The greater Portland retail market continues to see strong recovery through the third quarter of 2022 in the wake of uncertainty from the COVID-19 pandemic. Market-wide availability rates have returned to pre-COVID lows of 4.5% and the average direct asking rates on a triple net (NNN) basis have surpassed the $20 per square foot benchmark, a first for the Portland retail market. However, the recovery is confined to the suburban submarkets as the Central Portland submarket continues to struggle with an availability rate of 7%. Historically, the Central City has boasted the lowest availability rate of retail space. However, the asset type’s reliance on downtown office workers, who have yet to return to pre-pandemic levels, and continued issues related to safety in downtown Portland, has resulted in a 159% spike in the availability rate compared to Q1 2020. The largest sale of the quarter was the purchase of 3031 SE Powell Blvd by The Samantha K. Shannon Living Trust from MAJ Development Corporation. The $16.5 million-dollar NNN investment sold with a cap rate of 4.25%. The property is fully occupied by The Target Corporation which holds a 10-year NNN lease that has roughly six years remaining.
2022 Q3 Portland Metro Retail Market Report