Commercial real estate boom in Sisters
Last updated 11/1/2022 at Noon
There’s a real estate boom in Sisters — but it’s not residential. That’s cooled a bit. Commercial real estate, on the other hand, is on fire. Drive all over town and excavators are leveling dirt, concrete is being poured, walls are going up.
What’s driving it? Speculation mostly, and with the economy in flux and many economists predicting a recession soon (some saying that we are already in it), such investments may not pay off quickly. You can’t say that developers in Sisters lack pluck.
Not all commercial projects are spec in nature. Sisters Coffee just recently moved into its new roastery in Sun Ranch Business Park, an 11,308-square-foot, two-story facility that was permitted for $1.38 million in construction costs.
Philadelphia Steak & Hoagies, who currently rent at 352 E. Hood Ave., are building their own restaurant from the ground up catty-corner on the southwest corner of Hood Avenue and South Spruce Street, hoping to take occupancy in early spring.
The Cottage Inn of Sisters Boutique Hotel is putting the finishing touches on its seven cottages on East Main and North Locust and will open any day. Construction costs of $600-$700,000 don’t include furnishings, and none of the projects covered in this story include land cost or other fees such as design, surveying, or system development charges imposed by the City or Deschutes County.
Otherwise, developers are banking on Sisters’ continuing growth and appeal. It is most noticeable at Three Peaks Industrial Park, a 15.5-acre parcel previously owned by the Forest Service and bound by Barclay Drive and North Pine Street. The development consists of 14 lots of varying sizes.
Sisters Storage has just finished its Annex that took two of the lots. In total the Annex has 41,000 square feet under roof, with a construction value of $3.9 million.
Across the street, Compass Commercial has poured concrete for the floor, and walls will soon go up on a light industrial building comprised of two 7,000-plus-square-foot spaces that can be combined for a total of 14,924 square feet. Both spaces include 14-foot roll-up doors, a shared loading dock, and two private restrooms.
The building will feature steel construction with masonry wainscoting and is scheduled for completion in the summer of 2023. Its construction cost is valued at $2.2 million according to its building permit. Tenants are being sought.
Down the street at Lot 5, concrete has also just been poured for a 40,880-square-foot spec building that is divided into six units of 6,800 square feet each. Its indicated construction cost is $4.1 million. Ponderosa Plumbing has taken two of the units and will build out 3,798 square feet of warehouse space and 3,056 square feet of showroom and office on the first floor, and 2,972 square feet of office on the second floor.
Back at Sun Ranch, next to Bird Gard, footings are finished for 2,666 square feet being built as a two-story, live-work structure with construction projected at $500,000.
This isn’t the first live-work building in Sisters, and developers predict we will see more as remote working and work-from-home entrepreneurs are growing exponentially. In 2010 only 10,000 such live-work-play rental units were built in the U.S. In the last five years 225,000 such units were constructed bringing the total to 580,000 nationwide according to YardiMatrix.
And down the street a few hundred feet on the corner of Lundgren Mill Road and North Bluebird Street, 3 Sisters Partners is putting up what it describes as a first for Sisters. The 7,700-square-foot, two-story project has Class A office space downstairs and three “luxury” apartments upstairs.
Both the offices and the apartments are of a quality not seen in Sisters, both in term of design and amenities, the developers are promising. While the 4,000 square feet reserved for offices could be divided, and probably will be, the owners are hoping and actively recruiting for a single tenant, one with 30-40 employees in the tech field or professional services. Completion is scheduled for April 1.
The multipurpose building is likely another first for Sisters — panelized construction. Much of the structure, particularly the walls, are built with laser precision off-site at a shop in Redmond, transported to the site, hoisted into position, and locked together.