Portland's Comeback According to Bloomberg

Written by Linda Baker at Bloomberg

To sketch the changing trajectory of Portland’s status as a beacon of American urban policy, you could look at any number of metrics — the thousands of young people who flocked to Oregon’s biggest city in the 1990s and 2000s, or the crime and homelessness rates that spiked during the pandemic two decades later. Or you could just follow the bikes.

In the 1990s, Portland emerged as a hotbed for urban cycling in North America, building an extensive network of neighborhood bikeways and shaded bike lanes and launching community events like the Providence Bridge Pedal and the summer bike festival Pedalpalooza. In the 2000s, “it was off to the races,” says Jonathan Maus, publisher of the BikePortland advocacy blog. “We were golden.”

By 2014, 7.2% of Portlanders commuted by bike — by far the largest share of any US city.

But then the numbers started to reverse. Between 2015 and 2022, the city’s bike counts dropped by a whopping 45%. Just 2.8% of the city’s commuters were still on their bikes in 2021. One of the primary culprits, according to Maus, was a huge increase in solo car drivers. But he also sees it as a sign of diminishing political support in Portland, as issues like police brutality, disorder and public drug use came to dominate policy conversations.

“It was stagnation, decline and plateau,” Maus says. Until 2023, when bike counts ticked up by 5%.

There’s hope that this modest turnaround of the bike scene could be a sign of something bigger — a broader recovery for an embattled city.

For decades, Portland was considered a model for successful and sustainable urban policy. A generation of planners and leaders in other mid-sized US cities looked to the Pacific Northwest for best practices in walkable development, environmental stewardship and transit infrastructure. But that was before a longstanding unsheltered homelessness problem blew up into a full-blown crisis, before the pandemic hammered property values downtown and handed Portland an office vacancy rate of around 30% — the highest in the US. When protests over police funding triggered by the killing of George Floyd rocked the city for months in 2020, Portland joined San Francisco as a frequent target of conservative ire and a kind of shorthand for liberal governance gone wrong.

But to many residents, activists and planners in town, Portland started losing its edge earlier. Notably, between 2010 and 2020, Portland’s rent increases were among the highest in the US. As housing became increasingly unaffordable, a city known for luring young people began to see slower growth. During that time, critics complained that the city was also backsliding on sustainability indicators and failing to address the city’s legacy of excluding marginalized communities.

In the decade before the pandemic, Portland became hugely popular, and lost sight of what made the city special in the first place — “that, fundamentally, we will prioritize quality of life over everything,” says Mike Thelin, chair of Reimagine Portland, a civic engagement group.

It was as if Portland urbanism had become more of a marketing tool, rather than a demonstration of values and ideas, according to Thelin, who also founded the food festival Feast Portland, which shuttered in 2022. He and others point to a culture of bureaucratization that had set in, impeding implementation of new ideas and solutions.

In November 2024, restive voters delivered a political shakeup, with an historic overhaul of the city’s century-old commissioner system and the election of a new mayor who has promised to end unsheltered homelessness by the end of the year. These reforms align with a surge in housing construction and a slew of new infrastructure and neighborhood-scale redevelopment projects aimed at addressing some of the shortcomings from previous eras of Portland city-building.

Beyond the bike numbers, other indicators have been trending up. Nearly 5,500 people experiencing homelessness — out of roughly 13,000 across Multnomah County — moved into shelters and permanent housing between July 2023 and June 2024, a 28% increase compared to the year before. That uptick is largely a function of new affordable housing construction and rental assistance, funded with support from a tax on businesses and high-income earners. Several new mental health and addiction treatment facilities opened last year, denting the behavioral health crisis that plays out daily on Portland streets. Gun violence has dropped to the lowest levels since 2019. After three years of losses, the number of new residents inched up in 2023.

Portland is hardly out of the woods: There’s a ballooning budget crisis threatening city services amid the recovery, not to mention a new presidential administration eager to pick fights with this and other self-declared “sanctuary cities” over immigration enforcement and any number of other issues. Still, several local experts see signs that Portland has started to recover a sense of itself.

“There’s sentiment that we’re still in a bad spot but not the intensity of six or ten months ago,” says John Horvick, vice president of DHM Research, a local polling firm. “People are looking for wins.”

The Long Game

According to Ethan Seltzer, professor emeritus of urban planning at Portland State University, the Portland story has always had a comeback kid element to it.

In the 1980s, he recounts, Oregon was in the middle of a profound recession, triggering massive job and population loss and anxiety about the future of the city at a time when suburbanization was draining US cities of middle-class residents. But “due to the foresight of some very brainy people,” he says, Portland had a decade earlier established governance and planning tools like the first urban growth boundary in the US, which limited sprawl. Leaders and activists also demolished a downtown freeway to make way for a waterfront park — a first in a major US city.

These actions helped lay the groundwork for what Portland became in the 1990s, a poster child for the resurgence of cities as places where people actually wanted to live.

External factors helped make that happen. Cheap and plentiful housing, together with Portland’s climate and proximity to the mountains and ocean, lured thousands of young people to the city, powering the city’s famed creative culture, artisan businesses and eventual economic boom.

“Keep in mind we are talking about a 30-year arc here,” Seltzer says. “None of these things that happened were quick.”

During this period Portland also invested heavily in rail transit, launching one of the earliest modern light rail lines in 1986 and in 2001 introducing the first streetcar system built in the US since World War II. Both were credited with helping to reduce car trips, improve livability and spur walkable development.

Leaders in the 1970s weren’t looking to build “the next whiz-bang thing,” Seltzer notes. Initiatives like the light rail, he explains, grew “out of a concern about what would reinforce the kind of community Portland wanted to be.” Then and now, “the real issues are about community and really they are about governance.”

City Hall Shuffle

The charter reforms that took effect this month open a new chapter in that story, streamlining a siloed system in which individual commissioners and the mayor each controlled individual bureaus and departments. Under the new structure, a city manager appointed by the mayor oversees the bureaus. Additionally, the number of councilors has more than doubled, with the 12 members now elected by district rather than citywide — an effort to distribute political power more fairly across the city.

In its entire history Portland has had only two city commissioners that lived in East Portland, home to the city’s poorest and most ethnically diverse neighborhoods, says Duncan Hwang, community development director for the Asian Pacific American Network of Oregon, a local nonprofit.

“The fact that we have three starting in January means we have more representation than we’ve ever had before,” says Hwang, who is also a councilor for the Metro regional government. “It’s a big change.”

A political neophyte and green trucking company owner, new mayor Keith Wilson won a ranked-choice race with a resounding majority, winning over voters with a fresh face and aura of collaborative leadership. Wilson campaigned heavily on his plan for eliminating unsheltered homelessness across Multnomah County, where roughly 5,000 people are living on the street.

“Portland is dreaming big again,” Wilson said in a statement. “We have hard and important work ahead to solve our unsheltered homelessness crisis, bridge our budget gap, and rebuild the small businesses that power our community, but it’s safe to say Portland has recommitted to the vision and values that made us a world-class city.”

Wilson’s approach centers on building new overnight-only shelters; two weeks into taking office, the mayor opened two shelters with a combined 200 beds, and his plan calls for setting up 1,500 beds by the end of 2025.

That has echoes in Portland’s recent past: Wilson’s predecessor, Ted Wheeler, entered office in 2017 with similar promise, only to be frustrated by the scale of the problem. Many homelessness researchers maintain that investing in permanent supportive housing is less costly and more effective than emergency shelters, and some local experts have questioned the price tag of Wilson’s plan — $28 million the first year alone.

“Mayor Wilson anticipates this number will adjust over time to changing needs, and remains confident the number of emergency nighttime shelter beds will trend downwards over time as individuals are connected with services, permanent housing, and reunited with loved ones,” said Cody Bowman, a press officer with the mayor’s office. “The goal of this system is to manage the crisis at hand and provide a bridge towards long-term solutions.”

Any change in the amount of visible homelessness on city streets is likely to be welcomed by Portland residents.

“Initially, he will be seen as successful because he will be seen as doing something very publicly,” says Jim Moore, director of political outreach at the McCall Center for Civic Engagement at Pacific University. “But the proof is in the data: one year, three years, five years down the road.”

One significant factor that could work in Wilson’s favor is what housing experts say is a major shift in how the region is tackling the region’s affordability crisis. Funded by local and regional affordable housing bonds, roughly 4,000 new housing units have opened over the past seven years or are in the pipeline. Zoning reforms approved in 2022 allow Portlanders to build “missing middle” housing like duplexes, triplexes and ADUs in low-density single-family residential neighborhoods around the city; since then, more than 1,400 have been added.

“There’s a lot of consensus right now that the fundamental housing problem is that we need more homes,” says Michael Anderson, director of cities and towns for the Sightline Institute, a Seattle-based sustainability think tank that focuses on the Pacific Northwest. “That is something that was not widely accepted for most of my professional lifetime.”

Under Construction

With its 20-year development horizon, the restoration of the Lower Albina district is the kind of long-term project that could help reboot Portland urbanism.

Once the epicenter of the city’s Black community, the neighborhood was ripped apart by the construction of Interstate 5 in the 1960s. In 2020, a community-led nonprofit, Albina Vision Trust, launched a three-year planning process to create a framework for rebuilding the neighborhood. That vision includes capping an eight-acre section of the freeway, a project that has been folded into a $1.9 billion lane expansion. While the highway widening has been a target of local environmental activists, there’s widespread support for the cap itself.

Proponents of the project tout it as the largest US example of restorative development — an opportunity to rectify historic wrongs while advancing new solutions that align with current needs and values. “This time around we are making sure that the drivers are communities that look like ours, which has never been the case, and the benefits of innovations are shared by all Portlanders,” says Winta Yohannes, executive director of Albina Vision Trust.

The Trust helped the Oregon Department of Transportation secure $450 million in federal funding to construct a highway lid stout enough to support residential and commercial development. That promised funding, from the US Department of Transportation’s Reconnecting Communities program, is now in limbo following Trump’s freeze on infrastructure spending. But the rest of the 94-acre project is proceeding, in collaboration with property owners, including the city of Portland, Portland Public Schools and the Portland Trail Blazers NBA franchise. Plans call for more than 1,000 units of market-rate and affordable housing, along with business, cultural and education hubs and large scale energy efficiency innovation pilot projects. The development will qualify for the city’s housing preference policy prioritizing people with historic ties to the neighborhood who were displaced through urban renewal or subsequent gentrification for housing subsidies.

“What we are talking about is repairing our relationships to one another, and establishing a sense of citizenship for all Portlanders,” says Yohannes, who describes the project’s goal as creating “a central city neighborhood that is closer to our aspirations as a city in terms of how we live together in next 10, 20, 50 years.”

The new neighborhood’s first apartment building, Albina One, is slated to open this year. It was designed by one of only two licensed Black female architects in Oregon, according to Yohannes: “When the crane went up, it was only the second time in our state’s history that a Black-owned crane dotted the sky.”

Other development in progress demonstrates a similar equity focus. A 24-acre district around the city’s science museum includes plans for 1,200 units of mixed-income housing and a first-of-its-kind Center for Tribal Nations, which aims to restore the historic ties of Pacific Northwest tribes to the Willamette River, the waterway that runs through downtown. Slated to break ground next year, the project also features a waterfront park designed in collaboration with the Columbia River Tribal Commission.

And in October the city approved six new districts that use tax-increment financing — a favored local funding tool — to incentive new development. TIFs have a mixed record of success, but Hwang says that the city is reorienting this financing system that “used to focus primarily on subsidies for private developers” toward affordable housing, small business support and other community needs.

Downtown Turnaround

When it opened in August 2024, the $2 billion expansion of the Portland International Airport’s main terminal was heralded as another sign of a Portland comeback — at once an architectural showpiece and an expression of local values and ideals. All 3.7 million board feet of wood used in the expansion, including the nine-acre timber roof, was sourced from sustainably managed forests within 300 miles and harvested in partnership with Native American tribes.

Bridging Oregon’s stark urban-rural divide, the airport also bears comparison to the long-awaited James Beard Public Market, slated for a partial opening downtown later this year. Featuring food and farm stalls, a butcher shop, bookstore and teaching kitchen, the two-story venue is designed to support sustainable agriculture, small businesses and access to healthy affordable food. Thelin sees it as a natural successor to Portland’s influential food cart scene, which got their start in the central core during the 2008 financial collapse before expanding into a nationwide phenomenon.

Crucially, city boosters also hope the market will help revitalize downtown, which has a stubbornly high office vacancy rate — due in part to its concentration of software companies, a sector particularly vulnerable to remote work. Those empty offices are contributing to the city’s $27 million budget shortfall, a deficit set to quickly grow to $100 million.

“We still have innovative ideas. But our ability to execute is not what it used to be.”

But local brokers point to signs of a turnaround: The flood of businesses that decamped for the suburbs has slowed, and the number of tenants now seeking space in the central core is approaching pre-pandemic levels. Foot traffic and hotel bookings are up; restaurants are opening. In January, Wilson announced that city managers and supervisors — roughly 700 people — would have to return to the office full-time by April, a further boost to activity in the central business district.

The rise of remote work also brought huge declines in ridership to TriMet, the region’s public transportation system. Passenger counts on the agency’s buses and trains remain down about a third from pre-pandemic levels, but ridership has started to rebound as the agency rerouted bus lines, enhanced security and added a new Bus Rapid Transit system.

Chris Smith, vice chair of the Portland Streetcar and a former member of the city’s Planning and Sustainability Commission, says that the region has strayed from its roots as a leader in enlightened transportation policy. In 2020 Portland voters rejected a measure that would have expanded light rail; last year Oregon’s governor nixed a plan to impose tolls on sections of Interstate 205 and I-5, including the area targeted for expansion. Road deaths have climbed as driving increased: Despite Portland’s Vision Zero pledge, 69 people, including 24 pedestrians, died on Portland streets in 2023, the highest fatality rate in more than three decades. The region is also not meeting its own greenhouse gas reduction targets, adds Smith, a convener of No More Freeways, a group that is battling the I-5 expansion.

“The way I frame it is: We still have innovative ideas,” Smith says. “But our ability to execute is not what it used to be.”

As the new local government finds its footing, BikePortland’s Maus also sees an opportunity to revive two-wheeled advocacy. Mirroring the other community-driven fixes that are underway, he favors grassroots actions and fresh leadership. In 16 years, for example, the city has yet to expand the frequency of its popular Sunday Parkways — a series of car-free open streets events that take place three or four times a year. “I’d like to see them liberate the idea, hand it over to activists, neighborhoods, nonprofits, who could hold them weekly and all over the city to remind people how great bicycling is,” he said.

Portland’s table stakes have changed, believes Sightline’s Anderson, in part because residents now understand how fragile the city’s vaunted livability advantages always were. “We’ve had a lot of years where we enjoyed the fact that people wanted to live and work here. Now there’s a lot of consensus that we can’t take that for granted.”

Seltzer, the Portland State planner, preaches patience. Today Portland is 50 years from a lot of the innovations planners worldwide view as foundational to the city’s identity. “But the arc is continuing,” he says. “This isn’t the end of the Portland story as much as an ongoing saga.”

Source: Linda Baker, February 13, 2025, Progressive Portland Plots a Comeback, Bloomberg.