Oregon City Business Climate 2026: The Economic Outlook

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Event Overview

The Oregon City Business Alliance February Forum brought together business leaders from three of Oregon City’s most visible industries to take stock of the local economic landscape. Moderated by Renate, the panel assembled voices from the restaurant, automotive, and financial services sectors—each navigating a shared set of pressures from different vantage points.

The theme, “Navigating the Dark Clouds of Today’s Economic Climate,” proved apt. Across all three presentations, a common thread emerged: this is a K-shaped economy, where higher-income households continue spending while many others are pulling back on discretionary purchases. Rising operational costs, interest rate headwinds, tariff uncertainty, and shifting consumer behavior are creating real stress—but also prompting creativity, adaptation, and a renewed appreciation for community roots.

Attendees came away with frank, ground-level perspectives on what it actually takes to sustain a business in Oregon City right now—and reasons, despite the clouds, to remain cautiously optimistic.

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Speakers

Tara Wanstall — Owner, Watershed Cafe & Bistro

Ira Jones — General Manager, Lithia Subaru of Oregon City

Matt Christman — Business Banking Relationship Manager, Columbia Bank

Matt Christman brings over 25 years of banking experience to his role supporting small and closely-held businesses across Oregon and Southwest Washington. A graduate of the University of Oregon and the Northwest Intermediate Banking School, Matt focuses on relationship banking—lending for expansion, working capital, equipment, and real estate—and is active in community organizations including the Lake Oswego Rotary and Hunger Fighters food bank.

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By the Numbers

11,928	Restaurant and food service locations in Oregon
80%	Of Oregon restaurants are small businesses (fewer than 50 employees)
3–5%	Average restaurant profit margin in Oregon
60–70%	Of Oregon restaurant revenue comes from repeat customers
$1.80	Returned to the local economy for every $1 spent at Watershed
$748	Average new car payment in 2025, up from $554 in 2019
$532	Average used car payment in 2025, up from $389 in 2019
180	Vehicles sold per month at Lithia Subaru of Oregon City
$20M	Planned investment in Subaru’s new Oregon City “Connectivity Hub” facility
$70B	Asset size of Columbia Bank following the Umpqua acquisition

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Key Takeaways

Oregon City Is Operating Inside a K-Shaped Economy

All three panelists described a bifurcating economy: upper-income households are still spending, while middle- and lower-income consumers are pulling back hard on discretionary purchases. For a restaurant, that means diners who won’t absorb menu price increases above 10%. For a car dealership, it means customers arriving with payment expectations far below the market reality. For a bank, it means heightened scrutiny of loan portfolios and asset quality.

Rising Costs Are Eating Into Already Thin Margins

The cost of doing business is up across the board—utilities, insurance, compliance, labor, and supplies—and the increases are landing hardest on small operators who cannot spread costs the way large corporations can. Tara described heating a century-old building as a major line item. Ira noted that vehicle inventory financing has become his dealership’s third-highest expense as interest rates have climbed. Matt confirmed that the cost of capital has risen on the banking side as well, compressing net margins for lenders and their customers alike.

Tariffs Are a Real Factor, but Not the Whole Story

Tariff impacts were a prominent thread, especially in automotive. Subaru was among the first manufacturers to publicly announce price increases—averaging $1,800 per vehicle—while simultaneously moving Forester production to Indiana to reduce exposure. Ira noted that tariff-related cost increases represent a single-digit percentage of overall cost pressures; rising interest rates, staffing costs, and inventory carrying charges are comparably significant. Matt echoed this from the banking side: several of his manufacturing clients have raised prices due to tariff-affected input costs, but the broader economic slowdown is the larger concern.

The EV Transition Is Still Finding Its Footing

The electric vehicle market generated one of the forum’s most candid exchanges. Oregon had been a voluntary California Air Resources Board state, which would have required 40% of new vehicle sales to be battery electric by 2025. While that mandate was effectively set aside, manufacturers had already committed billions to EV development—and that inventory is arriving whether demand is ready or not. Ira described EV values declining steadily as the market works through the surplus, while hybrid demand has surged to the point of waitlists. Consumer range anxiety and charging infrastructure gaps remain real barriers.

Relationship and Community Are Competitive Advantages

Across all three panelists, the most consistent strategic response to uncertainty wasn’t cutting costs—it was deepening relationships. Tara emphasized building community before the cafe even opened, engaging local government and the business alliance early, and sourcing 90% of vendors from local Oregon companies (even when it cost more). Ira described Subaru’s “earn customers for life” philosophy and the dealership’s community giving through the Share the Love program. Matt stressed that community banking’s value proposition—knowing your customers personally, staying close during downturns—is exactly what distinguishes Columbia Bank from larger institutions.

Oregon City’s Business Community Is Unusually Engaged

A theme that emerged organically across all three speakers: Oregon City surprised them. Tara said the strength of the local business ecosystem was something she wasn’t fully prepared for. Ira confirmed that despite evaluating relocation during the facility planning process, he advocated for staying—citing strong relationships with city and county partners. Matt acknowledged that Columbia Bank needs to deepen its presence and community engagement in Oregon City, and that the February forum was a step in that direction. All three noted that local government actually listens and responds when businesses engage.

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Speaker Highlights

Tara Wanstall — Watershed Cafe & Bistro

Tara opened with an industry trivia exercise that set the tone for an honest, data-grounded conversation. Among the findings she shared: Oregon has nearly 12,000 food service locations, 80% of which are small businesses, and the average independent restaurant operates on a profit margin of just 3 to 5%.

Her economic headwinds section was candid and specific. She described the K-shaped consumer split, legislative uncertainty that changes the rules mid-game for small businesses, and cost spikes that defy easy solutions. A case of 15 dozen eggs—essential for a breakfast-forward cafe—had peaked at $110 before returning to roughly $25. Rather than raise menu prices (data shows restaurants that raise prices above 10% actually see profit losses, not gains), Tara’s team pursues micro-decisions: sourcing green onions from WinCo when the distributor price spikes to $20 a pound, for example.

On tailwinds, she highlighted Oregon City’s growing population inflow from Multnomah County, a strong and intentional local business community, and the role Watershed plays as a “staycation” dining alternative for residents who want a Portland-quality experience without the drive. She noted that real estate agents are actively using the cafe in marketing materials as a neighborhood amenity—a meaningful signal of how a local gathering place anchors community identity.

Tara also raised a systemic challenge: starting a small business in Oregon City requires navigating city, county, and state requirements simultaneously, with little coordination between the three. Despite that friction, she said feedback does get heard—public comments she’s made have prompted follow-up from city officials, which she described as rare and valuable.

Ira Jones — Lithia Subaru of Oregon City

Ira delivered a clear-eyed assessment of the automotive market—starting with the numbers most people don’t see. The average new car payment has climbed from $554 in 2019 to $748 today; used cars have moved from $389 to $532 over the same period. More than 30% of car buyers now carry monthly payments exceeding $1,000. This is the payment gap: the distance between what customers expect to pay and what the market actually requires.

Key headwinds he outlined: tariff-driven price increases (Subaru announced an $1,800 average increase per vehicle, with more expensive models absorbing more of the impact); rising flooring rates on dealer inventory financing, now the dealership’s third-highest operating cost; and a compressed used car market driven by Covid-era chip shortages that reduced production years ago. Used car prices are elevated today partly because there simply aren’t enough late-model vehicles in the secondary market.

Ira’s response strategy is multi-pronged: focusing on value-tier vehicles, leveraging Subaru’s manufacturer-subsidized interest rate incentives (as low as 0.9% on qualifying new vehicles), investing in a robust buying center to source used cars directly from consumers, and building service revenue to offset margin compression on new car sales. He noted that Lithia Subaru actually lost money on every new car sold at the end of last month—a sign of how intense the pressure to move volume has become.

On the positive side: Subaru is moving Forester production to Lafayette, Indiana—a zero-waste facility—and using domestic production to actually reduce prices on that model while competitors face tariff-related increases. Ira also announced the planned $20 million redesign of the Oregon City location into a Subaru “Connectivity Hub,” one of the first ten of its kind nationally. The new facility will blend sales, service, and parts into a single open showroom with a coffee bar, positioning it more like a lifestyle brand experience than a traditional dealership.

Matt Christman — Columbia Bank

Matt offered the broadest macro perspective of the three panelists—drawing connections between interest rates, consumer behavior, Portland’s commercial real estate collapse, and the downstream effects on small business lending.

Columbia Bank (formerly West Coast Bank, which acquired Umpqua) is a $70 billion institution that Matt describes as a “community bank at scale.” The pitch to small business owners: dedicated relationship managers who want the whole banking relationship, not just a transaction. He described his own approach as getting to know clients’ families and business trajectories over time—exactly the kind of engagement that large banks struggle to replicate.

His headwinds rundown covered interest rates (doubling mortgage costs for first-time homebuyers, compressing operating lines for businesses), asset quality management (banks must reserve capital against loan risk, limiting lending capacity), and the stark reality of Portland’s commercial real estate market—a downtown office tower that sold for $350 million five years ago recently changed hands for $42 million. That erosion of commercial values creates ripple effects across the regional economy that Oregon City businesses aren’t immune to.

Matt also flagged business fraud as an underappreciated threat: both internal and external, it’s a growing problem that business owners should be actively building systems to detect and prevent. On staffing, he noted difficulty filling entry-level banking positions—a labor market dynamic that mirrors what Tara described in the restaurant sector.

His prescription for navigating a potential multi-year downturn echoed the other panelists: stay close to your customers, double down on relationships, and remember that 2008 was survived through community—not by retreating from it.

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Q&A Highlights

What is Lithia Subaru’s key customer demographic, and how do you reach them?

Ira Jones: Our current sweet spot is buyers between 45 and 65, and we’re actively working to shift that younger, toward 30 to 50. Almost the entire advertising budget is digital—we’ve eliminated linear TV and run OTT campaigns for cord-cutters—because that’s where car shopping starts. Everyone Googles “lowest price Subaru near me” before they ever set foot on a lot. Subaru is also deliberately positioning as a more affordable brand to attract younger buyers, and our focus on value-tier vehicles naturally follows that direction.

Some analysts predict a business downturn beginning in 2026 that could last up to four years. How would you adjust?

Tara Wanstall: The more authentic and community-connected the experience, the more likely people are to choose us over competitors when discretionary spending gets squeezed. We can’t out-discount a chain—but we can out-relationship them.

Matt Christman: Stay close to your customers—that’s the lesson from 2008. During the financial crisis we weren’t lending, but we were in branches reassuring people. That relationship capital is what you draw on in a downturn.

Ira Jones: People still need reliable transportation. Our job in a downturn is to meet customers where they are—whether that means a less expensive vehicle, a lower monthly payment, or reduced service pricing. Earning a customer for life means showing up for them when times are hard, not just when it’s easy.

How has Oregon City been as a place to do business, and what could improve?

Tara Wanstall: Starting a small business here is genuinely challenging—city, county, and state all have different requirements and don’t communicate well with each other. There’s no single resource to navigate all three. But what surprised me is that when I make a public comment or give feedback, someone in city government actually responds and asks for more. That kind of responsiveness is rare, and it matters.

Ira Jones: We seriously evaluated relocating during the facility planning process. I advocated hard for staying, and I’m glad we did. The relationships we’ve built with community partners—and the fact that we’re the only car dealership Oregon City will allow—make this the right place to invest.

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Conclusion

The February OCBA Forum didn’t offer easy answers—because the economy isn’t offering easy answers right now. What it offered instead was something arguably more useful: honest testimony from three business leaders who are living these pressures in real time, making hard calls, and finding ways to hold on and move forward.

The common thread running through every presentation was the same: in a difficult economic climate, relationships—with customers, with vendors, with the community—are not a soft benefit. They are a structural advantage. The businesses that have invested in those connections are better positioned to weather the storm than those competing on price alone.

Oregon City’s business community has something that many communities would envy: a civic infrastructure that actually listens, a growing and engaged resident base, and a culture of mutual support among local operators. In an economy full of dark clouds, that’s a meaningful patch of clear sky.