Will Naito has big shoes to fill. His grandfather, Bill Naito, was among the earliest to see the importance of redeveloping Portland’s Chinatown and Old Town.

Through the 1950s and early ’60s, Old Town was known as Skid Road. At a time when most developers were abandoning downtown for the suburbs, Naito saw value and potential in reclaiming derelict and abandoned buildings in both downtown and the Old Town Chinatown area.

In 1975, he renovated a department store building built in 1910 and turned it into one of the earliest mixed-use renovation projects in the area. The project, dubbed The Galleria, helped secure Naito’s reputation as a developer willing to breathe new life into old properties.

When Bill died in 1996, his son Bob Naito took over as head of the firm, continuing the family tradition of finding new purposes for old buildings. The firm, for example, moved the historic Simon Benson House to the Portland State University campus, where it was renovated as a visitor center and alumni office.

Naito Development also has led by example when it comes to finding sustainable ways to renovate older buildings. Recent green projects include a LEED platinum renovation in the historic Halprin blocks in downtown Portland and One Waterfront Place, a project currently rising in Portland’s River District that’s also targeting a platinum rating.

In 2009, Bob’s son Will Naito joined the firm as a project manager. Both Will and Bob are part of the team that last year was handed the task of redeveloping the 117-year-old Grove Hotel in Old Town Chinatown. The project calls for a 52-room, 190-bed boutique hotel.

“When we bring people from out of town here – developers, architects, designers, hospitality professionals – they get excited at the potential in Old Town Chinatown,” Will Naito said. “Sometimes locals forget what a gem they have here. Helping to revitalize it is what we do. I guess you could say I’m doing what my father and grandfather did, and I can’t think of anything else I’d rather do.”

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added some certainty to its big hole in the ground last week, announcing that construction on the Park Avenue West office tower would resume… though likely not before 2013.

That leads us to ask… what’s happening with Portland’s other long-unbuilt office tower, One Waterfront Place?

Melvin Mark brokerage Vice President Tom Becic says the 12-story, 270,000 square-foot office tower project is shovel ready and is just waiting on a large (100,000-square-foot or so) tenant to move forward.

That’s not really new news, of course. One Waterfront Place has been a project on the books since 1999. The office tower and adjacent garage, proposed by developers Jim Winkler and Bob Naito, was the subject of a disposition and development agreement with the Portland Development Commission . Between 2000 and 2010, that DDA was amended or restated eight times. The final PDC agreement expired this January.

Becic says he still expects to see PDC and the city supporting the project when it goes forward, in one way or another. That’s because he believes the building supports the city’s goals of green development as it has been pre-approved at LEED platinum status. He also suspects a tenant, possibly coming from outside the city or state, could bring hundreds of jobs, which is another prospect that could merit local government support.

The Park Avenue West announcement on Friday was a mix of good and bad news: on the one hand, certainty is a good thing – as long as TMT can stick with its 2013 construction restart date. On the other hand, however, the timeline is a sort of resignation on the part of TMT, acknowledging that it doesn’t think it will have a tenant able to move in for another four years (at the end of 2015.)

Becic feels like One Waterfront Place can do better than that, and could even be “ready to go faster” than already-started Park Avenue West, because the One Waterfront Place project doesn’t need to dig a hole for underground parking.

“An advantage for us is that we’re ready to rock and roll with the right tenant,” Becic said. If that happens, permits will be ready in “weeks, not months,” he said, and the building could be open in two years. The project already has financing secured, pending a tenant agreement, Becic said.

(Note: the broker on Park Avenue West said that project could go forward before 2013 if it secured a tenant, as well. Between now and then, however, the team is moving the crane-off the site and constructing an 8-foot wall to serve as an art project for local youth – to make the next two years of presumed inaction more attractive for passersby.)

Representatives on both projects agree that the low Class-A vacancy rate in Portland is positive for their projects. According to Grubb & Ellis’ recent analysis, Portland’s Class A commercial vacancy rate in the third quarter of 2011 was just 6.5 percent, which means that Portland has the second-lowest vacancy rate of any major metropolitan area in the country.

That will be good news for the projects – but only if a large tenant starts looking for space and picks one of those two buildings to move into. In “normal” economic times, financing may have been available for these projects on a speculative basis – that is, without a tenant already on board. For now, the projects will be completely dependent on tenants. Where are they?

PS: Former 91��Ƶ reporter Nick Bjork predicted that one of these two projects would go forward this year. Is that still a plausible prediction?

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It doesn’t matter whom I talk to, everyone has the same outlook on where downtown Portland’s office market is as well as where it needs to go.

In a nut shell, the office market is really tight in downtown, and it needs a new building. But for some reason or another, that building isn’t being built.

Portland has one of the lowest central business district vacancy rates for office space of any city in the entire country, sitting between 10 and 13 percent depending on whom you ask. That number shoots down to about eight percent when just taking Class A space into account. But the tight vacancy rate has nothing to do with the state of Portland’s economy, which is actually trailing national averages.

The reason Portland has such a tight downtown has everything to do with the real estate term “flight-to-quality.” As businesses downsized or went under, vacancy rates went up and rents down. This led everyone on Kruse Way and the Sunset Corridor to move downtown. Considering how accessible downtown is, it wasn’t as big of a task as it is in other cities.

This brought down the vacancy rate significantly even though businesses weren’t moving to the area and jobs weren’t being added. Now thinking about the future, when jobs will hopefully be added, the city needs to add some office space in downtown.

Call it a space race. Is it going to be One Waterfront Place, the building being pitched by Bob Naito and Jim Winkler in Northwest Portland? Or is it going to be TMT Development‘s Park Avenue West in the heart of Southwest Portland’s business district?

At the beginning of the year it seemed as if it was Park Avenue West that would be the first to completion. Not only did the project have a leg up, as the building is literally poking out of the ground, but firms that were working on the project were saying the project was only days away from resuming construction.

That never happened, and those rumblings have stopped completely.

Now it seems One Waterfront Place, a proposed 12-story building with 245,000 square feet of leasable space, might be in a better position. In a recent conversation with Naito, he mentioned that his team is in negotiations with several large tenants about potential leases. If the team could lock in one of those tenants, it would most likely gain the financing needed to go forward, he said.

“Speculative financing is relatively nonexistent, but if you can get the project preleased at about 60 percent, you can get the money,” he said. “If we lock in one tenant at around 100,000 square feet, we will look into knocking off a story and moving forward with the project.”

Nothing is finalized yet, obviously, but one of these projects will get going this year. It will be interesting to see which one.

The post Which will be first: One Waterfront Place or Park Avenue West? appeared first on Daily Journal of Commerce.

It doesn’t matter whom I talk to, everyone has the same outlook on where downtown Portland’s office market is as well as where it needs to go.

In a nut shell, the office market is really tight in downtown, and it needs a new building. But for some reason or another, that building isn’t being built.

Portland has one of the lowest central business district vacancy rates for office space of any city in the entire country, sitting between 10 and 13 percent depending on whom you ask. That number shoots down to about eight percent when just taking Class A space into account. But the tight vacancy rate has nothing to do with the state of Portland’s economy, which is actually trailing national averages.

The reason Portland has such a tight downtown has everything to do with the real estate term “flight-to-quality.” As businesses downsized or went under, vacancy rates went up and rents down. This led everyone on Kruse Way and the Sunset Corridor to move downtown. Considering how accessible downtown is, it wasn’t as big of a task as it is in other cities.

This brought down the vacancy rate significantly even though businesses weren’t moving to the area and jobs weren’t being added. Now thinking about the future, when jobs will hopefully be added, the city needs to add some office space in downtown.

Call it a space race. Is it going to be One Waterfront Place, the building being pitched by Bob Naito and Jim Winkler in Northwest Portland? Or is it going to be TMT Development‘s Park Avenue West in the heart of Southwest Portland’s business district?

At the beginning of the year it seemed as if it was Park Avenue West that would be the first to completion. Not only did the project have a leg up, as the building is literally poking out of the ground, but firms that were working on the project were saying the project was only days away from resuming construction.

That never happened, and those rumblings have stopped completely.

Now it seems One Waterfront Place, a proposed 12-story building with 245,000 square feet of leasable space, might be in a better position. In a recent conversation with Naito, he mentioned that his team is in negotiations with several large tenants about potential leases. If the team could lock in one of those tenants, it would most likely gain the financing needed to go forward, he said.

“Speculative financing is relatively nonexistent, but if you can get the project preleased at about 60 percent, you can get the money,” he said. “If we lock in one tenant at around 100,000 square feet, we will look into knocking off a story and moving forward with the project.”

Nothing is finalized yet, obviously, but one of these projects will get going this year. It will be interesting to see which one.

The post Which will be first: One Waterfront Place or Park Avenue West? appeared first on Daily Journal of Commerce.

The developers of One Waterfront Place have another year to secure an anchor tenant for the planned commercial office building.

�ճ����Portland Development Commission last week extended its agreement with Winkler Naito Development, a partnership between Jim Winkler and Bob Naito. The between the PDC and Winkler Naito dates back to 2000. It’s been amended eight times before now.

One Waterfront Place is planned to be a 12-story, $100 million commercial office building north of the Broadway Bridge. The leasing company with the project, Melvin Mark Brokerage Company, has not yet secured an anchor tenant, but it has bought more time.

“We certainly hope we have something cooking by the end of the year,” said Tom Becic, Melvin Mark vice president.

Becic said his team is looking for corporate tenants who need large blocks of office space.

In a press release, the development team cited an “improving picture in the central business district‘s Class A office market.” Vacancy rates in Portland area, especially in the suburbs, are expected to climb, but Becic pointed to reports by Grubb & Ellis and Cushman & Wakefield that paint a competitive picture of the downtown Portland market.

According to the , “as the various GSA requirements begin to land, vacancy in the CBD Class A market will decrease quickly and with no other new development likely in the foreseeable future, the market should return to relative health by 2011.”

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