April 15, 2024

Three lease deals revitalizing Portland communities

Communities need shared spaces where they can live, work, play and grow. The last several years have taught us a lot about human resiliency and the creative ways people seek these spaces out, even in hard times (and sometimes because of them).

In recent months, we’ve closed some special deals between Portland area landlords and tenants, and we think they point to promising signs of renewal in communities throughout the city. We’re excited to share three of these stories below.

X-Golf at Canyon Place, Beaverton

Associate Emmy Johnston closed our firm’s largest deal of Q4 2023 between Schnitzer Properties and an X-Golf franchise operator. She’s also a golfer… and that’s not just a coincidence.

“I live in this area,” Johnston says. “And that does factor into what we as brokers look for in retail tenants, because we know what we’d like to see and what would make sense for the community.”

Compared to office and industrial real estate, she says, retail trends depend more heavily on demographics and population density: “This is where people work, live and spend their money, where we’re going grocery shopping—or where we’re playing golf.”

Experiential retail concepts—from pickleball courts to indoor trampoline parks—have become a popular way to make use of large, empty retail spaces such as box stores and movie theaters.

“It’s fascinating to see the cycles of a retail space because of our market trends,” Johnston says. “We’re probably working from home, and we can get physical goods delivered. But we have to go seek out experiences.”

Johnston was working with Schnitzer to identify a tenant for a 9,500-square-foot space in Beaverton’s Canyon Place Shopping Center on SW 117th Avenue. But actually, she had her mind on indoor golf concepts because of a different property—a 5,000-square-foot retail vacancy near the golf course where she took lessons growing up. “I know the market and thought an ancillary golf offering would work well, so I started researching indoor golf concepts and drew up a list,” she says.

One concept on the list was X-Golf. Johnston remembers their call well:

“I reached out to them, and their response was, ‘Oh, that’s so great, thanks for sending… but we actually need about 10,000 square feet.’ So of course I said, ‘Well, we have that, too.’”

While the deal took some months to come together, it was quicker than most for a number of reasons. First, X-Golf’s operator was local, where most box-size tenants are regional or national chains that require lengthy due diligence processes before signing a lease. Second, this operator had a franchise agreement with deadlines, so he was highly motivated to close.

The third reason is a whole story in itself:

“The space was a shell in mostly raw condition—it didn’t even have an electrical panel, which in this market, and with a global copper shortage, is either hard to find or on backorder,” Johnston recalls.

Franchise deadlines and construction delays could easily have killed the deal, were it not for one serendipity: the franchisee behind this X-Golf location is also the president of a local commercial construction company. Since the operator was knowledgeable about the work and had connections in his own network, he was willing to take on some extra risk.

“He was able to look at the space himself—as both the tenant and the contractor—and expedite a lot of processes,” Johnston says. “It was basically, ‘Oh, you have the space? Let’s move a mountain.’ It was the perfect marriage between a landlord and tenant.”

Johnston lives just down the street from the new X-Golf location—so the deal worked out well for her, too.

Northwest Children’s Theater at The Judy, 1000 SW Broadway

Northwest Children’s Theater (NWCT) is celebrating the one-year anniversary of its permanent home this month. In April 2023, NWCT established the Judy Kafoury Center for Youth Arts—“the Judy,” for short—at the 1000 Broadway Building in downtown Portland. The year has brought tremendous growth not only to the theater, but also to the Portland community.

Between the pandemic and a series of temporary spaces, “we went dark for a couple of years,” says Rachael Brown, NWCT’s Marketing and Communications Director. The theater’s first post-COVID show, Elephant & Piggie’s “We Are in a Play!”, opened at the Judy on April 29, 2023—and had five weekends of sold-out shows.

Word spread throughout the spring, and as soon as it was time for summer camps, “there were so many kids—hundreds and hundreds of kids—coming through the door,” Brown says. It wasn’t just a post-pandemic fluke; summer 2024 is gearing up to be a big one: “Our performance camps especially tend to sell out pretty quickly, but all our summer enrollments are going strong. We’re just growing—by word of mouth. Everybody has started seeing the Judy as the prime place to take classes.”

Hundreds of children singing and dancing is a picture of hope on its own. But NWCT’s revitalizing influence downtown also extends beyond students and their families.

NWCT supports the larger artist community by running a robust rental program, allowing different organizations to rent the Judy’s performance spaces and cinemas for events. It also has a special relationship with the Indian American community in Portland, which began when NWCT partnered with Anita Menon—a local artist who specializes in Bharatanatyam classical Indian dance—to co-create an original stage adaptation of The Jungle Book that ran in early 2020.

Last November, NWCT hosted a Diwali festival at the Judy and over 600 people attended. Brown describes it as a “building takeover” complete with Bharatanatyam dance lessons, art, an on-stage talent show, live storytelling in the cinema, henna artists and a local Indian food vendor.

“We wanted to engage the Indian American community,” she says. “But part of the purpose was also to build a bridge so that folks of all backgrounds could come and learn and experience something. We have such a great opportunity to engage the art community, and the community as a whole, in brand new ways that we couldn’t have done in our old space.”

The Emerson School at Harrison Square, 1800 SW 1st Ave

Downtown Portland has always been home for the Emerson School. The urban core is an ideal backdrop for the school’s project-based learning model, allowing teachers and students to get outside the classroom, partner with local businesses and explore via public transit. But despite the school’s dedication to being downtown—and its status as Portland’s oldest charter school—it operated out of temporary spaces from 2003 until 2023.

This January, the school moved into a new downtown space: nearly 10,000 square feet on the ground floor of Harrison Square, a six-story office tower on SW 1st Avenue. The school has easy access to the streetcar and light rail. Every classroom has an entire wall of windows facing the Willamette River and Mt. Hood. And best of all, the lease is 15 years long.

NAI Elliott brokers arranged the contract with Libertas Management, the building’s ownership, and the $4.1 million deal closed June 7.

It was a hard-fought victory following multiple appeals to the city to sus out the details of converting three office suites zoned for business occupancy into a six-classroom school.

Sara Daley, a Senior Associate at NAI Elliott who helped broker the deal, says the school now has a dedicated entry, and exits separate from the rest of the building and tenants. That’s necessary for fire code purposes. It also adds “a little bit of a buffer between laughing, yelling, running children and, you know, very serious corporate meetings.”

The Harrison Square property feels quiet, clean and safe, set back from the street and shaded by mature trees. But it’s also highly visible, with an east-facing wall of expansive glass windows that stretches nearly a full city block along Naito Parkway, a major corridor.

Before the Emerson School moved in, the building was an ongoing reminder of Portland’s struggling office market, says Jordan Elliott, President of NAI Elliott. “It was this conventional office building with a big ground floor right at eye level, and nothing at all happening inside. You just can’t miss it—it’s a lot of surface area—and every time I drove by, the whole floor was dark. Then the lights came on.”

Now, driving down Naito reminds Elliott of how creatively spaces can be used. “It was a double whammy,” he says. “A school finds a new location and doesn’t have to close. And a downtown office building is reactivated on the ground floor—with… what’s more active than children?”

Daley adds: “This [is a] school that frankly has had to withstand really temporary situations with their school location, and we’re giving them a permanent home. They’ve been contributing to our community for the last 20 years, and now hopefully they’ll have at least 20 more.”

The lights are coming on, and Portland is getting brighter. Can you feel it? The Diwali festival at the Judy is strikingly on-theme: Diwali, the Hindu festival of lights, symbolizes the victory of light over darkness.

As people across the city seek togetherness, they’re finding spaces—sometimes surprising ones—to occupy. And the energy and joy these communities bring doesn’t just fill up these spaces. It overflows, brightening everything around them.

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© 2022 NAI Elliott - All Rights Reserved


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