Complex's retail space to complement tenants
The Beranger seeks downtown tenants, condo buyers
October 30th 2007
Only one of the seven ground-floor spaces is leased at the new Beranger, but the sheer variety of interested businesses bodes well for the diversity of downtown Gresham.
"We've gotten interest from a pretty wide range of uses," said Beranger leasing agent J.J. Unger. "From nail salons to hookah bars."
A retail specialist with Norris, Beggs and Simpson in Portland, Unger is working with Gresham's Peak Development to fill seven street-level spaces at the complex on Northeast Third Street and Hood Avenue. Designed by Portland-based Myhre Group architects, the four-story structure features 24 one- and two-bedroom condominium units over 7,000-square feet of retail space. A "green roof" using state-of-the-art environmental technology to manage rainwater provides an attractive rooftop garden area for condominium owners to use.
Like The Crossing, another Peak project located on Civic Drive, The Beranger is a mixed-use complex that benefits from a Vertical Housing Tax zone. Formerly known as Transit-Oriented Tax Exemption, or TOTE, the program offers tax-abatement incentives for projects that combine residential and retail uses. The 10-year property tax reductions are offered to urban centers close to mass-transit facilities such as the MAX.
Unger's first commitment for ground-floor space came from Edward Hones Investments. The financial services company moved into the southeast corner space soon after The Beranger was dedicated Thursday, Sept. 27.
As he considers offers for remaining spaces, Unger has to think about more than the commercial viability.
"Activity is picking up now that the project is completed," he said of the building. "It's really about finding the right tenant mix. You've got to be courteous to those you lease to upstairs. If you get an operator in there that doesn't fit, the (condo) owners get mad above you."
That doesn't necessarily mean restaurants and bars are off-limit, but he says they have to complement the entire project. While it's too soon in the process to name names, Unger has considered a couple different salons and a sushi restaurant. A food-service business would work well, he noted, with the proposed Gresham Center for the Arts across Third Street.
"We're looking for some high-energy retail that would fit in the downtown area, something that will add value to downtown," he said. "With the arts center across the way, our mix (of businesses) will feed off that."
Mike Rossman of Peak Development noted that it takes people living nearby to make arts-oriented facilities successful.
"We're hoping to add more to what we have, with boutique shops and restaurants," he said. "It would be nice if the timing is more in line with the Center for the Arts. To support those businesses, we need more residents down here."
The remaining six suites are between 600 and 1,200 square feet. Spaces can be combined or modified to suit tenants' needs up to approximately 3,200 square feet. The Beranger's developers provide an improvement package to help tenants remodel the semi-finished areas, which are available for $18 to $20 per square foot. Among the incentives is a "modified gross" rate, in which the building owner pays a portion of the property tax, insurance and common maintenance fees.
"We are paying for some of that," Unger said, adding that he expects to have commitments for the retail space by early 2008. "It's another incentive. The developer pays some of the cost. When (tenants) compare rates, they'll see they're really saving in that aspect too."
As Unger concentrates on retail, Rossman works to fill the condominiums. He has sold approximately 25 percent of the 24 units, which feature wood floors and tall, light-inviting windows. Prices range from $180,000 for a one-bedroom unit to $250,000 for a two-bedroom with a den area. One-bedroom dens are $250,000 and two-bedroom lofts list for $285,000.
"Sales have slowed down," he admits. "That's a reflection of a new product, and a slowdown in the market. We're still getting quite a bit of activity."
Rossman would like to see the condos fully occupied by May 2008. He sees mixed-use buildings like The Beranger and the nearby 20-unit Central Point as key to a healthy downtown.
"I'm very pleased with the way the project turned out," he said. "Now it's up to the market to do the ultimate test. We've compromised no elements... Everything was maintained from the level of quality we wanted to achieve."