- Burnside 26 web page
- And the gentrification just keeps on coming.
The oh-so-very-Portland apartments that everybody loves to hate—Burnside 26—sold earlier this month.
Now, everybody take a seat before you read this next part. Really. Sit down. You’re sitting? The closing price: a whopping $41.5 million, as first reported by the Portland Business Journal. The seller secured a $15.4 million construction loan to build Burnside 26, which opened in 2014. That’s a $26.1 million difference, if we’re doing the math.
Let’s do some more math, while we’re at it. Remember that one Willamette Week contributor who wrote not one, but two, loathsome op-ed pieces about why his tiny, overpriced apartment was so great? Yeah, well, on a per-unit basis, that means his one-bedroom, 592-square-foot box sold for $307,407.
By comparison, he wrote that he and his wife paid $1,400 per month. If you could secure a home loan, and you had a $30K down payment, you’d pay $1,900 per month on a mortgage at that price with a 4.176 percent interest rate, according to Zillow.
Burnside 26 came under fire when it owners released an ad featuring “Luke and Jess,” a fictitious couple who flitted around their airy building, washing their bikes, using their stainless steel appliances, and enjoying time with their friends on the building’s rooftop lounge.
The 135-units at Burnside 26 are a mix of studios, one- and two-bedroom units that lease at prices starting around $1,300 per month. When the Luke and Jess ad came out, the property came under a firestorm of ire on social media by people who see developments like this as an example of everything that’s going wrong with Portland, which has been called the “most gentrified city” in the US.
26.1 million? Gives new meaning to the name “Burnside 26”, eh?
Did the construction loan include the purchase of the land? If not, that explains a lot of the $26M difference.
And doesn’t the building also have ground-floor retail shops, in addition to the 135 units?
I normally see price-per-unit for buildings this size under $100k each (see the listings below). These are nicer than most of what’s available, and in a nicer location. But unless there’s a LOT of retain income from those tenants, $307k per unit is super high.
http://www.josephbernard.net/properties.ph…
Well, hey, here’s a building with 8 units on NW 23rd for $275,000 per unit. Maybe $307,000 per unit isn’t that unusual, even though it still seems wild to me.
http://www.josephbernard.net/raleigh-stree…
By the time this plays out, Burnside 26 is going to be the most hated building in Portland, which is good news for the Portland Building, which has its own set of issues, but at least it’s not gentrifying anything. Apparently. Well, not directly, anyway.
The Portland Building already did its gentrifying back in the day. It is time for another loathsome building to take over its place. Burnside 26 is to Portlandia what the Portland Building is to Old Portland. (see what I did there?!)
There are no ground floor retail shops in that building. There are ground floor units with unusable tiny patios in front of the sidewalk though.
Seriously? Who writes this stuff and how many people does it make it past before it gets published?
1 – That $15.1 million does not represent the entire cost of construction. The developers and investors of projects like this have to kick in a significant amount of equity on top of that….i.e., no banks loan 100% of construction costs on something like this. Not to mention the ongoing overhead costs of the developers’ staffs, office expenses, etc. which gets allocated to each project.
2 – The developers also most likely purchased the land outside of the construction loan, whether with 100% equity or not, which also increases the total $ amount invested in the project
So, no, it was not a $26 mm windfall profit. I would like to see some more intelligent reporting on topics like this, rather than using sensational headlines and false figures to further the popular refrain of “Portland is ruined” every time an apartment building is built or sold in this town……at a time when we desperately need more rental housing supply nonetheless!
Ugh, I can’t believe the Merc is making me potentially defend the developers. Did the construction loan include the purchase of the land? Did the developer have to put money down? How much was it? All these questions…If only there were a reporter or journalist to answer them. Perhaps Reymont is looking for some extra work.
Were Taxpayers on the line for the loan ??
If not, who gives a shit anyway.
Are you gonna bitch about a house selling in the West Hills for 2.1 million?
Did I somehow miss the part about taxpayers funding this?
I hate seeing rampant development and inflated rents within inner Portland. I really do. However, I can’t help but feel annoyed by the numerous chances white, liberal Portlanders have had to curb gentrification (or whatever you call it) over the last couple decades. Do people really think this trend started after the recession? Our African American population along with other marginalized groups have struggled to pay rent in neighborhoods like Albina since the 1990s. In the name of urban renewal, we’ve pushed around our most vulnerable populations for decades — from the Vanport flood to Emanuel Hospital’s expansion in 1973. Now that the middle class can’t pay the rent in neighborhoods west of 82nd, they’re finally making a stink. You’re welcome to come move to my neighborhood in East Portland, just don’t gentrify it.
Guspaso:
There is at least one retail/commercial unit. A place called “Americano” is going in there according to the liquor license notification.