Portland’s Downtown Real Estate: A Reset in Motion

Portland’s Downtown Real Estate: A Reset in Motion

First, a big thank you to Jonathan Bach and The Oregonian/OregonLive for their thoughtful, detailed reporting on Portland’s downtown commercial real estate market. Jonathan’s latest piece, “Portland’s downtown real estate fire sales will hasten millions in property tax losses,” captures the magnitude of the changes we’re seeing and the ripple effects those changes will have on property values, tax revenues, and the city’s future.

Jonathan lays out a clear picture: years of pandemic-driven remote work, high-profile departures, and broader reputational challenges have combined to drive property values in the city center to historic lows. The recent sale of the iconic U.S. Bancorp Tower — “Big Pink” — for just $45 million, a fraction of its 2015 price, is perhaps the most striking example. As the article notes, these “fire sale” prices not only reset market valuations but will also trigger significant property tax compression, with downstream impacts for schools, public safety, and city services.

The piece also rightly points out that while this reset is painful, it may create a foundation for recovery. Lower rents could attract new tenants, stimulate investment, and, over time, re-energize our urban core.

I especially appreciated seeing my partner, Mike Holzgang, share his perspective. As someone who helped sign tenants at Big Pink in the early 1980s when it first lit up our skyline, Mike knows the building — and Portland’s commercial real estate cycles — better than most. His comment that the tower is “a city within a city,” complete with amenities and services, is a reminder that great buildings have staying power. And his frank acknowledgment that “the recovery is going to take longer now” is exactly the kind of clear-eyed realism our industry needs.

Mike also points out a hard truth: much like in the 1980s, we have more office space than demand. But this time, it’s not just overbuilding — it’s a shift in how and where people work, combined with migration trends and tax policies that have influenced where professionals choose to live.

The challenges are real, but so is the resilience of Portland’s real estate community. As Jonathan’s article suggests, there are reasons for optimism — new ownership, fresh investment, and leaders committed to steering the city through this transition.

For those of us in the industry, the task ahead is clear: adapt, innovate, and help shape the next chapter of Portland’s story.