Gillespie, a broker with ReMax Equity Group, says he and the others are currently planning to deliver 16,500 sf of street-level, sidewalk-fronting retail under 22 townhouse-style condominiums or apartments in the summer of 2003. They have yet to begin seeking city approval, but plan to stay well within existing zoning requirements.
McDonald's optioned the site after Arby's shut down in October 2000 but backed away last year after being denied a drive-thru. McDonald's then assigned the option to a local architect who planned a similar residential over retail project but never exercised the option. Gillespie says he tied up the site in October 2001.
A national retailer will likely anchor the new development and be complemented with local retailers, says Gillespie. The asking rate for the retail space will likely be $24-$25 per sf per month, NNN. By comparison, existing national retailers on Hawthorne -- Subway, Noah's Bagels, Starbucks and Hollywood -- are all said to be paying rents in the low to mid-$20s.
With retail vacancy rates on Hawthorne almost non existent and excellent demographics to market, Gillespie doesn't expect much problem finding takers. As an example of potential retailers, he talks of Portland Northwest 23rd retail district, which has attracted The Gap, Pottery Barn, Smith & Hawken and Cost Plus World Markets. The local chain Kitchen Kaboodle is also a likely candidate.
Gillespie says his buying group is paying cash for the property and use for the required 25% equity on a $5.2-million construction loan. A concrete barrier will be poured between the retail and residential floor decks to dampen noise.
"I'll probably be the most expensive, but we might also be able to deliver a certain economy," says Gillespie. "We are exploring every idea we can for making them energy efficient; they will be very, very high quality."
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