Portland Retail Market Report

Comparatively-low living costs draw migration from nearest major metros. An average multifamily rent at least $330 below Seattle and Bay Area markets, along with a lower income tax rate, is attracting new households to Portland. Net in-migration reached a five-year high in 2022 — with 21,400 new residents — and the metric is projected to grow further in 2023. Many transplants operate on a remote work schedule, bringing comparatively-high Bay Area and Seattle-based wages to the metro. Paired with Oregon’s absence of a state excise tax, this trend is fueling income growth and the near-term consumption outlook. Portland is projected to have the second-largest retail sales growth among major U.S. markets during 2023. Still, many businesses are hesitant to expand, in light of recent layoffs from the metro’s largest firms. Uncertainty among some vendors is compounded in the core by an ongoing housing crisis, which has diminished foot traffic downtown. As such, overall vacancy will rise to 4.2 percent by year-end; however, strong in-migration should help return operations to historical norms in the coming years.