The soaring windows at 107 NW 5th Ave. in Old Town/Chinatown reveal only forlorn, empty floors where the retailer Compound Gallery operated until the end of October.

"After 18 years, we're making moves from Chinatown to downtown," reads a sign in the window.

For sneakerheads and trendsetters, Compound Gallery offered limited-edition shoes and cool streetwear, bringing fashion-conscious shoppers to a neighborhood that has struggled with boarded-up storefronts and street crime.

The store's departure from Old Town—and a subsidy from Prosper Portland, the city's economic development agency, to aid that move—has raised the hackles of nearby business owners.

"My thought was, the city was supposed to be subsidizing parts of town that need subsidy, like Old Town," says David Leiken, longtime owner of the Roseland Theater, a music venue a block from Compound Gallery's old space. "I don't know how you can say you are trying to help Old Town when you enable one of our flagship businesses to fly the coop."

The intersection of Northwest 5th Avenue and Couch Street was a bright spot in Old Town/Chinatown: The restaurant Mi Mero Mole thrives on the southeast corner, the boutique Upper Playground stands on the southwest corner, and the arcade Ground Kontrol once surrounded Compound Gallery on both sides.

Now, Compound Gallery operates in a temporary space on Southwest 10th Avenue as it awaits completion of a permanent home in new, subsidized, street-level retail space in the city-owned SmartPark building at Southwest 10th Avenue and Yamhill Street. The parking structure anchors the West End, a neighborhood that has seen a surge of new restaurants and shops, and hundreds of millions of dollars in new residential development. Prosper Portland wants to add a half-dozen more retailers to that mix.

Compound Gallery owner Katsu Tanaka says he decided to move his business because his lease in Old Town was up and he was tired of crime in the neighborhood.

"Old Town was getting too dangerous," Tanaka says. "We had break-in and theft issues there."

Tanaka says he'll lease two spaces in the city building from Prosper Portland—1,300 feet for retailing new products and about 800 feet for a consignment space.

"They have been great to work with," he says of Prosper Portland.
Amy Nagy, a project coordinator for the city's economic development agency, confirms that Prosper is negotiating with Tanaka to fill some of the newly renovated, ground-floor retail space in the garage.

"We've been talking to them for a while," Nagy says.

Back in 2017, Prosper Portland announced that following renovations of the parking garage, the agency would actively market its 21,000 feet of retail space to businesses owned by women and people of color.

Nagy says the new storefronts, with improvements paid for by the city, are being offered to qualified tenants at a discount—undisclosed for now, until details are final—from market rents.

Compound’s temporary home, until its deal with Prosper Portland is finalized. (Sam Gehrke)
Compound’s temporary home, until its deal with Prosper Portland is finalized. (Sam Gehrke)

Prosper Portland changed its name and its focus a couple of years ago, shifting from a bottom-line emphasis on new development to "building an equitable economy," which includes targeting entrepreneurs of color, like Tanaka.

The agency must balance that equity work with attention to neighborhoods identified for urban renewal, such as Old Town/Chinatown. That can be difficult.

The city's involvement with Compound Gallery is frustrating to Old Town/Chinatown business owners, who see Compound Gallery's empty storefront as a metaphor for neglect by city officials. Leiken says the store brought foot traffic to the neighborhood, and he's sorry it's gone.

"On one hand, the city and Prosper Portland claim they are trying to bring business and people to Old Town, and yet they turn around and help enable one of the really successful stories in this area to move," says Leiken. "I think it's speaking out of both sides of your mouth."

David Gold, who was Compound Gallery's landlord, says Tanaka's move caught him by surprise.

"He was a pioneer of the street apparel movement in Old Town," Gold says. "Lots of others followed him in."

Gold's beef is not with Tanaka but with Prosper Portland.

"The West End is probably the hottest retail market in the city right now," Gold says. "They are building Ritz Carlton and lots of other projects there. Why the hell are tax dollars going to support that area?"

Such dissatisfaction extends to what the agency has failed to do in Old Town/Chinatown—such as find a solution for the vacant site adjacent to the Chinatown Gate at Northwest 4th Avenue and West Burnside Street that was formerly home to Cindy's Adult Bookstore and, later, the homeless camp Right 2 Dream Too.

Charles Mattouk, owner of Charlie's Deli at 22 NW 4th Ave., just north of the vacant lot, says since Prosper Portland moved Right 2 Dream Too in 2017, the space has been strewn with garbage and needles.

"Prosper is a horrible landlord," Mattouk says. "Having nothing there and no oversight from them is way worse than having Right 2 Dream."

Nagy says Prosper did not solicit Compound Gallery to leave Old Town. Rather, she says, Prosper merely executed the agency's strategy of helping to create a more equitable city.

"We aren't recruiting from one neighborhood to another," she says. "[Compound]'s lease was up."

She says the agency has been intentional, not only in its choice of prospective tenants but that those tenants fit into a concerted downtown retail strategy of luring shoppers to a mixture of national brands and unique, locally owned stores.

"The story is a success story," Nagy says. "How does the city provide great, beautiful space and promote people coming downtown?"

Jessie Burke, general manager of the Society Hotel at 203 NW 3rd Ave., questions why Prosper hasn't engaged in a strategy for Old Town/Chinatown similar to the marketing strategy for the 10th and Yamhill garage.

Burke says Prosper, which is headquartered in Old Town, seems disengaged from its own backyard, even though, she notes, there's plenty of money available—more than $50 million in urban renewal funding for Old Town/Chinatown.

"There are a lot of businesses that could use their help in Old Town," Burke says. "But things keep happening where it feels like the cards are stacked against the neighborhood."