Portland Retail Market Report
Leasing Surge Helps Retail Sector Cross Inflection Point;
Deal Flow Accelerates
Net in-migration stokes space demand. Population growth, driven by pandemic-era in-migration trends, is bolstering the metro's consumer base and retailers have taken notice. Vendors absorbed more space in the first three months of 2022 than the previous three years combined, slicing 40 basis points off vacancy in the first quarter alone. Six of Portland's 12 submarkets registered over 100,000 square feet of net absorption year-over-year through March, with Southwest Portland, Clark County and the I-5 Corridor each recording vacancy declines exceeding 100 basis points. However, more central locales like the CBD and Lloyd District still face challenges, with availability at least 240 basis points above their 2019 rates entering April. Nevertheless, Oregon recently lifted indoor mask mandates in March, which will likely induce more social gatherings and provide an additional boost to retailer demand in the near term.