Average rents in the Portland area rose 11 percent last year and are expected to continue to escalate, according to a report by commercial real estate firm Kidder Mathews.
The average rent is now $1.16 per sq ft, with downtown Portland reaching an average $1.93 per sq ft.
“Rental rates are expected to continue to escalate over the next year, though the general consensus based on market participant interviews is that there is not a lot of room for additional rental rate growth,” said the report. It predicted that continued growth in net operating income (NOI) will come at least in part from putting bill-back programs in place and eliminating tenant incentive concessions.
Property taxes have also continued to rise, particularly in Multnomah County, but the cost of gas and electricity has remained fairly constant.
According to the Barry Apartment Report, a publication covering financial trends relating to Portland apartments, the increased demand is due to major employers such as Intel, Nike, Kaiser’s Westside hospital and Daimler Trucks taking on more employees.
New construction projects, including the Collaborative Life Sciences Building at Portland’s South Waterfront, Trimet’s Portand-Milwaukie Light Rail project and the re-start of Park Avenue West have also created jobs.