Document Type

Report

Publication Date

3-2017

Keywords

Portland State University. School of Business Administration. Center for Real Estate

Abstract

The Exchange at Coquitlam Central is be a transformative and innovative development project involving over 14-acres of prime real estate located in the heart of the Tri-Cities submarket. As a major transportation hub for the Millennium Line, newly-opened Evergreen Line, and regional bus mall, the site is well positioned to become an amenity-rich community with robust opportunities for residents and commuters to live, work, and play.

This multi-phased development will feature a modern, full-service health club, state-of-the-art entertainment center, and first-class specialty grocer. These anchors, along with a thoughtfully-curated mix of smaller merchants, employment-generating office space, and best-in-class residential product will provide Coquitlam with a landmark community and a center of thriving commerce. The future residents of The Exchange will be treated to an array of retail and restaurant options, highly-programmable public plaza, and peerless access to an array of public and private transportation options. In fewer than 15 years from commencement of construction, The Exchange will boast twelve pedestrian-friendly city blocks with 14 thoughtfully-designed buildings, including an iconic X-shaped tower called The Crossing, celebrating both the site’s heritage as a transit hub, and its future as a place of exchange and commerce. While we acknowledge the slow, but steady economic growth within the submarket, we feel that the draw created by this unique, peerless project will stimulate growth and demand previously unseen in this trade area. Moreover, a measured, phased development program will help curb potential oversupply at any given point in the economic cycle. Weighing stakeholder goals and transit imperatives against optimum returns, The Exchange at Coquitlam Central yields a conservative, but steady financial return, based on the prescribed programming outlined in this proposal. The project’s IRR of 7% is conservative, using the sales of strata residential units to fund infrastructure costs of $52 million. TransLink’s investment, after the strata sales, consists of the NOI from parking estimated at $350,000 in year 1 and increasing to an average NOI of $2.2 million annually once Phase 2 of construction is complete. Retail and office units, combined, provide an initial NOI of $700,000 in the first year of lease up in Phase 1. NOI for retail and office continues to escalate to an average of $3 million annually once Phase 2 of construction is complete. The initial returns may not seem lucrative, but this project has the potential to crescendo into a very sound investment with many years of solid returns.

The development plan for The Exchange at Coquitlam Central will excite and invigorate the Tri-Cities community, making this a top priority for development.

Description

Portland State Masters of Real Estate Development

Persistent Identifier

http://archives.pdx.edu/ds/psu/22287

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