Lennar's LMC opens Portland office to support local projects
When LMC, a Lennar Company, opened its Pacific Northwest office in 2012, the multifamily developer and operator decided on a Seattle location.
However, the company has always had plans to open a Portland office, according to Scott Rasmussen. A veteran of the multifamily industry, Rasmussen joined LMC last year as a senior project development manager. He arrived in Portland in August to open the local office and oversee the two projects the company already had underway in the city.
The Denizen, a 212-apartment development at Northeast 20th and Hoyt near Portland's Laurelhurst neighborhood, broke ground in 2018. The second project, the Amara, is a 138-unit building on a site on West Burnside, in the Pearl District, that used to house a Firestone auto service outlet.
Lennar Multifamily Builders is serving as general contractor on the projects, both of which will offer mixes of studios and one- and two-bedroom units as well as subterranean parking. However, the company shopped locally when it came to architectural services.
The Denizen, a six-story building, was designed by SERA Architects. The project was vested before the city's inclusionary housing rules went into effect, so all of the units will be market rate. The company funded the project internally. The first tenants are expected to move in later this year.
Ankrom Moisan Architects designed the seven-story Amara. In keeping with inclusionary housing rule, a portion of the units will be set aside for people making 60% or less of the family median income for the area. The site is in an Opportunity Zone; however, the company decided against using an Opportunity Fund to help pay for the project, Rasmussen said.
The two Portland projects are part of more than 26,300 units that LMC has under development or in operation across the country. The company's portfolio, valued at more than $9.6 billion, includes high-rise, mid-rise and garden apartment complexes.
The Pacific Northwest appealed to the company for several reasons. Both Portland and Seattle offer a high quality of life and boast populations with solid educational bases. Portland offered another attractive factor. Although Rose City rents have climbed over the past couple of years, they're still lower than other major West Coast cities.
While LMC could have continued to develop in Portland while based out of Seattle, the company employs a three-part strategy: build top assets in prime locations that can be compiled into an impressive portfolio and then hold onto those properties for the long term. Accomplishing the latter goal requires establishing a local presence where those properties are located, according to Rasmussen.
"If you want to be a long-term participant in the local market, you really need boots on the ground," he said.
While the two projects currently under construction are keeping Rasmussen busy, he's also keeping an eye out for new ventures in the multifamily arena.
"We actively looking for new opportunities," he said.
Those opportunities could include LMC's new workforce housing platform, which focuses on multifamily projects geared for transit-heavy areas outside main urban areas.
"The (platform) goal is to develop properties for middle-class income. A lot of new developments are targeting Class A. Our goal is to develop something attainable for the middle market," Rasmussen said. "There's a big need for that (outside Portland's urban core)."
While LMC is bullish on Portland, the company is taking a careful approach, with no specific future projects on the boards right now. Construction costs continue to climb in the Portland metro area, which can make it difficult to make projects pencil out. Land availability is a lesser concern, Rasmussen said, but it's still something that the company needs to consider.
"(Any future projects) would need to be evaluated on a case-by-case basis in terms of our appetite for new opportunities in Portland," Rasmussen said. "We really like the market, and our goal is to be here long-term. But we'll look at it on a deal-by-deal basis."
In November, Portland's Operating Engineers Local 701 parked the"Rat Tracker" at West Burnside and Park Avenue, near the site where the Amara apartments are rising.
The presence of the giant inflatable rat on the back of a truck was a protest of the use of nonunion subcontractors on the project, which is being developed and built by LMC, a Lennar Company.
Some people mistakenly assumed a banner on the truck emblazoned with the words "Shame on LMC" referred to another local company, general contractor LMC Construction, which commonly goes by "LMC."
A representative from the union, who said the company name on the banner eventually was changed to Lennar to avoid confusion, told the Business Tribune he had heard the construction company was involved in a trademark dispute with the Lennar subsidiary.
However, Scott Rasmussen, general manager of LMC, a Lennar Company's Portland office, told the Business Tribune in December that he was unaware of any such dispute.
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