U.S. Bancorp Tower owner Jeff Swickard has purchased another downtown Portland office building, and he said he’s not done yet.

Swickard has closed on the eight-story, 266,664-square-foot Five Oak building, at 421 S.W. Oak St., for “a little over $10 million,” he said. Swickard Group bought the building from a group of creditors led by Nuveen. Five Oak was constructed in 1944 and then renovated in 2005.

The purchase comes only seven months after Swickard purchased the U.S. Bancorp Tower, better known as “Big Pink.” The buildings are almost directly adjacent to each other.

“It’s in our mind a perfect complement to the Big Pink,” he said.

Swickard said he hopes the two buildings can share certain amenities, such as parking and hospitality.

It’s another big splash for Swickard, who initially made his fortune from a string of car dealerships based in Summerlin, Nevada. Swickard Group began investing in commercial real estate 14 years ago.

Swickard is a University of Oregon alum.

“Portland, it just meant something to me,” he said. “Even though I moved away, it never left my heart.”

Swickard has also purchased real estate in Wilsonville, the San Francisco Bay Area, Southern California, and Vancouver and Edmonds, Washington. Swickard Group is closing on an industrial building in Tigard this week, he said.

“We’ve been active, but until we bought Big Pink, nobody cared,” he said.

Both Big Pink and the Five Oak building lie in Portland’s opportunity zone, which confers tax benefits after seven and 10 years.

“Buying in an opportunity zone, it’s not the motivating factor, but it’s helpful,” Swickard said.

The downtown buildings are long-term holds, Swickard said. Current tenants at Five Oak include the U.S. Postal Service, Oregon Health Authority and Multnomah County. The building’s occupancy rate wasn’t immediately available.

“It’s really a capital-intensive business to re-tenant these buildings,” Swickard said. “On the surface, it might seem like it’s a windfall because prices are low, but by the time it’s re-tenanted it’s a long, long-term play.”

Swickard said the purchase was made in cash, with no debt or institutional money. The property previously traded for $37.1 million in 2014.

“There’s very little or no attractive debt that you can put on a building,” he said. “You have to be prepared to use your cash.”

Swickard suggested he’s not done investing in downtown Portland.

“I decided to buy a couple projects, and I’m going to continue to buy,” he said.

Unico Properties was selected as the property manager for Five Oak, the company announced Thursday. Unico also handles such business at Big Pink.

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“Big Pink,” the iconic office tower in downtown Portland, is for sale.

Brokerage JLL recently published a listing for the 42-story skyscraper. Completed in 1973, U.S. Bancorp Tower, which is better known by its rose-shaded nickname, is Portland’s largest commercial building, spanning 1.15 million square feet.

It’s also the city’s second-tallest building, behind only the Wells Fargo Center.

“Portland will never see another building like U.S. Bancorp Tower, considering the asset’s extraordinary scale and the complete absence of new development planned in the urban core for the foreseeable future,” JLL’s listing states.

Last fall, U.S. Bank said it would exit the tower and move most of its employees who were based there to Gresham amid a broader pullback in office occupancy in downtown Portland.

The building previously was purchased by Seatle-based Unico Properties and its ownership group for $372.5 million in 2015.

Large-scale commercial buildings in Portland resold since the COVID-19 pandemic have done so at massive discounts.

Montgomery Park sold for $33 million in 2024 after fetching $255 million in 2019. Block 1 in the Pearl District’s Brewery Blocks sold last year for $21 million after it was valued at $44.76 million in a 2007 transaction.

U.S. Bancorp Tower’s current ownership has invested $18 million in capital improvements for the building since 2016, according to JLL.

Big Pink is 45.7 percent occupied, according to JLL. The building also offers 999 parking spaces and Portland City Grill, a luxurious restaurant on the 30th floor.

Another Portland tower, the 30-story PacWest Center, was also recently listed for sale.

Unico Properties has a large portfolio of more than 20 properties in the Portland area, including the Moda Tower, Galleria building and Sixth + Main.

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Portland’s office market is sending mixed signals as it recovers from the worst of the pandemic while a new reality sets in with fewer workers going into offices.

The vacancy rate continued to climb early this year, reaching 19.3 percent in the metro area, according to JLL‘s first quarter report. Asking rents fell to $33.75 per square foot.

The urban core showed signs of life, however. Among large-scale leases of 10,000 square feet or more, 78 percent of first-quarter deals occurred in Portland’s central business district.

First-quarter data comes as tenants struggle to discern their future needs for office space.

“With a lot of companies coming back to the office, they’re reassessing their space needs,” said Tim Harrison, JLL’s Pacific Northwest research director. “A lot of companies are moving to a hybrid model, and they’re reconsidering how much space they need.”

Insurance company Moda Health recently renewed its lease of more than 100,000 square feet at Moda Tower in downtown Portland, casting a vote of confidence in the area’s future. The lease length and other terms were not disclosed. Moda Tower is now 83 percent occupied, according to building owner Unico Properties.

The tower was completed in 1999, when Moda Health was known as ODS Health.

“The signal then was the same as this signal we send today,” Dave Evans, Moda Health’s chief financial officer, stated in a news release. “We are committed to downtown, to this city and to this community.” (Unico Properties and American Realty Advisors acquired Moda Tower in 2018 and leased back space to Moda Health. A $6 million remodel followed in 2021).

Office brokers and analysts are watching for moves by major office users. Legacy Health is evaluating its office space needs and crafting a strategic plan for remote work. The health care network owns its headquarters, an 86,450-square-foot building in Northwest Portland.

Legacy Health had no moves to announce, spokeswoman Elizabeth Baker said.

“Obviously, like all companies, we’re evaluating the situation and our options,” she said.

Some companies that downsized earlier in the pandemic may be looking for more space soon, Harrison said.

“I think a lot more people are going to come back to the office on a regular schedule, and I think a lot more companies are going to realize they need more space than they have, or what they’ve rightsized down to,” he said.

Employment trends are positive; the Portland area’s labor force grew by 56,000 employees compared to a year ago.

“What we’ve also seen is a lot of companies doing a lot of hiring,” Harrison said. “Companies are quickly seeing they need more space than they have for their employees.”

JLL’s report identified “growth on the horizon” for the central business district, with several large leases contributing to much-needed office space absorption. Still, downtown has a ways to go, Harrison said.

“It was really hard-hit,” he said. “Do I think that the market recovers overnight? No, I don’t. It will take multiple years – when I say multiple years, I think it takes five years, maybe more, before the market recovers to the place it was pre-pandemic. But we’ll get there.”

It will help when city and county employees return to downtown Portland, he said.

Kidder Mathews, in its own first-quarter report, likewise saw positive trends.

“We can expect movement across the metro to gradually improve in 2022 as companies hire at rapid pace and tenants begin to finalize back-to-office procedure,” the brokerage stated.

In the metro area, 419,762 square feet of office space was under construction during the first quarter, according to JLL.

Subleasing activity has jumped. Navex Global returned 45,000 square feet in the Kruse Way submarket during the first quarter. The asking rent is 11 percent below the average for the area, according to JLL, providing some needed affordable office space in the increasingly expensive Lake Oswego office market.

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It came as a bit of a surprise to SERA Architects officials that they signed the largest commercial office lease in Portland since the pandemic began. In fact, for years they sought to build, not lease, a new showcase office.

“We got serious in a few locations,” said Stuart Colby, a SERA principal who leads the firm’s workplace studio. “It’s just that there were a number of barriers.”

Instead, SERA agreed earlier this year to a lease with Galleria owner Unico Properties for the entire 42,000-square-foot top floor of the historic downtown building between Southwest Alder and Morrison streets, and Ninth and 10th avenues.

“The firm has a long history of preservation and adaptive reuse,” Colby said. “These older buildings offer a lot of richness.”

The Galleria building, completed in 1910, offers a number of other advantages. As a full-block building, it has a floor plate among the largest available in urban Portland.

“In general, a full-floor-plate building is certainly ideal,” Colby said. “Large floor plates are scarce.”

After the move, all of SERA’s Portland employees will be able to work on one floor – something that is not possible within the firm’s current space at 338 N.W. Fifth Ave. in Old Town Chinatown. SERA has approximately 150 employees in Portland (30 additional employees work in an office in Oakland, California, where the firm has done work for Google and other tech companies).

In Portland, SERA currently occupies five floors in two buildings. The firm first moved into the former Minnesota Hotel building in 2004.

Environmental reasons also led SERA to lease existing space rather than build new, Colby said.

“It’s also a sustainability issue,” he said. “Reusing these existing buildings is a huge piece of keeping your carbon use down.”

Another point in the Galleria building’s favor, Colby said, is that it received a major seismic retrofit in recent years.

“We wanted seismic safety,” he said. “Most of these cool, old buildings in Portland, most of the developers didn’t want to do a full seismic upgrade.”

The Galleria office will have more space for collaboration and creative endeavors, Colby said. The tenant improvement is meant to be something of a demonstration project for SERA.

“We’re certifying everything under the sun, at great financial and labor cost,” he said.

Separately, SERA is designing core and shell improvements for Unico Properties on all five floors, Colby said.

“We did not commingle any financial interest between the two (projects),” he said.

Fortis Construction is building out SERA’s tenant improvements. A main goal is to showcase the original skylight, while upgrading it with modern materials. The primary steel structure will remain, but the glazing frames and clear glass will be replaced with insulating glass that will feature tinting and a ceramic frit, or small dot pattern, to maintain consistent temperatures.

“Given the property’s historic significance, the overall appearance both from the inside and outside will maintain fidelity to the original skylight design,” Colby stated in an email.

SERA plans to welcome employees to the new space in June 2022. The firm is also adapting to remote work, with the expectation that employees will return to the office on some days.

“We’re working out the details,” said Cristian Asher, senior director of business development.

Firm executives are discussing the possibility of asking employees to work in the office three days a week, but no decisions have been made, Asher said.

“Again, this is a work in progress,” he said.

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Unico Properties has snapped up a 203,069-square-foot office property in Lake Oswego.

The Seattle-based real estate firm purchased the 1999-constructed property from seller Shorenstein, a San Francisco real estate investment company.

Located at 5800 and 6000 Meadows Road, the two-building Class A office property was over 90 percent leased to several professional services tenants at the time of sale. The property is near Interstate 5 and Oregon Highway 217, connecting Lake Oswego to the rest of the Portland metropolitan area.

The sales price was not disclosed and was not yet reflected in Clackamas County records. Leases were listed online last week for $40 per square foot.

CBRE‘s Charles Safley, Paige Morgan and Tom Pehl represented the seller. Nick Santangelo of CBRE’s debt and structured finance team arranged the buyer’s acquisition loan.

“The stability of the asset, strong surrounding demographics and improving market fundamentals fueled significant interest in the property,” Safley said in a news release. “We remain excited for the continued evolution of the Kruse Way submarket and for the asset.”

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Unico Properties has signed Lane Powell to a long-term lease renewal for space in a 24-story high-rise in downtown Portland.

The law firm’s renewal is for 63,000 square feet at Moda Tower, which was completed in 1998. Unico and partner American Realty Advisors recently undertook a $5 million renovation project, which included a lobby remodel and new amenities.

The building, at 601 S.W. Second Ave., has 398,412 square feet of commercial space on a full block bounded by Southwest Morrison and Alder streets, and Second and Third avenues. Unico and ARA purchased the property for $176.25 million in 2018. Lane Powell is the building’s second-largest tenant after Moda Health.

“There’s no denying that COVID-19 has created a challenging environment, but it’s exciting to see a major law firm double down on its commitment to downtown Portland, and this move signals the resilience of downtown Portland and a bright future coming out of the pandemic,” Charlie Floberg, Unico Properties’ director and market leader in Portland, stated in a news release.

New amenities at the building include a gym, a tenant lounge with Xbox 360 and beer kegs and shuffleboard, a 65-person conference room with video conferencing technology, and a 1,800-square-foot outdoor terrace.

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After a long drought, downtown Portland has finally landed a major new lease.

SERA Architects has agreed to occupy 42,000 square feet of office space within the historic Galleria building. That is the largest lease in Portland’s urban core since the pandemic began more than a year ago.

The lease term is for 15 years. Unico Properties, which owns the building with Partners Group, declined to reveal the lease rate.

SERA will occupy the top floor of the five-story building sometime in spring 2022. The Target store in the building is downsizing, vacating the second and third floors to move into the first floor, which had been limited to a storefront and a Starbucks café.

The upper-floor changes from retail to office will require a major renovation, which SERA is designing. Unico declined to comment on whether SERA’s lease was tied to the design deal. Unico Properties and Partners Group are committing $20 million to fully renovate the 194,737-square-foot building.

The Galleria building was completed in 1910, and originally was home to the Olds, Wortman and King department store. Bill Naito Co. repositioned the Galleria in 1976 as a shopping mall. Naito sold the property to the Unico-Partners Group joint venture partnership in 2018 for $64.1 million.

New building amenities will include a new lobby and entrance for office tenants, outdoor spaces, a fitness center and a yoga studio.

The project team will also be tasked with making the building more efficient. The renovations will target Leadership in Energy and Environmental Design gold status via the existing buildings program, and Fitwel certification.

The renovation of the Galleria comes as the future of office space remains hazy. Some companies have announced plans to reduce their office footprint amid widespread adoption of flexible work-from-home policies.

Leasing activity for the Portland-metro area fell 42 percent to 562,626 square feet during the first quarter, compared to a year earlier, according to Kidder Mathews. Full-service asking rates slipped to $28.09 per square foot, down from $28.38 per square foot.

More than 2.3 million square feet of office space is under construction in the metro area, Kidder Mathews reported.

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The “new normal” has taken on multiple forms throughout the COVID-19 pandemic. The first stage was shifting to remote work temporarily and then to a long-term work from home life. But the “new normal” is still metamorphosing as people prepare to return to the office.

With two COVID-19 vaccines approved for emergency use, the general public might start to see vaccinations late-spring to mid-summer. Work spaces need to be prepared to keep occupants safe during the pandemic for when workers gradually return.

“We haven’t actually had to teach tenants how to safely occupy a building,” Keren Eichen, director of real estate services for Unico Properties, said.

Buildings, entryways, and gathering spaces are being retrofitted to allow for social distancing. Signage is being put up reminding people to stay six-feet apart and wear a mask. Throughout the building, sanitation stations may lace the hallways; arrows placed directing one-way traffic and barriers put up to protect workstations.

ZGF Architects principal Alan Gerencer has spent nearly 30 years working on methods to build collaboration in workplaces and design environments for people to feel comfortable.

“People need to be ready to return and feel comfortable in the space,” Gerencer said. “Make sure it feels and looks clean.”

While every company will have a different approach and space to work with, Gerencer encourages businesses to survey employees about what they’re comfortable with and not. The information gathered will help inform how to design spaces.

As the pandemic progresses, Dietrich Wieland, president of Mackenzie, said the virus is impacting design on simple levels in many cases. It has made them rethink how they plan break rooms and entryways.

The firm released a COVID-19 design guide in March and updated it in May, where they looked at existing layouts, how they could be retrofitted and then reimagined.

Entryways typically have people coming and going from the same door, which places people face-to-face. As a retrofit, it could have a barrier in the middle, creating lanes for entering and exiting. A sanitation station can be placed inside the doorway, and a queue of people can wait outside to enter with markers indicating every six feet. A reimagined design has separate entry and exit points, touchless doors and a canopy to cover people waiting.

While it’s going to be a slow transition back into the office, COVID-19 has already impacted the way people look at office spaces and their importance for workplace culture.

“The beauty of the office is this touch point where we all come together,” Gerencer said.

As property managers, Unico Properties has been investing in signage, touchless technology, PPE and sanitation chemicals to get the U.S. Bancorp Tower ready for people to come back to work.

Eichen said the scale of the signage campaign required throughout the tower is the first of its kind. Signs line the building and are propped up in rooms that say “Let’s be safe” in the hallways, “Thank you for practicing social distancing,” and on the floor detailing “Stand here; stop the spread.”

Property Managers have been going above and beyond what their jobs traditionally mandate. Eichen said Unico is the busiest it has ever been in 2020.

Workers continue to remain at home as COVID-19 case numbers rise. But the planning and preparation for their returns have already started.

While 2020 comes to a close and 2021 entices a “new normal,” flexibility has been a critical clause throughout.

“It is really important to understand what is so important to people,” Gerencer said. “What is it that will make them feel comfortable and valued and what is working for them.”

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The long-awaited COVID-19 vaccine has cleared its final hurdle and on Monday morning the first Americans were administered the injection.

The director of the U.S. Centers for Disease Control and Prevention (CDC) on Saturday accepted recommendations that the vaccine may be given to people age 16 and older. That concluded the approval process.

“This is the next step in our efforts to protect Americans, reduce the impact of the COVID-19 pandemic and help restore some normalcy to our lives and our country,” CDC Director Robert Redfield stated on Sunday.

But as businesses plan for the coming year, news of immunizations raises a host of questions. For instance, should employers require workers to receive vaccinations?

“It’s a tough question to mandate that somebody does something to themselves,” said Brian Pearce, executive vice president of real estate services for Unico Properties. The company owns U.S. Bancorp Tower in Portland and has more than 300 employees covering its western U.S. portfolio.

For now, officials are focused on prioritizing groups considered exceptionally high risk: workers in health care and long-term care facilities. Experts say the vaccine will probably not become widely available in the U.S. until spring 2021.

There has yet to be a decision directly stipulating whether employers can mandate that workers get a COVID-19 vaccination. However, there are already in place Equal Employment Opportunity Commission (EEOC) guidelines regarding flu shots.

Businesses are allowed to mandate flu shots, according to the EEOC. However, employees can seek an exemption based on medical or religious reasons as part of the Americans with Disabilities Act (ADA).

The EEOC also advises employers to encourage but not require employees to get flu shots.

“Hoffman will not require anyone to get a (COVID-19) vaccine,” Hoffman Construction Vice President Dan Drinkward said. “When a vaccine becomes available, if we can, we will help any employee that wants one to get it. We will not have a specific plan until the timing and distribution process becomes clear.”

Currently, Hoffman is continuing to work with its safety precautions in place.

“We want to make sure now that there’s a light at the end of the tunnel, not to let our guard down,” Drinkward said.

Once more doses of the COVID-19 vaccine are released to the general public, employees’ returns to workplaces will likely be a gradual shift rather than an abrupt switch. The Pfizer–BioNTech vaccine requires two doses, given 21 days apart.

“I don’t anticipate that we would mandate a vaccine,” Pearce said. “But I think we will also follow the lead of what the business world does.”

If public opinion shifts, and a majority of businesses begin requiring vaccinations, employers should be prepared to accommodate employees with approved exemptions. Accommodations might include allowing the employee to work on-site while wearing a face covering, moving the employee’s workstation, or allowing the employee to work remotely.

However, employers may be concerned that exempt employees pose a health risk to co-workers. If an exempt employee tests positive for COVID-19 and infects others, the employer could face legal risk.

“Outside an act by the Legislature providing employers with some type of immunity, the liability is unlikely to be ever zero,” Fisher Phillips attorney Stephen Scott said. “That is why employers should stay vigilant in enforcing social distancing, proper sanitation, mask usage, etcetera.”

Depending on vaccine production, increasing numbers of employees could gradually return to workplaces throughout 2021.

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The U.S. Bancorp Tower, a 1.2-million-square-foot monument to capitalist dynamism, stands eerily quiet in downtown Portland. Nearly all of the thousands of office workers who give the building purpose are at home.

On the ground-floor plaza, custodians wearing masks and gloves clean again and again, outnumbering the few office workers striding briskly through the lobby.

Furniture has been removed. Signs urge visitors and tenants to “KEEP CALM AND MOVE ALONG,” lest they create a plume of disease.

For office tenants and property managers in Portland and around the nation, the COVID-19 pandemic has raised fundamental questions about the modern workplace: Should we be together, or apart? If we can work effectively from home, should we? Is there still meaning and value in meeting face to face?

As Oregon, in fits and starts, slowly revives its stunned economy, office tenants are reconsidering the basics. They’re coming to different conclusions and watching their competitors, government authorities and news of the virus’ rise and fall for cues.

It’s an open question of whether the pandemic will subside quickly and the workplace will snap back to what, before March, was considered normal. It’s also unclear whether, like disasters and wars throughout American history, change will be good.

In interviews, property managers, tenants and architects expressed a new and humble sentiment: They don’t know.

“This is unprecedented times,” said John Wix, managing director of Gensler‘s office in Portland.

At the U.S. Bancorp Tower, better known as Big Pink, offices are operating at about 10 percent capacity, Unico Properties‘ representatives said. On a typical weekday before the pandemic, 4,000 to 5,000 workers filled the 42-story building.

“When the tenants are ready to come back, the building will be ready for them,” said Keren Eichen, Unico Properties’ director of real estate services.

Unico, the real estate giant that owns and manages the downtown tower, is preparing for tenants’ returns. The company has placed a hand sanitizer station in the lobby. Elevators are restricted to four people at a time, with their standing places marked on the floor. The parking garage has been reprogrammed for contactless entry. An app will call an elevator, as another measure to avoid touching buttons.

Big Pink entered the pandemic with 94 percent occupancy, and Unico has had no unplanned tenant exits, said Brian Pearce, Unico’s executive vice president.

Clackamas and Washington counties are reopening, and Multnomah County is likely to do so at some point in June, if certain benchmarks can be reached.

As offices prepare to reopen, managers are considering measures to ensure distancing. They include installing physical barriers between desks, staggering employees’ start times and asking only a quarter to half of office workers to return at first.

“The new normal is highly individualized by each business and what they can do to protect people,” said Stuart Colby, a principal at SERA Architects and director of its workplace studio.

It may make more sense to keep office density low, and have some employees continue to work from home, rather than undergo costly tenant improvement projects, some experts said.

“Tenants are not looking to spend a whole bunch of money right now, especially with the economy so poor,” Pearce said. “They’re looking at what they can do for little or no cost.”

In Unico’s conversations with tenants, Pearce said, the “vast majority of tenants said, ‘Look, we’re going to take it slow.’”

In other states, employers have reopened offices slowly. In Unico’s markets that have already reopened, including Salt Lake City, Denver, Nashville, Tennessee, and Austin, Texas, office use has grown gradually to about 50 percent, Pearce said.

“I don’t expect to see a line out the door the day the (Oregon) governor loosens restrictions,” Pearce said.

In early May, CBRE conducted an international survey of office tenants. Of 203 respondents, 59 percent said they would provide masks, but only 28 percent said employees would be required to wear them at all times at work.

Only 20 percent of companies plan to reopen as soon as government restrictions are lifted, according to the CBRE survey. More than twice as many – 42 percent – plan to reopen after their internal standards are met.

Most companies plan a phased reopening, with 72 percent taking that approach, according to CBRE.

Wade Lange, vice president and regional manager of American Assets Trust, said the company is preparing to welcome back in the Lloyd District workers with employers including WeWork, Genentech and PacifiCorp. AAT employees will have their temperature taken when they return to work, he said.

Tenants’ employees will be asked to wear masks.

“We ask that they please wear face masks from their cars or buses up to their suites,” Lange said.

Building owners will need to prepare the physical systems as well. The Portland Water Bureau and Bureau of Development Services issued a bulletin May 1 cautioning that deadly bacteria can grow in stagnant water pipes while buildings are vacant. The agencies advised running fresh water through commercial buildings at least weekly.

Commercial real-estate professionals are watching closely to see whether tenants’ needs change emerging from the pandemic. Office space could face competing imperatives, with the need for social distance prompting desire for more space, but a greater number of employees working from home on some or most days leading to a need for less space.

“It’s also possible once there’s a vaccine that everybody will go back to the way things were,” Pearce said.

Gensler’s Wix said that with more employees working remotely, offices could have more conference rooms and fewer desks.

“We’re seeing the workplace becoming this place where the office possibly is more geared toward the community and cultural activities – the collaborative activities,” he said. “Individuals don’t need to be there to do their work.”

Most office tenants have signed yearslong leases, which has cushioned the commercial real estate market from shock and given tenants and building owners time to adjust. Still, more than $1 billion in transaction volume disappeared because of the pandemic, Jones Lang LaSalle Managing Director Eric Turner said during a recent 91��Ƶ Builder Breakfast event.

The modern office environment did not materialize by accident, but is a highly evolved, specific model that works for many tenants, SERA’s Colby said.

“Business leaders have been making this very conscious choice for housing their workers for decades,” he said. “It seems like unwinding it to deal with one potential resilience model is highly unlikely.”

Colby said he’s cautioning clients not to lose sight of the workplace’s function as an employee recruitment and retention asset.

“Do we really want to go backwards?” he said. “(With) a command and control mindset, you’re going to lose a competitive advantage with the workforce. Maybe not today, but tomorrow.”

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