NBS Financial Arranges $9M for Grocery-Anchored Shopping Center in Small Washington Town

NBS Financial Services Principal Mike Wood and Associate Finance Officer Andrew Patterson have arranged $9 million for Pioneer Village Shopping Center in Orting, a small town about 40 miles south of Seattle.

The 82,130 sf Pioneer Village Shopping Center was built in 2000. It is anchored by Safeway and is 92 percent occupied. The borrower was seeking a long-term, fully amortizing loan.

"This was a heavily shopped transaction, but NBS Financial was able to step up and deliver a very attractive rate and terms that beat the competition," Wood said.

With a population under 7,000, Orting is considered a tertiary market, which was initially a concern for some lenders, who prefer larger primary markets. Anchor tenant Safeway doesn't report sales, and its lease is up for renewal in less than ten years, which was also a concern since the borrower sought a longer term loan.

But NBS Financial was able to overcome these challenges with a relatively conservative loan-to-value and a rate in the low 4 percent range on a 20-year loan term with a 20-year amortization.

Portland Commercial Real Estate Market Saw Improvement in Third Quarter

Some good news was present in Third Quarter reports detailing Portland's office, retail, industrial and multifamily markets. The reports are available here.

Office vacancy fell in the Central Business District, suburbs and Vancouver. TriMet’s more than 50,000 sf lease at downtown’s Harrison Square was the largest office lease of the quarter, and the $38.7 million sale of Parkside Center, also in downtown, was the largest sale.

The industrial market improved from a slow first half, with vacancy falling to 13.58%, and 161,422 sf of positive absorption. North/Northeast, the largest industrial submarket, saw significant improvement, including a number of leases over 50,000 sf.

Retail vacancy was fairly flat at 6.82%, with slight positive absorption. Leasing activity picked up in 122nd/Gresham, as ReStore and the Hannah Agency leased a total of nearly 35,000 sf there. Downtown has also seen smaller leases for a number of new restaurants from well-known Portland chefs and restaurateurs.

Portland’s apartment market remains very strong, with vacancy remaining at 2.60, its seventh consecutive quarter under 3%. We are tracking more than 6,000 units either proposed or under construction in the metro area, and though we have seen a few of these projects come online, 2013 and 2014 will see many more deliveries.