As capital flows into downtown Salem — new apartments, a $150 million riverfront redevelopment under contract, a reinvigorated Forge district — the partnership behind Salem Center Mall says the block next door is ready for a new investor to step in. But co-owner Patrick Carney has a message for city and state leaders too: “Don’t confuse activity with action.
Downtown Salem is in the middle of its biggest private-capital push in a generation. New apartments have opened next door to Salem Center Mall, with a second complex currently under construction. A $150 million riverfront redevelopment of the former Truitt Brothers cannery is under contract and on track to close in May. The Forge, on Liberty Street, has transformed a long-dormant block into one of the most active gathering spaces in the downtown core. Local investors have stepped in where out-of-state money walked away, betting that the downtown they grew up in is finally turning the corner.
But downtown business owners say the political environment in Salem and across Oregon is still working against them. State law limits involuntary mental-health treatment to narrow circumstances, leaving people in visible crisis on public streets even when city outreach teams make contact. Downtown property owners have been absorbing the costs of fencing, cleanup, private security and break-in repairs out-of-pocket, rather than file insurance claims that would trigger rate hikes or policy cancellations. Salem’s police force ranks last in per-capita staffing among Oregon’s eight largest cities, Police Chief Trevor Womack told councilors last fall — while the city carries the second-highest violent-crime rate in the state, behind only Portland. Last year, the Salem Area Chamber of Commerce and Salem Main Street Association privately raised $360,000 to restore downtown bike patrols after city resources fell short.
The cumulative weight of that math is catching up with some of the same investors who bought in during the downtown push.
Patrick Carney and his partners at Salem Center Mall are listing the adjacent Downtown Salem Macy’s building at roughly half its 2024 assessed value — both to free up capital and attention for the mall itself and to invite a new investor to help carry the weight of a downtown rebuild that, to this point, has been almost entirely local.
“Don’t confuse activity with action,” Carney told the Salem Business Journal. “We need action now. As the heartbeat of Salem, downtown business, continues to suffer, public safety and the perception that downtown is safe and inviting is what needs to happen.”
From Big Vision to the Market
When the partnership — operating under the name OGSC Macy’s LLC and led by Salem Center Mall co-owners Kelly McDonald, Patrick Carney and Mark Shipman — closed on 400 High St. NE on Aug. 29, 2024, they described the acquisition as a strategic move to control the full downtown retail block and engineer a new entertainment-and-retail destination next door to the mall. In January 2025, McDonald told Salem Reporter the group had “a big vision” for the space, including plans for a large anchor tenant in the 25,000-to-40,000-square-foot range. Marion County records at the time valued the building at $12.3 million.
Fifteen months later, the group is asking roughly $42 per square foot on a 188,500-square-foot building — approximately $7.9 million, or close to half the county’s 2024 assessed value.
In July 2025, McDonald told Salem Reporter that “improvements for three suites in the Macy’s are underway,” though no tenants had been announced.
Carney told the Salem Business Journal the partners had “multiple opportunities” to sign leases that did not work out, and that prior interest in the space from larger national retailers — including IKEA and Kroger — had not translated into a deal.
“Really, the streets of Salem, downtown, if cleaned up, would probably lend themselves to a company of those sizes coming in and committing to Salem,” Carney said. “But with the way things are right now, it’s tough.”
Break-ins and Out-of-Pocket Costs
Carney said the Downtown Salem Macy’s has been broken into seven times since the partnership took ownership, with a single incident causing roughly $30,000 in damage. He estimated total out-of-pocket expenses for break-in cleanup, repairs, fencing and security at the Macy’s and adjacent former Cinebarre theater at more than $70,000 — costs he said cannot be submitted to insurance without triggering rate hikes or coverage cancellation.
“The property crime and insurance rates are something that get underreported out there,” Carney said. “You can’t turn minor break-ins and fencing into your insurance, so you’re paying that out of pocket. And when we bought the mall, we never had a fencing budget.”
Both the former Macy’s and the former Cinebarre theater are now surrounded by temporary fencing on their storefront sides. At least one Macy’s entrance has been framed over in wood after repeated door break-ins, Carney said.
Salem’s broader property-crime context supports the premise that downtown is a consistent hot spot. The city’s overall property-crime rate runs around 34.5 incidents per 1,000 residents — above the state and national averages — and downtown consistently appears as a red zone on third-party crime heat maps. Salem’s violent-crime rate hit a 15-year high in 2024, according to Salem Police Department data released last year, even as property crime modestly declined citywide.
The Salem Business Journal has filed a public-records request with the Salem Police Department for calls for service at 400 High St. NE since the partnership took ownership. Those records will be reported in a follow-up.
The REACH Program and the Limits of Outreach
Carney’s frustration extended specifically to the city’s newest street-response tool: the Rapid Engagement, Assessment and Community Health team, known as REACH, which launched Jan. 20 as a six-month pilot under the city’s Clean and Healthy Salem initiative.
REACH pairs a Salem Fire paramedic and EMT with a Marion County Qualified Mental Health Associate and is dispatched through 911 to handle calls involving behavioral-health crises, substance use or other complex social needs. It is funded through a $626,000 package the Salem City Council approved in November 2025.
In its first 18 service days, REACH served 49 people — roughly 70% of them unhoused — and kept 12 patients out of the emergency room, according to a March 9 presentation by Salem Fire Chief David Gerboth to the city council.
But Carney said the program, as designed, cannot resolve the situations downtown property owners encounter daily.
“We have a crazy person in the intersection. We call it REACH. They talk to them. They won’t give them consent, so they can’t help them,” Carney said. “In my mind, that makes no sense.”
Oregon law restricts involuntary mental-health treatment to cases of imminent danger or formal civil-commitment proceedings — constraints that apply to REACH and to every other outreach program in the state. That is a statutory reality, not a program-design choice on the city’s part. But the gap Carney is describing — between the presence of a person in crisis and any authority to move them out of the street when they refuse services — is one downtown property owners have raised repeatedly.
Carney stopped short of personalizing the criticism.
“I love the mayor. I love a few people on the city council who are trying to help,” Carney said. “We were very hopeful with the change in mayor. I’m optimistic that the city leaders can put their differences aside and work in unison to make downtown more safe and inviting.”
Refocusing on the Mall
With the Downtown Salem Macy’s going on the market, the partnership can concentrate its capital and attention on Salem Center Mall itself — the largest and most strategically important of the group’s downtown holdings.
McDonald, Carney and Shipman bought the 289,000-square-foot mall from Miami-based Rialto Capital Management in March 2024, ending a five-year period of out-of-state ownership that followed a 2018 loan default and a subsequent $27 million bankruptcy sale. Carney and McDonald had previously owned the former Nordstrom building before partnering with Portland-based Deacon Development, which ultimately demolished the store and built the 157-unit Rivenwood Apartments that opened in September 2024 next door to the mall.
The mall is now 70% occupied, Carney said, with additional tenant announcements expected in the coming weeks. Those plans will be covered in a follow-up story.
“We’re not moving on from the mall. We had a different partner group in Macy’s, and it’s time to sell,” Carney said. “We don’t have forever, like the government does. We have to face reality.”
Six-and-a-half acres and a full-block former department store is a lot to carry while also trying to revitalize a two-building, 289,000-square-foot mall and reopen a shuttered seven-screen movie theater. Selling the Macy’s block, Carney said, would free up the partnership’s time and capital to move faster on all three of the group’s remaining downtown assets.
More Hands Make Less Work
The decision to list the Downtown Salem Macy’s comes at a moment when downtown Salem is seeing a level of private reinvestment it has not seen in a generation.
At The Forge, the renovated retail and event complex that has become downtown’s most visible signal that the core is coming back, a team made up of Chris Blackburn of Clutch Industries, AJ Nash and Nat Borchers has built out a gathering space that has hosted Salem Main Street Association business forums, weekend public events and new retail concepts. Borchers is also the owner of the 45th Parallel Building in north Salem — anchored by Xicha Brewing — and is leading the long-awaited redevelopment of the former JC Penney building at 305 Liberty St. SE, which has sat vacant since 2020.
“I would love to acknowledge the amazing work they have done with The Forge. What Chris Blackburn, Nat Borchers and Clutch Industries have done downtown to date needs recognition, and we’re just trying to build on that.”
Meanwhile, SilverSphere Capital, a New Jersey firm led by Oregon-based developer Aaron Stickney, is under contract to acquire the former Truitt Brothers cannery on Front Street NE for a roughly $150 million, 382-unit mixed-use riverfront project with land-use approvals already in place. Apartment development has added hundreds of new downtown residents over the past 24 months, with more in the pipeline.
For Carney, attracting an outside buyer to take on the Downtown Salem Macy’s — a 188,500-square-foot full-block property with 600 covered parking spaces, skybridge access and adjacency to the mall — would add another investor to a downtown rebuild that has, until now, been almost entirely locally financed.
“All the investors downtown so far have been local,” Carney said. “The local guys, we’re trying. We’re just not getting any assist here.”
More hands, in other words, make less work. Every additional investor who steps into downtown Salem — whether regional, institutional or out-of-state — reduces the share of the lift carried by the small group of Salem operators absorbing the risk to this point. A new buyer for the Downtown Salem Macy’s would not just solve one partnership’s capital problem; it would broaden the base of capital committed to downtown as a whole.
The Barometer
Downtown Salem has, by almost any measurable standard, more going on today than it did 24 months ago. But for Carney, the question of whether downtown is truly recovering has a simpler test than any rent roll, permit tally or press release.
Asked how he would measure the city’s progress, he pointed to Marion Square Park — the small green space between the ARCHES homeless services center and the Center Street Bridge, where the city has cleared encampments at least three times since 2019.
“Any day a parent or grandparent can take their kid down to the park and play — then we’re okay,” Carney said. “That’s like the barometer.”
“I take my granddaughter there once a week. She wants to stop every time. I’m like, ‘Nope, not today.'”
Jesse Peone is the publisher of the Salem Business Journal. This is a developing story. A follow-up will report on Salem Police records for 400 High St. NE and on forthcoming tenant announcements at Salem Center Mall. Contact: jesse@salembusinessjournal.org.
