Construction updates

As summer approaches, construction at our two active job sites, Killingsworth Phase II and Hotel Grand Stark, is pressing forward.

Hotel Grand Stark
The renovation of Hotel Grand Stark is progressing well. Drywall installation on the upper floors is now completed. Installation of drywall on the ground floor began in June and is anticipated to wrap up by the end of July. Interior painting on the upper floors began in May on the 2nd floor and will be completed by the end of July.

We are working through some permit issues pertaining to work on the west deck. We expect to resolve these issues soon and we will complete demolition of the west deck openings by the end of June. Construction on the new deck will start shortly thereafter.

We will complete lightwell roofing and mansard roofing by mid-July. Hotel Grand Stark’s estimated completion date is the end of Q3.

Lyra (Killingsworth Phase II)
During Q2, we have achieved several construction milestones at Killingsworth Phase II, our mixed-use residential project in Northeast Portland. We recently renamed the project “Lyra” as part of our branding strategy. As of early June, we have poured and sealed gypcrete on the second through fourth floors. In May, we completed exterior painting and siding installation, and we began interior painting, which is scheduled for completion by the end of June on the upper floors. Casework for the model residential unit also began in May, and is scheduled for completion in July.

By mid-July, elevator installation will be complete, and we will complete floors two to four with finishes, including casework, countertop, doors and frames. The project on track for a mid-August completion date.

Residential pre-leasing at Lyra will begin on July 1. We will be working closely with the Portland Housing Bureau to fill eight affordable units to qualified households earning up to 60% of Portland’s median family income. Our first move-ins are anticipated in August.

We are actively marketing ground floor retail space to prospective tenants and commercial brokers. Two to three spaces ranging from approximately 1,100 to 1,400 SF are available for lease.

RESIDENTIAL OPERATIONS aND LEASING UPDATE

As of June 9, an estimated 4% of residents across our portfolio have not paid May rent due to COVID-19—down from over 7% in mid-May. An estimated 6% of residents have not paid June rent. Similar to the trend observed in April and May, we anticipate the collection rate to fall over the course of the month. Our property management team will continue to work with tenants who are behind on their rent to create reasonable repayment plans.

Residential leasing activity is strong, with an estimated 94% of units across our portfolio leased. We have strengthened our virtual presence. All tours, applications and communications with prospective residents are conducted through digital and virtual tools. We continue to experience a high conversion rate of applicants to leases.

As part of our COVID-19 response, we have installed hand sanitizer stations in our residential lobbies and main building entrances. Other steps we have take to ensure the health and safety of residents and our team include:

• Eliminating all non-essential in-person interactions and entry into units. To protect the health and safety of our team and residents, only emergency / urgent maintenance requests that require a team member to enter an individual unit are handled in person. We are using Face-Time / video chat to walk tenants through simple fixes, such as changing a light bulb.

• Daily cleaning. Each residential property and all common areas are cleaned daily by a member of UD+P’s maintenance staff or our contracted / third-party maintenance team. All common area touch points (e.g., elevator buttons, common space and entry door handles, etc. ) are disinfected.

• Weekly “COVID clean”. Our maintenance team conducts a weekly deep clean of each residential floor. All touch surfaces, including exterior door handles to all units, stairs / handrails, etc., are disinfected.

• Limiting use of elevators to one household at a time and disinfecting elevators multiple times a day.

Our operations team is currently focused on developing our residential reopening strategy. We are planning to reopen indoor and outdoor common areas at all UD+P residential properties, including the Slate gym and activity spaces. Key elements of our strategy include ensuring that we have adequate supplies needed for residents to properly disinfect and creating common area signage and directions that address CDC social distancing and public health recommendations. At Slate and Àlmr, we will continue to request that residents restrict use of elevators to one household at a time.

We have also enhanced resident communications. We are sending a weekly communication to residents to notify them of any updates or changes to the community and to share the latest CDC health and safety recommendations. Recently, we launched a “positivity campaign” using social media and other digital communications to foster a sense of community by encouraging residents to do things such as share a favorite recipe or photos of art or other creations. Lastly, we have created a digital community bulletin board residents can use to share volunteer opportunities, post free or for sale items, and share news and happenings in the community.