ODS Tower is a 400,000-sf office building completed in 1999 and majority owned by Oregon Dental Services. Seattle-based Wright Runstad manages the building and locally based Norris Beggs & Simpson has the leasing assignment.
The same year it was completed, ITI Education Corp. inked a 10-year lease for the building's 12th floor. In 2001, the company filed for bankruptcy and eventually vacated the space. NBS broker Joe Vaughan tells GlobeSt.com the 12th floor has been vacant and not generating rent for "more than a year," but now is fully leased thanks to Mulvanny and CorVel, an existing tenant in the building that is expanding into the remainder.
ITI was reportedly on the hook for an average triple-net lease rate in the low $20s per sf per year. Local brokers familiar with the transaction tell GlobeSt.com that Mulvanny will be paying a triple net lease rate in the low teens per sf, not including an above-standard tenant improvement allowance and some free rent. Pacific Real Estate Partners' Steve Gilbert, who with Bill Pollard and Jeff Durrell negotiated the lease on behalf of Mulvanny, declined to comment on the specific terms, as did Vaughan.
"Market rents aren't what they were three or four years ago," says Vaughan. "We feel like we made a fair market deal, and that's all we can really ask."
Earlier this year, Wright Runstad leased the 21,213-sf 18th floor of ODS Tower to the law firm Foster Pepper Tooze, which is scheduled to occupy its space this month. The floor was occupied by Copper Mountain Trust, which signed a lease in 1999 that ran through October 2006. Wright Runstad reportedly let Copper Mountain buy out its lease at a discount and then used the proceeds to give the law firm a steeply discounted rate for the first three years of its lease.
"We are now over 97% leased in a market that otherwise is about 85% leased for comparable properties," says Vaughan.
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