A renovation of a former industrial building under way in Southeast Portland will provide 46,000 square feet of craft manufacturing, light industrial and creative office space in the Central Eastside Industrial District.

ScanlanKemperBard (SKB) is partnering with Denver-based Tryba Architects and Lorentz Bruun Construction on the Glass Lab, which will contain multiple speculative light industrial suites ranging in size from about 2,000 to 4,800 square feet. The building’s ground-floor suites will cater to industrial users, with concrete floors and interior roll-up doors providing access to a shared loading dock. The fully air-conditioned second-floor spaces are designed for creative office users.

“We’re big believers in a localized manufacturing economy,” said John Olivier, senior vice president of acquisitions & development for SKB. “For lack of a better term, I call it an urban industrial concept. This building is not just industrial; it’s also creative office or creative industrial.”

The project is a core-and-shell remodel of the 59-year-old building, which was constructed for a glass manufacturer. It later was used as an antique furniture showroom and most recently as the home of Eastside Distilling. SKB purchased the property last summer for $6.3 million, and is investing about $8.9 million in the renovation.

The two-story tilt-up concrete building features old-growth timber beams, tongue-and-groove wood floors and 20-foot ceiling heights. It will feature common amenities including break room and kitchen space, bicycle commuter facilities, a conference room, and a ground-floor gathering area. The second floor is being expanded by 4,000 square feet, and new interior mezzanines will be added to select ground-level suites.

As with the Iron Fireman building, an SKB-owned light industrial building in the Brooklyn neighborhood, the idea for the Glass Lab is to provide a home for craft manufacturers in an area where availability of affordable space is becoming increasingly rare.

“The smaller tenants are having trouble finding stuff in the Central Eastside,” Olivier said. “We really want to cater to the manufacturers, probably tech manufacturing, but we can still do any kind of light manufacturing.”

SKB has been working with Prosper Portland to capitalize on Enterprise Zone tax benefits, giving tenants the benefits of the capital improvements along with whatever money they invest into their individual spaces. According to Olivier, initial estimates equate to about a $1.40/square foot savings for the first five years of occupancy. Rental rates will be about $25-28 per square foot, triple-net.

“We think it’ll be some of the least expensive space in the Central Eastside, certainly of the newly-delivered stuff,” Olivier said.

The Glass Lab is being outfitted with new mechanical/electrical/plumbing systems, including an electrical upgrade from 208-volt service to 480-volt service, new water and sewer systems, rooftop mechanical units, and an upgraded fire suppression system. The building’s energy model is being brought up to code, and new insulated glass, window frames, storefront systems and roll-up doors are being installed.

The core and shell work is expected to last through the summer, at which point tenants will be able to begin building out their white box spaces. The building’s leasing is being handled by Colliers International.

SKB is also in predevelopment on a 140,000-square-foot creative office building on an adjacent parcel at 1919 S.E. Third Ave. The firm is working with Scott | Edwards Architecture to design the building. Olivier hopes construction will begin early next year.

“We see our ability to develop that area over time,” he said. “We think we’ve got the capability to bring all of these elements together and create a mini-campus, ultimately.”

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