NAI NBS Earns CoStar Power Broker Awards

NAI Norris, Beggs & Simpson made a strong showing in the 2010 CoStar Power Broker Awards. For the sixth consecutive year, NAI NBS was named a top leasing and sales firm in the Portland metropolitan market.

A number of NAI NBS brokers earned individual awards:
Top Office Leasing Brokers: Chris Johnson and MaryKay West
Top Retail Leasing Brokers: J.J. Unger and Pam Lindloff

Visit the Power Broker website for the entire list.

First Ever Dex One Solution Center Opens in Vancouver, Wash.

Dex One has leased 6,508 square feet of retail space at Columbia Tech Center, Building 601, for the company’s new Dex One Solution Center. NAI NBS' Tamara Fuller represented the lessee.

The new location serves as the first Dex One Solutions Center in the country. The center, which combines a local Dex One office with a unique storefront presence, is designed to help local businesses and consumers interact directly with Dex One’s marketing consultants. In addition to on-site consultation, the storefront features kiosks and interactive displays to help visitors learn about Dex One’s online, print, voice-enabled and mobile solutions.

“Columbia Tech Center provides not only a prime location, but also ample space and amenities that will help Dex One’s consultants better serve Vancouver’s local business owners and residents,” Fuller said.

Dex One unveiled the new facility to the public on Sept. 20 with a Grand Opening celebration featuring live music, activities, food and a special appearance by “The Dex Guy,” star of Dex One’s TV commercials.

Fuller Earns Certified Green Broker Designation

NAI Norris, Beggs & Simpson Vice President Tamara Fuller has earned the Certified Green Broker designation, a certification granted within the commercial real estate industry to commercial brokers and affiliated professionals who have completed the Certified Green Broker course.

Washington state-based Commercial Brokers Association (CBA), in partnership with the Cascadia Green Building Council, developed Certified Green Broker to enable commercial brokers to identify sustainability issues related to real estate practices. Green Brokers provide appropriate counsel on the benefits of buying, building, leasing and managing green properties. The U.S. Green Building Council (USGBC) has approved Certified Green Broker through their Approved Education Provider Program.

The Certified Green Broker education program consists of ten three-hour online modules presented in an interactive format. The program offers 30 hours of real estate continuing education credit in Washington, Oregon and Idaho.

Fuller, an office broker in NAI NBS’ Vancouver office, joined NAI NBS in 2000 and has since had a hand in leasing more than a million sf of space, and selling about $18 million in total value of real estate. She was one of NAI NBS’ Top Ten Producers the past three years. Fuller is on the board of the Greater Vancouver Chamber of Commerce and is active in the Rotary Club of Greater Clark County and SW Washington Junior Achievement.

Retail Vacancy Flat in Second Quarter, Some Large Leases Signed

Overview

Retail vacancy was unchanged at 8.0% during the Second Quarter, with negative 20,547 sf of absorption. Vacancy in Central City decreased nearly a percentage point to 10.9%. Vacancy in Southeast/East Clackamas increased more than a percentage point to 6.5%, with more than 20,000 sf of negative absorption each at Clackamas Town Center and Hilltop Mall. However, there was considerable leasing activity in big-box stores that are not tracked in our report. For instance, Salvation Army leased about 40,000 sf at the former Linens ‘n Things on SE 82nd, and Dick’s leased the nearly 50,000 sf former Joe’s Sports, Outdoors & More at Johnson Creek Crossing in Clackamas.

Vancouver vacancy rose by half a percentage point to 11.0%, with 46,688 sf of negative absorption. At Columbia Square – Vancouver, 20,000 sf became available. This is a portion of the former Joe’s Sports, Outdoor & More space, which is partially occupied by Chuck’s Produce (expected to open in August).

Noteworthy News

Closely watched indicators of the health of the retail market were mixed during the Second Quarter. Retail sales grew by a seasonally adjusted rate of 0.6% in April, but fell by 1.2% in May. The Conference Board’s Consumer Confidence Index also dropped by almost 10 points to 52.9 in June. Economists didn’t expect such a significant decrease, as the index had been rising since February.

Portland continues to attract large tenants of all kinds. In recent months, Ultimate Electronics, which was acquired by Hollywood Video founder and former CEO Mark Wattles, leased the 40,000 sf former Levitz Furniture building in Beaverton. Two new clothing stores are also in the works: H&M confirmed its Pioneer Place store will open this fall, and Saks Fifth Avenue Off Fifth will open at Bridgeport Village September 2. Nordstrom Rack also leased 48,344 sf at Cascade Plaza Shopping Center.

Signs of life were present in the Portland retail investment market during the Second Quarter. Retail Opportunity Investments, Corp., purchased Vancouver Market Center in Vancouver for $11.19 million, and is under contract to purchase a portfolio of four other centers in the Portland Metro Area from Gramor Development for about $90 million.

Though retail development has slowed, with our report tracking just under 30,000 sf of space under construction in the metro area, some activity and future planning is occurring. Big Al’s, the popular bowling center in Clark County, has a second 66,000 sf location under construction at Progress Ridge in Beaverton. It is expected to open in August, and developers hope the site will also be the future home of New Seasons and Cinetopia.

The full report can be found here.

Portland Industrial Vacancy Increases Slightly in Second Quarter

Overview

Industrial vacancy rose less than a percentage point to 15.24% during Second Quarter, with negative 354,330 sf absorbed. Southeast saw a significant increase in vacancy, to 14.35%, as United Stationers Supply Co. vacated 40,608 sf at Commerce Park – McLoughlin and relocated to 195,510 sf at Rivergate Corporate Center III in the North/Northeast submarket. Vancouver vacancy also increased about four percentage points to 15.44%, and Columbia Business Center had more than 450,000 sf available. Significant leases of the quarter included Consolidated Molding & Millworks leasing 48,000 sf and Stanton Furniture leasing 92,960 sf at 115th Commerce Park in Southwest I-5.

Flex vacancy increased slightly to 18.23%, with negative 23,633 sf absorbed, down considerably from First Quarter’s negative 166,559 sf of absorption. Vacancy in the North/Northeast submarket fell about 5% to 12.09%, and Columbia Gorge Corporate Center saw considerable activity, with Multnomah County leasing 18,150 sf and Pac/West leasing 11,950 sf.

Market Trends

Greenlight Greater Portland, a privately funded economic development group, released a report in June suggesting that manufacturing will be a major factor in Portland’s economic recovery. It predicted that the manufacturing sector could grow by 14% in the next five years.

Renewable energy companies, particularly solar power companies, continue to be active players in the Portland industrial market. Solexant Corp. is expected to receive a $25 million state loan to build a factory in the metro area to develop ultra-thin-film solar cells. The plant would initially employ 100, and could rise to the same capacity as SolarWorld in Hillsboro, which will employ 1,000 by this fall when its expansion is completed. ReVolt Technology, a battery maker, also won a $5 million U.S. government grant that will help it build a Portland plant to develop a battery for plug-in vehicles.

In other major transactions, Farwest Steel will acquire more than 20 acres from the Port of Vancouver for about $5 million. The company will build a $20 to $30 million steel processing and distribution facility that will create 125 new jobs and employ about 200 overall.

The full report is available here.

Portland Office Vacancy Rose During Second Quarter

Central City office vacancy increased to 12.73% during the Second Quarter, with negative 242,145 sf absorbed. About 40,000 sf of this negative absorption was from multiple tenants leaving the historic Stevens Building. The Church of Scientology of Portland purchased it in 2008 and planned to inhabit the whole building, but it was found to be unsuitable for the organization and is for sale. This quarter the Church of Scientology bought downtown’s historic Sherlock Building for $6.4 million to serve as its new home. In a highly-anticipated decision, the Portland Development Commission opted to remain at its current location in Old Town (but in 10,000 fewer sf), rather than move to the stalled Park Avenue West, its other primary option. It is uncertain when construction will restart at Park Avenue West, as the project lacks financing. Active tenants downtown include alternative energy groups, who seek environmentally friendly buildings. Many tenants are also seeking moderatelypriced Class A buildings with quality buildouts.

Suburban office vacancy rose about two percentage points to 23.92%, with negative absorption of 179,725 sf. This is the 7th consecutive quarter of negative absorption for the suburbs. Kruse Way saw the most significant increase in vacancy, from just under 23% last quarter to 29.36% during Second Quarter. Kruse Woods V had nearly 100,000 sf of negative absorption, as Northwest Evaluation Association vacated about 108,000 sf to move to the former Port of Portland building in Central City. However, Black & Veatch filled some of the space at Kruse Woods V, leasing about 25,000 sf. Vacancy in I-5 South rose significantly to 28.10%, but some large leases occurred, including State Farm’s lease of nearly 24,000 sf at Fanno Creek Building B. Brokers are seeing a flight to quality in the suburban submarkets, with healthy activity in nicer buildings.

Vancouver vacancy rose slightly to 18.55%, with negative 11,634 sf absorbed. The most significant deal was the $18.5 million sale of The Columbian Building to the City of Vancouver for its new city hall. The 118,000 sf building, previously listed at $41.5 million, was turned over to Bank of America early this year after the Columbian Publishing Co. filed for bankruptcy.

The full report is available here.

Three NAI NBS Brokers Earn CCIM Designation

NAI NBS' Neville Bassett (Portland), Doug Bartocci (Vancouver), and Garret Harper (Vancouver) have obtained the Certified Commercial Investment Member (CCIM) designation.

A CCIM is an invaluable resource to the commercial real estate owner, investor, and user, and is among an elite group of more than 9,000 professionals across North America and in 30 countries abroad. Only 6 percent of the estimated 150,000 commercial real estate practitioners nationwide hold the CCIM designation, an indication of one of the most coveted and respected designations in the industry.

To attain the CCIM designation, each broker completed four core courses, an ethics course and three elective credits, prepared a portfolio and passed a comprehensive exam.

PDX Industrial Market Looking Up in First Quarter

Industrial vacancy decreased slightly to 14.56%, with 118,458 sf absorbed. Vacancy in North/Northeast remained stable at 17.58%. Some large leases were signed in this submarket, including Owens Corning leasing 123,120 sf at Bybee Lake Logistics Center – Phase II. Ferrotec USA and Archive Systems also signed leases at Birtcher Center @ Townsend Way totaling 81,850 sf. Vacancy in Vancouver decreased about 1.5 percentage points, as 82,800 sf was leased up at Hart Industrial Center, bringing that property to 100% occupancy, and 40,267 sf was leased at Westside Business Center.

Flex vacancy rose nearly two percentage points to 18.01%, with 166,559 sf of newly available space coming back on the market. Much of this space can be accounted for by Intel, which vacated more than 100,000 sf at the Amberglen Business Center in moving back to its headquarters, pushing Southwest Sunset’s vacancy up more than two percentage points to 19.71%. Some positive absorption did occur, though. BiAmp Systems leased 50,963 sf at Nimbus Corporate Center in the Southwest 217 submarket, whose vacancy stayed fairly flat at 17.76%.

Market Trends
The industrial market showed continued signs of a slow but steady recovery during First Quarter. Vacancy in the Portland metro area, though still high, appears to have stopped rising, and construction and new deliveries have been so limited of late that the market isn’t burdened by oversupply. National economic indicators were looking up. Factory orders rose 1.7% in January, the largest increase in four months, with heightened demand for commercial aircraft, and industrial production rose 0.1% in February.

Manufacturers continue to invest in the Portland metro area. LaCrosse Footwear is moving production of Danner boots to a new 59,000 sf factory about a mile from its Northeast Portland headquarters, a facility twice the size of its current plant, which it is replacing. Production is expected to begin there in Third Quarter 2010. Boeing is also investing up to $120 million in upgrading its operation in Gresham, which will add 152 jobs in the next three years. It will build a new 60,000 sf facility on its 87-acre campus where it will treat metals used in making commercial aircraft.

First Quarter 2010: Portland's Central City Office Vacancy Stable, Suburban Still Rising

Central City office vacancy remained stable this quarter at 11.99% (see vacancy comparison chart at right), with 54,312 sf absorbed. Some significant sales and leases occurred, especially in the Central Business District. The General Services Administration (GSA) signed four leases totaling more than 250,000 sf at First & Main, which delivered this quarter, and Alpha Broadcasting leased more than 25,000 sf at Pacwest Center. In one of the largest sales in recent months, KBS REIT II purchased One Main Place for $57 million, or about $180 per sf. American Pacific International Capital Inc. also purchased the office portion of the KOIN Center, reportedly for between $53 million and $60 million. Vacancy in Northwest fell more than a percentage point to 15.69%, as two tenants leased space at Machine Works, including the GSA in 19,431 sf.

Suburban office vacancy rose about a percentage point to 21.93%, with negative 142,240 sf absorbed. The Barbur Boulevard, Beaverton-Hillsdale/Sylvan and North/Northeast submarkets all saw vacancy rise at least two percentage points. Though vacancy in the Kruse Way submarket stayed relatively stable, this area saw some movement, including M & T Bank relocating from Kruse Woods I to about 20,000 sf in 4949 Meadows. A few submarkets had positive absorption, such as I-5 South, where vacancy decreased slightly and Pinnacle Mortgage Bankers leased 16,000 sf at Durham Office Center. Though a number of suburban buildings are totally empty, one will soon be fully occupied. The Oregon Institute of Technology is planning to purchase the 131,000 sf former headquarters of InFocus in Wilsonville, and consolidate its four Portland-area locations there. InFocus moved out of the building last fall to a smaller office in Tigard.

Vancouver vacancy fell nearly half a percentage point to 18.10%, with 42,644 sf absorbed. Vacancy in Class C space fell five percentage points to 14.57%, as 29,000 sf was leased up at the Former Red Lion Headquarters. Class A and B space also saw some significant absorption; Doug Williams and Associates and Richard James and Associates both signed leases at the Thurston 500 Building, totaling 12,583 sf.

Featured Deal: General Services Administration Leases

The General Services Administration (GSA) leased nearly 260,000 sf at First & Main at the west end of the Hawthorne Bridge. The GSA leases were the first for the building and took the office areas to 76% leased. The tenants were displaced by the redevelopment of the Edith Green-Wendell Wyatt Building and plan on taking occupancy in May. NAI NBS Vice President Jeff Borlaug, Executive Vice President Chris Johnson and Vice President MaryKay West represented First & Main’s owner, Shorenstein Realty Services.

NBS Companies and Stratton Launch NBS Multifamily Management

Norris, Beggs & Simpson Companies and Susan Bowlsby Stratton, a successful apartment management executive, have joined forces to found NBS Multifamily Management, a company dedicated to managing apartment communities of 100 units or more around the West Coast.

Why start a new venture in this economic climate? NBS Companies President J. Clayton Hering said he expects that as the job market grows, the demand for housing will increase, with a short supply of single-family and multifamily housing due to the significant reduction in construction over the last several years. With single-family lenders requiring greater equity and better credit, fewer people will be able to buy houses and will thus reenter the apartment market.

“With increased market activity the necessity for professional, value-added multifamily management will rise, and NBS Multifamily Management will provide a quality of service to enable multifamily owners to be competitive,” Hering said.

NBS Multifamily Management expects to hire more than 100 people in the area to run and maintain the apartment communities it will manage.

Stratton, who has more than 20 years of multifamily management experience up and down the West Coast, will serve as President of the new company. Stratton spent 13 years at Harsch Investment Properties, most recently as Senior Vice President of Operations, where she was responsible for the company’s multifamily division and managed up to 5,500 units. A native Oregonian, she will receive her Executive MBA from Pepperdine University in March.

“I am so pleased to be joining NBS,” Stratton said. “My years of experience combined with NBS’ very successful property management track record will allow us to shine in the multifamily management industry.”

Cassandra Haavisto will serve as NBS Multifamily Management’s Regional Manager for the Puget Sound area. Haavisto’s industry experience spans 20 years; she has managed more than 13,000 units during her career and worked for major companies like Harsch Investment Properties and Trammell Crow.

Vancouver Industrial Broker Garret Harper is Number One Top Producer of 2009

Garret Harper, the brokerage department’s Number One Top Producer of 2009 and an industrial specialist, makes his first appearance in the Top 5. He has been with NAI NBS since 2003, and participated in 28 deals totaling $18 million in 2009. A number of his deals were significant sales, including the $5.5 million sale of a 19-acre parcel at Birtcher Business Center to the US Army Corps of Engineers and the $4.23 million sale of a 64,000 sf Vancouver warehouse. He serves as Treasurer of the Evergreen School District Foundation Board.

NAI NBS Special Asset Team and Johnson Reid Team Up to Release 3Q09 Single-Family Housing Report

NAI Norris, Beggs & Simpson’s Special Asset Team and Johnson Reid, a consultancy specializing in real estate development and land use economics, have collaborated to release a single-family housing report for the Portland metro area for Third Quarter 2009.

The report covers both lots and standing inventory in Portland and Vancouver, and contains some good news for the market.

“Market watchers think that the bottom of the curve is behind us and that we are well on our way into a recovery in this hard-hit market,” said NAI NBS Executive Vice President H. Roger Qualman, who heads up the Special Asset Team.

The inventory of new and used homes and lots is declining, the report says, and houses between $150,000 and $199,000 are a sweet spot for action.

NAI NBS’ Special Asset Team, consisting of five brokers in Portland and Vancouver, was created within the firm to respond to the collapse of property markets through the Pacific Northwest. Tight financing for housing, investors and developers has created a need for its services as stress is placed on banks, bankers and banking relationships. The Special Asset Team works with lenders to provide strategic solutions for distressed assets, improved properties or loans.

The full report can be found here.

NAI NBS Represents Buyer in $8.275M Purchase of Quad 205

NAI Norris, Beggs & Simpson Vice President Denis O’Neill and Vice President Steve Dodds represented Spears Real Estate, LLC in the $8.275 million purchase of Quad 205 Business Park, a 108,625 square foot landscaped business park in Vancouver, Wash. NAI NBS also took over building leasing and management in the trade.

The buyers are local private investors and were attracted to the property because of the mix of local and regional companies, according to Dodds. They feel the property has great long-term potential, which they can facilitate through personal attention and quick decision-making.

Built in 1983, Quad 205 comprises four buildings near the intersection of NE 112th and NE 39th Streets in the Orchards area, with easy access to I-205.

“Quad 205 is in a great location on the 112th Avenue corridor and offers high-quality light industrial space with nice office build-outs,” said NAI NBS Senior Salesperson Garret Harper, the leasing agent.

Spaces range from about 1,000 to 10,000 square feet, and some major tenants are Johnstone Supply, Thermal Supply and Automotive Electrical Distribution. Large industrial neighbors include companies like SEH America. Quad 205 has tilt concrete construction, dock and drive-in doors, and plentiful parking.

NAI NBS Property Managers Take Home IREM Awards

NAI Norris, Beggs & Simpson and three of its property managers were honored with awards at the Institute of Real Estate Management (IREM) Oregon chapter annual awards ceremony on Nov. 3 in Portland.

Associate Vice President Traci McCauley, CPM, was honored as Certified Property Manager of the Year. Property Manager Kathi Pearce was recognized as CPM Candidate of the Year. McCauley and Pearce work in NAI NBS’ Portland office. Senior Property Manager Kimberly Fuhrer, CPM, who works in the company’s Vancouver office, was recognized for Outstanding Member Participation of the Year.

NAI NBS was also recognized as Sponsor of the Year.

IREM has been the source for education, membership, resources and information for real estate management professionals since 1933. An affiliate of the National Association of REALTORS®, IREM is the only professional real estate management association serving both the multi-family and commercial real estate sectors. With a network spanning 81 US chapters, eight international chapters and several other global partnerships, its membership comprises over 18,000 individual members and 500 corporate members around the world.

NAI NBS Adds Braam to Special in Sales of Special Assets

Sierk Braam has joined NAI Norris, Beggs & Simpson’s Vancouver office as a Real Estate Salesperson specializing in the sales of special assets. Braam joins NAI NBS' Special Asset Team, an existing team of brokerage professionals working with lenders on foreclosed or bank-owned properties, including subdivisions, entitled land, and improved properties in the Portland Metropolitan Area.

Most recently, Braam served as Vice President of Specialty Lending and Emerging Markets for National City Mortgage’s Western Division. He was responsible for managing specialty lending and emerging markets and increasing specialty production by at least 20% every year.

Braam holds a Bachelor of Arts from the University of Oregon, and a Master of City and Regional Planning from Ohio State University.

NAI NBS' Fuller Earns CCIM Designation

NAI Norris, Beggs & Simpson Vice President Tamara Fuller, a broker specializing in office leasing and sales in Clark County, has obtained her Certified Commercial Investment Member (CCIM) designation.

To attain the CCIM designation, Fuller completed four core courses and three elective credits, prepared a portfolio and passed a comprehensive exam.

A CCIM is a valuable resource to the commercial real estate owner, investor, and user, and is among an elite group of about 9,000 professionals in North America and in 30 countries abroad. Only 6% of the estimated 150,000 commercial real estate practitioners nationwide hold the CCIM designation, according to the CCIM Web site.

Fuller joined NAI NBS in 2000 and has since had a hand in leasing nearly a million sf of space, and selling about $18 million in total value of real estate. She was NAI NBS’ #2 Top Producer and #3 Deal Maker of the Year in 2008. Fuller is on the board of the Greater Vancouver Chamber of Commerce and is active in the Rotary Club of Greater Clark County and SW Washington Junior Achievement.

NAI NBS Releases Third Quarter Reports

NAI Norris, Beggs & Simpson has released its Third Quarter 2009 quarterly reports for office, industrial, retail and multifamily commercial real estate, as well as its economic report.

Office vacancy in Central City rose slightly from the previous quarter to 11.12%, with -272,692 sf absorbed. Two Class B buildings in Northwest were major contributors to this rise in vacancy and negative absorption. Vacancy in the suburban office markets rose about a percentage point to 20.59%, and Vancouver office vacancy rose to 18.42%.

Industrial vacancy increased to 14.94%, with -531,805 sf absorbed. One positive sign for the industrial market this quarter was Daimler Trucks North America’s decision to keep its Swan Island plant open. The plant had previously been scheduled to close in June 2010.

Vacancy in the retail market rose to 8.0%, with 365,818 sf newly available. The closure of all Joe’s Sports & Outdoors stores helped contribute to the increased vacancy, but Dick’s Sporting Goods leased a few previous Joe’s locations in the metro area.

Multifamily vacancy decreased slightly to 4.64%, which can partly be attributed to more tenants being active during the summer months; some landlords offered rent concessions and other incentives to attract tenants. Multifamily rental rates rose slightly.

A PDF of all of the reports can be found here.

Columbia Tech Center’s 17200 Mill Plain Gains Three New Tenants Despite Tough Office Market

Columbia Tech Center’s 17200 Mill Plain Boulevard has gained three new tenants and an existing tenant has expanded since NAI Norris, Beggs & Simpson listed the 52,845 sf building in May, taking it from nearly 85 percent vacant at the beginning of 2009 to more than three-quarters occupied today.

Charter College, which is opening a new Vancouver branch, leased 17,112 sf, and Insitu, a tenant since February 2008, expanded into 7,470 additional sf. Barbara Bushell, Director of Leasing for Columbia Tech Center, represented the owner, PacTrust, on these transactions.

American Ultraviolet Company, another business that is new to the area, leased 5,156 sf, and Ciber, Inc. leased 4,150 sf. NAI NBS Vice President Tamara Fuller and Senior Salesperson Doug Bartocci represented PacTrust on those leases.

The quality of the two-story Class A building, built in 2007, the myriad amenities in the growing East Vancouver area, and excellent rates attracted tenants to the building, Fuller said.

Columbia Tech Center is a mixed-use development featuring 2.8 million square feet of commercial space on 412 acres. Major tenants include Nautilus, Logitech, Rose City Printing and Packaging and CRU-Data Port.

Barendrick Moves to Portland Office

Real Estate Broker Gina Barendrick has moved to NAI Norris, Beggs & Simpson's Portland office. Barendrick, a retail specialist, has been in NAI NBS’ Vancouver office since 2006.

Barendrick is teaming up with Real Estate Brokers J.J. Unger and Tyler Honzel to provide comprehensive retail services throughout the Portland metro area. Barendrick has extensive knowledge of the Vancouver and Southwest Washington markets and will continue to have listings in these areas, while also taking on listings in Portland.

Barendrick holds a bachelor of arts in public relations from Gonzaga University, and is a licensed real estate broker in Oregon and Washington. She is involved with the International Council of Shopping Centers Next Generation Planning Committee, among other industry groups.

NAI NBS Second Quarter Retail Report: Vacancy Rises, But Some Bright Spots

Overview

Retail vacancy rose slightly to 7.1% during Second Quarter, with 240,321 sf of newly vacant space. Central City vacancy increased by a percentage point to 9.2%, with a large portion of this area’s negative 30,000 sf of absorption in the Close-In NW area. The suburban submarkets saw significant absorption, both positive and negative, in larger spaces. Vacancy in the 122nd/Gresham submarket rose nearly a percentage point to 8.4%, partly due to Joe’s Sports & Outdoors vacating 55,120 sf at Gresham Town Fair. But, the good news is that Grocery Outlet opened a 20,020 sf store at Sandy Marketplace on Highway 26 in this submarket in May.

Southwest retail vacancy rose nearly one percentage point to 7.5% with 88,722 sf newly vacant, due in large part to the more than 20,000 sf Zupan’s at Appleway Corner closing, and the departure of Linens-N-Things from Cascade Plaza Shopping Center. Retail vacancy in Vancouver also increased to 8.7%, with 91,000 sf newly available at Vancouver Plaza.

Noteworthy News

Some recent indicators, such as May consumer confidence that reached a 9-month high, are suggesting that the retail slump may end soon. But national and local retailers alike continue to struggle. Joe’s Sports & Outdoors liquidated in early April after filing for bankruptcy. The closure of stores like Joe’s and other big-box retailers is injecting an excess of large retail spaces into the market, and not many big-box retailers are looking to expand and fill them. So retail brokers are getting creative in trying to fill this vacant space, including marketing to non traditional tenants like thrift stores, service retailers or call centers, and trying to attract tenants who are surviving the recession better than others, like discount retailers.

Retail tenants aren’t the only ones feeling the recession. General Growth Properties, which operates Pioneer Place and Clackamas Town Center and some community shopping centers in the Portland metro area, filed for bankruptcy in April. GGP, the second largest mall owner in the country, is expected to keep all of its malls open, but may sell some properties.

Construction of new retail properties has slowed considerably in recent months, but some projects are still in the works. During Second Quarter 2008, just one year ago, Vancouver alone had nearly 300,000 sf under construction, while today it has only 16,080 sf at Lacamas Square. Portland’s Eastside retail submarket has the largest amount of retail currently under construction at 193,919 sf, largely due to the 140,625 sf Cascade Station Target, which is expected to deliver this November.