ENGLEWOOD CITYCENTER REDEVELOPMENT Master Developer Proposal
15 MAY 2019 Contents
1. Authorizing Letter ...... 7
2. Executive Summary ...... 11
3. Proposal Response ...... 17
4. Case Studies ...... 43 The Round, Beaverton, OR
SECTION 1 Authorizing Letter
| 5 May 15, 2019
City of Englewood 1000 Englewood Parkway Englewood, Colorado 80110
Re: Request for Proposals, Master Developer for a Portion of the Englewood CityCenter Redevelopment
Dear Members of the Selection Committee:
ScanlanKemperBard (SKB) is pleased to submit our response to the Request for Proposal (“RFP”) issued by the City of Englewood for the redevelopment of the Englewood CityCenter site (the “Redevelopment”). We are committed to collaborating with the City of Englewood and its real estate entity, the Englewood Environmental Foundation, to redevelop the City-controlled property (the “City Property”) and work in conjunction with the surrounding property owners, namely at the former Weingarten Realty property (“C-III Property”), the Artwalk CityCenter Apartments, and the WalMart Supercenter, to create a unified, master planned CityCenter.
SKB, founded in Portland 25 years ago, has successfully completed over $4.2 billion of real estate transactions consisting of redevelopment and adaptive re-use of mixed-use, office, retail, industrial, multifamily and hospitality assets, across 91 different projects in Portland, Seattle, the Bay Area, Phoenix and Denver. Our team has the passion, experience, discipline, and creativity to successfully complete the planning, design and the full execution of this important project. SKB currently owns and manages property in Denver, and we have a number of locally based employees, including one of the firm’s Principals who lives in the immediate vicinity of the Redevelopment. We are committed and prepared to advance funds to work collaboratively with the City through the development process to achieve an economically sustainable, diverse and vibrant mixed-use community that leverages the transit oriented and central Metro Denver location.
SKB has a history of successful development partnerships with mid-sized transit- oriented municipalities. We successfully partnered with the City of Beaverton, Oregon to redevelop their underperforming transit-oriented mixed-use development into a revitalized live/work/play environment that activated the surrounding community. Currently, SKB is working alongside the City of Tigard, Oregon to undertake a 200+ unit mixed-use project that will serve as a catalyst for development in an Opportunity Zone, which is master-planned for a new light-rail line and pedestrian corridor.
In Englewood, we anticipate a re-imagined CityCenter will build on the City’s visionary design that was started over two decades ago. Additionally, redevelopment would provide an opportunity to consolidate and modernize municipal services, attract a major office tenant and/or hotel brand, enhance and even expand quality public
6 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 7 space, and secure the financial viability of the currently under-utilized transit-oriented location. A strengthened CityCenter will provide the community a true gathering place and will provide the City with benefits including increased taxes and potential future monetization of the property.
Working with you and the Community Development Department, along with input from the Englewood community, we anticipate studying and carefully curating density, product mix and project schedule to create the next iteration of Englewood CityCenter. SKB’s deep bench of operating, construction, and architectural partners allows us to program a multitude of complementary uses across the Redevelopment, including hospitality, retail, entertainment, a variety of multifamily housing, creative and traditional office, and community uses. SKB has fourteen active institutional capital partners, including those with dedicated Opportunity Zone Funds. Our strong relationships with numerous other debt and equity partners will allow us to tailor the financing to meet the needs of the Redevelopment. With the right planning and placemaking, SKB believes that the Redevelopment can become Englewood’s “Living Room,” where citizens gather, collaborate, and live.
Our response is valid for 60 days from this submission and SKB will, if selected, negotiate in good faith with the City according to the terms of the RFP. We look forward to the opportunity to meet with the City, and in the meantime any inquiries may be directed to Todd Gooding at (503) 220-2600 or [email protected].
Thank you in advance for your time and consideration.
Best Regards,
Englewood CityCenter Todd M. Gooding President, Principal
Cc: Dan Poremba, Chief Redevelopment Officer Brad Power, Community Development Director SECTION 2 Executive Summary
8 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 9 EXECUTIVE SUMMARY
TEAM EXPERTISE RELEVANT EXPERIENCE ScanlanKemperBard (“SKB”) has identified a strong SKB brings 25 years of experience to ensure the City’s multi-disciplinary team with demonstrated experience guiding principles and goals for the Redevelopment are to achieve every aspect of the City of Englewood’s met. We consistently demonstrate execution of those redevelopment vision, goals, and objectives. Our team same principles in our work: excellence in design; pairs deep local knowledge of the Metro Denver prioritizing sustainability, community, and Community with best practices and relationships environmental responsibility; highly successful, derived from national experience and perspective, accessible, and active public and private spaces; and particularly our vast experience with Public-Private financially strong projects that mitigate risks for our Partnerships. While each team member is an expert in partners and create long-term value for all their respective field, we are ready to listen to and stakeholders. Please see the attached case studies for collaborate with the City to re-envision an exciting select properties within our current portfolio that are of future for Englewood CityCenter (the particular relevance: The Round at Beaverton (Portland “Redevelopment”). Metro, Oregon), High Street (Phoenix Metro, AZ), Iron Fireman (Portland, Oregon), KOIN Tower (Portland, SKB has practical experience and knowledge as a Oregon), and 72nd & Dartmouth (Tigard, Oregon). developer, owner and operator of large-scale mixed- use projects. We understand market trends and As for execution, both SKB and our partners have demands, tenant needs and desires, and operational demonstrated considerable expertise in the creation and marketability issues, all of which influence design, and curating of successful places, drawing upon deep development and financing. SKB has a depth of local relationships in every area of real estate development and national relationships with subject-matter experts and management. Of specific note is our strong that will allow us to supplement our team with the right ownership experience of highly successful ground floor strategic partners and consultants as the development retail that integrates with the public realm and evolves. This ranges from engineering and feasibility gathering spaces. As the team leader, SKB has consultants, to capital partners with traditional and undertaken over $1 billion in ground up development, opportunity zone financing capabilities, and ultimately and currently averages over $50 million per year in to the dynamic mix of tenants and users who will be construction activity, involving redevelopment, the heart of this vibrant and innovative mixed-use repositioning, and capital improvement projects. In district. addition, SKB currently has approximately $344 million of real estate projects in varying stages of development.
Equally as important, as a long-time owner of large- scale, high quality assets throughout its history, SKB also brings significant asset and property management experience to the team. With proven experience in owning and operating large-scale mixed-use developments, and portions of larger urban, mixed-use neighborhoods, SKB has a deep understanding of what is required to create, operate and maintain a successful, dynamic and economically sound project in that context. SKB’s strong intuition, focus, creative problem solving and institutional discipline bring a market “reality check” to the planning and design
The Pearl District, an SKB mixed-use redevelopment in Portland, OR
10 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 11 EXECUTIVE SUMMARY
process and further enhance the probability of longer- critical to the success of the overall project and further in refining the detail for development, but also • Successful history of undertaking ground lease term financial success of vertical projects. community, and SKB has the available resources to successfully execute the plan to fully achieve the City’s transactions with public and private parties, having work alongside the C-III buyer and simultaneously objectives. SKB is ready to commit additional human undertaken a total of 10 ground lease transactions assist the City with the master-planned and capital resources to the effort to ensure successful totaling over $510 million in transactional volume, FINANCIAL CAPABILITY Redevelopment. planning and development. most recently with Arizona State Land Department. With over $4.2 billion in real estate transactions in its 25-year history, SKB brings deep capital, lending and • Strong reputation on delivering on our brokerage relationships to better ensure project UNDERSTANDING OF THE ENGLEWOOD OUR STRENGTHS commitments and executing on transactions, even success. SKB has fourteen active institutional capital VISION Our team’s strengths, described below, would be at the when others have previously failed. partners and strong relationships with multiple lending We recognize the importance of this project to the City service of Englewood to build the next iteration of • Commitment to community creation and institutions. We engaged in over $285 million in annual of Englewood; it will not only continue to be home to CityCenter. sustainability practices and policies for properties acquisition, development and redevelopment activity the City’s governmental offices, but it also has the • Local leadership with deep roots in the community within our portfolio. and over $725 million in real estate loan transactions potential to emerge as a vibrant primary downtown for and a Denver-based Principal who lives in the within the past 5 years. With its significant real estate Englewood. It will continue to serve as a reliable transit • Deep relationships with partnering developers and immediate vicinity of the Redevelopment. activity, SKB further developed strong relationships hub and, with the right vision, can grow to include operators with complimentary expertise – such as with the leasing community to deeply understand more housing options, commercial space, and public • Demonstrated knowledge of Metro Denver’s real mixed-rate affordable housing, senior housing and Denver and national market trends and tenant needs space. estate market dynamics, with 25 years of real student housing. and desires. As a result, we have the ability to engage estate investment in our Denver-west focused We can plan and execute on the City’s desire to create In summary, we believe that not only has SKB the right leasing professionals to ensure that vertical territories. projects are well-leased with well-curated tenants and a true town center and the next generation of a transit- demonstrated capabilities with specifically unique remain financially stable. oriented downtown Englewood. SKB believes the • Boots on the ground with over 400,000 SF of office qualifications to successfully deliver the CityCenter Redevelopment will positively influence the immediate under ownership with dedicated property Redevelopment, but we also have strong relationships Acknowledging the fluid structure of the ownership area and could effectively connect the transit station management and engineering teams. with tenants, partnering developers, and operators to and planning stages, SKB is a mature, long-standing on the western edge with the Broadway corridor and ensure a diverse, vibrant, and innovative mixed-use business with the capabilities to engage with the the hospital complex to the east. We understand the • Deep understanding of capitalization and financing district that embodies the City’s vision. eventual acquirer of the C-III controlled property and considerable planning necessary to incorporate every strategies related to large and diverse real estate pursue a redevelopment of the City controlled property aspect of the City’s visions, and we believe that our assets, including the structuring and simultaneously. Coordination between properties is team is uniquely qualified to not only collaborate implementation of special taxing districts, and the ability to creatively approach project financing.
• Strong relationships with highly experienced Denver-based architects, engineers, contractors, capital partners, leasing brokers, and consultants that will complete the strong multi-disciplinary team.
• Vertically integrated asset management, property management, and engineering teams that provide SKB with detailed insight into micro and macro opportunities and concerns.
• Strong understanding of active ground floor retail, with over 785,000 SF in our current portfolio, including ownership of over 94,000 SF of ground floor retail, across 10 blocks, within the Pearl District in Portland, Oregon.
The Portland Youth Builders touring The Glass Lab, an SKB mixed-use development currently under construction
12 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 13 Iron Fireman, Portland, OR
SECTION 3 Proposal Response
| 15 PROPOSAL RESPONSE
1 2 Experience developing or redeveloping mixed-use and Experience working with municipalities in a partner-like TOD projects, in Colorado and elsewhere relationship to collaborate on redevelopment efforts and to define specific real estate and finance transactions as SKB brings 25 years of experience to ensure the City’s the plans evolve guiding principles and goals for the Redevelopment are met. We consistently demonstrate execution of those Please see the case study for The Round at Beaverton same principles in our work: excellence in design; and 72nd & Dartmouth in Tigard for examples of SKB’s prioritizing sustainability, community, and relevant municipal collaboration. environmental responsibility; highly successful, accessible, and active public and private spaces; and financially strong projects that mitigate risks for our partners and create long-term value for all stakeholders.
Please see the attached case studies for select properties within our current portfolio that are of particular relevance: The Round at Beaverton (Portland Metro, Oregon), High Street (Phoenix Metro, AZ), Iron Fireman (Portland, Oregon), KOIN Tower (Portland, Oregon), and 72nd & Dartmouth (Tigard, Oregon).
High Street, Phoenix, AZ
16 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 17 PROPOSAL RESPONSE
The first phase of redevelopment will center on the 3 parking garage, surface lots, and the Civic Center Conceptual Development building, primarily encompassing Blocks A and B per Initial ideas or recommendations regarding the Tryba’s conceptual planning package on page eight of redevelopment of the City Property, including mix of uses, the RFQ. In addition to the vertical development, the KEY phasing, specific ideas for the Civic Center building and first phase would ideally reconfigure the existing parking garage, etc. Multifamily (New) access ways to limit dead ends, increase pedestrian 2 Retail (New) SKB envisions the Redevelopment encompassing safety, and activate the street level to maximize viable Existing Buildings 1 multiple phases, with the primary focus of the first retail frontage. SKB has provided an alternative phase of the Redevelopment centering around the Conceptual Development Plan for discussion purposes, S INCA ST S INCA S HURON ST S FOX ST S ELATI ST S ELATI existing development opportunities that are which outlines initial thoughts regarding phasing and ST S GALAPAGO W FLOYD AVE immediately accessible, while programming the site for mix of product types. Please reference the preliminary future flexibility as additional sites, namely within the site plan in conjunction with the following sections. C-III Property, become unencumbered as the existing Bullet numbers 7-8 outline SKB’s vision for Phase I site lease obligations expire. SKB will engage with the renovations that will improve flow of traffic and provide future owner of the C-III Property to highlight the 8 a safe central gathering place for the Redevelopment. mutual benefits of a unified Redevelopment in the SKB suggests improving W Floyd Avenue and creating hopes to partner on site improvements during the first a through street to the south of the Civic Center 9 phase, including improved access, signage, and following the demolition of the existing parking garage 5 branding opportunities. 10 ENGLEWOOD PKWY
6 9 8
4 9 3
9 9 7
W HAMPDEN AVE
NEW BUILDINGS & ADDITIONS STREET & PUBLIC REALM RENOVATIONS Enhanced gateway from Hampden into Phase I 1 Multi-Family Residential, Townhomes & Parking Phase I 7 Garage Englewood City Center
2 Multi-Family Residential, Townhomes & Parking Phase II Splash pad park Active retail streetscape 8 New Public Access Road and Bus Drop-Off Phase I
3 New Retail building fronting Inca Street Phase II
Multi-Family Residential & Parking Garage Phase II 4 COLLABORATION Collaboration and co-branding with adjacent Phase I Possible expansion to the Civic Center Building Phase I 9 5 property owners for a unified “Englewood CityCenter” branding and marketing effort
10 Collaborative site improvements and upgraded Phase I Englewood Trolley BUILDING RENOVATIONS
6 Renovate building to increase transparency Phase I and connections to the park space and to accommodate varied tenant mix
Residential placemaking Revitalized office frontage
18 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 19 PROPOSAL RESPONSE
that connects to S Inca Street. SKB also suggests This first phase sets the stage for a larger, future eliminating the roundabout to the west of the Civic redevelopment that ideally incorporates the C-III 5 Center and having buses utilize the newly created Property with the City Property. The initial scope will Ideas for funding various third-party predevelopment through street as the primary turnaround. This new focus on adding more bodies through multifamily expenses required to replan the City Property and, connectivity would create an alternative public access development, improving through access by connecting potentially, the C-III Property to, in turn, facilitate related way to the future multifamily sites outlined in Bullets 1 Inca Street and Floyd Avenue, and unifying the development and financial agreements between the City & 2, which would help alleviate vehicular congestion in Redevelopment’s brand by focusing on continuity of and the respondent, the middle of the project. signage, wayfinding, and messaging. In conjunction, these factors will increase the commercial viability of SKB is experienced in flexible funding of SKB hopes to create a collaborative atmosphere when existing and new improvements and increase the City’s predevelopment costs, and it would be willing to engaging with the surrounding property owners by overall monetization potential. SKB will work with the prefund all third party predevelopment costs and highlighting the mutual benefits of a site-wide City of Englewood, RTD, surrounding property owners, expenses, subject to future discussions regarding cost redevelopment and by proposing ways to share in the and other public and private stakeholders to curate the sharing and reimbursement agreements with the City. associated expense and upside. A primary goal in best mix of uses to prioritize a healthy balance between Phase I is to undertake Englewood Parkway site creating a community-gathering place and a financially improvements to create a walkable “Main Street” that stable downtown. will invite better connectivity between the City’s developments to the west with Broadway and the Englewood CityCenter hospital district to the east, as outlined in ULI’s TAP report from 2016. A significant component of furthering 4 the new W Floyd Ave infrastructure, SKB proposes this connectivity is increasing pedestrian infrastructure redeveloping Site 3 and 4 as part of Phase II, which Initial ideas regarding possible approaches and and improving the visibility, safety, and schedule of the would permit adequate time to thoroughly study the financial transactions that would monetize the value of Englewood Trolley. multiple development options and would allow the Englewood’s property interests in the City Property while minimizing its related risks The location of Site 1 & 2 north of W Floyd Avenue and structure to provide parking for CityCenter throughout adjacent to the existing housing stock lends itself well Phase I. SKB anticipates a multitude of monetization options for to multifamily residential development. SKB expects Subject to future discussions with the City, SKB Englewood in regards to both the City and the C-III podium and wrap style multifamily projects to achieve envisions the Civic Center to retain the Englewood Properties. One potential option pertains to the existing the appropriate level of density and aesthetic, including government functions. The Civic Center would undergo ground lease of the C-III Property, which may be potential town homes along Inca Street that tie into the a renovation in Phase I with a focus on increasing extended with an immediate prepayment or which may surrounding neighborhood. The new development transparency by adding new glazing, street level be extended by providing the lessee with future would to take place over two phases, with the storefronts, and updated facades. Additionally, with the renewal options, prepaid or otherwise. Alternatively, southernmost site developed in Phase I and the bus roundabout removed to the west, SKB would look the future potential buyer of the C-III Property may northernmost site used as staging and parking to to expand the footprint of Civic Center towards the benefit from an outright fee-simple purchase of the alleviate RTD’s parking requirements. transit station to increase the rentable office and retail underlying land, which would provide the City with immediate monetization and allow the City to collect The current parking structure south of the Civic Center, square footage. Further, this expansion may be single annual real estate taxes from which it would not labeled as Sites 3 and 4, can be selectively demolished or multiple levels, which would also provide the otherwise benefit. Additional monetization approaches to create the W Floyd Ave connectivity and to access opportunity to create a private, elevated outdoor may be in form of a sale of individual condominium development sites that would be well-suited for a mix amenity for office users with views of the mountains to interests, with rights of first offer and approval rights of of uses, including multifamily, hospitality, the west. The repositioning and potential expansion potential buyers. entertainment, and office, with selective retail as would solidify the Civic Center as the primary focal appropriate. Portions of Site 4 may ultimately remain as point of CityCenter, and additional transparency would structured parking as required to provide an provide a welcoming atmosphere for public and private appropriate ratio for future tenants and to visitors. accommodate RTD’s ongoing requirements. Outside of
Englewood CityCenter 20 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 21 PROPOSAL RESPONSE
the Opportunity Zone Legislation, SKB discovered it private sector market knowledge and resources to the 6 had five assets in its existing portfolio that were table to work collaboratively with the City to ensure the located within Opportunity Zones. SKB has spent best results for all. At SKB, our participation within Initial thoughts on the extent to which the respondent countless hours with tax counsel learning the communities goes beyond our development and would self-develop various vertical projects vs. legislation, benefits, and shortcomings of the redevelopment endeavors. We strive to be active transferring the subject development parcels to other Opportunity Zone regulations, and it is committed to leaders within the communities that we work on. Our vertical developers maintaining that knowledge as the legislation is employees give their time and resources to dozens of SKB has extensive experience in acquiring, developing, rewritten and refined. local organizations every year. In a challenging and and creating a sense of place for creative, co-working, ever-changing real estate environment, we understand Currently, SKB is actively pursuing five individual and traditional office and industrial tenants. As such, that to provide the best product to our tenants and Opportunity Zone investments (three in our existing SKB would look to take the lead as developer for any investors, we must be committed to the long-term portfolio and two new opportunities). SKB is finalizing office, retail, and industrial developments. Although health of the communities we work in. the capitalization on two of these assets before the end SKB has previous and ongoing experience with of June (including 72nd & Dartmouth), with the ground-up multifamily development projects, SKB may expectation to close the other three before the end of THE ROUND, BEAVERTON, OR look to find best in class, Denver Metro based 2019. SKB has a deep bench of potential capital execution partners on the multifamily, hotel, or Since 2011, SKB has successfully coordinated and partners and high net worth investors that are corporate headquarters opportunities. These actively targeted a collaborative strategy for the specifically targeting Opportunity Zone capitalization partnerships may take various forms, and each would development of the project, working with all levels of opportunities. Current Opportunity Zone investment be evaluated based on the individual opportunity City government to encourage and cultivate the type of demand out-paces viable investment supply, and SKB growth and improvement that the development was Iron Fireman, Portland, OR relishes the opportunity to bring nationally originally intended to foster. Examples of this success renowned, institutional investors to the table include the opening of the Beaverton City Hall and IRON FIREMAN, PORTLAND, OR with the City of Englewood. frequent markets, festivals and other public events in 7 The property also plays host to numerous and diverse the open spaces. Financial capacity and resources, including possible tenant-centric and community events and gatherings, plans to utilize financing made available because of the which include Portland Bazaar, PDX Metro events, Opportunity Zones Program 8 HIGH STREET, PHOENIX, AZ Oktoberfest, weddings, art shows, food cart pods, as well as short term, nonprofit-sponsored seminars The project hosts many charity and community events Over our 25-year history, SKB has completed over 90 Experience with community outreach, public and events. individual investment opportunities encompassing over participation and education, in the context of complex on High Street including the annual Boys and Girls Club $4.2 billion. We capitalized these investments with best development or redevelopment projects ‘Dish-it-Out’ culinary fundraiser, blood drives, Development of this property involved extensive in class institutional and high net worth equity Octoberfest for Parkinson’s along with monthly negotiations with the City of Portland, who had not SKB has extensive experience working with unique investors and household name lenders. Examples of community farmers markets and other seasonal seen the inside of the buildings for more than 80 years communities and jurisdictions on complex our equity partners include, but are not limited to, community events. prior to SKB’s ownership. Many unique and redevelopment projects across the Western United Goldman Sachs, Oaktree Capital, and Prudential idiosyncratic features of this expansive property meant States. SKB has deep pride and proven commitment to Development of this project involved extensive Insurance. Our lenders include HSBC, Canadian that SKB necessarily had to work in close partnership the communities that we work in, choosing projects negotiations with the various public and private Imperial Bank, and Bank of America. with the City of Portland in executing SKB’s business stakeholders, including the State of Arizona, the that we feel that our team can bring knowledge and and leasing plan. The resulting impact to the area has Arizona State Land Department, as well as the These deep relationships empower SKB to secure the expertise to. As seen in our Case Studies, SKB can been to create a thriving urban industrial property that neighboring leasehold owners. The resulting impact best available capitalization to ensure success. One of handle complex projects and we are committed to the is helping to transform the look and feel of the Close-In has been to create a premier and thriving live-work- SKB’s primary investment thesis is investing in “The long-term growth of the communities that we work in. Eastside neighborhood in which it is located. next Great Neighborhood.” As a result, after reviewing SKB works with the relevant municipality, bringing our play destination for experiential retail, office, and residential.
22 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 23 PROPOSAL RESPONSE
KOIN TOWER, PORTLAND, OR Richard Morean KOIN Tower’s renovated lobby has been donated for 9 community use including events organized by Pacific Team member resumes and experience EXECUTIVE VICE PRESIDENT CAPITAL MARKETS, PRINCIPAL Northwest College of Arts for Design Week Portland ENGLEWOOD PROJECT PRINCIPAL – CAPITAL MARKETS SKB’s broad experience with large mixed-use projects and First Thursday. The building hosts numerous tenant at every stage of the development process and deep and community events throughout the year including Mr. Morean has 30 years of commercial real estate experience, including 6.5 relationships with best-in-class real estate professionals Easter Seals Bloomfest, blood drives, CPR and first aid with SKB Companies. Mr. Morean joined SKB Companies as a Principal in 2013 will ensure the implementation of Englewood’s plan, training and flu shoot clinics. The building promotes after holding senior positions with firms including Trammell Crow Company, guaranteeing its success as a central place that wellness by providing a well-appointed fitness center Kennedy Associates Real Estate Council, Furniture Row Companies, and GE provides attractive opportunities for new employers, free of charge to tenants, indoor secured bicycle EDUCATION Capital Real Estate. He sits on the firm’s investment committee and is deeply retailers, and residents. Our institutional equity and involved in SKB’s acquisitions and investment efforts. He has driven the growth parking and a loaner bicycle for tenant use. In 2016 Colorado State University debt partners have come to trust that our vertically KOIN Tower ownership took a leadership role and of the firm’s institutional investor relationships, which has helped to drive integrated platform, entrepreneurial culture, and pledged $222,000 in support of a voluntary LID to MBA, “Thunderbird” company expansion in the western U.S. Living in Denver, CO (Greenwood passion for real estate keep us at the forefront of restore the four fountain parks of the Portland Open American Graduate School Village), Mr. Morean has had deep Denver real estate experience, market innovation within the industry. Space Sequence designed by Lawrence Halprin. of International knowledge, and has been involved in all aspects of the real estate process Management through his career. This includes capital raising, acquisitions, asset Our project team is committed to successfully fulfilling management, dispositions, financing, etc. for all asset product types. Englewood’s vision of creating a functional central PROFESSIONAL gathering place that is complementary to the City’s ASSOCATIONS Mr. Morean grew up in Denver and attended Colorado State University before commercial core while positioning the investment moving to Arizona in 1985 to attend the Thunderbird Global School of ULI opportunities for optimal monetization potential. SKB International Management to earn his MBA. After 13-years away from Colorado offers its unique perspective developed over its 25- Previously ICSC, NAIOP, with roles at Trammell Crow Company and Kennedy Associates, he returned year history to collaborate with the City to create a CoreNet (corporate R E). home to Denver in 1998 to start up and run the real estate office for Kennedy financially stable, re-energized CityCenter. Associates Real Estate Council, a real estate pension fund advisor. Mr. Morean FINRA licenses 63 & 22 Also ran the Denver real estate platform for Furniture Row Companies and for GE Capital Real Estate, where he oversaw the firm’s investment of equity Planning & Zoning capital into various real estate deals nationally Commission for the city of Winfield, IL in 1989-1990. Relevant Experience
• Kennedy Associates Real was responsible for development of the Estate Council firm’s retail assets nationally. This included In 1998 founded and ran the firm’s new Furniture Row’s flagship Denver location in Denver office and was instrumental in Lone Tree, as well as the Dacono store. Kennedy’s equity investments in a number While the firm owned an additional 50 acres of Denver area real estate deals, including of land in Lone Tree, Mr. Morean was Legacy Plaza, the first office asset responsible for the firm’s relationship and developed in Denver’s Central Platte Valley collaborative interaction with the city of neighborhood behind Union Station. Lone Tree. Additional projects were undertaken with developer, Trammell Crow Company and • SKB Companies included an office asset in Greenwood Initiated SKB’s new Denver office once Village (150,000 sf) and two office joining the firm as a principal in 2013. Mr. properties in Louisville (200,000 sf). Morean has taken a lead role in the firm’s Denver investments, including the • Furniture Row Companies acquisition of Greenwood Corporate Plaza Oversaw the firm’s real estate platform, in Greenwood Village near the Arapahoe which included overall site selection, light rail stop. This investment is owned entitlements, public/private collaborative with SKB and its institutional partner, interaction, development, and asset Goldman Sachs, and is still in the SKB management. While at Furniture Row, he portfolio.
KOIN Tower, Portland, OR
24 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 25 PROPOSAL RESPONSE
Todd Gooding John Olivier
PRESIDENT, PRINCIPAL SENIOR VICE PRESIDENT OF ACQUISITIONS AND DEVELOPMENT ENGLEWOOD PROJECT PRINCIPAL – STRATEGY ENGLEWOOD PROJECT LEAD Mr. Gooding has 28 years of commercial real estate experience, including 22 Mr. Olivier has been in the real estate industry for over two decades. He started with SKB, where he is credited with developing the firm’s “value-add/ his career in the practice of law, representing several national and regional opportunistic” acquisition platform. He was named a principal in 2002 and lenders, owners and developers in over $1.5 billion of real estate transactions, president and chief investment officer in 2006. During his tenure at SKB, Mr. including acquisitions and dispositions, financing, joint ventures and ground Gooding has initiated $4.36 billion of acquisitions and concomitant debt up-development. In 2005, he left his role as partner with a regional Florida law EDUCATION EDUCATION placements and restructuring, and he serves as a member of the SKB firm to pursue opportunities on the business side of the real estate industry. Bachelor of Science, Investment Committee. He was also responsible for initially sourcing and Juris Doctor degree, During that time, he has been involved with the acquisition, entitlement and University of Oregon maintaining SKB’s institutional capital partner relationships to bolster the University of Tulsa development of a variety of projects, including retail, office, mixed-use, development and redevelopment investments. Bachelor of Arts, University condominium, subdivision and hospitality assets. In early 2015, Mr. Olivier PROFESSIONAL brought his broad skill set to SKB, where he now leads the Acquisitions and ASSOCATIONS He started his real estate career as a licensed real estate appraiser with then of Oklahoma Development team on ground-up and redevelopment opportunities. ULI CB Commercial, Inc. Prior to joining SKB, he served as vice president of acquisitions for G.E. Capital Investment Advisors and senior real estate Relevant Experience ICSC analyst with CB Commercial, Inc. in San Francisco. Mr. Gooding is an Advisory Board member for The Center of Securities Analysis at the University • 1921 SE 3rd ($56,500,000) Development of 140,000 SF building with office, creative industrial, retail of Oregon and holds FINRA 22, 39 and 63 licenses. and underground parking; Role: acquisition and Project Lead Relevant Experience • 1805 SE MLK ($14,000,000) • Hight Street ($102,000,000) Redevelopment of 41,000 SF industrial building into creative industrial and 24.91 acre development with nine, three and four story office and office; Role: acquisition and Project Lead multifamily buildings accompanied by ground floor retail and two parking • Residence Inn – Pearl District / Portland, Oregon ($51,000,000) garages, includes 99 luxury residential units, 176,000 SF of upscale retail 223-room Marriott Residence Inn Hotel. Financed utilizing the EB-5 dining and entertainment options and over 334,000 SF of Class A office Program; the first hotel within the Pearl District; Role: acquisition, space Structuring EB-5 Investments, Project Management • The Round ($33,000,000) • Hyatt House – Riverplace District / Portland, Oregon ($54,000,000) 5.86 acre development with 24,000 SF of ground floor commercial/retail 203-room Hyatt House. Financed utilizing the EB-5 Program. The only Hyatt space, a five-story parking structure with 15,000 SF of ground floor retail hotel within Portland’s urban core; Role: acquisition, Structuring EB-5 space and a five-story 119,000 SF office building, along with three Investments, Project Management development lots totaling 96,000 SF • W Hotel and Residences – Fort Lauderdale, FL ($220,000,000) • Hanna Andersson HQ ($15,670,000) 1,033,740 SF, mixed-use resort on a 4.5-acre site; 346 hotel rooms and 171 113,676 SF project consisting of a two-story office building, along with an luxury residential units in twin 23-story towers; amenities include a adjacent industrial building, restaurant building, and parking lot. Current destination health spa, two swimming pools, meeting and convention North American HQ for Hanna Andersson facilities, premium restaurants and lounges and an 827-car parking garage; • KOIN Tower ($88,000,000) Role: development counsel, responsible for acquisitions/land assemblage, Iconic, class-A mixed-use building in downtown Portland. Significant entitlements and conceptualizing and implementing condominium and hotel multi-million dollar repositioning. Current HQ for SKB structure
26 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 27 PROPOSAL RESPONSE
Tom Howes James Paul
SVP OF DEVELOPMENT AND CONSTRUCTION MANAGEMENT EXECUTIVE VICE PRESIDENT − ASSET MANAGEMENT, PRINCIPAL ENGLEWOOD CONSTRUCTION LEAD ENGLEWOOD REPORTING AND COMMUNICATIONS Mr. Howes joined SKB in 2013, with over 35 years of experience in managing As Executive Vice President, Mr. Paul leads the asset management and major development and construction projects throughout the United States. property management departments. He oversees SKB’s $1.2 billion portfolio Past responsibilities included managing all design, government relations, including developing investment strategies, property valuations, dispositions, EDUCATION lender coordination, and budgets through project completion for over one asset operations and refinancings. He serves as a member of the SKB billion dollars of projects. Bachelor of Science in Investment Committee. Mr. Paul is also directly responsible for asset Business Administration, management for a portfolio of assets and complements the firm’s due Prior to joining SKB, Mr. Howes was Director of Design and Construction for University of Oregon diligence, acquisitions and investor management efforts. Mr. Paul joined SKB Thomas J. Klutznick Company, where he developed Phase I of City North in in 2000. During his career, Mr. Paul has served as a court-appointed receiver Phoenix AZ (Residential/Retail/Office). In addition, he opened ten regional HONORS & AWARDS and directed SKB’s initiative to bring property management in-house. He has malls throughout the United States for JMB/Urban Retail Properties. As their 2015 underwritten more than 30 closed transactions totaling over $1 billion in Development Manager, his duties included opening the development office Portland Business Journal’s value. and managing all development and construction required to complete each Top Forty Under 40 new construction project. Notable construction projects include Paseo Nuevo Runners Up List in Santa Barbara, Town Center at Boca Raton, Penn Square in Oklahoma City, and Roseville Galleria in California.
Relevant Experience
• City North, Phoenix, AZ ($240,000,000) Mixed Use, 99 residential units, 350,000 SF office, 185,000 SF retail, 1340 stall garage, 22 acres land development
• Northfield, Denver, CO ($110,000,000) Mixed Use, 100,000 SF office, 900,000 SF retail, 1340 stall garage, 60 Chris Holden acres land development SENIOR DIRECTOR OF REAL ESTATE MANAGEMENT • Saddle Rock Village, Aurora, CO ($25,000,000) ENGLEWOOD OPERATIONS MANAGEMENT Retail, 300,000 SF and land development Mr. Holden joined SKB in 2013 with over 25 years of experience in real estate • Roseville Galleria, Roseville, CA ($140,000,000) asset, facilities and construction management; property leasing and 1,000,000+ region shopping mall, and associated land development EDUCATION marketing; project development; financing; acquisitions; and dispositions. In conjunction with the firm’s asset managers, he directs the activities of SKB’s • Citrus Park Town Center, Tampa, FL ($105,000,000) Bachelor of Arts in in-house management teams, serving nearly 5 million SF in our primary 1,000,000+ region shopping mall, and associated land development Organizational Management, western states markets. With revenues exceeding $80 million and operating Evergreen State College • Wolfchase Galleria, Memphis, TN ($90,000,000) budgets of some $35 million, Mr. Holden ensures that all SKB performance 1,000,000+ region shopping mall, and associated land development standards are met, the properties operate smoothly, leasing efforts are • Brandon Town Center, Tampa, FL ($105,000,000) supported and SKB realizes the investment objectives set forth for its 1,000,000+ region shopping mall, and associated land development acquisitions. He encourages the development of SKB’s 50 property management and engineering professionals while providing senior direction • Paseo Nuevo, Santa Barbara, CA ($175,000,000) in all facets of property and facilities services. 1,000,000+ region shopping mall, and associated land development
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DAVID TRYBA, FAIA undertaken a total of 10 ground lease transactions 10 LEAD DESIGN PRINCIPAL, 11 totaling over $510 million in transactional volume, TRYBA ARCHITECTS most recently with Arizona State Land Department. Information about potential third-party redevelopment Information about the respondent’s unique experience, DENVER, CO team members culture, capabilities, industry relationships, etc., • Strong reputation on delivering on our The Founding Principal of the that would allow them to bring unique value to the commitments and executing on transactions, even architecture, urban design and redevelopment when others have previously failed. planning firm, David’s passion for cities directs the work Our team’s strengths, described in the Executive LEAD ARCHITECT AND URBAN DESIGN of Tryba Architects. He is involved in each of the firm’s • Commitment to community creation and projects and excels at leading talented designers Summary and below, would be at the service of sustainability practices and policies for properties As Master Developer, SKB plans on fully engaging towards solutions that are in the best interest of the Englewood to build the next iteration of CityCenter. within our portfolio. Tryba Architects and its local team of engineers and client, the community and the project. David’s consultants to help execute the Redevelopment. SKB • Local leadership with deep roots in the community • Deep relationships with partnering developers and entrepreneurial spirit directs the firm’s commitment to and Tryba have successfully worked together on six and a Denver-based Principal who lives in the operators with complimentary expertise– such as the transformation of urban buildings, sites and systems urban redevelopments projects in multiple markets, immediate vicinity of the Redevelopment. mixed-rate affordable housing, senior housing and into active, human-scaled and successful places. providing the City of Englewood with a proven team. student housing. • Demonstrated knowledge of Metro Denver’s real David possesses a deep understanding of the evolution Tryba Architects specializes in the full integration of estate market dynamics, with 25 years of real In summary, we believe that not only has SKB of cities – past, present and future - and has completed architecture, urban design and planning. Throughout estate investment in the Western United States. demonstrated capabilities with specifically unique projects across North America, including: Colorado, New our 31-year history, our 60-person firm has earned qualifications to successfully deliver the CityCenter York, California, Florida, Michigan, Pennsylvania, Utah, • Boots on the ground with over 400,000 SF of a national reputation for shaping thriving urban Redevelopment, but we also have strong relationships Arizona, Massachusetts, Mississippi, Washington, Texas office under ownership in Denver, with dedicated neighborhoods and designing unique, timeless with tenants, partnering developers, and operators to and Mexico. property management and engineering teams. buildings. We take our clients' goals to heart to craft ensure a diverse, vibrant, and innovative mixed-use highly-personalized and context- sensitive places at all • Deep understanding of capitalization and district that embodies the City’s vision. scales, from the neighborhood to the street to building SARAH KOMPPA, AIA financing strategies related to large and diverse orientation to the smallest detail of our buildings and SENIOR ASSOCIATE, URBAN real estate assets, including the structuring and interiors. We look forward to working with Englewood, DESIGN AND PLANNING, implementation of special taxing districts, and the given our strong shared commitment to distinctive TRYBA ARCHITECTS ability to creatively approach project financing. 12 design and creating a community destination. DENVER, CO Initial ideas, if any, regarding redevelopment concepts, • Strong relationships with highly experienced Additionally, as a sign of our commitment to clients uses and phasing for the City Property and alternatives Sarah is an Urban Designer and Denver-based architects, engineers, contractors, and their visions, we often go beyond providing for the Civic Center property, including alternatives for Architect bringing fourteen years of national experience capital partners, leasing brokers, and consultants standard architectural services and consulting as retaining the Englewood government functions located in Master Planning and urban design. She enjoys the that will complete the strong multi-disciplinary financial partners in our clients' projects. there vs. relocation to other leased or developed facilities challenge of complex projects and the ability of design team. to transform and create place. With experience ranging As discussed in answer #3, subject to future from Campus, cultural, transportation and neighborhood • Vertically integrated asset management, property discussions with the City, SKB envisions the Civic planning, Sarah brings a keen understanding of urban management, and engineering teams that provide Center to retain the Englewood government functions. sites, sustainability and multi-modal connections to the SKB with detailed insight into micro and macro Barring a large office requirement, a renovated and project. opportunities and concerns. expanded Civic Center has the capacity to provide • Strong understanding of active ground floor retail, public and private office tenants a central Englewood with over 785,000 SF in our current portfolio, location and modern common office amenities under including ownership of over 94,000 square feet one roof. of ground floor retail, across 10 blocks, within the Pearl District in Portland, Oregon.
• Successful history of undertaking ground lease transactions with public and private parties, having
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72ND & DARTMOUTH, TIGARD, OR we understand the considerable value that additional mixed-use development would create for the C-III 13 Kenny Asher Property owners. At the earliest available opportunity, References from other municipalities with which the Community Development Director, City of Tigard SKB would suggest a unified branding, wayfinding, respondent has worked (minimum of three references 13125 SW Hall Blvd. and signage agreement spanning the sites. SKB from master development projects in the past 10 years), Tigard, OR 97223 would use this as a launching board for additional including information about the use mix within those 503.718.2443 (office) discussions about further participation in the broader projects, project cost, financing sources used and [email protected] redevelopment plan as development sites become investment in public amenities unencumbered once existing leases expire. THE ROUND, BEAVERTON, OR Mayor Denny Doyle 14 City of Beaverton, Oregon (503) 526-2222 For respondents that may still be involved, in one way or 16 [email protected] another, in pursuing the acquisition of the C-III Property Expanding on questions #3 and #6 above, respondents as of the May 15, 2019 RFP response date, please discuss are requested to share their initial view on the best mix HIGH STREET, PHOENIX, AZ your approach to the potential opportunity to create and of hotel, office, multifamily, retail and other uses on the Christine Mackay execute a larger redevelopment plan involving both the City Property plus information on how they would expect Community and Economic Development Director, C-III Property and the City Property City of Phoenix, AZ (602) 534-9049 to target and attract those uses that often involve third- [email protected] At this time, SKB is no longer a participant in the parties, such as a hotel owner/operator, large-employer acquisition process for the C-III Property. However, office tenants, retail tenants, etc. we feel the time invested in the sale process gives IRON FIREMAN, PORTLAND, OR SKB envisions the best mix of new development to us unique insight into the strengths and weaknesses Kyle Chisek consist of multifamily, office, hotel, and retail, in that of the project that we can leverage throughout the Director of Bureau Relations order. Multifamily would be the lead product type for planning phases of the City Property. Additionally, City of Portland, Office of the Mayor Ted Wheeler (503) new ground-up development and would consist of new the insight will be helpful when engaging with the 823-1126 market-rate multifamily residential and townhomes future owners of the C-III Property, as it gives us [email protected] north of Floyd Avenue at approximately 100 units per immediate credibility and should foster a collaborative acre density, as well as multifamily residential with atmosphere. KOIN TOWER, PORTLAND, OR ground floor retail south of the Civic Center. Office The Round, Beaverton, OR Jeff Mills product would exist primarily within the repositioned and expanded Civic Center and selectively in new and Prudential Real Estate of the local leasing teams, from which we have many existing retail if the use were complimentary to the (previous Equity Partner 2015-2018) jeff.mills@pgim. 15 quality relationships to choose, would be able to point com, (415) 244-3081 curation of the tenant mix in the Redevelopment. For respondents that are not involved in pursuing the to the unique characteristics of an Englewood location acquisition of the C-III Property, please discuss whether Increasingly, Denver’s office tenants are focusing to pull a tenant from the Tech Center or CBD. on traffic patterns to drive decision-making. The and how you would assess the potential to collaborate SKB will work with its President and CEO of the SKB redeveloped City Center office building will provide a with the purchaser of that property to explore the joint Hotel Group, Robert Riley, to pursue the potential prospective larger office user with contiguous blocks formulation of a larger, shared redevelopment plan and addition of a full-service hotel or boutique hotel that of space on large floorplates, which is difficult to find strategy could provide additional amenities and conference outside of the CBD or the SE Submarket. The Civic and meeting rooms for Civic Center’s office tenants, SKB and our Partners will be open book with the Center can provide high-quality office space on light the City of Englewood, the nearby hospital, and the buyers of the C-III property and would encourage a rail, in close proximity to executive and workforce surrounding community. The multifamily development shared redevelopment plan and strategy. SKB engaged housing in the surrounding communities, while still site south of the Civic Center is a potential location for with a multitude of local resources to understand the offering tenants a 20-minute drive to downtown a hotel use, and being on the west side of the project unique opportunities present in the existing retail and without having to contend with I-25. We expect one office improvements during the C-III sale process, and would provide hotel users with unobstructed views of
KOIN Tower, Portland, OR
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PORTLAND METRO AREA 18 • Strategic Partner with / neighbor of Oregon Respondents should discuss whether they are prepared Museum of Science and Industry (OMSI) – to collaborate with the City on related place-making programming and branding of initial catalyst activities, including: (a) assuming management of the project within OMSI’s mixed-use district. (While we CityCenter exterior property management functions did not win the RFQ, we have a continuing close currently provided by EEF, (b) the potential opportunities working relationship with OMSI). to brand, market and program Englewood CityCenter, including the need for related conversations with • Founding Member of Innovation Quadrant (IQ) the other key CityCenter stakeholders, Walmart and Board – Role in strategic implementation of district the ArtWalk Apartments; (c) participation in the goals, including membership within IQ workgroups establishment of a Downtown Development Authority; (Real Estate Business and Placemaking). and (d) participation in steps to improve the Englewood • Instrumental in courting Portland Youth Builders as Trolley as a key transit connection between CityCenter a key community member within the IQ Real Estate and Englewood’s downtown and hospital districts. Biz work group to facilitate involvement of the PYB program in the implementation of the IQ. Iron Fireman, Portland, OR SKB and its partners have extensive experience with property management, and we currently manage • Early signatory to Eastside Services District, the mountains. elevator cores that can be up-fitted for additional approximately 5 million SF of office industrial and helping to fund enhanced district-wide services, occupancy requirements. Incorporating these features retail assets in the western United States, including Retail is the lowest priority for new development and including jobs and services for the homeless into new above-grade parking structures provides the approximately 600,000 SF in Greenwood Village, would primarily be located on the ground floor of the community. City, or potentially future owners of the structures, the CO. We would embrace the opportunity to property newly developed multifamily projects. The expectation flexibility to convert single floors or entire structures to manage the CityCenter portfolio and would bring our • Tigard – working closely with Economic is that the new ground floor retail would benefit from new uses as future parking requirements wane. best practices to the opportunity. Development and the City’s Urban Renewal the close proximity to Hampden Avenue and the Authority to implement the newly adopted Urban highest rent-achieving spaces in the C-III retail portfolio. The cost of the parking structures may be shared SKB and our strategic partners also have extensive Renewal Plan and be the first developer to bring a between the surrounding developments and parcelized experience branding, marketing, community outreach catalyst mixed-use project into the URA. as condominium interests, or individual parking as well as being an active participant in establishing structures may act as standalone investments with improvement districts and improving access to public 17 revenue monetization resulting from leasing stalls to transportations. Examples include: Related to #16, respondents should describe possible surrounding users. For existing structures and surface approaches to reconfiguring the existing structured and lots, SKB sees the opportunity to execute a shared surface parking at CityCenter, possible mechanisms parking agreement similar to the Round at Beaverton, for sharing the cost of such parking and ideas for which provided an equitable parking allocation engineering structured parking to enable conversion to for building owners that addressed varying use other uses in the future as parking demand decreases, as requirements at different times of day. is widely projected
Depending on the RTD and future mixed-use parking requirements, parking may exist in a combination of surface and structured lots, and potentially in conjunction with residential, office, or hotel development. SKB is currently programming a parking garage in Portland with specifications that make it a viable candidate for future office conversion, including tall ceilings, long window lines, and mechanical/
KOIN Tower, Portland, OR 34 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 35 PROPOSAL RESPONSE
SKB is prepared to engage and collaborate with the surrounding property owners and all related Realized Investments
stakeholders to create a unified branding, marketing, Property Property Type Acquisition Disposition Hold Period Purchase Price Sale Price and programming effort. We have worked with Tryba Assets Acquired & Disposed After 2010 on similar projects and are excited for the opportunity Bank of the Cascades Portfolio, ID & OR All Asset Classes Sep-11 Sep-12 1.0 yrs. 60,000,000 88,300,000 to release the full team to begin developing ideas. First Independent Bank Portfolio, OR & WA All Asset Classes Jan-11 Jun-13 2.4 yrs. 10,800,000 16,400,401 Albertsons Portfolio Recapitalization, Arizona Retail Jun-12 Sep-13 1.3 yrs. 10,000,000 11,630,000 SKB would also be interested in being involved with the West Willows, Redmond, WA Office/Flex Jul-11 Mar-15 3.7 yrs. 17,400,000 28,500,000 establishment of a Downtown Development Authority, Parkside Center, Portland, OR Office Sep-12 May-15 2.6 yrs. 38,700,000 55,000,000 and have had similar experience with The Round at Tower Plaza, San Mateo, CA Office Dec-13 Sep-15 1.7 yrs. 41,750,000 67,500,000 Beaverton. Finally, SKB is interested in taking steps Broadway Webster Medical Plaza, Oakland, CA Medical Jun-11 Nov-15 4.4 yrs. 29,750,000 44,104,750 to improve the Englewood Trolley to create better The Round, Beaverton, OR Office & Retail Apr-12 Feb-16 3.8 yrs. 13,250,000 29,325,000 connectivity to Broadway and the hospital district to American Bank Building 2014, Portland, OR Office Jul-14 Feb-17 2.6 yrs. 45,100,000 53,000,000 the east. Although this would entail bringing a number High Street, Phoenix, AZ Mixed-Use Apr-13 Jul-17 4.3 yrs. 67,000,000 129,500,000 of stakeholders in the surrounding area together, Western U.S. Office and Industrial Portfolio Office/Industrial Oct-13 Sep-17 4.0 yrs. 43,000,000 78,781,214 Englewood CityCenter which can be a difficult task to achieve in a timely CH2M Center, Portland, OR Office May-15 Dec-17 2.6 yrs. 55,000,000 65,000,000 • Beaverton – working closely with Community manner, SKB sees countless benefits to creating better Creative Office Portfolio, Portland, OR Office Sep-13 Feb-18 4.4 yrs. 49,050,000 83,925,000 Development Office to relocate City Hall and connection to some of the biggest economic drivers in KOIN Tower, Portland, OR Office Jan-15 Apr-18 3.3 yrs. 88,000,000 127,500,000 finish the development of a mixed use Transit the area. Mountaingate Plaza (Recap), Simi Valley, CA Retail Aug-13 Jun-18 4.9 yrs. 44,550,000 51,125,000 Oriented Development. Projects included Westgate Center (Recap), San Leandro, CA Mixed-Use Feb-15 Oct-18 3.7 yrs. 42,900,000 87,000,000 redrafting community power plant agreement and Hoyt20 (Hygge), Portland, OR Residential Aug-16 Nov-18 2.2 yrs. 13,400,000 17,300,000 comprehensive parking management plan. 19 3.1 yrs. 669,650,000 1,033,891,365 For the respondent’s past development projects, SAN FRANCISCO BAY AREA especially those involving a municipal partner, describe Property Gross Equity Gross IRR Gross Equity Multiple • LIT San Leandro – early adopter/partner/advocate the range of resulting financial returns to the firm (may Assets Acquired & Disposed After 2010 for LIT San Leandro – a high speed fiber optic be stated as internal rate of return, cash-on-cash return, Bank of the Cascades Portfolio, ID & OR 600,000 63.77% 1.55 line distributed through San Leandro to maximize etc.) First Independent Bank Portfolio, OR & WA 11,062,758 32.77% 1.55 Albertsons Portfolio Recapitalization, Arizona 8,383,962 62.40% 1.37 connectivity and drive innovation and technology SKB primarily evaluates opportunities based on a West Willows, Redmond, WA 6,815,855 21.59% 2.01 quadrants within the municipality. targeted return-on-cost, internal rate of return, and Parkside Center, Portland, OR 17,425,000 22.91% 1.79 equity multiple. SKB’s post-recession development • BART Shuttle – early adopter/partner/advocate for Tower Plaza, San Mateo, CA 42,517,403 27.26% 1.51 and redevelopment project-level returns can be seen BART Shuttle - peak time connectivity between Bay Broadway Webster Medical Plaza, Oakland, CA 13,640,000 19.85% 2.02 in the table below. The firm regularly invests corporate Area Rapid Transit (BART) and select destinations The Round, Beaverton, OR 6,789,056 27.42% 2.55 and principal capital and generates a combination of throughout the city of San Leandro, including American Bank Building 2014, Portland, OR 16,105,350 17.02% 1.45 Gate510. property, asset, and construction management fees, High Street, Phoenix, AZ 70,551,530 13.28% 1.42 as well as profit interests upon reversion or sale. The Western U.S. Office and Industrial Portfolio 17,683,542 43.12% 2.66 • Hamilton Landing Novato, CA - early adopter/ targeted financial returns to SKB vary depending on CH2M Center, Portland, OR 23,116,481 12.71% 1.37 partner/advocate of shuttle run by the Hamilton the project’s size, timeline, and level staff involvement. Creative Office Portfolio, Portland, OR 19,742,217 30.06% 2.04 Landing HOA (Former Hamilton Air Force Base) SKB’s vertical integration allows us to earn market-level KOIN Tower, Portland, OR 39,328,784 18.24% 1.82 between the light rail and Hamilton Landing, the property, asset, and construction management fees Mountaingate Plaza (Recap), Simi Valley, CA 16,900,250 10.99% 1.53 Safeway complex and other select areas. that sustain the firm, with the targeted profit interests Westgate Center (Recap), San Leandro, CA 22,501,150 24.95% 2.25 serving to align interests. Hoyt20 (Hygge), Portland, OR 4,508,335 38.12% 2.00 • Ale Trail – Worked with multiple stake holders, 337,671,674 21.54% 1.73 including the City of San Leandro, to create a destination oriented path that celebrates San Leandro’s microbrewery scene.
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Canadian Imperial Bank, and Bank of America. We opportunity, and a fee-simple acquisition with a flexible 20 have a deep bench of equity and debt partners with 23 leaseback component would likely provide the highest various risk and return targets that would have an monetization potential to the City in the timeliest For respondent’s potential involvement as the master For projects involving respondent partnering interest in each of the redevelopment opportunities. manner. The specific terms of the purchase price and developer of the City Property at CityCenter, what is the relationships with municipal entities, discuss how We expect to engage with our financial resources for the leaseback will be negotiated to provide the City range of resulting financial returns that respondent the respondent generally accounted for its associated individual redevelopment opportunities as they are with a preferred balance of immediate monetization would expect to target (may be stated as internal rate of overhead costs, including personnel, office and travel identified, ideally taking advantage of the Opportunity and future lease payment obligations. return, cash-on-cash return, etc.) expenses (have these been charged to the project, and if Zone financing in similar fashion to the newly so were additional margins included, or are they generally SKB anticipates market-level returns consistent with capitalized 72nd & Dartmouth project. SKB envisions the opportunity to provide financial viewed as a cost of doing business) current market expectations. The full scope of the work participation to the City in connection with the North and resulting risk is yet to be determined, but SKB SKB believes current market conditions allow SKB overhead costs are typically charged at cost with Parking Lot and additional development opportunities, will target market-level internal returns for deploying developers to secure non-recourse construction no margin to the project. Assuming market-based and SKB would expect those costs to be capitalized human and financial resources. We welcome the financing with completion guarantees at competitive valuation and execution, SKB bears the financial risk into the value of the land alongside the acquisition. opportunity continue to discuss financial requirements market terms. involved with pre-acquisition costs and would include SKB prides itself on its flexibility and collaboration, and of a sustainable partnership. those in the capital stack with its debt and equity would expect each of these details to be fully discussed partners. and all possible ideas entertained during future negotiations. 22 21 For projects where the respondent has partnered with a municipal government (formally or informally), discuss 24 Discuss respondent’s general equity and debt resources 25 available for the CityCenter redevelopment as well as the whether there are other financial criteria respondent Expanding on #4 above, respondents are requested respondent’s willingness to provide construction and evaluates to consider and structure its involvement and to preliminarily describe a possible "deal structure," Pertaining to #24, respondents should comment on loan guarantees discuss how these considerations might apply to the including how the respondent might propose to: the possible approach of utilizing appraised market redevelopment of the City Property at CityCenter (e.g., values for the redevelopment plan that evolves to SKB has capitalized $4.2 billion in total investments lower going-in acquisition costs, lower financial risk, etc.) a. Ground lease or purchase the Civic Center building and identify the value of the City’s interests to be monetized with best in class institutional and high net worth land, (appraised values could be established per parcel or SKB evaluates projects based on the entirety of the risk equity investors and household name lenders. use and adjusted to reflect: (a) the City’s portion of and the entirety of the revenue, acting as fiduciaries for b. Provide a subsidized long-term lease to the City (in or Examples of our equity partners include, but are not predevelopment and other costs initially funded by the its investors. There is no specific inclusion, exclusion, or outside of the Civic Center building), limited to, Goldman Sachs, Oaktree Capital, and master developer, (b) the development timing for each Prudential Insurance. Our lenders include HSBC, priority in this regard. c. Provide financial participation to the City in connection parcel, (c) financial adjustments associated with the with the development of the North Parking Lot (net of costs of structured parking, (d) the developer-provided ground lease buyout costs and costs of providing shared subsidy value for the City’s long-term lease or other parking to RTD), and facilities transaction (including possible early retirement of the Civic Center Certificates of Participation), and d. Provide additional financial participation to the City in (e) various other factors identified by the parties in the connection with additional development opportunities to Development Agreement) be identified on the City Property Future discussions with the City are welcome, and The preferred deal structure is a fee-simple purchase SKB would expect to engage with all stakeholders to of the underlying land and assets, or alternatively a ensure fair and market driven transactions. SKB would purchase of condominium interests. Although we respond favorably to using appraised market values to are familiar with ground lease transactions and will determine values of the City’s interest. SKB envisions entertain those during future discussions, for ease eventual valuations to come from a combination of capitalizing these projects with market terms, we of appraised values and market-based investment suggest fee-simple land and asset sales. SKB sees sale brokers (CBRE, HFF, etc.) opinion of values. The tremendous value in the Civic Center redevelopment MOA (Museum of Outdoor Arts) is headquartered at the Englewood Civic Center
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predevelopment costs and various other financial adjustments outlined in a-e above should be factored 27 directly into the valuations. In the event that the selected respondent and City were to enter into a DA and then not ultimately come to agreement on specific project terms and conditions, discuss how the respondent might expect to be 26 reimbursed, if at all (e.g., partial cost reimbursement, Respondent should address its financial capability and breakup fee, etc.) willingness to fund all of the related predevelopment SKB’s business plans often require undertaking costs, including the costs required to formulate the financial risk during pre-acquisition and due diligence redevelopment plan that would ultimately serve as with no assurances of success or reimbursement. the basis of the DA and subsequent specific project The scope of costs and timeline for those projects are agreements (a preliminary estimate range would be largely known prior to assuming this risk, which may helpful as well) make it difficult to commit to a required reimbursement SKB has adequate working capital and financial schedule for the Redevelopment until the details of the resources to assume a portion of the upfront risk to DA are better understood. Subject to future discussions collaborate with the City throughout the ENA process with the City, SKB would expect to enter into a partial to formulate the DA. SKB acknowledges the multitude cost reimbursement schedule that increases over time; of future conversations with Tryba, surrounding however, we expect the first 90 days to be free of property owners, RTD, development partners, and the reimbursement to coincide with market standard due public that will shape the eventual Redevelopment diligence periods. After the initial 90-day period, SKB plans. SKB has considerable experience structuring would expect the opportunity to reassess the future flexible agreements between our partners and financial requirements and collaborate with the City to ourselves that minimizes initial capital outlay, and SKB ensure a viable partnership moving forward. High Street, Phoenix, AZ welcomes the opportunity to bring that experience to collaborate with the City on a mutually beneficial agreement to bear third-party out of pocket costs. These conversations are part of a number of steps that 28 need to be completed before the entire scope of work Pertaining to the Civic Center building, discuss whether and subsequent costs will be determined, and SKB the respondent would envision the possibility of is open to no reimbursement of time or travel related respondent funding the early retirement of the City’s SECTION 4 expenses for the first 120 days following the award of remaining annual Certificates of Participation obligation the master developer role while the scope and costs (approximately $1.5 million annually through 2023) as are better quantified and the DA is executed. Following part of an overall financial transaction with the City and Case Studies the successful agreement of the DA, SKB would expect to expedite the availability of the Civic Center site for that these upfront costs associated with the forming of redevelopment. the ENA and DA would be factored into the economics of specific project agreements and would be capitalized SKB envisions the possibility to end the City’s into land values prior to acquisition. obligation at the Civic Center building as part of the transaction involving the redevelopment and potential expansion, with the expectation that these additional costs would be capitalized into the value of the building.
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Exceptional Qualifications
Our goal is to work collaboratively with the City of Englewood to create an authentic downtown for residents and visitors alike. The following five projects represent our vast experience in delivering this type of project.
1 THE ROUND
2 72ND & DARTMOUTH
3 HIGH STREET
4 IRON FIREMAN
5 KOIN TOWER
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DEVELOPMENT FINANCING and declining market conditions. When SKB originally began evaluating the property in 2011, a portion of the $33 million acquisition costs including land. Total residential was owned by one lender, one of the office projection capitalization - $20 million; $8 million in buildings was owned by another lender, another office equity, $12 million in debt from SKB for commercial building was owned by a preferred equity investor, and space and parking lots. $1.0 million from SKB for 13 the excess land was owned by yet a third lender. The residential units, approximately $13.0 million from the developer of the property had been in default of its City of Beaverton for the acquisition and development obligations to the City for some time, and the project of their City Hall. had been significantly impaired as a result.
PROJECT OUTCOMES SKB worked to negotiate acquisition contracts, aligning SKB’s property, The Round, located in Beaverton, the interests of these varying owners of the properties, Oregon is a Class A transit-oriented suburban mixed- and eventually purchased approximately 9 acres of the use development that has experienced resounding overall property in 2011. The purchase, included one success under SKB’s leadership with the property. The of the office buildings, the parking garage, 13 condo Round is an approximately 355,000 SF vertical, mixed- units, and all of the vacant land parcels. SKB then use development, consisting of two office buildings, a secured a commitment from the City of Beaverton to parking garage and 63 residential condominium units acquire the additional 105,000 SF office building within and a number of ground floor retail condos. The MAX the property, and redevelop it into a new City Hall and light rail has a stop in the center of the development, executive office building. surrounding it in a circle, providing the basis for the SKB worked with the City of Beaverton to rewrite the project’s name. original development agreement for the project and THE ROUND Originally developed between 2003 and 2006, The ultimately sold two parking lots to the City in 2017 Beaverton, OR Round was considered a visionary project by the City of for the construction of a new parking garage and Beaverton. Unfortunately, it suffered for several years performing arts center, which are both currently in the from poor execution due to its fractured ownership design phase with an estimated cost of $45 million. DEVELOPMENT TEAM MILESTONE DATES Lead Developer: SKB February 27, 2012 | Property Acquisition Developer Partners: March 2013 | Start of Construction Project Architect: LRS and KPFF December 31, 2013 | Phase I Construction Complete General Contractor: Fortis Construction March 31, 2014 | Final Project Completion Lender: Prime Finance Equity: WHI Real Estate Partners
DEVELOPMENT SCOPE 5.86 acre land area with 24,000 SF of ground floor commercial/retail space in the Crescent/Promenade buildings, a five-story parking structure with 15,000 SF of ground floor retail space and a five-story 119,000 SF office building, along with three development lots totaling 96,000 SF.
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72nd & Dartmouth Tigard, OR
DEVELOPMENT TEAM digital fiber connectivity with building-wide WiFi Lead Developer: SKB mesh. Developer Partners: Project Architect: SERA MILESTONE DATES The project is thriving at 95% occupancy and rents and new parking garage for the property are currently General Contractor: Essex General December 2018 – December 2019 | Predevelopment hovering at the top of the market. With approximately in the design phase, and the activity at the project has Construction Design & Permitting $35M in capital invested in the development by SKB spurred development of 230 market rate apartments on Equity: WHI Real Estate Partners and its public and private partners to date, SKB plans the adjacent land parcel to the west, with anticipated January 2020 | Commencement of Construction to continue to invest its time and resources in this delivery beginning in fourth quarter 2018, along with a DEVELOPMENT SCOPE development for at least the next decade. hotel that is currently in the predevelopment stage. November 2021 | Completion and Lease-Up Catalytic mixed-use development consisting of 215 October 2022 | Stabilization multifamily units with 6,500 SF of neighborhood- SCHEDULE AND DELIVERY serving ground floor retail, housed in 2 six-story The development phase of the project was complete buildings wrapping a 2-level parking structure in March 2014 with final closeout from the City of providing 224 parking spaces. The project will include Beaverton in October 2014. As mentioned previously, top of market finishes and amenities, including a the project is currently 95% occupied. fitness/yoga facility, co-working and conference areas, food and beverage retail incorporated into the lobby, As discussed above, SKB has been involved with the common courtyard with fire pits and outdoor seating, development since 2012. The performing arts center a rooftop tenant lounge and deck with views, and
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DEVELOPMENT FINANCING from studios to 3-bedroom units, 6,500 SF of ground investors and capital partners, SKB was able to move SCHEDULE AND DELIVERY floor, neighborhood-serving retail wrapping a 224 stall quickly to secure a contract on the site in late 2018 $66 million total Project costs. Capitalization includes The Project is currently in the predevelopment phase structured garage. and immediately began work with its architect and approximately $28 million in equity and $38 million in undergoing design. Design and permitting is expected contractor to work through early project design and debt. The capitalization for the Project has been In addition to its advantageous location within Tigard, to continue through the summer and into the fall of feasibility. structured to comply with Federal Opportunity Zone near abundant local retail amenities, the Project will 2019. Permits are expected late 2019 to early 2020, regulations so that Project equity may take full ultimately be transit served, being located within Immediately thereafter, SKB began outreach within depending on City processing times, with construction advantage of Opportunity Zone tax benefits. The 2 blocks of TriMet’s newest light rail line along the the Tigard community, meeting with City officials and to commence in early 2020. Project also has been approved for Oregon Vertical southwest corridor, providing access from Downtown community leaders to discuss how the Project would Project completion is estimated in late 2021, with Housing Tax Credits and the City of Tigard has Portland through Tigard and to Bridgeport Village to help to stimulate revitalization in the area. Through lease-up taking approximately 12-14 months thereafter. approved an additional $1 million to subsidize City fees. the south. This line has already received approvals and these collaborative discussions, SKB was able to hone design and predevelopment is now underway. the Project programming and design to further align Being well-located, transit-oriented real estate, SKB PROJECT OUTCOMES its vision with the goals, priorities and objectives of intends to own the Project for the long term. This will SKB identified the development opportunity through The Project is located within Tigard, Oregon, a first-ring the City and the Tigard Triangle Urban Renewal Plan. also allow its investors and capital partner to take full its strong personal and professional relationship suburban market located just outside the Portland city Most recently, the City – through the Towncenter advantage of Opportunity Zone tax benefits. with a local family-owned brokerage firm who was limits. It is intended to be the catalyst project to spur Development Agency (the agency responsible for listing the land. Understanding the City of Tigard’s development with the City of Tigard’s newly formed administering the Urban Renewal Plan) – has approved strong desire to see new development within this Urban Renewal Area (“URA”), specifically along the of making a $1MM public subsidy in the Project. area, and understanding that the location was also 72nd Avenue corridor. The Project will be the first within a newly-designated Opportunity Zone which Pursuant to a Development Agreement, approved urban-design mixed use project within the City and would provide advantageous tax benefits to its by the Towncenter Development Agency, SKB will the URA, providing a good cross-section of unit types, continue to work closely with the City in finalizing plans and delivering the Project. As part of this process, SKB has also agreed to continue to engage with the community to provide unique and creative ways to further the City’s goals of equity and diversity, the first of which is to involve Portland Youth Builders in the Project. SKB is currently working with PYB and its general contractor to design a program to provide meaningful experience and exposure to PYB’s students.
Both the City and SKB are eager to continue to collaborate and bring the Project to fruition.
Project Site—5 minute walk from transit stop 48 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 49 3
Completed in 2008, at a cost of roughly $330 million, Phase 1 features 330,000 SF of Class A office space, 175,000 SF of ground-level retail space, two parking garages featuring 1,414 and 236 stalls, respectively, surface parking lots totaling 470 stalls, along with 4.9 acres of entitled, adjacent land.
In the summer of 2008, after the original developer broke ground on a new building for Nordstrom (the first in Phase 2), the Goldwater Institute (a nonprofit public “watchdog”) sued the City of Phoenix over the constitutionality of the development agreement and subsequently was turned away by the State Supreme Court. The lawsuit delayed the ability of the developer to obtain construction financing, which prompted DEVELOPMENT FINANCING Nordstrom to terminate its lease. By the time the State Approximately $102 million, including land costs; total had ruled on the lawsuit, the recession was in full development costs were funded by a combination of force, and the project collapsed. debt and equity. In April 2010, amidst the retail tenant exodus, Capmark (representing the two lending groups who lent PROJECT OUTCOMES approximately $260 million to construct High Street) High Street is a truly authentic mix of residential, took possession of High Street by way of foreclosure. HIGH STREET retail and office development in the affluent Northern Capmark spent the next 2 years trying to unwind Phoenix/ Northern Scottsdale submarket. Formerly various legal and title issues. By late 2012, Capmark Phoenix, AZ known as City North, the project was originally the elected to take the property out for sale, at which first phase of a large-scale, multi-phased, high-density, point SKB acquired and took control of the project, mixed-use lifestyle development. The project failed purchasing it in 2013 for $67 million. DEVELOPMENT TEAM MILESTONE DATES during the great recession when anchor retailers, such SKB and Tryba Architects April 15, 2013 | Property Acquisition as Nordstrom, pulled out of the project. After years Since 2013, SKB and its partners have invested $35 July 1, 2013 | Start of Construction in receivership, SKB and its partners acquired the million to re-tenant the project into a mixed-use DEVELOPMENT SCOPE 4/1/14 – 10/1/14 | Garage Construction asset and were able to develop and capitalize on the office and entertainment district, more than doubling office occupancy from 41% to 91%, doubling retail 25-acre land area with nine-, three- and four-story 7/1/13 – 5/1/15 | Re-Branding favorable location and uniqueness of its mixed-use office and multifamily buildings accompanied by July 1, 2017 | Landscaping and Signage Completion appeal. ground floor retail and two parking garages; 630,000 Situated on 24.91 acres and ground-leased from the SF of Class A office, luxury multifamily residences, State of Arizona, the High Street project is located in restaurants, retail and community spaces; 99 condo- one of Arizona’s largest master-planned communities, quality residential units totaling 120,000 SF; 176,000 Desert Ridge. The community encompasses 5,700 SF of upscale retail dining and entertainment options acres of land either owned by the State of Arizona, and over 334,000 SF of Class A office space. ground leased to others by the State of Arizona, or in the case of residential land, previously sold by the State and now owned by homeowners or the respective developer.
High Street was originally intended to be Phase 1 of a 2.2 million SF mixed-use development project.
50 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 51 CASE STUDIES 4 occupancy from 36% to 72%, and maintaining the office development. Both uses will enter into a parking occupancy of the 99 apartment units at an average of management agreement with the greater High Street 95%. Concurrently, SKB coordinated and negotiated development. the provisions and expansion of the intricate 99-year ground lease with the State of Arizona, and heavily SCHEDULE AND DELIVERY negotiated approvals and additional development rights with the original developer of the property, who As of project completion in July 2017, the project is maintained limited blanket approval rights over the 93% occupied for office space, 75% occupied for retail aesthetics and improvement thereon. space and 98% occupied for residential units. SKB expects to continue its successful involvement in the SKB’s involvement in the property has resulted in development of the property well into the next decade. positive gross absorption of over 270,000 SF across both the office and retail components of the project, including the addition of the 71,000 SF corporate headquarters for Sprouts Farmers Market. In 2017, SKB recapitalized the property for $131 million, and has recently entered into negotiations for the development of a hotel, as well as multi-family and retail on the 4.9 acre vacant development parcel. SKB is currently in agreement to sell 2 acres to a hotel developer to build a 140 room Marriott Residence Inn. The intent for the remaining 2.9 acres is to build a 140,000 SF IRON FIREMAN Portland, OR
DEVELOPMENT TEAM MILESTONE DATES Lead Developer: SKB January 13, 2016 | South Building and Lot Acquisition General Contractor: Lorentz Bruun March 18, 2016 | North Building Acquisition
REDEVELOPMENT SCOPE February 10, 2016 | Start of Construction 147,000 SF project consisting of a two individual DEVELOPMENT FINANCING buildings, the South Building (112,000 SF) and the North Building (35,000 SF). SKB acquired the South Approximately $27.3 million, including land costs; total Building and its adjacent land parcel, and then the development costs were funded by a combination of North Building through two separate transactions with debt and equity. the intent to combine the adjacent properties and parking into a single, multi-tenant, urban industrial project.
City North A2 | A14 Option 1 52 | | Englewood CityCenter Redevelopment | Master Developer Proposal Conceptual Design Package Ground Floor Site Plan | 53 PHOENIX, AZ | #314097 | OCTOBER 28, 2014 SCALE: 1” = 120’-0” 0’ 60’ 120’ © Nelsen Partners, Inc. 2014 2 CASE STUDIES
PROJECT OUTCOMES more traditional smaller industrial users seeking creative space. Signed leases have ranged from artisan The Iron Fireman Building is a 1920s era, industrial manufacturers (Brooklyn Tweed, sustainably sourced warehouse in the Close-In Eastside submarket of yarn) and Breweries (Ruse Brewing and High Five Portland, Oregon, one of the last remaining industrial Cider) to manufacturers involved in sports apparel pockets for redevelopment in Portland. The Property and industrial technology manufacturing (robotics, was exclusively occupied for 80 years by PECO retail fixtures). The combination of word-of-mouth and Manufacturing. At purchase, the property was vacant existing tenant synergies has further increased activity and consisted of a 112,000 square foot warehouse/ at the property. office building and an adjacent 61,000 SF parcel, improved with a 3,000 SF metal building and partially- The property has historically been a single-tenant paved parking lot. manufacturing and warehouse facility that, prior to SKB’s involvement, had minimal capital invested into With its close proximity to light rail, as well as quality maintaining and updating its structure and systems. creative space and walkable amenities, including SKB has successfully transformed the utilitarian restaurants, bars, and shopping, the property is property into a modern, multi-tenant space for light reminiscent of the Old Portland industrial era and industrial/manufacturing and creative tech businesses features exposed brick, old-growth timber beams, and with over $11 million equity invested thus far. large exterior windows that provide an abundance of natural light throughout. The property also substantially SKB has maintained the property’s historic architectural benefits from its proximity to the MAX Orange line features and created flexible, functional spaces of light rail, with stops located approximately 500 feet various sizes, with demising walls to make the property from its entrance and the track running adjacent to the appealing to the maximum number of prospective have been priced out of the Central Eastside Industrial property. tenants. This has allowed SKB to target the surging, District, as properties in that submarket transition to unmet demand for 2,000-20,000 SF industrial and Leasing is driven by the thriving and close-knit light office and residential uses. manufacturing suites, providing modern space with manufacturing community in Portland, as well as historical character at affordable rates to tenants that SCHEDULE AND DELIVERY The first new tenants took occupancy in the property in early 2018. Since that time demand for tenant space has been continuous, with leases for a majority of the property currently in various states of negotiation, planning, or build-out. Leasing velocity and occupancy has increased almost every month since substantial completion, and SKB expects to continue its successful involvement in the development of this property well into the next decade.
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In 2015, SKB sourced this off-market opportunity through its deep relationships within San Francisco’s brokerage community. As a result, the $250 PSF purchase price represented a substantial discount
to the replacement cost estimated at approximately $400 PSF and of other comparative buildings in Portland’s CBD, which had traded in the $280-$320 PSF range. The opportunity came at a time when vacancies in Portland’s CBD had dropped dramatically (hitting their lowest level in more than 10 years). SKB was instantly interested, specifically because of the building’s iconic status in Portland and due to the fact that in Portland CBD Class A availability had fallen markedly, as tenancy continued to grow with almost no new supply delivered. In addition, KOIN Tower’s tenant profile offered diversification through a rent roll featuring a variety of tenants with a balance of small, mid, and large-sized users. Collectively, the property’s tenant base at the time of the offering represented a variety of industry sectors, including insurance, finance, law, marketing and consulting, a diversity SKB felt DEVELOPMENT FINANCING would shield investors from sector-specific economic KOIN TOWER Approximately $98 million, including land costs; total shocks. SKB’s home marketplace knowledge and Portland, OR development costs were funded by a combination of due diligence underscored the KOIN Tower purchase debt and equity. as a rare opportunity to acquire what was once arguably Portland’s most desirable CBD asset, manage DEVELOPMENT TEAM MILESTONE DATES PROJECT OUTCOMES managing the property more efficiently than the prior ownership, as the property had been operating with Lead Developer: SKB January 23, 2015 | Acquisition Constructed in 1984 to the highest institutional-quality expenses well above market standards, and return it to General Contractor: Lorentz Bruun standards, KOIN Tower is an iconic, centrally-located, April 27, 2018 | Disposition Class “A” office tower totaling 352,234 square feet its former prominence. (“SF”) of office and retail space spread over 19 floors. DEVELOPMENT SCOPE Start of Construction | February 2016 SKB and its partners re-branded the property "KOIN Widely regarded for its architecturally distinct design, Class A 352,234 square feet (SF) office tower with Re-Branding | from April 2015 – September 2015 highlighted by a brick and limestone façade with office and retail space spread over 19 floors. It is part Lobby Upgrade Completion | November 2016 gradual step-backs and a galvanized steel crown of a larger, 34-story mixed-use project, which also and spire top, the property is a vital anchor of the includes separately owned, high-end residential Portland skyline and is one of the most recognizable condominiums (floors 20-31) and the local, CBS- landmarks in the Pacific Northwest. As well, KOIN affiliate TV studio. Tower is ideally located at the southern end of the CBD, offering tenants immediate access out of Portland via Interstates 5 and 405. It stands just two blocks from a MAX Green Line Light Rail Station, providing tenants quick access in and out of town and the ability to connect at Pioneer Square with other rail lines that serve the surrounding metro area.
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Tower," and completed a $4.8 million sweeping assist SKB in managing the garage. Doing so saved renovation to the lobby, including a breathtaking roughly $60,000 per year in parking garage operating 2-story media wall, and fitness center and bike parking costs and increased parking revenue. amenity upgrades, common area refurbishments and a state-of-the-art energy management system, SCHEDULE AND DELIVERY aimed at driving rental rates to ranges in-line with SKB repositioned the property back to a best-in-class other top-tier, institutional quality assets in Portland’s Class A commercial office property, rolled existing CBD. SKB executed an aggressive leasing plan that tenants to market rental rates at lease renewal marketed the property to the brokerage community, which were approximately $8.00 PSF higher than as well as, increased the marketability of vacant suites the property’s average in-place rent at acquisition, by upgrading individual floor common areas and increased occupancy from 83.7% at acquisition to bathrooms, and producing white-shell vacant suites 92%, and realized the property's potential after a hold that presented a clean, attractive, and marketable open period of 3 years. floor plan to prospective tenants touring the Property. SKB moved quickly to maximize the efficiency of the parking garage, by retaining a parking consultant to
High Street, Phoenix, AZ 58 | | Englewood CityCenter Redevelopment | Master Developer Proposal | 59 222 SW Columbia St. #700 Portland, OR 97201 503-220-2600