There's a building in Slabtown that you might not look twice at today, but next summer its deck will be full of Gen Z-ers taking vape breaks and Northwest 17th Avenue will be hot with bikes and people searching for food that isn't Olympia Provisions.
The building at 1715 N.W. 17th Ave. was the home of Premier Gear & Machine Works, which made metal parts for engines. The north and smaller part of it was built in 1925, and the rest was the company yard. Then in the 1940s, and again in 1970, they expanded until the whole block was filled.
Now Sturgeon Development Partners is turning the building into creative office space, set to open in early summer 2020. LRS Architects and the contractor, Lorentz Bruun Construction, have been cutting large rectangles in the concrete walls to bring in more sunlight. On a recent sunny day, dozens of windows were stacked against the wall awaiting installation. On the south side, in the larger building, the chop saws have cut rectangles as large as 12 feet by 5 feet for fenestration.
It's a bit of a stretch to try to make the Premier Gear & Machine Works building (they're calling it Premier Gear Works) at all glamorous, even though Steven Smith Tea and the fancy restaurant Olympia Provisions are just across the street. This is flyover country: the ramp to the Fremont Bridge is so close to the building's roof that on Google Maps, the block has its corner lopped off, like a missing ear.
It would be hard to imagine chatting in the street amidst the roar of traffic, but the developers are making a go of it. They are building a mezzanine-level terrace, indented into the east side of the building, where future office workers can work outside or take their lunch. It will be loud, and the air quality won't be good (all those exhaust fumes), but the developers are gambling that the building's unique historical character will make it attractive.
"Obviously, when folks are outside, they'll hear a little bit of the ambient noise, but otherwise it should be okay," Robert Pile, one of the three partners at Sturgeon Development Partners, told the Business Tribune on a hard hat tour of the building.
They've pulled out the interior walls and are building a mezzanine on two sides of the structure that will have a 22-foot clearance from floor to ceiling and access to a double set of big, new windows. Pile says they considered a second mezzanine but then decided to stick with the high ceiling, whose sense of grandeur could inspire office workers pulling 12-hour shifts.
There's undoubtedly some old Portland charm about the bone structure of the building. The roof is held up by 30-by-14-inch beams made of Douglas Fir. A sawtooth skylight has been uncovered and is being reglazed. The concrete floor, still chipped and oily from 95 years of hard work, will have a new topping slab poured and polished. The five-ton capacity crane hanging from the ceiling will be kept, as a conversation piece, as will one of the smaller cranes.
This is pre-OSHA Portland
Lorentz Bruun superintendent Bruce Fabian says the renovation and seismic upgrade was not that complicated. "But any time you cut into concrete, you don't know what to expect," he said during the tour. The rebar in the oldest part of the building was irregularly spaced and much less "deformed" than rebar in use today. Deformed rebar is twisted and knotted up, which gives it a better grip on the concrete that is poured around it. Back in the 1920s, Fabian said, they weren't as concerned with code.
Vanessa Sturgeon owns and runs the company with Robert Pile and Nick Fritel, as a side business to their day jobs at TMT Management. TMT is a long-term Portland developer, founded by Sturgeon's grandfather Tom Moyer, who made his fortune in movie theaters. TMT developed the Fox Tower and Park Avenue West downtown, but is mostly in building management mode now.
SDP is more of a risky business. The principals spot buildings and try to match them to up-and-coming renters, preferably with deep pockets.
As Pile explains it, they raise the money, find the architect and contractor to realize their vision, and a commercial real estate broker to find the right tenants.
The goal is a cool space that seems unique, and in this case, has a sense of history, even if that history is irrelevant to the mouse clicking and swiping that will take place in it. The logo for Premier is a take-off on the logo of the original machinist company, which has moved to modern facilities in Canby.
Work proceeds apace. New glulam wooden beams, wrapped in plastic marked Vancouver, Canada, sit on blocks waiting to be installed to hold up the mezzanine. Fabian estimates they weigh around 2,500 pounds each, and if they have to trim the ends, "Some guys try to make little things out of it, other guys take it home for firewood."
Pile says it's up to the eventual tenant how the space is finished. They will negotiate who pays for the tenant improvements, based on how long a lease they commit to and how luxurious they want the place to look.
They will want "more open space users, and cubicles maybe...just a lot of desk spaces. There might be some closed offices and conference rooms, but I think it will most likely be more of an open working environment," Pile said.
SDP's job is to deliver the core shell of the building and then work with the various brokers and tenants to customize it to their wants. "We may get somebody who wants half of the building, and then it takes a little bit more time to fill the other half. There are definitely users out there who might want the entire thing," Pile said.
What would be ideal?
"They might come on board early and take 68,000 square feet!"
Pile looks to the Towne Storage building across the Burnside Bridge as an example of a successful adaptive reuse. The brick building was a warren of artist studios and storage lockers until it was redeveloped and architectural software company Autodesk moved in, lock, stock and barrel.
"They're the perfect example of the type of tenant that might want something like this: A software company, but also architecture firms and engineering firms."
He expects many workers will bike to work, and in the future, ride the streetcar a block away when it extends to Montgomery Park. But there will always be drivers, so they have leased a pair of parking lots. They will sell parking as an amenity more than a money maker.
Bruun's subs found the coveralls of a machine shop worker who retired after 30 years at Premier. They were hanging in the rafters like a player's uniform in a hall of fame.
Premier also left behind some obsolete machinery — a band saw and a lathe — that Sturgeon Partners will clean up and display like sculpture.
"That's character. They can have that, or a rectangle box with a dropped a ceiling and whatnot," said Pile. "It's a unique space that's hard to replicate, which, a lot of times, can give those software firms the recruiting edge."
Premier was not inspired by any other particular remodel, although Pile does say he likes what happened at the Custom Blocks at Southeast Ninth Avenue and Main Street. That, too, is an old machine shop turned into offices with a big stamping press at its center. He also likes Field Office, a spec office building on Front Avenue.
Developers before Sturgeon (such as Homer Williams) had wanted to turn the building into mini storage, but it never happened.
"A lot of that has to do with the zoning too. The new comprehensive plan changed that last year. We did a rezone of the property. We basically changed it to a mixed-use zone," Pile said. "Thankfully, it was relatively simple. We had some challenges with some of the bureaus."
According to Sturgeon, "We're seeing tenants look for something special, and a space that unique gets leased quickly."
She told the Business Tribune the film and TV industry is growing in Portland, citing Claymation company Shadow Machine, which is expanding. Sturgeon also thinks that Premier Gear being near a potential baseball stadium would be good for business.
"The Pearl is not as interesting as it used to be," Sturgeon said. "It's starting to look pretty uniform. There's more of a rhythm in Slabtown, and each building is different."
She added that the freeway bridge is a good thing, for access, and for visibility.
"With so many people driving by, if you brand the building, it's good."
Other local commercial real estate experts are watching Premier Gear closely, like it's the creative office space canary in a coal mine.
Peter Andrews, executive VP of Melvin Mark Brokerage, told the Business Tribune that the office market remains strong in Portland, citing Google and Amazon doubling their square footage in recent months.
"The question is, what is the right location, scale, size and access to amenities? Convenience is important, as is having a space that speaks to an organization that's different and unique."
Andrews added, "Young people want something different from their parents' office."
Ten years ago, it was clear what was traditional office and what was adaptive reuse. "But now even traditional offices are doing creative. Look at when Unico redid US Bank Tower, or the place where Puppet is now. It was a federal office."
Montgomery Park and the Galleria downtown are trending to open plan offices and exposed ceilings, and even NW Natural's HQ has outdoor decks and strong natural light. Working for a utility is not considered a creative job, but that type of design is spreading.
"It's about attracting the right talent for the companies that can afford it," added Andrews.
Jamaal Brown is a senior associate at Colliers International, where he tends to work with the tenant, often marketing agencies who want an attractive, fun space that promotes collaboration.
"I saw the (Premier Gear) renderings, they look cool," said Brown. "In my experience you want a product that's' functional," he cautioned. "Sometimes organizations can have great ideas about a creative space with exposed beams and brick, but the noise and temperature are too much. So sometimes it's polished concrete in the elevator lobby the carpet tiles back in the bull pens" where the hard work is done.
"Space for collaboration is important, if part of what you do is being creative. You want to be inspired by the place you work. If a graphic designer is looking at black and white wall and drop ceiling…"
Brown added that one of the most appealing factors right now is natural light at the glass line (the windows). Executives are giving up city-view offices to their staff to keep them happy.
"When you're working in nice natural light, it affects your mood. Some computer programmers, it may be better for them to be in the dark, because they look at a screen all day."
The view from L.A.
…Creative space goes far beyond just its "look." There is also a functionality that is becoming more prevalent in today's shifting workplace. And interest in creative office is beginning to expand beyond media, tech and entertainment companies to include more traditional industries such as law firms, real estate companies and financial services providers, which see the benefit of creating a more welcoming environment based on collaboration and creativity, shifting away from the staid environments of the past.
Additionally, what has often been overlooked by firms is the need to attract and retain top talent. Whether you are a crack computer programmer or an influential attorney, employees prefer to spend eight to 12 hours of their day in an environment that promotes creativity, spontaneity through space optimization, increased collaboration, enhanced culture and employee mental health. This effort to attract, engage and retain top talent is becoming more and more pervasive as employers realize that workers want environments that nourish as opposed to drain—no matter what their line of business may be.
As the demand for creative space becomes mainstream, the extent of just how creative it is—or can be—is often determined by the effectiveness of the individual marketing the property. It is also dependent on the ability of the tenant representative to communicate a vision to the finished space. For every seller, there is someone buying, and in the case of creative space, it is crucial to promote a vision and plan for what it can be, especially when you are converting traditional offices—and users, for that matter—to the creative model.
Neil Resnick, Principal, Avison Young, Los Angeles.
Reporter, The Business Tribune
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