Downtown Portland’s office vacancy rate is highest in the nation, report says
Downtown Portland’s office vacancy rate is highest in the nation, report says
Portland’s central city’s office vacancy rate reached 30.2% by the end of 2023.
"According to Colliers, more than 1.4 million square feet of office space in downtown Portland was available for sublease at the end of 2023. The total available amount of space available for lease downtown was more than 32%. Collier expects that figure to reach 40% over the next year.
“We’re predicting vacancies to continue climbing into 2025,” Shields said. “Unlike other markets that are starting to see a turnaround, Portland hasn’t hit the bottom yet.”"
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Projections from McKinsey Research show demand for office space in 2030 ~13% lower than 2019, with some extreme examples like SF going down by as much as a fifth.
Knowledge economy firms are increasingly having to earn their employees commute and are doing so by turning their offices into hybrid places with WeWork like amenities and collaborative spaces (in its glory days).
All of this means tons of lower quality buildings will get dumped on the market as the overall price of office space goes down. We certainly need more conversion projects when feasible but pandemic trends also reduced demand for residential space inside urban cores, so I wonder if the demand for the converted old buildings will even be there.