U.S. Bancorp Tower owner Jeff Swickard has purchased another downtown Portland office building, and he said he’s not done yet.

Swickard has closed on the eight-story, 266,664-square-foot Five Oak building, at 421 S.W. Oak St., for “a little over $10 million,” he said. Swickard Group bought the building from a group of creditors led by Nuveen. Five Oak was constructed in 1944 and then renovated in 2005.

The purchase comes only seven months after Swickard purchased the U.S. Bancorp Tower, better known as “Big Pink.” The buildings are almost directly adjacent to each other.

“It’s in our mind a perfect complement to the Big Pink,” he said.

Swickard said he hopes the two buildings can share certain amenities, such as parking and hospitality.

It’s another big splash for Swickard, who initially made his fortune from a string of car dealerships based in Summerlin, Nevada. Swickard Group began investing in commercial real estate 14 years ago.

Swickard is a University of Oregon alum.

“Portland, it just meant something to me,” he said. “Even though I moved away, it never left my heart.”

Swickard has also purchased real estate in Wilsonville, the San Francisco Bay Area, Southern California, and Vancouver and Edmonds, Washington. Swickard Group is closing on an industrial building in Tigard this week, he said.

“We’ve been active, but until we bought Big Pink, nobody cared,” he said.

Both Big Pink and the Five Oak building lie in Portland’s opportunity zone, which confers tax benefits after seven and 10 years.

“Buying in an opportunity zone, it’s not the motivating factor, but it’s helpful,” Swickard said.

The downtown buildings are long-term holds, Swickard said. Current tenants at Five Oak include the U.S. Postal Service, Oregon Health Authority and Multnomah County. The building’s occupancy rate wasn’t immediately available.

“It’s really a capital-intensive business to re-tenant these buildings,” Swickard said. “On the surface, it might seem like it’s a windfall because prices are low, but by the time it’s re-tenanted it’s a long, long-term play.”

Swickard said the purchase was made in cash, with no debt or institutional money. The property previously traded for $37.1 million in 2014.

“There’s very little or no attractive debt that you can put on a building,” he said. “You have to be prepared to use your cash.”

Swickard suggested he’s not done investing in downtown Portland.

“I decided to buy a couple projects, and I’m going to continue to buy,” he said.

Unico Properties was selected as the property manager for Five Oak, the company announced Thursday. Unico also handles such business at Big Pink.

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With a vacancy rate of about 4.5 percent and businesses and tenants still adjusting to post-COVID workspace needs and uncertain economic conditions, Salem-area experts are cautiously optimistic about the city’s commercial office market.

Curt Arthur, a Capacity Commercial Group principal, said at the company’s annual economic forum on Feb. 12 that the decreasing vacancy rate was a positive sign, and the quickly submitted offers on new space indicate strong demand.

“Last year, I mentioned it was a little bit of a lackluster year,” he said. “I would say it’s a little bit of the same, but we see light at the end of the tunnel.”

The market has shifted over the past 10 years, said Kelsey Oran, a Hancock Real Estate partner and principal broker. Where she once saw multiple offers per space in a low-supply, high-demand market, she now sees spaces lingering unleased for longer.

Office tenants are downsizing or maintaining spaces. Expansion requests are rare, she said. And tenants are shifting away from the standard five-year lease to three-year leases, allowing more flexibility as markets evolve.

Deals are also taking longer to close due to cautious tenants and market uncertainty for landlords.

Oran noted that while asking rents have softened, they have increased nominally – about 0.5 percent – since last year.

The average number of months left vacant for lease listings were improving, Arthur noted, falling from 7.1 to 5.7 since 2025.

Oregon’s capital city has also experienced the fallout of state agencies exiting private-sector leases as more people work remotely. The state is opting to focus on its own properties and lease fewer privately-owned office spaces in the city.

The Salem-area office market has about 12 million square feet in its inventory.

The state of Oregon is the biggest office tenant in Salem, Arthur said, at more than 1.5 million square feet.

Post-COVID, the state has worked to bring back multiple agencies into state-owned buildings, but remote-hybrid work remains common. He said two to three more years will be needed to see how the adjustment pans out.

The region is seeing very little new commercial construction compared to previous years.

Only 3,200 square feet of office space was under construction in Salem in the first quarter of 2026, Arthur said. The high cost of construction is a big factor in the slowdown, he added.

Recent successes could lead to more construction. Hunsaker Dental held its grand opening in January; about half of the space in the three-story, 29,841-square-foot building remains available. But the building, south of downtown, now has offers on all remaining spaces, Arthur said.

“Even though we don’t see any new construction on the horizon, I think what we saw at Hunsaker Dental is going to bring a couple of folks to the drawing table,” he said.

Salem doesn’t experience the same extreme swings as Portland. CoStar real estate analytics described Portland’s downtown core as “the epicenter of regional weakness” with an availability rate near 30 percent.

Currently, there are 278 office spaces listed as available across 126 properties in Salem, according to CoStar data, Oran said. The city’s office vacancy rate is 4.5 percent.

The upside is that people looking for office space can have more negotiating power for lease terms and amenities.

“It’s certainly a tenant-driven market,” Oran said. “There are many options that are available out there.”

Tenants tend to seek more amenities in smaller spaces, full-service leases, security upgrades and available parking, she said.

Landlords are remaining competitive by dividing larger spaces into smaller footprints and updating buildings.

Some areas of the city are thriving more than others. People are drawn to the accessibility of the Fairview Industrial area, the Commercial-Liberty corridor going into south Salem and downtown buildings with available parking, Oran said.

“The current market presents an opportunity to secure high-quality office space at competitive pricing,” she said. “For organizations and businesses seeking a presence in the state capital, there’s a range of quality options available.”

Some of the biggest sales of 2025 include Salem-Keizer Public Schools purchasing the former Wells Fargo call center building at 355 Hawthorne Ave. S.E. for $15.5 million and disability care provider DSP Connections purchasing the four-story office building at 5121 Skyline Loop S. for $7.2 million.

With strong investment in senior services like memory care and the looming acquisition of Santiam Hospital by Salem Health, Arthur expects medical office space to be a key commercial factor in 2026.

Leasing should uptick as market conditions improve, he said, adding that he would not be surprised to see a double-digit increase in leasing volume over the next year.

Editor’s note: This article first appeared in the Statesman Journal and then was distributed on the USA TODAY Network via Reuters Connect.

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Commercial and multifamily loan originations soared in late 2025 as once-frozen credit markets resumed flowing freely, a lender said at an industry event in Portland on Thursday.

Multifamily loan originations grew 25 percent in the third quarter of 2025, while office loans nearly tripled as values reset and investors pounced, said Matt Dzbanek, a lender with Ariel Property Advisors.

Nationally, $936 billion in commercial real estate loans will mature this year, adding significant flexibility, according to Dzbanek. He predicted debt will sluice through real estate this year.

“There’s going to be a lot of liquidity in the market,” he said.

Dzbanek delivered his comments during HFO Investment Real Estate‘s annual multifamily market forecast at AVENUE on Northeast Grand Avenue. The brokerage’s 21st annual event Thursday brought together investors and others to hear from industry analysts.

Locally, the picture is mixed, analysts said. Multifamily vacancies rose to 5.47 percent in 2025, up from 4.49 percent a year earlier. But rents grew modestly in Portland’s metropolitan statistical area, from $2.04 per square foot on average in 2024 to $2.11 last year.

Rent growth will remain muted in the near term as older assets face greater price pressure, said Greg Frick, an HFO partner and the event’s moderator.

“Vintage matters more than ever,” he said.

New multifamily supply will remain sparse, with only 2,319 units permitted in 2025 through August in buildings of five units or more, according to census data.

Efforts to boost supply, including Portland’s waiver of system development charges, have yet to bear fruit.

“For market-rate (housing), the pipeline is very, very dry,” Frick said. “We do still see new deliveries being constrained.”

Frick predicted positive in-migration will continue in the Portland area this year after the population declined post-pandemic. Job growth has stabilized, he said.

Economist John W. Mitchell cited national statistics showing a “pretty dramatic slowing” in the labor market, with job openings falling. But neither are employers rapidly shedding jobs, he said.

“We’re in a no-hire, no-fire economy,” Mitchell said.

The U.S. economy grew at a 4.3 percent rate in the third quarter of 2025, buoyed by strong consumer spending. Years of rising stock prices have contributed to a “K-shaped” economy, where high-income consumers continue to spend, while lower-income consumers stagnate, Mitchell said.

Oregon continues to lag much of the nation. Job growth ranked 30th in the nation in the third quarter, while the state’s 5.2 percent unemployment rate was 47th.

One piece of good news for landlords: With high housing prices in many cities, it makes sense for many residents to rent, Mitchell said, citing a recent article in The Economist.

“For most people, it pays to rent,” Mitchell said. “That bodes well for your business.”

Melissa Wall, a certified public accountant for Aprio in Portland, discussed various real estate tax strategies for avoiding gains taxation. The 2025 One Big Beautiful Bill Act established permanent opportunity zones.

The investment zones — first rolled out in 2017 — allow real estate investors to avoid gains taxation if a qualified investment is held for 10 years, and provide certain lesser tax benefits if an investment is held for five or seven years.

Much of central Portland, including downtown, was designated an opportunity zone, providing an investment incentive as the area struggles with one of the highest office vacancy rates in the nation.

1031 exchanges, which allow real estate investors to roll the proceeds from a property sale into buying another piece of real estate, remain popular, Wall said. She urged investors to speak with a CPA.

“Complexity is increasing,” she said.

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Goldman Sachs Asset Management has taken a 78 percent loss on a Pearl District mixed-use building.

Goldman sold the 42,000-square-foot property at 300 N.W. 14^th Ave. in Portland earlier this month for $3.6 million after purchasing the asset for $16.8 million in 2017.

The transaction is the latest sign that Portland’s real estate market continues to aggressively re-price commercial properties at much lower values.

The property, known as the 300 Building, sold to REALM in partnership with HP Investors. REALM describes itself as “an exclusive investment collective consisting of more than 100 ultra-high net-worth individuals, family offices and foundations dedicated to direct real estate investing.”

Built in 1946, the 300 Building was extensively renovated in 2012. REALM pointed to the former warehouse’s “efficient floor plates” and 34 underground parking spaces.

“REALM’s latest acquisition of 300 NW 14^th Ave. in Portland is the epitome of what we look for in an investment — the ability to purchase a high quality, well-amenitized building in an excellent location at a compelling basis,” said Travis King, founder and CEO of REALM, in a prepared statement. “REALM is excited to grow its presence in the Portland market, which offers an attractive quality of life and vibrant culture, which should continue to drive momentum and business expansion going forward.”

REALM will look to restructure existing leases, implement targeted building upgrades and adjust rents to market where feasible, according to the investment group.

The property “provides an immediate, high in-place cash yield with limited capital requirements, offering meaningful downside protection,” the company stated.

The transaction, which was recorded in Multnomah County on Dec. 12, values the 300 Building at approximately $86 per square foot.

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Portland’s Menashe Properties has doubled down on Chicago office space, purchasing a 31-story tower in the West Loop area for $51.5 million.

The commercial real estate firm closed on its acquisition of 125 S. Wacker Drive on Friday, according to an announcement. It is Menashe’s second major purchase in Chicago, after the acquisition of 230 W. Monroe Street, a 700,000-square-foot tower, in 2023.

“It is amazing the momentum in Chicago,” said Jordan Menashe, the firm’s CEO and principal.

The seller was La Caisse, a major investment firm based in Quebec, Canada.

Chicago’s office market is heating up, Menashe said. Meanwhile, developers can’t build spaces on speculation fast enough, he added.

“You can’t move fast enough for the market right now,” he said. “It is under-officed.”

The recent purchase values 125 S. Wacker Drive, a 640,000-square-foot property, at approximately $80.47 per square foot. The building is across Adams Street from Willis Tower, formerly Sears Tower – the tallest building in Chicago and the third-tallest building in the United States.

Menashe Properties often looks to purchase somewhat distressed assets and increase their occupancy. In 2024, the firm purchased Montgomery Park, a 768,443-square-foot building in Northwest Portland, for $33 million after it was foreclosed upon.

The Chicago building at 125 S. Wacker Drive is 63 percent leased, Jordan Menashe said. It has no anchor tenant.

“There is no tenant that has more than one floor,” Menashe said. “What does that do for you? It offers you flexibility.”

Chicago’s most desirable office space is occupied, leading tenants to consider the next tier, Menashe said.

“Trophy, class-A (office space) is full,” he said. “Class-C is never coming back.”

The Wacker Drive property is an “A to A-minus” property, he said.

Occupancy at Menashe’s other Chicago property, 230 W. Monroe Street, grew from 60 percent to 85 percent in less than two years, Jordan Menashe said. Stream Realty Partners will lease and manage both properties.

Menashe Properties’ Chicago purchase comes as dealmakers establish a new, post-pandemic ground floor for downtown Portland office values. The PacWest Center sold last week to an Alaska developer for a reported $55.7 million, or $101.64 per square foot.

In July, the U.S. Bancorp Tower — better known as Big Pink — sold for $45 million, or about $39.13 per square foot.

Office property is gaining momentum in other West Coast cities, Menashe said.

“It’s starting to build in San Francisco and Seattle, which bodes well for good ol’ Portland,” he said.

Menashe said Portland is perhaps seven years behind Chicago’s office market.

Portland has cleaned up since the pandemic, he added, but it lacks attractiveness to businesses.

“They have to lower taxes in Multnomah County,” he said.

Menashe Properties was founded by Jordan’s father, Barry, in 1978 and is one of the largest owners of Portland real estate. The company owns more than 7 million square feet of commercial real estate, including, in Portland, the 12th & Morrison Building in the West End, the Plaza on 6th, the American Bank Building and the JK Gill Building. The firm also owns major commercial properties in Dallas, Seattle and Denver.

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Oregon is implementing a new regulatory framework for energy efficiency that will significantly impact the commercial and multifamily real estate sectors. As part of this new framework, the Oregon Department of Energy (ODOE) recently finalized rules regarding an incentive program for early compliance with Oregon’s new Building Performance Standards (BPS).

HB 3409, signed into law in 2023, included the establishment of an Energy Performance Standard policy for commercial buildings. This is otherwise referred to as the BPS. The goal of the program is to reduce energy use and emissions from existing commercial buildings requiring many large commercial buildings to enhance energy management practices and implement various efficiency measures over the next several years.

Applicability and “Tier” System

The program applies to buildings classified as either “Tier 1” or “Tier 2”; the type of building determines its respective compliance requirements and deadlines.

Tier 1 includes large nonresidential, hotel, or motel buildings with at least 35,000 square feet of gross floor area. Tier 1 buildings must collect and report 12 months of energy usage data, calculate their building’s “energy use intensity” (EUI), and meet performance targets set by the ODOE. If a building fails to meet its target, the owner must conduct an energy audit and develop a plan to implement cost-effective energy efficiency improvements.

Tier 2 includes buildings with a gross floor area (excluding parking garage area) of at least 35,000 square feet that are used as multifamily residential, hospital, school, dormitory, or university buildings. Tier 2 also includes buildings where the gross floor area for hotel, motel and nonresidential use is between 20,000 square feet and 35,000 square feet. Tier 2 buildings are not yet subject to performance targets but must report energy and emissions data starting in 2028.

Some buildings are exempt. For example, historic buildings, certain buildings qualifying for exemption under “financial hardship,” some agricultural buildings, and some buildings with less than 50% occupancy may be exempt from these compliance requirements.

The following graphic from ODOE provides a high-level overview of how ODOE has categorized buildings for purposes of the BPS:

Important Compliance Deadlines

HB3409 required ODOE to establish a BPS to meet performance targets; the ODOE finalized the initial standard in December 2024 based on a national standard, with Oregon-specific amendments.

Compliance deadlines for Tier 1 buildings are phased based on size:

• Buildings greater than or equal to 200,000 square feet have until June 1, 2028.
• Buildings with 90,000–199,999 square feet have until June 1, 2029.
• Buildings with 35,000–89,999 square feet have until June 1, 2030.

Tier 2 buildings must submit their first data report by July 1, 2028, and every five years thereafter. ODOE will use this data to recommend future standards for Tier 2 buildings by 2030.

For those who do not comply, the ODOE is authorized to impose civil penalties for noncompliance, with fines up to $5,000, plus an amount to be determined for the duration of a continuing violation, which is capped at $1 per square foot of gross floor area (Tier 1 buildings only).

New Incentive Program Rules Released by ODOE

To encourage early participation, ODOE is launching an incentive program where building owners can apply to receive incentives for voluntarily meeting the program standards before the statutory deadlines.

To be eligible, a building must meet certain energy use requirements. Exempt buildings are not eligible for the incentive program.

• The incentive amount can be up to $0.85 per square foot for compliance for Tier 1 buildings, and $0.35 per square foot for compliance for Tier 2 buildings.
• Tier 1 buildings can receive up to $50,000, while larger Tier 2 buildings can receive a maximum of $35,000. There is also a limit of two awards per building owner, subject to increase based on funding.

To apply for this program, applicants must submit building data, energy use, utility territory, and compliance actions as outlined in the rules. This is anticipated to be a competitive review with priority being for high EUI buildings, multi-tenant buildings not in qualified utility territories, rural buildings, and multifamily affordable housing.

Deadlines for early compliance are one year before the regular compliance deadline:

• Tier 1 Buildings greater than or equal to 200,000 square feet: by June 1, 2027.
• Tier 1 Buildings with 90,000–199,999 square feet: by June 1, 2028.
• Tier 1 Buildings with 35,000–89,999 square feet: by June 1, 2029.
• Tier 2 (all sizes): by July 1, 2027.

These rules are effective August 5, 2025. The ODOE is expected to publish an opportunity announcement for the incentive program soon, with the application period open for 45 days.

BPS programs are an emerging policy solution in the United States for facilitating energy efficiency and greenhouse gas emission reductions. For real estate professionals, Oregon’s BPS program introduces new compliance responsibilities—but also opportunities. Early knowledge of these standards and prompt action can mean buildings owners can benefit from incentives and avoid penalties for noncompliance.

Anna Reutin is an associate member of the firm’s Real Estate group in Portland, Oregon. Mario Nicholas is a partner in the firm’s Construction group. Contact Anna at anna.reutin@stoel.com or Mario at mario.nicholas@stoel.com for legal guidance on Oregon’s Building Performance Standard’s Incentive Program.

The opinions, beliefs and viewpoints expressed in the preceding commentary are those of the author and do not necessarily reflect the opinions, beliefs and viewpoints of the Daily Journal of Commerce or its editors. Neither the author nor the 91��Ƶ guarantees the accuracy or completeness of any information published herein.

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A 17-story office building is receiving some updates. The first phase of the project will be complete late next year.

The Standard Plaza building, at 1100 SW Sixth Ave., Portland, home to The Standard, is set to undergo a multi-phase renovation. The first phase of construction and remodeling – about 70,000 square feet of remodeling – began in late March.

The project team includes owner Standard Insurance Co., architect GBD Architects, civil and structural engineer KPFF and general contractor Walsh Construction.

The phased project begins with the renovation of floors one through five. The redesign of several floors will enhance collaboration and team engagement through upgrades to meeting rooms, workspaces, common areas and more. There will be updates to finishes, plumbing, electrical and flooring throughout the building, reusing and recycling building materials where possible. Over time, the 17-floor building, including the main entrance, lobby and outdoor courtyard will be completely remodeled, The Standard spokesperson Melissa Wilmot wrote in an email.

“Spaces emphasize community, connection and collaboration and are optimized for hybrid, virtual and on-site work,” Wilmot stated.

There will be gathering areas for employees, customers and brokers. The design supports collaboration, while also accommodating a smaller percentage of daily workers. It will include a fireplace lounge and drink bar, as well as a work lounge.

The redesign will also include historical items from The Standard’s archives, as well as artwork by local artists.

A $6 million alteration permit was issued in June for redesign of the second level. The work will involve demolishing walls and adding new ones to create a north and south gallery, restrooms, a reading area, a library meeting room, a library, a vestibule, a main lobby, a fire command center, a parking lobby, an elevator lobby and storage rooms. The work will also involve ceiling, flooring, finishes, plumbing and electrical.

A $9.7 million addition permit is currently under review for the project. The exterior scope of work would involve removing an existing escalator, removing a storefront at the north and south alcoves, adding a storefront at the east facade to enclose the escalator alcove, removing and replacing the plaza deck surface and waterproofing. The interior scope of work would include building new connecting stairs between floors 1 and 2, and reconfiguring the space to include a vestibule, training rooms, reading and fireplace areas, and new restrooms at the west alcove.

Phase one of construction is scheduled to be complete in late 2026. Construction will take several phases and is expected to take several years to be fully complete.

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Astoria’s Pier 39 has hit the market, offering more than 110,000 square feet of mixed-use space on the Columbia River.

The property houses 26 tenants, including Rogue Pier 39 Public House, a coffee shop, a financial planner and the Hanthorn Cannery Museum, in a cluster of low-slung buildings with reddish-orange roofs east of downtown Astoria. The commercial space is 42 percent occupied, according to CBRE, the listing agent.

The listing also encompasses an adjacent 2.06-acre parcel. The land is zoned for multifamily, hotel, retail or mixed-use development, and is the last undeveloped site of its kind in Astoria, according to CBRE.

The parcels are located within an opportunity zone and an enterprise zone, offering tax benefits to developers and investors. The site attracts 50,000 visitors a month on average, according to CBRE.

Longtime owner Floyd Holcom is selling the property. An Astoria resident and U.S. Army special forces veteran, Holcom reached out to Wes Bochner, a Portland-based CBRE broker and U.S. Navy veteran, to sell the property. Erin Smith and Trent Steeves are also managing the listing for CBRE.

Holcom purchased the property in 2002 and owns it through a limited liability company, NBSD.

The pier traces Astoria’s economic transformation from reliance on natural resources to a focus on tourism. The pier was home to Hanthorn Cannery, the first and largest tuna cannery in Astoria, which later became a Bumble Bee Tuna cannery.

CBRE has not published a listing price for the property.

“Comparable properties in San Francisco and Southern California have traded at 10x valuations of where we expect Pier 39 to sell, reflecting the massive investment upside with lease-up and redevelopment of remaining original cannery spaces,” Bochner stated in a news release.

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By Idaho Business Review staff

Three properties in McCall, Idaho, on Payette Lake near the Oregon border were put up for auction on July 18, however there were no bids on any of the properties.

The properties are held by the and the agency could not say why there was no interest in them at last week’s auction.

Land for the properties is held in trust by IDL for the benefit of State Hospital South, and, thus far, 161 cottage-site properties have been sold at auction at Payette Lake, the agency stated in a release. Thirteen sites remain, and all have houses on them. Though the land belongs to the trust, cabins and other improvements made to the land are owned by leaseholders as their personal property.

Bids were started at the reserve or “lot only” price of each lot with the property at 1903 Warren Wagon Road in McCall appraised at $451,000; the property at 2060 Warren Wagon Road at $495,000; and the property at 3800 Warren Wagon Road at $3.25 million.

“While IDL has confidence in the appraised value of the properties for auction (July 18), each property is unique in location and design, and there is no way to determine why there was no interest at this particular time,” a statement from the agency read.

Public auctions for the sale of state endowment trust lands are required by the Idaho Constitution and IDL cannot accept less than the appraised value of each property.

Along with the properties at Payette Lake, there are 337 lots at Priest Lake, 312 of which have been leased, and the total of the properties brought in at public auction is $277.1 million.

“Upon the transactions closing, the funds from the land sales will be deposited in the ‘Land Bank’ and may be used to purchase new endowment land in Idaho or may go into a Permanent Fund to continue earning returns for the endowment beneficiaries,” a release stated. “In May 2016, the Land Board approved the Strategic Reinvestment Plan and will consider strategic land acquisitions with the proceeds from the sale of cottage sites and commercial properties.”

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Vacancies in Portland-area office space reached a record-high 15.1 percent during the second quarter of the year, Kidder Mathews stated in a new report.

It was the 11th consecutive quarter of rising vacancies in the Portland market, and the first time that vacancies crested 14 percent.

Leasing activity has slowed just as dramatically, Kidder Mathews reported. It fell nearly 43 percent to 635,000 square feet during the April-to-June period, compared to a year earlier, reaching a record low for the second quarter.

The only period of lower lease volume came in July through September 2020, during the heart of the COVID-19 pandemic.

“It’s pretty dreary,” said Gary Baragona, Kidder Mathews vice president for research, based in San Francisco.

“There’s still some work to do before that market starts to recover,” he said.

The plunge in office values has brought out bargain hunters. Investment activity grew 22 percent in the first half of 2025 compared to a year earlier, Kidder Mathews reported.

“Although institutional buyers have historically made up over 30 percent of the trades, private buyers and owner-users have accounted for over 90 percent of the transaction volume in the past year,” Kidder Mathews stated.

That fits with recent transactions such as the $45 million sale of the U.S. Bancorp Tower to auto dealer Jeff Swickard by Unico Properties, and the $33 million sale of Montgomery Park to Portland-based family investor Menashe Properties.

Asking rents grew to $29.64 per square foot, Kidder Mathews reported.

Many office users have downsized their space as employees’ hybrid work arrangements mean companies use less space. The average lease size is less than 3,000 square feet — approximately 5 percent below the 10-year average, Kidder Mathews reported.

“That illustrates that companies are trying to right-size their space,” Baragona said.

Large leases have become rare in recent quarters, and that trend is expected to continue, the brokerage reported.

Bucking the trend, some newer properties in Portland such as Block 216 and Eleven West have managed to attract tenants — primarily professional services firms. Architecture firm Populous recently agreed to lease a floor above the Bamboo Sushi restaurant at 404 S.W. 12th Ave., and leave a smaller space in the Central Eastside.

Suburban office space has outperformed urban offerings, but even suburban activity has slowed, Baragona said.

“The optimist in me says the cities that figure out how to reinvest in their urban cores are going to be the ones in front of that recovery cycle,” Baragona said, pointing to encouraging signs in San Francisco and Seattle.

“Portland has a little further to go,” he said. “Portland’s a market where we have yet to see much of a rebound in activity.”

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