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PORTLAND, OR-Capstone Partners LLC is taking down another parcel in the Port of Portland's Rivergate District for an encore warehouse-distribution development. The 16.4-acre site, located next to the 21.3-acre site it acquired early last year, will be home to a 288,915-sf warehouse-distribution building. Site work is expected to get under way later this year.
On the first site it acquired, a 440,000-sf warehouse-distribution building will be completed in February. No leases have been signed for that building. However, Capstone reportedly is close to finalizing a lease that will fill up 40% of the building, and the fact that it is taking down an additional parcel may speak to the company's confidence in closing the deal. Capstone principal Chris Nelson could not be reached Wednesday for comment.
The properties are located at the intersection of North Bybee Lake Court and North Leadbetter Road. The two buildings are being marketed as Bybee Lakes Logistics Center I & II. Each will have 30-foot-clear ceiling height and one trailer parking space per 4,000 sf of leasable area, components that are attractive to distributors and third-party logistics providers. Asking rates are $0.35 per sf per month on the shell, with a $0.65 per sf per month surcharge for any office build out. Paul Breuer of Colliers International has the leasing assignment.
Capstone is developing both parcels in partnership with equity from funds sponsored by Washington Capital Management. Capstone has small equity stakes in each project plus an earn-out provision and is the fee developer for the project.
The first parcel of land cost $4.95 per sf for a 55-year lease with six five-year extension options. The second parcel, taken down nine months later, will cost the company $5.20 per sf for the same terms. As approved by port commissioners on Wednesday, Capstone will prepay the cost of the lease in three lump sum payments totaling $3.7 million over the next 18 months.
Combined, the two Bybee facilities will cost $34 million ($46.50 per sf) to construct and ultimately create an estimated 360 new jobs in Portland. The total number of jobs will depend on the mix of customers and freight attracted to the new facilities.
"Compared to high-tech running shoes and computer chips, it's easy to think of handling and distributing freight as an economic ugly duckling," says Carl Warren, the Port of Portland's business development director. "But that duck starts to look an awful lot like a swan when you consider the private investment and living-wage jobs that logistics and distribution continue to attract to the Portland area."
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