The Old Mill Shopping District is set to break ground later this year on a new complex of three buildings at its northern end, adding approximately 31,000 square feet of retail and restaurant space.

The new buildings will be located in a part of the district that currently includes parking adjacent to the so-called “hot ponds.” The strip of restaurants including Cafe Yumm, Lady Bird and Pasta Pastini are located steps south from the future buildings. The Athleta shop will also be a nearby neighbor.

The building closest to Athleta will be mixed-use, with commercial space on the ground floor and nine rental housing units on the second level. These furnished units will offer a combination of short- and long-term rental options, said Peter McCaffrey, vice president of William Smith Properties, which manages the Old Mill District.

The two buildings closer to the river will have food and beverage tenants, said McCaffrey. These will be brick-and-mortar shops, rather than a food hall or food truck setup.

No tenants have been signed up yet for these units.

“We’re still working on who those will be and what style of restaurants and all of that, but they’ll be fun,” said McCaffrey. “We have a number of different interested parties in both the restaurant and the retail spaces, and we expect that by the time the buildings come online, they’ll be fully leased.”

Marney Smith, general manager of Hayden Homes Amphitheater, said the goal is to offer restaurants and shops that will appeal to both locals and out-of-town visitors.

“You need the staples, you want the stuff that a family might need every day down here, and then you also want things that you can only find in Bend, Oregon. So we try to balance that and make sure that we’ve got a thoughtful and interesting mix for people,” she said.

According to data compiled by Visit Bend, 77.2% of visitors to the Old Mill District in 2024 were locals, with the remaining 22.8% being people who visited from more than 50 miles away, defined as visitors under state statute.

The buildings will be modern in their design but pay homage to the past, said McCaffrey. Relics from the mill era — bricks and concrete blocks — will be used in patio areas and architectural features.

The westernmost building (known as Building X) will have views of the Deschutes River and around 6,000 square feet of space. Architectural plans submitted to the city show this building will have a large and open second-floor patio and glass walls on the bottom floor. The word “Pumphouse” is written in large letters across the building, a nod to the red sheds nearby which include a water pump unit.

McCaffrey says the pump unit is still in use and will remain on-site. A portion of the pumphouse shed will be demolished to make way for the new development.

The middle building (called Building Y) will overlook the “hot ponds,” so named because hot water from the mills was piped into them to cool off before the water could go back into the river. Renderings of this approximately 7,500-square-foot building show a single-story structure with a pitched roof, retail space and a cafe.

The easternmost building (known as Building Z) will face Powerhouse Drive. This is the two-story building with rental housing on the second floor and retail space below. Its total size is approximately 17,500 square feet.

Seventy-six parking spaces will be located behind the three buildings. The current parking spaces on the north side of the hot ponds will disappear under the buildings. Construction is expected to take two years and groundbreaking is planned for later this year.

Nate Wyeth, senior vice president of strategy for Visit Bend, described the expansion at the Old Mill District as an “exciting part of Bend’s continued evolution.”

“With most visitors to the Old Mill District being locals, this growth meets community demand while enhancing Bend’s appeal to visitors seeking similar experiences,” said Wyeth. “It’s a great example of how Bend can offer the amenities of a larger city while maintaining the unique charm that makes this place special.”