Decade in review: Construction boom shows no sign of bust
During the Great Recession, construction in the Portland area appeared to dry up seemingly overnight.
However, once the economy rebounded, the industry bounced back with a vengeance, with activity holding steady for the better part of the past decade.
From 2013 to 2014, the Portland metro area's population grew by 35,000 people, reaching 2.35 million, with about 50% of those new residents coming from outside Oregon, and then continued to rise, according to U.S. Census data. That increase combined with a shortage of apartments sent rents climbing. Developers responded with a flurry of multifamily activity, focused mainly in Portland.
Following closely behind was a swell of hotel activity and tower construction that brought high-rise mixes of retail and office. While most of those projects initially were focused in the city's central downtown business district, the latter part of the decade saw activity on the eastside, including the Central Eastside Industrial area.
After decades of discussion and little action to build a hotel with enough rooms to support event growth at the Oregon Convention Center, the project finally moved forward with Mortenson in dual roles as developer and general contractor. The company officially handed the keys of the building over to operator Hyatt in December. Meanwhile, developers like Brad Malsin and his company Beam Development breathed new life into tired, old eastside industrial warehouse buildings, attracting a fresh injection of creative companies to the area.
A bridge to the past
By the time the most recent decade ended, Malsin and Beam were well established as key players in Portland's development scene. It was a different story around 2005 when Malsin had approached the city of Portland with a unique plan to develop the east side of the Burnside Bridge. At the time, Malsin and Beam were relative newcomers in town, and the city decided to go with a larger developer. Then the recession hit and plans for the Burnside Bridgehead stalled.
During the last decade, though, the robust economy and healthy construction scene sparked renewed interest in the bridgehead project. The Skylab Architecture and Key Development 21-story joint-effort called Yard, a unique tower-and-podium design that drew controversy over its appearance, rose in the area. Malsin and Beam returned, joining with Urban Development + Partners and Works Progress Architecture, to construct the 10-story, mixed-use Slate. As the decade neared its end, the bridgehead also became home to Guerrilla Development's colorful Fair-Haired Dumbbell and another Skylab-Key Development project, the 20,000-square-foot Sideyard.
Mass timber for all
Cross-laminated timber (CLT) made its appearance in force in Portland and Oregon during the middle of the decade. Both Oregon State University and state agencies saw the material as a way to build up the state's timber industry while helping rural communities hit hard by the closure of lumber mills. Forward-thinking developers and architects saw CLT and similar mass-timber products as a new way to create sustainable, attractive buildings.
A family-owned mill in Riddle, Oregon, became the first in the country to be recognized as a certified manufacturer of CLT panels. Following close behind was Freres Lumber in Lyons, Oregon, with its mass plywood panels. The decade rounded out with the opening of the Advanced Wood Products Lab, a joint effort between OSU and the University of Oregon.
In 2016, Thomas Robinson and his Portland-based firm, Lever Architecture, unveiled a speculative office building called Albina Yard that earned recognition as the first building in the country made from domestically fabricated CLT. Projects by developers like Ben Kaiser's Kaiser Group + Path Architecture and Malsin's Beam Development also have fed the pipeline of mass timber projects, from creative office space to aging-in-place communities, that are carrying Portland into the next decade.
The price of progress
Older historic buildings in need of some attention received it during the latter part of the decade as developers turned long-neglected structures into boutique hotels and office spaces designed to woo creative companies.
The side-by-side 1908 building that once housed the Cornelius Hotel and the Woodlark Building, which started as one of the city's first drugstores and a full-service pharmacy, found new life together as the Woodlark Hotel, designed to speak to young travelers looking to explore the city. On the eastside, an old glass manufacturing facility received a make-over. Now called The Glass Lab, the building owners describe it as "a community-oriented hub for a new generation of creators."
But for some of the city's more notable older buildings, the decade's development came at a cost, according to historic preservationists. Developers often determined it was more affordable to build new than to invest in the costly seismic upgrades necessary to repurpose iconic and landmark buildings such as the Ancient Order of United Workmen's Temple at Southwest Second Avenue and Taylor Street.
Bonding for education
Buoyed by a healthy economy, voters stepped up to support school construction bonds floated by almost every school district in the Portland metro area.
Sherwood School District, for example, is using a large chunk of a bond approved by voters in November 2016 to build a new 2,000-student-capacity high school that will be the largest, square-footage wise, in the state. Meanwhile, Portland Public Schools passed two bonds — a $480 million one in 2012 and the second one for $790 million in 2017 — to build new schools and modernize existing ones, including the newly reopened Grant High School.
Voters also stepped forward to support construction bonds to build new facilities for police and emergency services in communities that included Beaverton and Oregon City.
However, there was one part of the construction industry that didn't rebound with the economy.
At the depth of the Great Recession, 43% of the state's construction workers were unemployed. Many found work in other industries. As a result, when the building boom hit, construction companies found themselves scrambling to fill positions. Efforts to recruit and retain more women and minorities to the trades helped fill some of those gaps. Portland-area construction companies also got creative, tapping lean construction models and getting subcontractors involved in projects at the design and planning stages to ensure their buy-in down the road.
The state's shortage of skilled workers is expected to get "worse before it gets better" during the next decade, according to a 2019 survey of local building industry companies released by Schwabe, Williamson and Wyatt. A study conducted by Metro regional government in 2018 found that there will be a need to fill 15,000 new construction jobs during the next decade, even as 20% of Oregon's workforce reaches retirement age. To solve that problem, Metro has committed itself to develop new strategies through its Construction Careers Pathway project. The agency is working with trade groups, non-profit organizations and training programs, private employers and other public agencies to help women and people of color move into careers in the construction trades.
Construction companies in the Portland metro area say they've seen work slow down slightly during the past year and expect another small dip in 2020. Overall, companies are mostly upbeat as they head into a new decade — at least for another year or two.
While hotel activity has slowed, there are projects still underway, including BPM Real Estate Group's 35-story, five-star Ritz-Carlton hotel project that broke ground in 2019 on the site of the former Alder Street Food Cart pod. Meanwhile, the flurry of multifamily projects that flooded Portland with units has slowed to a trickle since the city put in place inclusionary housing requirements that call for projects with 20 or more units to set aside a portion for affordable housing. Developers, however, aren't giving up on multifamily housing and have instead shifted their efforts to suburban areas such as Beaverton and Hillsboro.
The state's role as a leader in the world of mass timber, which took a giant step forward in 2019 with the opening of the A.A. "Red" Emmerson Advanced Wood Products Laboratory on the OSU campus in Corvallis as the decade ended, is expected to continue into the next decade. Tennessee-based Sauter Timber has announced plans to open a CLT prefabrication plant in Estacada in 2020, while OSU will prepare for the completion of Peavy Hall, which will be a showcase of mass-timber and technology.
School construction is expected to continue to keep some contractors and their crews busy for the next couple of years. Portland Public Schools, for example, plans to start construction on a remodel for Lincoln High School in early 2020, while also looking at approaching voters for yet another construction bond in the next year or two.
And a statewide $5.3 billion, 10-year transportation bill has started to spin out projects that are expected to continue through most the next decade. Among the efforts is a pilot program to examine the feasibility of applying congestion pricing to major roads in the Portland metro area. In addition, the debate over at least one of the projects included in the bill, a plan to add capacity to Interstate 5 through the Rose Quarter, promises a lively start to the next decade.
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