Will Portland's Condo Market Make a Comeback?
A counterintuitive fact: Since 2009, few significant condo buildings have gone up here. Despite what everyone calls them, most of those gleaming towers and block-length residential buildings changing Portland’s skyline (and throwing dry tinder on online comment sections) aren’t condominiums. They’re apartments or hotels or office buildings. People often use the words interchangeably, but apartments are for rent, and condos are for sale.
Enter the TwentyTwenty in Sullivan’s Gulch, one of two new major condo buildings breaking ground in Portland. Located near booming Lloyd District, the seven-floor, 162-unit, Z-shaped building is steps away from about 20,000 area jobs. (The other new condo, the Vista in the north Pearl, is slated to finish this fall.) PHK, TwentyTwenty’s local developer, hopes condo ownership will make a comeback among childless young professionals looking to build equity, as well as for retirees looking to abandon their yards.
“That’s really one of the markets that we think is very underserved right now,” PHK’s president, Patrick Kessi, says of the young professionals.
Condos used to be hot. A graph of condo development in Portland resembles a shark fin. During the building frenzy leading up to Great Recession, local developers added 4,651 units between 2005 and 2008. And since then, including these new buildings in the works? Only 794 units.
“Developers did other forms of development, or retired,” says Kessi. “Coming out of that recession, we had a big influx of apartment developers. There are two developers really left doing condominiums.”
Designed by Hacker Architects, TwentyTwenty will have one-bedroom units starting in the mid-$300,000 range, while two-bedrooms will go for the mid-$600,000s. Kessi notes condos demand longer-lasting materials and building techniques—they cost more to build than apartments, basically. Insurance and litigation risks add to the tab.
“I think there will be a spike in demand, but it’ll be more measured,” says Kessi, comparing the boom now to the prerecession surge. “Construction costs have gone up tremendously.”