Specht Development and Colas Development Group are teaming up to develop a 48-acre section of the Gresham Vista Business Park.

The Port of Portland Board of Commissioners on Wednesday approved a master development agreement with the two local companies. The partnership has the option to buy or lease Gresham Vista Lot 5 from the port, which owns the property.

“We have the option to buy; the port would prefer a long-term lease,” said Greg Specht, CEO of Specht Development. “Every deal is different. We have the flexibility to go in either direction.”

The Specht-Colas partnership will seek a user – ideally a manufacturing business, Specht said. “This deal with the port does not provide for speculative development,” he said. “It’s build-to-suit.”

The companies have formed a joint-venture entity, GV5, a limited liability company.

Specht Development and Trammell Crow previously built projects in Gresham Vista Business Park. The property also includes a synthetic diamond manufacturing plant built for De Beers Group by U.K.-based Gardiner & Theobald.

Colas Construction previously worked for Specht Properties on the renovation of the 220 NW 2nd Building to accommodate Prosper Portland‘s new offices.

“They did a bang-up job,” Specht said.

Andrew Colas, president and CEO of Colas Construction, did not return a message seeking comment. In a news release, he stated, “We are thrilled to partner with Specht, the Port of Portland and the city of Gresham on this unique development project. We believe this project will set a new standard in the importance of BIPOC Development Corporation inclusion in large-scale developments and could not be more excited to partner with Specht in this pursuit.”

The project will have strict diversity targets and require high-wage jobs. The average wage target is $53,890.

“That’s a high bar,” Specht said.

Predevelopment of the project comes as the industrial sector has been a bright spot in a weakening commercial real estate market. Specht, who has long maintained that a dearth of available land restricts industrial development in the Portland-metro area, believes Gresham Vista Lot 5 is special.

“It’s one of the best remaining greenfield sites for industrial development in the Portland metropolitan area,” he said.

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The Portland Bureau of Development Services is in the midst of carrying out a slow-rolling, “notes only” pre-application conference with applicant SERA Architects to discuss a proposal for a seven-story mixed-use project.

The development would be built on a flatiron parcel surrounded by Southeast Eighth Avenue, Pine Street and Sandy Boulevard.

The conference, originally scheduled for March 26, was changed to a written format to avoid interpersonal meetings and work around the closure of BDS offices due to the COVID-19 pandemic. SERA Architects principal Kurt Schultz said he was told the city will use this process over at least the next month, and possibly longer.

“They’re not holding public pre-app conferences; we just didn’t have a meeting,” he said. “We submit all the information and in a couple of weeks we’ll get our notes back. It will be the same with design advice requests; you send them the drawings, and staff and design commissioners write their notes and send them back to you.

“Right now we don’t get to talk to anyone in person.”

The project itself is actually a new version of a previous concept.

In June 2017, the Portland Design Commission approved a proposal for a seven-story mixed-use building at 306 S.E. Eighth Ave. It would have contained 123 market-rate apartments, ground-floor retail space and below-grade parking.

But property owner Specht Properties put the project on hold and ultimately chose to sell the site. In 2019, Southern California homebuilder SummerHill Apartment Communities, a division of Marcus & Millichap, placed the property under contract with the intention of pursuing essentially the same project; only a few relatively small changes would be made.

Too much time has passed to use the original plans, Schultz said.

“You need a building permit within three years of design review approval,” he said. “That expires in two months.”

The new iteration of the project is much the same, however. A seven-story building with 113 apartments is now envisioned, also with ground-floor retail space.

“It probably would be pretty similar,” Schultz said. “The zoning hasn’t changed. The height and (floor area ratio) haven’t changed. It’s seven stories like before. The only thing they may change is they may not do a full basement for parking. It may use stackers on the ground floor, and maybe there will be a change in the unit mix. The exterior design and massing are pretty similar to before.”

If SummerHill Apartment Communities follows through with the acquisition, applicants will undertake a new design review process.

“They’ll probably make adjustments if we go forward,” Schultz said. “They’re in their due diligence period studying the site and deciding if they want to go forward.”

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A proposal for a seven-story building with 123 market-rate apartments at 306 S.E. Eighth Ave. was approved by the Portland Design Commission, via a 6-0 vote, on Thursday.

SERA Architects‘ flat iron design for Specht Properties includes 8,500 square feet of ground-floor retail space, a 55-space underground parking garage and two amenity decks. Four live-work units are also planned for the ground floor. The building has a floor area ratio of 5.7:1.

“I think this meets the guidelines quite well,” Commissioner Samuel Rodriguez said. “It’s simple without being simplistic.”

The city staff report recommended attaching as a condition of approval that two vertical rows of balconies be added to the building’s south-facing walls. The commission agreed, and added a condition that the first floor of the building should include red brick.

One concern of the commission was the proposed locations of the live-work units. Three would be on Southeast Pine Street and one on Eighth Avenue.

“Whoever takes that unit (on Eighth Avenue) is going to be a lonely person,” Commissioner Julie Livingston said.

Commissioners debated whether modifying the building’s residential lobby, currently on the corner of Pine Street and Eighth Avenue, would allow designers to move one live-work unit from Pine Street to Eighth Avenue.

SERA Architects principal Kurt Schultz said the general concept was to design the live-work units with maximum flexibility, allowing them to be used exclusively as a business office if a tenant chose. The concept also allowed the units on Pine Street to be used for retail if the market dictated.

The other major concern for commissioners was the rooftop. They debated whether its current configuration made it look like a penthouse rather than an amenity for residents.

“It could be perceived as something that was a mechanical penthouse that was converted in some way,” Commission Chairman David Wark said.

In general, commissioners felt the amenity was out of place.

“It’s wonderful to have this outdoor space at the top of the building, but this does read as if it is from a different architectural era from the rest of the building,” Livingston said. “It doesn’t seem to be consistent with the rest of the architecture.”

In the end, the commissioners decided that better options weren’t available to address those concerns.

“Sometimes you go all over the place and you end up right back where you started,” Wark said.

The bottom line, the commission decided, is that with the conditions, the building met city design guidelines.

“In the terms of the overall building, it’s pretty good,” Wark said. “We are picking at it, but I don’t think it’s going to get better.”

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