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PORTLAND, OR-The Northwest Portland Area Indian Health Board has inked a seven-year lease for approximately 16,792 square feet in 2121 SW Broadway, according to the tenant’s brokerage firm, Grubb & Ellis. The lease commences in December. The tenant will occupy the entire top floor.

The three-story, 53,646-square-foot class B office building is located at the southern end of Downtown Portland. The building is owned by Joe Weston’s Weston Investment Co., which was represented in the transaction by Steve Root of American Property Management, which Weston also owns. Jake Lancaster of Grubb & Ellis represented the Indian Health Board.

The deal value for the full-service lease is approximately $2 million, local sources familiar with the transaction tell GlobeSt.com, which would make the average rate over the life of the lease approximately $17 per square foot. Lancaster declined comment on the lease details out of respect for his client, and neither Weston nor Root was not immediately available Friday for comment.

While the rate seems low relative to the $22.45 average full service asking rate for class B properties in the first quarter local brokers tell GlobeSt.com that it is indeed a market deal. Building owners have been keeping asking rates artificially high while handing out concessions such as free rent that effectively lower the rate by 20%, they say.

“The average asking rates are not reflecting what’s going on,” one local broker tells GlobeSt.com. “There are several class A buildings that have spaces available that you could get for [the average class B asking rate].”

The Indian Health Board is currently located in a slightly larger space at 527 SW Hall, a building owned by PSU, and will have a short lease overhang. The health Board has occupied the space since 1987.

Lancaster says the space was previously used to house professors and is built out in a very dense fashion, while the space at 2121 SW Broadway has a more open floor plan and newer tenant improvements. Joe Finkbonner, the Health Board’s executive director, says the new space will give the agency room to continue to grow and will have more open space flexibility for teamwork facilitation, as well as provide updated training facilities for its Tribal members while still being close to project partners OHSU and PSU.

The Downtown Portland office market totals 19 million square feet, with the class B office market comprising about 25% of the market. Class B vacancy is currently about 11%, according to Grubb & Ellis.

The Northwest Portland Area Health Board, under the direction of 43 American Indian Tribes in the states of Oregon, Washington and Idaho, oversees a variety of health-related programs. In efforts to promote health and prevent disease, the organization administers projects relative to cancer, tobacco use and women’s health. Its Tribal Epidemiology Center administers projects in diabetes, dental center support, immunizations, toddler obesity, STDs/HIV/AIDS, substance abuse and data registry. The NPAIHB also facilitates Tribal consultation on issues affecting Indian Health programs and gives close attention to legislation at the state, tribal and federal levels.

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