation.

Brett Horner, planning and design manager for the parks bureau, said previously that all 12 of the South Park Blocks should be planned at the same time – an effort that could take up to two years.

At Thursday’s meeting, Horner announced that park system development charges could not be used by the developer for Park Block improvements. That surprised GBD architect Phil Beyl, but he indicated that the anticipated wait for the parks master plan is too long for the developer. He also said those improvements should specifically be for Block 11.

“The momentum of the project leaves no other path,” he said. “The fact that we cannot use SDCs is new information, but we hope to work with the parks bureau.”

The property occupies a quarter-block bounded by Southwest Broadway and Park Avenue, and Southwest Columbia and Clay streets. The South Park Blocks are just west of the property across Park Avenue.

At the beginning of the meeting, Beyl said he hoped for quick approval and believed his design team had taken all of the commissioners’ previous suggestions to heart.

“I think we listened pretty well, and we’ve got construction guys ready to go,” he said.

GBD architect Michael Marcus said the new design met commissioners’ request that spandrel glass be decreased and the use of terra cotta at the ground level be reduced.

Marcus added that the building’s entry was enhanced by removing a planter on Southwest Broadway and adding a wide stair entrance.

“We made it more welcoming,” he said. “So now we have two 16-foot-wide stair entrances and with seating elements it creates a nice active space out front.”

Approval of the design was unanimous and received high praise from commissioners.

“I think the massing of the building is beautiful – a super addition to downtown Portland,” Commissioner Julie Livingston said.

“This is a model process for the city with the public benefits,” Commissioner Tad Savinar said. “You met all of our conditions. There is a lot of chatter about how difficult design review is, but this has been an easy one and we appreciate your cooperation.”

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A new type of hotel, the Radisson RED, will anchor the future Broadway Tower here in Portland when it’s complete in a couple of years. The brand will debut its first hotel in Brussels, Belgium later this month.

Ben Gardeen, spokesman for the Carlson Rezidor Hotel Group, which owns Radisson Hotels, said the Radisson RED will occupy the first eight floors of the 19-story, mixed-used building at 1455 S.W. Broadway St.

The second Radisson RED will open in Minneapolis later this year, Gardeen said. Portland will be the third of the brand out of a total of 15 hotels being developed around the globe.

Each Radisson RED location will be different, Gardeen said, but all the hotels will allow keyless entry using smart phones or other digital devices. For those less digitally-inclined, hotel employees in the lobby will use laptops or tablets for guest check instead of a traditional check-in counter.

What sets each hotel apart is that each will focus on music and art from the local area in the two-story open lobby, according to Gardeen.

“The space will be multifunctional and will serve as an art gallery reflective of Portland,” he said. “The Radisson RED brand is about art and music and fashion, and obviously incorporates design. You’ll know you’re in Portland.”

The guest rooms will also reflect Portland, he said, as will food and beverage services in the brand’s bar, called OUIBAR, and a food outlet, spelled KTCHN but pronounced “kitchen.”

The Portland hotel will offer 180 guest rooms “that feature touches of Scandinavian design highlighted by…functional furniture pieces like the picnic table that replaces the traditional desk” according to a statement from Carlson Rezidor. The company has a total of 1,400 hotels in operation or under development in 115 countries.

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A 19-story mixed-use building is planned for 1455 S.W. Broadway; however, its design isn’t quite ready yet, according to the Portland Design Commission. The project is set to return before the commission on April 21.

Plans for the building, designed by GBD Architects for Generations Columbia Property LLC, call for 180 hotel rooms on six floors and 175,000 square feet of open office space on 10 floors. The ground floor is expected to hold a restaurant, a lobby and retail space. A below-grade garage will provide parking for 210 motor vehicles and 132 bicycles. Plans also call for a glass curtain wall with terra cotta and composite metal panels incorporated.

One main topic of discussion during Thursday’s Design Commission meeting was how the three-quarters-block development’s floor-to-area ratio will be increased through bonus allowances. Two methods were discussed. One would be for the owner to make a $1 million donation to be divided between the city’s affordable housing fund and Portland Parks & Recreation. The second method would be to designate about 30 percent of the total units as affordable housing, which was preferred by staff and the commission.

If money were to go to the parks bureau, it would be used for master planning for improvements to the South Park Blocks. Commissioner Tad Savinar said he would like to see just one of the adjacent South Park Blocks be improved in the near future as an example of what is to come.

But Brett Horner, planning and design manager for Portland Parks & Recreation, said improvements and needed maintenance of all 12 South Park Blocks should be planned at the same time and that the process could take up to two years. He said implementation would then be done in phases.

Kurt Creager, director of the Portland Housing Bureau, said he would rather see affordable housing added to the project rather than a contribution to the affordable housing fund.

“It’s better for us to get the units than to get the money,” he said. “And there could be potential for the city to invest in a later date.”

Michael Marcus, GBD’s lead designer for the new building, told commissioners that one existing building on the property would be salvaged and that 30,000 cubic yards of contaminated soil would be removed at a cost to the developer of more than $3.4 million.

Since the project’s previous review in November, Marcus said the lobby entrance was expanded to two stories high, hearkening back to the city’s old theater district days. The second floor will include a lounge and conference space.

Marcus said he couldn’t reveal the name of the hotel yet, but said it will have a “branded entry” in red.

GBD principal Phil Beyl told the commission that the project will have “significant economic benefits” to the city and create more than 1,700 new jobs, including 250 temporary construction jobs.

Plans call for project completion in June 2020.

During the public comment period, several citizens concerned about possible increased traffic voiced objections to the planned loading dock’s location on Southwest Clay Street.

“With all the cars on Clay and the loading docks, it will stop traffic,” Marian McNamara said. “A more logical place for the loading dock is on Columbia (Street).”

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