Portland developer Walter Bowen and his company, Bowen Property Management  Co., have sued a former executive, claiming Barclay Grayson failed to pay subcontractors on the Block 216 Ritz-Carlton tower and wrongly signed Bowen’s name to documents.

The suit, filed Aug. 15, is the latest fallout from the construction of the luxury 35-story tower in downtown Portland.

Grayson served as senior vice president and principal broker for Bowen Property Management and its affiliates from August 2003 to July 2025, when he was terminated, according to the lawsuit.

Bowen, age 83, alleges that Grayson used Bowen’s signature stamp to sign personal guarantees without Bowen’s permission. The lawsuit states Bowen, given his advanced age, is a “vulnerable person” under state law.

Grayson’s lawyer rejected the accusations. “We strongly deny the allegations,” said Thomas R. Rask III, an attorney with Kell Alterman & Runstein LLP.

The lawsuit, filed in Multnomah County Circuit Court, also centers on a dispute involving a penthouse condo at the Ritz-Carlton. Grayson agreed to purchase the penthouse and two parking spaces for $3.2 million, according to the complaint. The sale agreement also provides for Grayson to have an improvement allowance of $1.13 million, or $350 per square foot.

Bowen alleges Grayson ordered construction on the condo unit before he had closed on it, and that Grayson intended to flip it rather than use it as his primary residence. Bowen also charges that his company, BDC Construction, was never compensated for the condo improvements, which totaled “at least” $3 million, according to the lawsuit.

At least one subcontractor has filed for arbitration against BDC Construction, claiming it was never paid, according to the complaint.

The lawsuit, which was first reported by The Oregonian/OregonLive, also charges that Grayson used some of the improvements allowance on personal spending, including a wedding ring.

The legal tangle adds to a heap of trouble for Bowen’s landmark mixed-use tower. Lender Ready Capital Corp. of New York took possession of the property in July. Construction on the project began before the pandemic rocked commercial real estate, and demand for office and condo units in the tower has been modest.

Bowen is represented by Stoll Stoll Berne Lokting & Shlachter P.C.

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How about an affordable condo in the same building as a Ritz-Carlton hotel?

The developers of the 35-story being built in downtown Portland have indicated to city officials that they will offer price-restricted units within the $600 million building to meet inclusionary housing requirements. That’s a reversal from earlier plans to instead pay the Portland Housing Bureau a fee in lieu estimated at $7 million to $8 million.

The units are proposed as for-sale condos, not rental apartments. The only previous Portland project to bring to market for-sale condo units with inclusionary housing restrictions was a Habitat for Humanity project, stated Martha Calhoon, a spokeswoman for the Housing Bureau.

BPM Real Estate Group has indicated it will allot 20 percent of the Block 216 units to be affordable at 80 percent of area median income. With 138 units in the massive mixed-use tower, 28 would be designated as affordable, according to the Housing Bureau.

The choice raises the prospect that affordable-housing tenants will not only share a building with Ritz-Carlton hotel guests and office tenants, but also floors with luxury condo buyers. That will make the market-rate condos a tough sell, said Brad Golik, a Luxe Christie’s International Real Estate broker who specializes in luxury condos.

“That really takes away from the lure of the Ritz-Carlton, quite honestly,” he said. “People are buying the exclusivity of it, and allowing affordable housing takes away from that.”

Based on 2020 data, prices would be set at $226,404 for a studio unit, $250,449 for a one-bedroom unit and $318,664 for a two-bedroom unit. Those prices are pegged to annual incomes ranging from $51,600 to $66,320. Any mortgage payments would depend on buyer financing.

That compares to prices for the market-rate units of about $1.6 million for a one-bedroom unit to upwards of $7 million for top-floor penthouses.

Perception-sensitive luxury real-estate buyers may shy away from the building, Golik said.

“Who’s going to pay those prices if they don’t have that exclusivity they expected with the Ritz-Carlton brand?” he said. “I don’t think that’s a win for the people buying it, quite honestly.”

BPM Real Estate Group, led by local developer Walt Bowen, did not respond to messages seeking comment via a representative.

Listing agent Sarita Dua of Keller Williams Realty declined to comment.

Last year, Bowen’s group sent investors some documents forecasting prices of $1,350 to $1,900 per square foot for the condos, The Oregonian reported. But a lot has happened since, and the market and perception of living and working downtown has changed dramatically.

Not only has the deadly coronavirus made sharing floors with others seem unappealing, but the virus and ongoing protests have curtailed retail business and turned downtown streets lifeless, at least temporarily.

“The idea of living or working downtown is very different today than it was before George Floyd,” Cairn Pacific multifamily developer Noel Johnson said, referring to the death of a Minneapolis man that sparked nationwide protests. “And so, in the face of that uncertainty, it makes sense not to incur the extra $8 million paid to the city.”

Sensationalistic media coverage of the sometimes-violent protests in downtown Portland hasn’t helped. One prospective East Coast buyer who was interested in the condos held off while watching the protests unfold on TV, Golik said.

“They’re painting a picture that the city is burning down,” he said. “It’s not that way everywhere in the city, but it’s what he’s seeing, and it’s put a negative feeling on moving to Portland.”

Block 216, which will be one of Portland’s tallest buildings upon completion, attracted blue-chip brands such as Ritz-Carlton and an opportunity zone fund managed by Baker Tilly Capital. Mosaic Real Estate Investors contributed a $460 million, four-year construction loan.

Providing affordable housing on-site also means Bowen’s group will have fewer condos to sell at top-of-market prices during a period of economic uncertainty. If the project team sets aside 20 percent of units as affordable, 110 units would be available for luxury buyers.

Luxury condo buyers face no great rush to snap up a property, Golik said.

“For many of them, it’s a second (or) third home,” he said. “They can be patient. With what’s going in the city, they will probably be much more patient, I would guess.”

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The developer of the 35-story tower planned on Block 216, in downtown Portland, has scheduled a ceremonial ground-breaking event for later this week, but real movement of dirt will have to wait on permits.

An excavation permit for the project remains under review, said Alex Cousins, spokesman for the Portland Bureau of Development Services.

The applicant is still in the process of obtaining consent forms from neighboring property owners for right-of-way encroachments necessary for the shoring process, Cousins said Tuesday.

“That process is still unfolding, and they’re still waiting on some additional permits from (the Portland Bureau of Transportation) and (Bureau of Environmental Services) for water,” Cousins said. “Hopefully they can get going sometime this summer.”

“It’s all happening,” he added. “It’s just not quite there yet to get an excavator out there yet.”

The ceremonial event is scheduled for 11:30 a.m. on Friday.

On Monday, Mosaic Real Estate Investors announced an affiliate has provided $460 million in senior construction financing for the mixed-use tower. The four-year loan, along with Ritz-Carlton‘s agreement to take hotel and condo space in the tower, suggests developer Walt Bowen’s BPM Real Estate Group has the necessary funding in place.

“The high-leverage loan request, in and of itself, made this a very complex financing,” Alex Ovalle, managing director for the lender based in Calabasas, California, stated in a news release. “It was made even more complicated given that it is also the first development of its kind in Portland to offer this mix of uses. However, we were able to approach and understand the valuation of each of the separate components. Combined with the strength of sponsorship, it created a situation that was perfect for us.”

The loan pitch went to market in late February. George Smith Partners Principal and Managing Director Malcolm Davies arranged the financing along with Senior Vice President Zachary Streit.

The 460-foot-tall building will include a 251-room Ritz-Carlton hotel, 138 Ritz-Carlton condominiums, 160,000 square feet of office space and 7,800 square feet of ground-level retail space, along with four and a half stories of parking below ground.

The Portland Design Commission approved GBD Architects‘ design in December. The project team also includes general contractor Howard S. Wright, a division of Balfour Beatty; interior designer HKS Architects and landscape architect PLACE. The Goodman family’s Downtown Development Group owns the property, and has agreed to a long-term ground lease.

More than 50 food carts were evicted from the block on June 30 to clear the way for construction. The development will also eliminate surface parking spots.

The project is subject to Portland’s inclusionary housing ordinance. Instead of providing affordable units within the building, BPM representatives have said they plan to pay a fee-in-lieu to the Portland Housing Bureau.

The fee must be paid at the time permits are issued. Based on information provided by the applicant, the fee will be approximately $7 million to $8 million, Housing Bureau spokeswoman Martha Calhoon said.

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