Lender Indicates Possible Repossession of Ritz Tower in Murmurs
A recent announcement from New York-based Ready Capital, the lender for Block 216, Walter Bowen’s striking West End high-rise, hinted at potential trouble for the property. In a supplementary report for investors, Ready Capital indicated that taking ownership of the property, rather than waiting for repayment, would yield the best results in terms of net present value. Thomas Capasse, CEO of Ready Capital, elaborated on this during a conference call, mentioning that the original plan to refinance the construction into a bridge loan was no longer the most advantageous option due to current appraisals and other factors.
Block 216 is a mixed-use development featuring ground-floor retail, office space, a Ritz-Carlton Hotel, and Ritz-Carlton Residences. Ready Capital took over the Block 216 loan in 2022 when it acquired Mosaic Real Estate Credit LLC, the original lender. However, like many other downtown towers, Block 216 has found it challenging to attract office tenants, with only 23% of the office space currently leased. The sales of Ritz-Carlton condominiums have also been slow, with only 8% sold at an average price of $1,105 per square foot.
Ready Capital plans to stabilize the three components of Block 216 and then sell the office space and hotel portion within two years, with the sale of the condos expected to take three years. Despite attempts to reach out to Block 216 management and Bowen’s BPM Real Estate Group for comment, no responses were received. On the bright side, the retail space within Block 216, home to the Flock food hall, is fully leased, providing a positive aspect amidst the financial challenges.
In a separate development, the Portland City Council is set to approve a nearly $1 million settlement with four journalists and two legal observers who alleged mistreatment by police during coverage of the 2020 George Floyd protests and riots. The journalists, including photojournalists who have contributed to WW, sued the city, claiming that police actions violated fundamental constitutional rights.
Portland Public Schools is also facing challenges, with substantial cuts being made to its Summer Acceleration Academy, a program designed to help students below grade level catch up during the summer. The program’s size and scope have been reduced due to budget constraints, with funding expected to be significantly lower this year compared to the previous year. The district is relying on state funds to run the summer academy after federal relief dollars have diminished.
Looking ahead to the May 2025 election, a shake-up may be in store for the Portland Public Schools Board, with four contested seats and incumbents facing challengers. The election could bring changes to the board composition, with candidates vying for positions in various zones within the district. The outcomes of these elections could impact the direction and policies of Portland Public Schools moving forward.