The building is the former headquarters of David Evans and Associates, a longtime supporter of PSU. The university's VP of Finance and Administration Jay Kenton tells GlobeSt.com that in order to facilitate the purchase, David Evans earlier this month sold the building for $3.85 million ($90 per sf) to Thurman Partners, a group of investors who also are "friends of the university."
PSU entered into a five-year lease with Thurman Partners that includes an $8-per-sf (NNN) rent for the first 18 months and an option to purchase the building at any time. Kenton says PSU will most likely acquire the building before its discounted lease rate bumps up to market rate. Kenton did not say what the purchase price would be, but given the university's relationship with Thurman Partners it is expected to be near Thurman's purchase price.
Kenton says the building is sitting on pilings and the space between the pilings, currently used as covered parking, could be enclosed to add another 20,000-sf of leasable space to the building. Kenton adds that the building has a pretty open floor plan such that it should be easy to remodel and, based on recent vibration tests, could house sensitive technical devices such as electron microscopes, scientific instruments that use a beam of highly energetic electrons to examine objects on a very fine scale.
Such instruments are used by the scientific start-up companies PSU hopes to attract to its so-called business accelerator program. As part of the program, PSU will offer some management services as well as offer access to university labs, faculty and students that will help the company develop and begin manufacturing its products.
The program is being launched in cooperation with Oregon Health Sciences University, Providence Medical Center, the state's economic development agency and the Portland Development Commission, the City of Portland's urban renewal agency. Kenton says PDC has already funded an RFP for proposals from consulting teams that would look at what the market is for incubator facilities and what types of start-ups would benefit most from such a facility. Kenton says seven consulting teams are now in the running for the work and a decision will be made in the next 15-90 days.
The impetus for the incubator lab is the passage of Oregon's Ballot Measure 10, which allows universities to hold stock in companies. "It gives us some motivation," says Kenton. "We help these companies get down the street and our assumption is that if they are successful they will reciprocate in the form of stock."
Kenton says he expects the tenant improvements to be completed toward the end of the year and have companies moving into the building in early 2004. If the incubator idea doesn't work out, Kenton says the university would ultimately move other university activities into the building. "We have no shortage of need for space," he said.Chris Johnson of Norris, Beggs & Simpson represented David Evans & Assoc. in the sale of the property.
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