Assignment
Principal Financial Group occupied 2 separate office locations in the Portland are in 2007. Each of these locations had a lease expiring in 2008, and it was the company's goal to consolidate these operations.
Objective
Identify 10,000 to 15,000 square feet of Class A office space near downtown Portland and find a location that could make two separate business units happy.
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Challenges
The budget that Principal had set aside for this transaction was roughly $23.00/SF. This budget limited options they could consider since the vacancy level was declining and rents were escalating. One of the business groups preferred to stay downtown or as close to downtown as possible, while the other group wanted to move outside of downtown into a free parking area.
Results
We were able to educate both business units about the Portland market separately and were able to determine that both could mutually work with a location along Kruse Way. Unfortunately, Kruse Way had the highest rental rates of the areas that we were considering. After adivisng the home office of the budget that was required to lease space at Kruse Way, we were able to gain approval to move forward with a transaction on Kruse Way. In the end, Principal moved to 14,000 square feet at Kruse Woods IV and was able to have their space built-out to suit their needs by the landlord at its sole cost and expense.
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