By MARC STILES
In the 10 years since its founding, Seattle-based Urban Renaissance Group has grown to become the region’s fourth-largest manager of commercial real estate.
The company plans to continue expanding in the Puget Sound region and in its other markets, Denver and Portland, and perhaps into some new markets.
We spoke with Urban Renaissance Group founder and CEO Pat Callahan about these plans and the remarkable performance of the office market in the region, where 24 buildings totaling more than 7.6 million square feet are under construction. Meanwhile, thousands of new apartment units are under construction as URG and its development arm, Touchstone, plan to expand into developing mixed-use residential projects.
What market is next for URG? The immediate focus is growing in the three markets we’re in. An expansion beyond these certainly would be a West Coast market, but we haven’t decided which city. It could be San Francisco or something else on the West Coast, or Arizona.
In Seattle, strong job growth is fueling an unbridled optimism. Is there room for caution? Job creation in Seattle is more robust than I’ve ever seen. If there’s a modest recession in a couple of years, for example, I don’t know that it’s going to affect Seattle. But I would say the employment growth has to continue for all of this office space and the new apartments to be filled. If for some reason employment growth is constrained for a little while then I would be concerned about supply.
What’s your read on future job growth in Seattle? Not only do the headlines and the evidence of the construction cranes portend continued growth, but for the office projects we’re working on there are plenty of tenant prospects. That is noteworthy because we’re late in the cycle, though it doesn’t feel like it’s late in the cycle.
Is Touchstone looking at doing more ground-up development? On the office side we intend to continue to do office development, absolutely. We’re looking at projects for the next cycle. We’re not just looking at entitled projects. We’re looking more for things that are not fully baked right now that we can patiently entitle. In addition to office sites, we’re going into mixed-use residential projects so we’re actively looking at residential and hotel sites.
The next cycle? When will that be?(Laughs). It’s going to be based on if and when there is a downturn and what it looks like.
