Security Properties, Chinese Investors Snap Up PepsiCo Facility Site, Plan Eastside Urban Village
A JV between Security Properties Development Co. and Beijing Jade Investment Group acquired the PepsiCo Distribution Center on Portland's Eastside for an unspecified price recently. The investors are putting together plans for an urban village on the five acres.
The companies plan to redevelop the site under the City of Portland’s Large Site Master Plan designation, offering market-rate and affordable housing, office, retail and other property types over the next several years.
Security Properties, which will serve as master developer of the property, is interviewing architects to begin initial concepts for the multiphased project. Beijing Jade Investment Group will be the initial capital partner on the redevelopment.
The property is between NE 25th and NE 27th avenues, and NE Holladay Street and NE Sandy Boulevard. Since 1962, the PepsiCo facility has been at the location, among the car dealerships and auto shops that have historically characterized the Sandy Boulevard commercial corridor.
PepsiCo will lease back its office and industrial space from Security Properties as it identifies a new location for its offices and distribution facilities.
“We will create Portland’s next urban village through the newly adopted plan,” Security Properties Chief Development Officer John Marasco said. "Soon we’ll begin outreach to the Kerns Neighborhood Association and various other local stakeholders."
Late in August, Security Properties held a meeting with the Portland Bureau of Development Services to discuss zoning rules at the site.
The property constitutes a “superblock” encompassing over four city blocks that have generally been used for industrial or office space, while the surrounding sites are zoned for mixed-use development. The eventual redevelopment of the PepsiCo building follows a number of other smaller new construction and renovation projects along the Sandy corridor.
“The area is ripe for more density, particularly workforce and affordable housing, as well as new commercial space,” Security Properties Director of Development Gus Baum said.
The plan is the latest move for Seattle-based Security Properties, which has a lot going on in Portland. Recently the company brought the Peloton Apartments project in Portland’s North Williams District to market. The company is also developing the 218-unit Heartline apartments in the Pearl District, which will be completed in early 2018.
Together with Seattle-based Urban Renaissance Group, Security Properties acquired the Oregonian Press Blocks, where the partners have received design approval for a 340-unit residential tower and a 140K SF office building with ground-floor retail. The Press Blocks are slated to break ground in the first quarter.