A $3.5 million bond, approved earlier this week by the Oregon Legislative Emergency Board, will enable PSU to purchase and upgrade an office building and adjacent parking lots at the Southwest corner of Fifth and Jackson Avenues. By the end of this month, the sale of the Fifth Avenue Business Center should be complete.
This latest acquisition is the fourth property purchased by PSU in the past six months. Existing leases on the new building will be maintained until they expire, at which time PSU expects to use $400,000 of the bond funds to renovate the building.
PSU expects that as many as 35,000 students could be enrolled by 2012, and the 36,000-square-foot Business Center building will aid in housing future academic activities as well as an additional 43 parking spaces.
PSU also expects the value of the property to increase. Jay Kenton, associate vice president of finance and planning, said that downtown development in the University District makes these purchases wise investments. Kenton believes that now is the perfect time to expand for the future.
He said that in 10 years when the facilities will be sorely needed, acquisition may be more difficult to negotiate, as demand will have risen as well as costs. By getting in sooner the University plans to save money in the long run.
The university will not know for certain what use the new building will have. “The trouble right now is that the buildings are fully occupied,” said PSU Architect Dick Piekenbrock, discussing PSU’s plans for the building.
Once the leases end, the real work of upgrading the buildings can begin, and assessing the building’s possible uses by the university will be easier.
With eyes on the future, PSU has been improving or restoring buildings like the Simon Benson House, and acquiring new properties all around its quickly expanding campus. With the new Portland Streetcar in full effect, as well as continued development of Portland’s downtown, expect more development of university buildings and acquisitions of new facilities in the future.
In March the university purchased two properties: the Sonitrol Company office at 1975 S.W. Sixth Avenue and the two-story building which has been converted to office use located at 621 S.W. Jackson Street.
The house has parking for four vehicles and has 1,400-square-feet of usable space. The office building is 1,770 square feet and offers parking for eight vehicles. The lease on the Sonitrol building will continue for the next year. The house on Jackson Street will be converted to PSU use. These properties were purchased for $625,000 in bond funds, and will see further development as opportunities arise.
The Art Institute Building at 2000 S.W. Fifth Avenue was purchased in November by the university. The Art Institute is moving to the new Brewery Blocks development on Burnside.
Construction is moving along ahead of schedule according to Piekenbrock, and the university is expecting the Art Institute to have moved fully by spring of next year.
The 27,000-square-foot building will require renovation to address some relatively minor zoning issues, according to Piekenbrock. The building was purchased through the use of a $3.5 million bond, with about $800,000 of that money intended for renovations.
Tenant and parking revenues are intended initially for debt service to the Article XI-F (1) bonds used to acquire the properties.