1631 Thurman is a 63,016-square-foot office property located in the Slabtown submarket.
PORTLAND, OR—This metro is increasingly attractive to tenants and employees seeking a significant discount to nearby West Coast alternatives such as San Francisco and Seattle. One recent example of investor interest in Portland is Goldman Sachs Asset Management Private Real Estate's acquisition of 1631 Thurman, a 63,016-square-foot office property located in the Slabtown submarket.
“We believe that the property's authentic physical features and location within Slabtown are attractive for tenants in this market, as it provides convenient access to walkable retail, immediate proximity to urban residential options as well as a short drive to popular residential communities to the northwest and northeast,” said Joseph Sumberg, co-head of Goldman Sachs Asset Management Private Real Estate.
The property was originally built as a warehouse for the Portland railroad in 1908 and was converted to creative office in 1990. It is on the National Register of Historic Places with historic features including elevated ceilings, unusual window lines, and exposed brick and timber elements.
The building has 19% vacancy, GlobeSt.com learns. Goldman Sachs plans to invest capital for improvements in order to attract a remaining tenant.
Slabtown's surrounding commercial real estate mix and the potential for future service from the Portland Streetcar public transportation system just 2 blocks away from 1631 Thurman would likely appeal to tenants. In addition, there have also been multiple large multifamily and retail projects developed in the Slabtown submarket since 2015. The office is a short distance to the 23rd Street retail corridor and a number of residential neighborhoods as well as an above-market parking ratio, which is attractive to tenants seeking office properties that offer a live-work-play dynamic.
“This may be a snoozer to many but this ratio of 2.6 spaces per 1,000 is unusual for this market,” Sumberg tells GlobeSt.com. “We have been targeting Slabtown for the last few years. It's a market we like and there is not a lot of product here so we identified this perfect off-market asset. We want to own more property just like this.”
Goldman Sachs owns approximately 4.8 million square feet of office across the United States. This marks the firm's 27th investment overall and third office investment in Portland, combining for nearly 150,000 square feet of office across the Pearl District and Slabtown.
“Portland is a target market for us,” Sumberg tells GlobeSt.com. “It is the most affordable office market among the major markets on the West Coast. It is a half or a third of the cost of other markets.”
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
