Andy Tullis / The BulletinSGS Development expects to finish the first of five apartment buildings at this site on North Empire Avenue early next year.

Work is underway to prepare 5.5 acres along North Empire Avenue in Bend for a 136-unit apartment complex.

SGS Development LLC obtained three permits for construction worth $10.1 million along Empire between Lower Meadow Drive and NE High Desert Lane. Plans call for three three-story buildings of 24 units each and two four-story buildings of 32 units each.

SGS Development, of Bend, obtained the permits Sept. 19. Crews are grading the site and installing drainage forms. Craig Smith, SGS director of development, said all five buildings should be complete by fourth quarter 2017.

“The first two should be ready by the second quarter,” he said Tuesday.

The project adds to a growing inventory of new apartment complexes in Bend, some already leasing, where few were under construction two years ago. The vacancy rate for homes and apartments in Bend was less than 1 percent, according to the spring survey by the Central Oregon Rental Owners Association.

The North Empire project calls for two- and three-bedroom units of 950 square feet and 1,150 square feet, Smith said. A community building will have an indoor pool. Among conditions the city attached to the project approval is reconfiguring turning pockets on Empire Avenue to reduce traffic congestion, he said.

Rents will be at prevailing rates when construction finishes, Smith said. The target market includes professionals and retirees who choose to rent rather than own, he said. People “who can afford to pay for a nice, amenitized project but don’t want all that upkeep,” he said.

Developers of two projects just off U.S. Highway 20 on Bend’s east side reported buildings filling up as contractors finish them.

“We’re going to do a phased delivery on all four buildings,” said Chris Looney, a partner in Paradigm Properties, of Eugene, the developer of Bellevue Crossing, 153 units on NE Bellevue Drive. “The first building is going to be delivered Oct. 17. It’s already 65 percent leased.”

Looney said the next three buildings are scheduled for occupancy in mid-November, mid-December and just after the new year. Bellevue Crossing features 96 one-bedroom apartments of 766 square feet that rent for $1,145 a month, he said. Two-bedroom apartments of about 1,100 square feet start at $1,365. The complex includes an outdoor patio, dog park and fitness center.

“Lease-up has been brisk, very brisk. There’s a lot of pent-up demand in the system,” Looney said.

He said lease rates reflect the cost to build in Bend. “I know that there is some talk in the community about rates and how some of the new supply is expensive. It may seem that way, but it’s expensive to build these projects,” he said. “The (system development charges) alone are significant. So getting a project like this to pencil out is a challenge. We’re sensitive to that.”

At the foot of Pilot Butte, a 208-unit project by Seattle-based Evergreen Housing Development Corp. is also leasing its first building, with occupancy set for mid-October, said Andrew Brand, Evergreen director of development. That project, called Outlook at Pilot Butte, on NE Linnea Drive, is three buildings of one- and two-bedroom apartments in two different styles. So far, 39 units have been leased in the first building, Brand said Tuesday. Rental rates were not available Tuesday.

“I don’t think we’ve seen a slackening in demand,” Brand said. “I kind of thought we’d see that, but I feel that demand has been strong, even with the other projects that leased up. If we see any slowdown, it’s due to the regular Bend seasonality.”

— Reporter: 541-617-7815,

jditzler@bendbulletin.com