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One of the most ambitious real estate projects in Portland history has been turned over to its lender after failing to attract enough office tenants and condo buyers.
Ready Capital Corp., based in New York, said it has taken possession of Block 216, the 35-story building in Portland’s West End that has ground-floor retail, five floors of office space, a 251-room Ritz-Carlton Hotel and 132 Ritz-Carlton residences.
Block 216 was the swan song of local developer Walter Bowen, 83, who had a searing run in Portland real estate until now. His company, BPM Real Estate Group, broke ground on the project in July 2019, just months before COVID-19 crushed the office market and riots over the murder of George Floyd scared off buyers of high-end condominiums.
“Closing a chapter like this is never easy, but I’m immensely proud of what we’ve built and the lasting mark we’ve made on Portland’s skyline,” Bowen said in a statement. “This city’s future is full of promise, and our commitment to the community we love will endure for years to come.”
Ready Capital’s foreclosure has been expected since March, when WW reported that the lender had determined the best option for the $503 million construction loan it held on Block 216 would be to take possession of the property instead of waiting for repayment.
Ready Capital didn’t make the loan originally. It took possession when it bought Mosaic Real Estate Investors, based in Calabasas, Calif., in 2002. All parts of the tower will operate “business as usual,” Ready said in a statement released today.
As of March, when Ready Capital reported earnings and updated investors on the state of the Block 216 loan, just 23% of the office space had been leased, and only 8% of the Ritz-Carlton residences had been sold.
The hotel was underperforming, too, Ready Capital said at the time. Its average revenue per available room was $188 in 2024, compared with $343.28, the average for all Ritz-Carlton hotels during the same period. The chain is owned by Marriot International Inc., which provided the average figure in its full-year earnings report.
Earlier this month, BPM Real Estate parted ways with Barclay Grayson, Bowen’s right-hand man and an eager enthusiast for five-star hotels, WW reported.
In a lawsuit filed May 23, Grayson says the entity that controls the Ritz-Carlton residences is denying his right to buy one, as he and BPM had agreed. Grayson said he has spent $2 million on improvements, including “luxury closet built-ins,” window coverings, and glass treatments.
Grayson wants BDC Real Estate Investments LLC, a BPM affiliate, to honor the sales agreement or pay him $2.6 million. He named Ready Capital in his complaint, too. Grayson didn’t return a message sent to him via LinkedIn.
Ready Capital said it will keep everything running “business as usual.”
