Lincoln Property Sells Downtown Portland Office Tower
The asset traded at a 67 percent loss.
Lincoln Property Co. has sold Pacwest, a 547,992-square-foot office tower in Portland, Ore., after nine years of owning the asset. Alaska-based real estate firm Fountainhead Development acquired the property for $55.7 million, or $102 per square foot, Willamette Week reported. Newmark brokered the transaction on behalf of the seller.
Pacwest had been under Lincoln’s ownership since the company purchased it from The Ashforth Co. in 2016. The property changed hands for $170 million, or $326 per square foot, Yardi Matrix data shows, marking the largest deal in Portland at that time.
With such a drastic price drop, the current deal positions the property at a 67 percent loss, mirroring ongoing office real estate trends in both pricing and investor sentiment across the U.S.
In the first three quarters of the year, Portland’s office market saw $191.6 million in investment sales, with 21 properties changing hands at an average of $92 per square foot, according to Yardi Matrix information. Meanwhile, the first nine months of 2024 registered the same number of office buildings that traded for an average of $71.5 per square foot, amounting to a total of $136.8 million.
A LEED Silver-certified high-rise
Developed in 1984 by Tokyo-based Mitsubishi Estate Co., Pacwest is a LEED Silver-certified property at 1211 SW Fifth Ave., in Portland’s central business district. The high-rise underwent several cosmetic renovations in the last 25 years, including one which began in 2017 that amounted to $44 million in capital investment and resulted in a fully refurbished lobby with concierge services.
The 30-story office tower is one of the tallest buildings in the city, and features a two-story podium and a rooftop terrace. Amenities include an athletic club, tenant lounge with entertaining areas, an outdoor terrace and subterranean parking with more than 400 spots.
Pacwest’s tenant roster features legal, banking, wealth management and investment management firms, including Schwabe, Williamson & Wyatt, Commerce Bank of Oregon, Becker Capital Management Inc. and Charles Robinowitz Law Offices. The property was 50 percent leased at the time of the sale.
Nationwide, high vacancies in the office sector continue to be a direct consequence of hybrid work, which still prove to be the norm, according to the latest Yardi Matrix office report. The average occupancy rate set at around 50 percent over the past 12 months, as confirmed by office usage data.
Newmark Vice Chairman Nick Kucha, Senior Managing Director James Childress and Directors Kellen Kollmorgen and Jakob Nicholls arranged the sale of behalf of Lincoln Property Co.
You must be logged in to post a comment.