Portland’s Largest Office Buildings Have Lost $2 Billion in Value. Here’s What It Means.
Portland’s commercial office market just crossed a threshold that would have been unthinkable five years ago. According to Multnomah County assessment records reported by KATU, the 20 largest office buildings in the city have lost nearly 70% of their combined market value since 2019 — dropping from roughly $3 billion to just under $1 billion. That’s a $2 billion decline concentrated in the buildings that once anchored Portland’s tax base and defined its downtown skyline. For anyone leasing, owning, or investing in Portland office space, this isn’t just a headline — it’s a market recalibration that changes how every deal gets underwritten.
The Economic Picture
The numbers behind the decline are stark. Properties like Fox Tower, Montgomery Park, Standard Insurance, and PacWest Center have collectively shed approximately $170 million in taxable value alone. Across the broader office market, assessed values for the top 20 buildings fell from $1.2 billion in 2019 to $890 million — and market values dropped even further.
The ripple effects are hitting city budgets hard. Property tax growth from commercial real estate is expected to generate roughly $8 million this year, compared to the $20 million annual growth the city had grown accustomed to. Portland city government anticipated $67 million in budget cuts heading into summer 2025, while Portland Public Schools is facing a $50 million funding gap.
Meanwhile, property tax appeals from commercial owners have surged. In 2023, the county processed 313 commercial income property appeals. That jumped to 422 in 2024, and the current cycle has already reached 529 — with projections to exceed 1,000. These appeals cost the county over $30 million in refunds across the 2023–2024 cycle alone. As county economist Jeff Renfro has noted, the scale of these value adjustments was something few expected would be possible.
The Portland Metro Chamber’s 2026 State of Downtown report puts the occupancy picture in equally sharp focus. Vacant office space in Portland’s Central City averaged 10.2 million square feet in 2025 — the highest level ever recorded. Quarterly leasing activity averaged just 252,289 square feet, the lowest on record outside of the initial pandemic shutdown in 2020. The region also lost 8,800 jobs in 2025, making it one of the worst-performing metro areas in the country for employment.
The one bright spot: foot traffic. More than 32 million pedestrians visited downtown Portland in 2025, a 5.5% increase over 2024. Saturdays are approaching 90% of pre-pandemic levels. People are coming downtown — they’re just not filling office buildings when they get there.
What This Means
For tenants and occupiers: This is the most tenant-favorable office market Portland has seen in modern history. Landlords are competing for a shrinking pool of active tenants, and that competition is showing up in concession packages, free rent periods, and tenant improvement allowances that would have been off the table three years ago. If your lease is coming up for renewal, you have significant leverage — but only if you understand the current market and start the process early enough to create competitive pressure. The key is benchmarking your current deal against what’s actually trading today, not what your landlord tells you the market looks like. A lease rate analysis can give you that clarity.
For landlords and investors: The decline in assessed values creates both a tax relief opportunity and a strategic decision point. If you haven’t appealed your property’s assessed value, you may be overpaying on taxes relative to what the market says your building is worth. On the investment side, the 70% drop in market value across Portland’s largest office assets means pricing has reset to levels not seen in over a decade. For investors with a long time horizon and tolerance for near-term vacancy, this may represent a generational entry point — similar to what we saw with Jeff Swickard’s $125 million in recent downtown Portland acquisitions. But underwriting office acquisitions in this market requires a clear-eyed view of where interest rates, tariffs, and employment trends are heading. A broker opinion of value is a smart first step before making any hold, sell, or buy decision.
The Bigger Picture
Portland’s office value decline is not happening in isolation. Nationally, office markets are being repriced as hybrid work becomes permanent, and cities with high tax burdens and slow job recovery are seeing the steepest corrections. Portland checks both of those boxes — the Metro Chamber report flags the city’s tax burden as one of the highest in the country, and the region’s job losses put it in the bottom tier nationally.
But the story is more nuanced than “office is dead.” The Lloyd Center redevelopment signals that major capital is still betting on Portland’s long-term trajectory. The Q4 2025 Portland Office Market Snapshot shows that while vacancy is elevated, the buildings that are investing in repositioning — spec suites, updated amenities, flexible lease terms — are the ones attracting tenants. And the foot traffic recovery suggests the fundamental demand to be in Portland hasn’t evaporated; it’s just shifted in form.
The question for every owner, tenant, and investor is the same: What does the next cycle look like, and how do I position now to benefit when it turns? History suggests that the investors who deploy capital during periods of maximum pessimism — when values are down 70% — tend to outperform on the other side. The same applies to tenants locking in favorable lease terms during a window that won’t stay open indefinitely.
Need help navigating the current market? Whether you’re evaluating a lease renewal, exploring acquisition opportunities, or trying to understand what your property is worth in today’s environment, I can help you cut through the noise. Request a free Broker Opinion of Value or Lease Rate Analysis — no cost, no obligation — and get a clear picture of where you stand.