At nine or 10 stories – depending how you count the original mezzanine – the Woodlark Building was one of Portland’s early skyscrapers. When its ribbon was cut in 1912, “one of the most modern and complete buildings of its kind.”

Next door is the equally illustrious Cornelius Hotel, which, over its 108-year life has served as an upscale hotel, a gay bathhouse and a fire-scarred vacant building.

Now, workers are fusing the two historical properties into a 150-room hotel for the ownership trio of Arthur Mutal, NBP Capital and Provenance Hotels.

“They want a nice hotel that also respects the unique history of the buildings,” said architect Christian Robert, principal at R&A Architecture, one of the architects employed for the project.

Owners kicked around a number of ideas for the past couple years, including various combinations of office, multifamily and hotel. They also purchased the nearby Sullivan Building and other adjoining parcels.

Robert said the design team had to “fight for every inch” to update the buildings and still abide by preservation guidelines. Certain materials and building technologies considered out of touch with the original historical era – including exposed brick in the lobby – were nixed in design development. To maximize space, the team created unique mezzanine and junior suites that employ the historic ceiling heights.

The project will have two restaurants – one for formal dining and a smaller tavern in the Cornelius building’s northern portion, the original entry lobby of the hotel.

Design-wise, there are a lot of cooks in the kitchen. Firms are under contract for room design and the design of the ground-level bar area that wasn’t included when the project went through permitting. And after the first construction permits were obtained (which took more than a year), R&A took over construction administration from the project’s initial architect, MCA Architects.

MCA has stayed on as architect of record.

“These are very old buildings,” MCA partner Dan Gates said. “There’s a million things about this project. It’s very complicated.”

Combining two buildings that have non-aligning floors is no easy task.

“None of the floors actually match up, so we solved it by providing a different stair length at each level,” Robert said.

Another major task is bringing Woodlark and Cornelius up to seismic code. The Woodlark is a concrete building. The Cornelius has some steel columns in the center, but is basically a wood-framed building with exterior walls made of unreinforced masonry (URM).

To achieve uniformity, the contractor, LCG Pence, is employing shotcrete with a fiberglass mesh to stabilize the URM from within. Other advantages include requiring less space to apply, and allowing the team to retain more of the historic URM.

In a way, tying two buildings together provides structural support, Robert said.

“It’s like you have two feet to stand on,” he said.

R&A project lead Richard Destin said it’s an honor to bring old artifacts back to life. And it’s exciting to work on a wood high-rise, he added, at a time when emerging mass timber products are de rigueur.

“Under current code, none of it would be allowed,” he said.

The Woodlark

Cost: $30 million

Architect: R&A Architecture

Architect of record: MCA Architects

Contractor: LCG Pence

Expected completion: spring 2018

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Portland’s hotel industry is in the midst of a booming expansion that is raising concerns that developers are arriving late to a long period of economic growth.

A Travel Portland tally of the hospitality development pipeline shows 2,728 rooms on the way. If built, the hotel developments would expand Central Portland’s room count by 35 percent by 2020 – an amount that one hotelier warns will be a “shock to the system.”

“I worry about the market’s ability to absorb the supply medium-term,” said Bashar Wali, president of Provenance Hotels, which owns several boutique hotels in Portland. “Long-term, the supply momentum is going to slow down. It doesn’t make sense anymore.”

Projects including the $50 million, 204-room AC Hotel Portland have opened in recent months, yet more hotel developers are looking to jump in with proposals that have yet to enter the city’s design review hearing process, according to stakeholders.

Brisk hospitality business in Portland is being supported by strong population and job growth. Portland hotels were 82.3 percent occupied in March, up 4.1 percent from March 2016, and 74.4 percent for the year, according to research firm STR.

As average daily rates and occupancies showed impressive strength, hotel groups began rushing into the market. National brands including Hyatt, Hampton, Hilton, Marriott and Radisson all wanted to be in Portland. That supply is on track to be added to the market in the next two to three years.

The flood of new rooms is prompting some people to question whether developers could overbuild. Already, signs suggest that some hospitality chains are looking to exit the market. The Porter Hotel, part of Hilton’s Curio brand, is on the market, Wali said. The 299-room hotel, under construction at 1355 S.W. Second Ave., hasn’t even opened.

“That was another indication that says to us the market is definitely turning,” he said.

Provenance is evaluating the offering, but so far, it has been unable to come to terms with the developer, The Widewaters Group of Syracuse, N.Y.

“I don’t know if we’ll get to where they want to get in terms of pricing,” Wali said.

The Widewaters Group did not return a message seeking comment.

Even as some companies are looking to reduce their exposure to Portland’s hotel market, others are considering getting in. Plans for an 11-story, 171-room hotel at Southwest 10th Avenue and Alder Street in downtown’s West End were revealed in April public notices. The project is from Graves Hospitality, based in Minneapolis, and design firm DLR Group‘s Portland office.

The property, home to a number of popular food carts and a surface parking lot, is owned by the Goodman family.

Benjamin Graves, president and chief operating officer of Graves Hospitality, visited Portland on Tuesday to meet with city officials, food-cart operators and others near the proposed project site.

“We’re hearing what everyone’s wants and needs are in the neighborhood, and hopefully we can do something the neighborhood can be proud of,” Graves said.

Graves said he’s interested in accommodating the food carts at Southwest 10th Avenue and Alder Street as the hotel proposal goes forward.

“That’s definitely something that we’re considering and exploring at the moment,” he said.

Graves Hospitality develops, owns and manages hotels across the country. The company works with several major hotel brands, and is a preferred developer for Moxy, a Marriott brand.

Graves said he’s interested in bringing a hotel to Portland, but the project on the Goodman family lot isn’t set yet.

“We’re just in the exploration phase, but we’re spending real time, energy and money in this process,” he said.

New projects must contend with costs for land and construction that have grown along with the economic cycle. Yet for a prospective developer such as Graves, Portland’s strong fundamentals continue to beckon, and costs remain below those for comparable West Coast markets like Seattle and San Francisco. Prices for steel, for example, have moderated and are below year-ago levels.

“From a relative perspective, if you’re looking at other markets, cost to build in Portland is still achievable,” Graves said.

Portland’s hotel development pace is similar to those in other fast-growing cities, and more growth is supportable, Graves said.

“We don’t think there’s a bubble right now,” he said. “I don’t believe Portland’s as frothy. There are markets we feel could use some breathing room – New York comes to mind.”

For developers and investors, a project’s success depends in part on when they intend to sell. Developers looking to flip a hotel project in the next few years may be in for a tough exit, Wali said.

“If you are a short-term investor for private equity, any of the traditional Wall Street investors, your hold horizon is typically three to five years,” Wali said. “We’re in the fifth, sixth year of our run. You’re now starting to come into the market. It’s going to take you two to three years to build, and if you’re going to hold for another two to three years, your contemplated sale of the asset to realize your returns is essentially at the bottom of the next cycle. If you don’t think it through that way, and your intent is to flip, you’re going to be hurt on your exit.”

Graves Hospitality holds its properties for five to 25 years, Graves said.

“It really is just a function of market conditions, our partner and how we feel about the marketplace itself,” he said.

Another new proposal calls for demolishing an existing quarter-block building at 600 S.W. Fourth Ave. to construct a 15-story, 215-room hotel. SERA Architects was listed as the applicant for an early assistance meeting, but the meeting was canceled. The identity of the developer was not listed, and the architect did not return a message seeking comment.

By far the largest hotel in the pipeline is the Hyatt Regency due to be built near the Oregon Convention Center. The hotel, expected to open in late 2019, will bring 600 rooms to market. How that hotel will affect others is among the most important questions looming over the local hospitality industry.

The Hyatt Regency may draw primarily from special events held at the Convention Center and nearby Rose Quarter. Only time will tell if the hotel creates its own demand, or as Graves said, “if it’s just going to suck demand from the existing hotels.”

Airbnb and competing services add another wrinkle.

“Airbnb is essentially the equivalent of an 1,800-room hotel in the market, day in and day out, competing with us,” Wali said. “Anyone who thinks Airbnb is going away has their head in the sand, because they’re not going away.”

In today’s hotel market, local and national developers alike are pushing boutique brands.

Provenance is expanding downtown with construction of the Woodlark Hotel at Southwest Ninth Avenue and Alder Street and a renovation and rebrand of the Westin, built in 1998 at 750 S.W. Alder St., into a new offering called Dossier.

Woodlark construction has been slowed by issues in the historic buildings. The project combines the Cornelius Hotel, built in 1908, and the Woodlark Building, an office and retail building built in 1912.

“It would be a lot easier if it were ground-up (construction), but that’s not what we do,” Wali said.

The Woodlark is now on track to open in spring 2018. The hotel will offer 150 rooms and an East Texas-meets-Portland restaurant from Doug Adams, the chef at the well-regarded Imperial restaurant in Provenance’s Hotel Lucia. Another bar is also planned.

Dossier will relaunch in August with 205 rooms.

Hotel developers are focused anew on drawing in customers with attractive lobbies, restaurants and other ground-floor amenities as distinguishable features.

“I can’t tell you that the guest room at my hotel is better than the guest room at the Hampton Inn,” Wali said. “Everybody has a comfortable bed and great Wi-Fi and a great shower. We think what really creates the experience now is it’s all about the public spaces, the social spaces, the restaurant, the bar. We’re spending a lot of money, focus and effort on those to give a true Portland experience, elevated.”

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A gas leak at a downtown construction project site early Thursday led to full or partial evacuation of five heavily-used office buildings.

A crew with NW Natural was able to locate the source of the leak and stanch the spread of natural gas without incident, said Lt. Rich Chatman of Portland Fire and Rescue. The 911 call went out at 7 a.m. and the situation was deemed “safe” at 9:40 a.m. Southwest Alder and Washington streets were closed from Broadway to Southwest 10th Avenue.

But LCG Pence principal Paul Schulz said the leak was caused by a subcontractor hired by the developer, Arthur Mutal, though LCG Pence did have an employee on site performing preconstruction work. Philip Arthur, managing principal of Arthur Mutal, declined to comment.

Heavy work for the $14 million project is scheduled to begin shortly, according Schulz.

Chatman said that once the leak occurred, everyone involved followed proper protocols. The incident came around a month after a contractor-caused gas leak led to multiple blasts on Northwest 23rd Avenue. Multiple buildings were damaged and several people were injured.

“We moved with the same mindset of protecting life safety, as quickly as we could,” Chatman said. “Granted, that situation was very real in our minds because of what happened. We as humans are obviously going to remember something like that.”

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The developers who plan to create a new upscale hotel from two historic downtown buildings hope the end result will become a community gathering place.

A plan to transform the Cornelius Hotel and the Woodlark Building, on Alder Street between Park and Ninth avenues, into a 150-room “lifestyle” hotel took on new life when the property was purchased earlier this year. Provenance Hotels and NBP Capital were major investors, and development group Arthur Mutal LLC also invested in the purchase and hotel development.

Lauren Noecker Robert, a managing member of NBP Capital, said she hopes the new hotel will attract both out-of-town visitors and locals looking for a place to “hang out.”

“For a time, the Cornelius was called the House of Welcome and that resonated with us,” she said. “We haven’t decided on a name yet, but we wanted something that invokes emotion and that says anyone and everyone is welcome. We want it to be Portland’s gathering place.”

Noecker Robert said work to renovate the two old buildings will begin as soon all the required permits are obtained.

A first step was a hearing Monday before the Historic Landmarks Commission. The commission unanimously approved the plan, with a staff-recommended requirement that no more than 20 percent of the old windows would be completely replaced.

The Cornelius Hotel, built in 1908, has been closed up for a long time, Noecker Roberts said, and “needs a little more love” than the Woodlark, which was built in 1912 for commercial uses.

Bashar Wali, president of Provenance Hotels, said plans for developing the hotel include restoring the lobby of the hotel “to its original feeling and glory,” and keeping as many artifacts as possible.

“Unfortunately, there’s not a lot left to preserve, but we hope to find hidden gems,” he said. “I have done a lot of historic hotels and have seen some where sometimes the accents are cheesy.”

The design and dĂ©cor of the hotel, with the theme, “the New Northwest,” will reflect the past while also looking to Portland’s future, Wali said.

“We hope to embody what the city can become, and (the hotel) will be softer and prettier than just flannel and reclaimed barn wood,” he said. “The hipsters’ moment in time has passed. Portland is more sophisticated and has outgrown the image presented by Portlandia.”

LCG Pence Construction will serve as general contractor. All work on the project will be done by local companies, Noecker Robert said.

R&A Architecture + Design handled initial design work. MCA Architects is serving as the architect of record and is overseeing design implement of the overall project. Interior design is being handled by Staicoff Design Co. of Portland.

Because the two buildings feature different types of construction, converting them into one structure won’t be a simple process, said Ted Grund, MCA Architect’s project manager. The Cornelius Hotel, built in 1906, is made of load-bearing masonry with some iron columns and beams.

“They improvisationally used iron where they didn’t want heavy columns and the rest is timber,” he said. “It has a heavy load-bearing wall that’s 21 inches thick at the bottom. In the lower levels, to have slimmer columns, they used structural steel encased in concrete.”

The Woodlark Building, on the other hand, is built entirely of reinforced concrete with steel supports.

Another challenge in joining the two buildings is their different heights. The Woodlark is nine stories; the Cornelius is seven stories.

“Every single floor is at a different height, including the ground floor and the basement,” Grund said.

The owners estimate the renovation will cost around $30 million and will take between 12 and 18 months.

According to MCA’s application to the Historic Landmarks Commission, renovation of the two buildings includes installing new wood and a metal storefront. A new “Juliet” balcony is planned at the entrance, and a new elevator penthouse and stair tower are planned for the roof of the Cornelius.

Both buildings will require new elevators and enlarged elevator shafts, which also will add to the complexity of the renovation work, Grund said.

The project’s developers are seeking tax credits for retaining the exterior historical aspects of the two buildings using original drawings by the architectural firm of Bennes, Hendricks and Tobey.

A metal and glass canopy over the sidewalk on Cornelius will be recreated. The mansard roof on the Cornelius, damaged earlier by fire, will be restored to original condition. All windows, although they will be double-paned, will be clear glass.

The new hotel will include a large restaurant and bar on the ground floor of the old Woodlark building with a sidewalk-level lunch window on Southwest Ninth Avenue. The lobby of the Cornelius portion of the building will have bar and will serve light meals throughout the day.

The new hotel will also have deluxe suites on the two top floors with two large conference spaces and meeting rooms on the basement level.

Once the new hotel is completed, it will be Provenance Hotels’ fifth property in Portland. In addition to owning the Westin Portland, the company owns and manages the Hotel Lucia, Hotel deLuxe and the Sentinel. The company also owns hotels in Seattle and Tacoma as well as Nashville.

NBP Capital currently owns more than 2,000 apartments and 400,000 square feet of commercial space in the Portland metro area.

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Adjacent historic buildings in downtown Portland are pegged for redevelopment into a hotel.

The 102-year-old Woodlark Building on Southwest Alder Street and the neighboring 105-year-old former Cornelius Hotel on Southwest Park Avenue will be connected internally and hold 90 to 100 hotel rooms, as well as a restaurant and bar, according to initial plans submitted to the Portland Bureau of Development Services.

The project will be discussed at a pre-application conference on Dec. 16 at 10:30 a.m. in Room 4a at 1900 S.W. Fourth Ave. Designs by project architect R&A Design, which has offices in Santa Monica, Calif. and Portland, will eventually be reviewed by the Historic Landmarks Commission, city planner Sheila Frugoli said.

Both buildings are listed on the National Register of Historic Places and owned by Portland-based real estate investment and development firm Arthur Mutal. The company earlier this year purchased the nine-story Woodlark Building for $6.85 million and late last year saved the seven-story Cornelius Hotel from demolition by purchasing it from TMT Development for $2.07 million.

Arthur Mutal also owns the 99-year-old Stevens Building, located due north of the Woodlark Building.

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The Woodlark Building in downtown Portland is now listed on the National Register of Historic Places.

The Oregon State Advisory Committee on Historic Preservation in June recommended that the 102-year-old, nine-story office building on Southwest Alder Street be given a national listing. The National Park Service approved the nomination in early August, said Diana Painter, an architectural historian with the Oregon State Historic Preservation Office.

The Woodlark Building was designed by Doyle, Patterson and Beach – a formerly prominent architecture firm – in the Commercial style with an elaborate cornice and prominent entry. The original wood windows remain above the retail and mezzanine levels, which have been remodeled over time.

The building’s appearance and longtime use as offices is deceiving, Painter said. It was actually originally constructed as a retail and wholesale pharmacy operation for Woodard, Clarke & Co. and Clarke-Woodward Drug Co.

“It’s a really attractive building with all the terra-cotta detailing, but it’s also got an interesting history,” Painter said.

The structure was built during a major building boom in Portland following the Lewis and Clark Centennial Exposition in 1905. In 1924, the drug companies were sold and the building’s upper floors were converted to office space.

The Woodlark Building is now one of more than 600 properties in Portland that are listed on the national register.

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A Portland real estate investment and development firm has added a third historic building to its Central Business District portfolio, effectively positioning the trio for adaptive reuse.

Arthur Mutal, in a joint venture with NFN Investments, has purchased the 102-year-old Woodlark Building for $6.85 million. The nine-story office building, located on the Northeast corner of Southwest Ninth Avenue and Alder Street, is the third property Arthur Mutal has acquired on the block in recent months with an eye toward newer and better uses.

At the end of last year, Arthur Mutal saved the 105-year-old Cornelius Hotel (slightly east of the Woodlark Building) from the wrecking ball by purchasing it from TMT Development for $2.07 million. That followed the firm’s purchase of the 99-year-old Stevens Building (due north of the Woodlark Building) from the Church of Scientology for $4.35 million.

In a previous interview with the 91ĘÓƵ, Jeff Arthur, a managing principal at Arthur Mutal, said the company is considering for the three buildings a variety of schemes that could include a mix of hotel rooms, office space and multifamily housing. Arthur, who was out of the country at the time of the sale, was unavailable to discuss the plans further at present.

Arthur reported via email, however, that the Woodlark’s seller was Bill Jay Corp., and that Nick Kassab at Capacity Commercial represented both groups in the transaction.

“We continue to be bullish on Portland and the office market,” Arthur wrote via email.

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Like taking baby steps, sometimes the key to renting out space is to break it up into smaller pieces.

“When we were trying to lease it all together, the market was kind of tough and we didn’t have much interest and so we split it,” said Richard Jennings, a broker at in Portland, of a 4,420-square-foot, Class A, office space on the eighth floor of downtown Portland‘s historic Woodlark Building.

With interest coming in for smaller spaces, Jennings cut out a 2,879-square-foot piece of the floor for a political-oriented nonprofit organization called Our Oregon, and is now in negotiations to lease the remaining 1,541-square-foot space to a wealth management company that currently rents space on the fourth floor of the building.

He said he hoped to have that deal finalized by the end of the week and that space could be opening up in the building in the near future. He said the deal required his company to make several tenant improvements to convert the once open-spaced floor plan – the design leftover from the engineering firm that once occupied the floor – to include more offices and private spaces. Rents run from $14 to $16 per square foot.

It will be the newest renovation for a longtime staple in Portland’s skyline.

Built in 1912, the once notable architecture company Doyle, Patterson and Beach designed the Woodlark Building as the headquarters for a drug company called Woodard-Clarke & Company (“Woodlark” is the conjunction of that company’s founders’ names, C.H. Woodard and Louis G. Clarke), according to a 2004 historical report by the Portland Bureau of Planning.

At the time of its opening, the building was lauded as “America’s Largest Drug Store,” and individual departments specialized in things like surgical instruments, dental supplies, electrical apparatus equipment and optical goods. The building itself is one of Portland’s earliest commercial skyscrapers and embodied then-new building technology like fire-resistant concrete/steel-frame construction and elevators.

In 1924, the Blumauer-Frank Drug Company bought Woodward-Clark, and later in 1959 the building became home to the Gloria LaVonn Finishing School until 1973.

Jennings said he hopes to continue the tradition.

“They’ve been there for a number of years, they’re dedicated and so we want to make sure they’re happy,” Jennings said of the tenant moving from the fourth floor.

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