pearl lofts portland oregon - lofts portland, oregon project type a 27-unit, new loft-style...
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VOLUME 26 NUMBER 6APRIL-JUNE 1996
PEARL LOFTSPORTLAND, OREGON
A 27-unit, new loft-style residential projectlocated on the north edge of downtown Portland. This infill redevelopment project isthe first phase of a 39-acre master-planneddevelopment on a former rail-yard site. Targeted to middle-income residents, PearlLofts features a broad selection of unit configurations and price ranges.
New construction, loft-style condominiumsBroad price range, targeted tomiddle-income buyersInterior garden courtyardSelection of nine separate floor plansSecured off-street parking
Patrick R. Prendergast Urban Homes, Inc. Prendergast & Associates, Inc. 333 SW Fifth Avenue, Suite 200 Portland, Oregon 97204 503-223-6605
Tim Merrill Church & Merrill Architects 30 NW First Avenue, Suite 201 Portland, Oregon 97209 503-295-0900
Craig Kiest Huntington & Kiest 2892 NW Upshur Street Portland, Oregon 97210 503-223-3383
Walsh Construction Co. 3015 SW First Avenue
Portland, Oregon 97201 503-222-4375
Pearl Lofts is a condominium complex designed and developed to offer residents loft-styleresidential living environments in a newly constructed 27-unit multifamily structure. Theproject's apartment units include features commonly associated with adaptive-use residentiallofts, including high ceilings and expansive windows, while simultaneously offering thevalue-added amenities and finishes of new construction.
Situated on a site formerly used by the Burlington Northern Railroad for freight storage, PearlLofts is located within Portland's Pearl District, a rapidly gentrifying urban neighborhood, onthe north edge of downtown. The Pearl District, formerly a warehouse and industrial district,now includes a combination of residential, retail, arts, and industrial uses and has become oneof the fastest-growing residential districts in the Portland market.
Pearl Lofts is the first phase of the 39-acre Hoyt Street Yards master-planned development.Current plans for Hoyt Street Yards include the development of 3,000 residential units andapproximately 200,000 square feet of retail space at buildout. Hoyt Street developer, PatPrendergast of Urban Homes, Inc., initiated development on the Pearl Lofts parcel because thesite abutted existing development that provided an urban context. By contrast, his holdingswithin the interior portion of the Hoyt Street Yards property are encircled by vast tracts ofempty rail yards. Infrastructure costs for the Pearl Lofts site were also less than those forinterior parcels, because the parcel was serviced with streets and a public driveway.
The project, with its numerous floor plan variations and reasonable sale prices, allowed thedeveloper to effectively evaluate and respond to an uncertain market while stimulating HoytStreet's residential development initiatives.
The Hoyt Street parcel was first master planned by Glacier Park, the real estate subsidiary ofBurlington Northern. Prendergast, the site's current owner and developer, amended theoriginal 1980s plan, which called for a heavy dose of office development, to give it aresidential focus.
Pearl Lofts, as the first phase of the 39-acre master-planned development, was a"testing-the-waters" project. Although several Pearl District warehouses had been convertedover the last five years to loft apartments, Pearl Lofts was the first new construction in thearea of a for-sale residential product. Therefore, the developer opted to build at relativelyconservative densities until the depth of market interest in new loft condominiums was betterknown. Density was ultimately determined by parking needs. The number of units, 27, wasderived from the number of cars that could be accommodated on site without buildingstructured parking. To minimize risk, the developer decided to build housing only, and torefrain from adding street-level retail shops; however, streetlevel units were designed to bereadily converted into retail use.
DESIGN AND CONSTRUCTION
As with many development efforts in urban settings, infrastructure construction for the PearlLofts was complicated. Old utilities that were documented with dated or defunct records madethe task of connecting water and sewer lines more involved than anticipated. Consequently,the costs for engineering and construction work were significantly higher than first projected.
Most of the Pearl District's early loft buildings were renovations of old, derelict, brickwarehouses. Loft design was generally spartan and industrial in character. Although PearlLofts is encased in the traditional red-brick industrial box, it is more of a hybrid design. Here,the voluminous spaces of traditional lofts are combined with such features as hardwood floors,spacious closets, and carpeting in the sleeping areas to create a softer, more residentialcharacter. In traditional lofts, the walls are typically raw concrete or exposed brick. Here thewalls are painted and textured. Likewise, the use of exterior detailingpediments above thefront doors, brick framing around the entryways, canvas awnings, and wrought-iron window
boxesfurther emphasizes the residential ambience.
In a city that is famous for its long, gray winter days, people crave natural light. Thus, a maindesign goal was to make the most of every last ray of light. To accomplish this, the first-floorunits feature plentiful, expansive windows that are accommodated by 12-foot-high ceilings. Inthe second-floor loft units, ceilings rise to 17 feet. The street-level units are actually flats, forthere is no variation in floor height. The goal, however, was to create a feeling ofspaciousness within a relatively small area.
Additional light comes from the landscaped interior courtyard. The four largest units havebalconies overlooking the courtyard.
A significant complication was the problem of sound transmission, which was a concern,because Pearl Lofts is a multifamily building. To minimize sound vibrations, specialconstruction techniques were applied to make the concrete floors more rigid, and they wereencased in rubber gasket membranes. Likewise, double-wall instead of single-wallconstruction was used to reduce sound.
The selection of different unit designs limited the opportunity to repeat unit configurations,making it difficult for the contractor to work out a sequencing schedule. These inefficienciesmade for higher contractor fees.
The ability to custom design individual units, however, was one of the strong selling points ofthe project. Prospective buyers could select from nine different floor plans, plus various wallpaints and carpeting, and were offered a selection of more than 15 different laminates. Theycould also upgrade such items as bathroom tiles and kitchen counters. Buyers could evendetermine the location of recessed light fixtures and outlets.
One parking space is allotted to each residence. Eight surface spaces on the west side of thebuilding are assigned to the smaller residential units; covered garages provide the remainingeighteen spaces. No parking is reserved for commercial tenants.
The financing strategy was largely determined by two self-imposed requirements: (1) keeppricing as low as possible to appeal to a broad market segment and (2) presell 50 percent ofthe units before construction started.
These requirements created a sequencing problem with respect to financing, for there was noway to gauge how long it would take to sell 50 new urban lofts in pioneer territory.Prendergast decided it would be easier to finance this first project privately and created alimited partnership of investors.
So that purchasers could qualify for financing from Fannie Mae, the developer agreed to limitcommercial uses to no more than 10 percent. Pearl Lofts houses a number of commercialtenants, including a real estate broker, engineering consultant, and talent agency. Anadditional Fannie Mae requirement was that 70 percent of the units had to be owner occupied.
The developer's original thought was that the lofts would appeal mostly to first-timehomeowners who were renting in the area. They discovered, however, that the market wasfar more extensive. Suburbanites from Beaverton and Lake Oswego were equally drawn to theproject. Single men and womenboth young professionals and retireesclaimed more than athird of the units.
Because of the uncertainty of the market, the pricing strategy was set deliberately broad,spanning a range of $79,000 to $159,000. The initial goal had been to presell 50 percent ofthe units; in fact, nearly all the units sold before construction started.
Pearl Lofts was the first such project in the neighborhood, so prospective buyers made theirselections based only on construction drawings. Marketing was mainly through newspaperadds and site signage. An on-site marketing office operated seven days a week.
In the case of a large-scale development where the depth of market interest is relativelyunknown, it is prudent to start out with small projects and build incrementally over time.Thus, the density of Pearl Lofts was deliberately conservative.
The offering of nine different unit types and 15 different laminate selections, whichessentially allowed purchasers to custom design their units, undoubtedly boosted earlysales. However, the developer cautions that too many choices tend to confusecustomers. In addition, this approach made it difficult to sequence the contractingschedule, thus driving up construction costs.
In retrospect, balconies would have been a better investment than 17 foot-high ceilings.The ad