HARSCH Investments’ Produce Row Development Leases Up

(House Spirits/Steve Smith Tea)

HARSCH Investment is more known for its core office and suburban retail and industrial properties that totals over 20 million square feet in 6 different states. But that may be changing. With a 60 year history and the ability to understand a wide range of product types and markets, HARSCH has been closely watching the growing rejuvenation and entrepreneurial energy taking root in core markets in Portland and elsewhere. “We have been closely watching how older somewhat dilapidated central city neighborhoods are attracting higher and more creative uses. The Central Eastside with its location, older but interesting building stock and influx of growing and entrepreneurial companies has been on our radar for some time” says HARSCH VP Steve Roselli. They took the leap in early 2013 with the purchase of almost three city blocks in the Produce Row Area that was owned by Dealers Supply Company who had outgrown the properties and neighborhood and moved to Northwest Portland into a slick new 160,000 sf facility. With two older buildings primed for redevelopment coupled with a vacant large lot to provide the much desired parking or future development, this basket of sites provided the heft, potential and location that HARSCH could not pass up.

Harsch went through several several development renditions. First thoughts were towards a larger investment to go to higher paying creative office but that was a bit riskier and then interest in the site dictated their direction to a more higher end craft industrial development where costs of renovation are lower and are a good “placemaker” as the area continues to upgrade. House Spirits, which is one of the original boutique distillers in the Central Eastside and known for their signature product Aviation Gin, came calling for a new upgraded facility from their small location on SE 7th. With parking; high clear heights, outside seating and a flexible open layout the 13,8000 sf building was a perfect empty canvas for House Spirts. House and Harsch are investing significant dollars to increase their production facility by over 200% and will also have a large, tasting room and administrative offices as well and they move to the next level in their product development and introductions. It will be a very cool industrial feel operation that will add to the food and beverage options in the Produce Row Area and continue to activate this submarket of the east side.

Steve Smith Tea is the Dali Lama of tea having started both TAZO tea and Stash Tea in Portland. He is till at it and his latest rendition, Steve Smith Tea company is sought out all over the world and he cannot keep up with demand for his expertly sourced and eclectic tea combinations. He started both his previous tea operations in the southeast area so his desire to return to the area was strong and easy. “We really see an opportunity in the Produce Row Area to establish and grow our tea business and plus we know the area and have a long history in the neighborhood and just love the transition of the area to some exciting and people oriented uses so we want to add to and be part of this very cool trend” says Smith. They are leasing 14,000 sf in the 110 SE Washington Building for a large tea tasting room as well as a significant proportion of their mixing, packing, and distribution business. They have some simple but aesthetic upgrades to the building coming and they hope to be open in November.