Follow McLoughlin Boulevard south out of Portland, past the gentleman’s club with the $5 steak special and the sprawling vacant lot next door, and you can get a wide-angle view of the reality of arterial strip development as it is. The 4.5-mile stretch of state highway from Milwaukie to Oregon City is a random mix of the weird, the cheap and the ugly: a restaurant with a bomber plane parked out front, a replica of the Statue of Liberty, a rectangular mountain of storage space, a huge “no-credit, no-problem” auto lot, a motel next door to a strip club with rooms starting at $29 per night, a 66,000-square-foot former GI Joe’s sporting goods store available, for sale or lease.
In the middle of this urban planning disaster is a strip mall with twin turrets built from residential-style brick, the Green Castle Retail Center. The buildings are attractive enough to stand out in a sea of hastily constructed eyesores, but the attempt at transformation they represent is daunting. Property owner Joe Green III says he and his father invested in the area and fixed up the property on the belief that “McLoughlin only has one direction to go, and that’s up.”
Not far from the Green Castle, plans are being made for a new light rail station. With light rail could come transit-oriented development, mixed-use density. A team of consultants is making plans for a more coherent future. But the gap is vast between Oregon’s urban planning ideals and the current realities on McLoughlin and other suburban-style strips from Beaverton to Salem to Medford.
Even with its vaunted land use laws, Oregon is no stranger to strip mall sprawl. Metropolitan Portland contains over 400 miles of arterial commercial strips heavily laden with every variety of retail space. Head west out Canyon Road to Beaverton, south along 99W from Tigard to McMinnville, or east along Powell Boulevard from 82nd Avenue to Gresham, and you might just as well be touring the suburbs of Atlanta or Indianapolis: huge parking lots, congested intersections, national chain stores squeezing out any semblance of regional identity.
These areas fit the profile of convenience-driven strip development in that they are auto-oriented, endless and, well, ugly. They are also increasingly distressed. The latest in-depth retail report from Portland-based Norris Beggs & Simpson finds a steadily improving overall retail vacancy rate of 6.3% for the Portland market (significantly lower than the national rate of 7.2%), with major improvements in central city, neighborhood and regional shopping centers. The most troubled sub-category by far is “strip convenience,” with a vacancy rate of 18.2%.
Nationally, the Wall Street Journal has reported that strip mall vacancies continued to rise even after the recession ended. Locally, the picture is mixed. “If you have a grocery-anchored center you’re OK, because people still need to eat,” says J.J. Unger, a retail specialist for Norris, Beggs & Simpson. “But if you’re in a center that wasn’t designed properly, that doesn’t have an anchor, those are the guys having issues.”