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PORTLAND-For $1.82 million, local investor David Gold has purchased the historic Smith Block Building at 111-117 S.W. Front Ave. The four-story structure was constructed in 1872 by Joseph and William Smith as a warehouse and later converted to 21,389-sf of office space. The building reportedly underwent $1.6 million worth of a $2 million restoration and seismic upgrade in 1986 before being repossessed by a bank.

The current sellers, Bill and Carol Atherton, purchased the building from the bank in 1990 for $500,000. It is currently home to the Oregon Maritime Center & Museum, as well as other nonprofits and attorneys’ offices.

Michael Kapnick of Marcus & Millichap represented the Athertons early on in the deal. Gold was represented by Cushman & Wakefield’s Bill Burton, who says he officially closed both sides of the transaction after paying Kapnick his commission early.

Current rents in the building are below market rates, Kapnick tells GlobeSt. The attorney offices are paying in the $12 per sf range, while the nonprofits are paying between $5 per sf and $7 per sf. Most of the rents are coming up for renegotiation in the next 18 months, and will most likely be increased by Gold to raise his capitalization rate, says Kapnick.

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