BY LINDA BAKER

For the past few years, things have looked pretty gloomy on Portland’s downtown retail front. Saks pulled out of Pioneer Place, and retail vacancy rates at one point hovered around 10 percent.  What a difference today makes.  Vacancy rates are at about 5 percent, and a raft of new retailers, and developers, are moving into the neighborhood.

As the Portland Business Journal reported on Tuesday, Microsoft has submitted plans to develop the downtown site that Macaroni Grill vacated in September. That store will be one block from the new retail outlet that Apple is planning in the former Saks space in Pioneer Place.

The West End continues its evolution as one of the area’s hottest new neighborhoods. This past summer, Project Ecological Development purchased the Red Cap Garage, a two-decades-old bar, and Aura, a nightclub. both located between SW Stark and Burnside. The development firm is converting the space into an interior mall with local and national tenants.

This summer, of course, Target is moving into the Galleria, becoming, in effect, the West End anchor for the downtown retail district.

Even Nike may be getting into the downtown swing.  Now that the footwear company has committed to expanding, Nike is reportedly considering a site near South Waterfront for two additional office towers.  

More retailers are setting up shop downtown.  But the miniboom in downtown retail is more than a matter of numbers.  As Lisa Frisch at the Portland Business Alliance observes, many of the new retailers “really reflect the needs of downtown residents."  Fifteen years after downtown Portland began “rebranding” as a residential neighborhood, residential oriented retailers are now following, not just the restaurants, clothing and interior design shops, but retailers such as Target concerned with the pragmatics of everyday living.

At the same time, the influx of Apples and Microsofts suggests a new, perhaps iconic era for Portland's downtown retail environment, one that reflects the city's increasing cachet nationally and internationally.  Even the West End development ethos suggests a new sophistication, with the potential for a more interior and labyrinthine kind of urban density unfolding in that section of downtown.

My OB colleague JT Carter did alert me to an unintended consequence of the West End retail boom: as that area gentrifies, the neighborhood is no longer the epicenter for the city’s gay community--and nightlife.  In recent years, stalwarts such as the Silverado, the Bathhouse and now the Red Cap have disappeared.  Today, only Scandals and the Roxy remain.

Much like the city’s African American community, once centered in North and Northeast Portland, Portland's gay community, for better or for worse, is now dispersed.

Linda Baker is managing editor, Oregon Business.