One of Portland’s Few Black-Owned Music Venues is Facing Eviction

After the first missed rent payment, Malone, a first-time business owner, met with Phil Morman, the director of leasing at Constant Commercial Real Estate. The two discussed Malone’s lease and a pre-existing promissory note he set up with McLeod. After seeing what Malone was paying in rent, taxes, and monthly fees—about $9,600 per month—Morman offered to work with Malone pro bono. They got the rent reduced to an amount Malone could more easily afford.

Morman says the rent on the building is far higher than comparable properties in the neighborhood. McLeod, the property owner and commercial real estate broker, disputes that. 

“I do leases all over the city of Portland,” McLeod told the Mercury, noting she has tenants in several other commercial buildings she owns and had several people interested in leasing the venue on Foster Road. “All my other tenants are happy.”

While the parties disagree on what’s reasonable to charge for the space, Malone and Morman assert the monthly rent, property taxes, parking lot rent, and other monthly costs, have made it difficult for his business to make a profit. 

On top of that, Malone says he’s encountered plumbing issues and a carbon monoxide leak that went unnoticed for several months. He claims he was also saddled with paying for costs from the building’s previous tenant. 

Malone has what’s known as a “triple net” lease, which means he pays rent on the building, but also pays the taxes and all operating costs for the property, like routine maintenance, and insurance. The terms are sometimes referred to as “hands-off” leases, because the landlord has the tenant cover almost all expenses. Triple net leases are common in commercial real estate.

But the Heights’ owner said he began questioning his rental arrangement when McLeod requested to be included on the OLCC liquor license for the business. Malone calls it a power move on behalf of McLeod that would allow her to retain the liquor license at that location, even if Malone relocated his business. McLeod says she asked for her name to be added as a security measure, telling the Mercury, “it took a long time to get the liquor license and if he defaulted on the property, I would still have a liquor license.”

McLeod says her practices are fair and typical, and says she agreed to lower the rent and even covered the costs for several items, including a fire insurance policy, when it was clear the business was having trouble covering expenses.

She says she took a chance on Malone even though he was a “high risk” tenant without much financial capital, because he had a vision for a family-run space that would be a boon for the surrounding neighborhood. She says the building offers amenities that are hard to find in Portland, like a large parking lot and plenty of space for signage. 

“He didn’t require anything special. It was already a bar, it just needed some remodeling,” McLeod recalls. “That was part of the agreement.”

That lease agreement, McLeod says, includes a stipulation that Malone would reimburse her for all the fixtures and furnishings that she purchased. According to McLeod, Malone’s lease also states that if he defaults, he forfeits all items at the property. 

“The lease says, whatever’s there, if you’re in default, it becomes mine,” she says. “I even put a provision in the lease that if he provided me with 30 days notice, I would let him out of the lease with no penalty.”

Like the vast majority of leases in Portland, Malone’s rental agreement includes multiple stipulations that could put a new business owner without commercial lease experience at a disadvantage.

Malone says he was given written orders—in the form of a personal word document—to vacate the space on the morning of December 22, but has yet to see any legal paperwork or eviction filing with the courts. 

Malone took to social media recently after McLeod was in the process of changing the locks on the building to force him out. She confirmed to the Mercury that a locksmith successfully changed the locks at the front of the building, but says Malone still has access to the back door entry.

While residential landlord-tenant law in Oregon requires a formal court filing before tenants can be forcibly removed from the property or locked out, commercial evictions don’t afford tenants the same degree of protections. Lease agreements can be written to give property owners more rights than they might have with a residential lease.

McLeod says she’s given Malone ample notice of default and intent to evict, and claims the lease agreement allows her to execute a “self-help” eviction—essentially giving her the right to forcibly take possession of the property by way of locking Malone out, even before the legal filing has occurred.

“We’ll go through the normal court process,” McLeod says, noting her attorney will handle the administrative aspect of the eviction, starting next week. 

“Do I want to evict somebody? Never,” she says. “It’s silly that it has to go in this direction.”

Malone says his issues at the space weren’t the result of a bad business plan, rather, a bad landlord-tenant arrangement.

“We weren’t failing as a business,” Malone said in a video posted to The Heights’ Instagram page. “We were trying to survive a situation that was never safe or fair to begin with.”

For now, Malone has hunkered down at the spot, staying inside The Heights night and day since December 22 for fear of losing access to the site and his belongings. Initially, Malone wanted to stay at the current location, but says his plans have been altered. Friends and supporters are rallying around The Heights and Malone to help him physically stay in the space while also searching for the venue’s next location. 

News of the eviction arrives hot on the heels of the closure of Lollipop Shoppe, a woman-owned institution on the Central Eastside, and two years after the shuttering of Doug Fir Lounge, as well as the impending closure of North Portland corner venue Turn! Turn! Turn!