If things had gone a different way, Tom Moyer might never have found his way into the world of development – and the landscape of Portland would have been the poorer for it.

Moyer, who died this past November at the age of 95, dropped out of high school as a freshman to embark on a career as a boxer. Building impressive amateur and professional records, he narrowly lost a five-round amateur bout to Sugar Ray Robinson and missed out on an Olympic appearance due to the start of World War II.

In 1966, he opened the region’s first multi-screen theater in Portland. One theater grew into a chain, and Moyer earned a reputation for having an eye for finding the best spot for each location.

He eventually decided to sell the chain and sail around the world with his wife, who died while the theaters were being sold.

“He got to the end (of his plans) and she was gone,” Moyer’s granddaughter, Vanessa Sturgeon, said, “so his plans got completely broken.”

Alone and grieving, Moyer sailed around the world several times. Then he got bored, and decided it was time to start yet another career, this time as a developer, Sturgeon said.

From a handful of properties, Moyer went on to develop some of the Portland’s most prestigious buildings.

His willingness to walk, sail and develop the path less traveled extended to his choice for his successor at his company, TMT Development. Sturgeon was pursuing her dream of becoming a judge when her grandfather asked her to join the company.

“Not many people of his generation would give a young woman with no experience a chance,” said Sturgeon, now the president of TMT Development. “But he was very gender-blind and color-blind when it came to people.”

Under her grandfather’s guidance, Sturgeon learned about the world of development. The most valuable lesson he taught her: “He taught me to go with your gut; data and numbers aren’t enough,” she said.

Moyer’s last project, Park Avenue West, was still rising when he died. But while the tower will finish next year under Sturgeon’s watchful eye, she says it will always be her grandfather’s project.

“Park Avenue West is entirely his vision,” Sturgeon said. “I wish I could take credit for it, but I can’t. It’s not mine.”

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Portland native Tom Moyer retired from leading TMT Development in 2010. But he lived a full life for many years before, including an impressive run as an amateur boxer, service with the U.S. Army during World War II and ownership of one of the largest privately-owned theater companies in the nation.

Moyer died Nov. 28, at age 95, at his home in Portland. He was remembered at a public service on Friday, at St. Mary’s Cathedral. He founded TMT Development, and built projects including the 1000 Broadway Building, the Fox Tower, Hayden Meadows throughout Portland and the Pacific Northwest.

Born in Sellwood, Moyer eventually turned to boxing and amassed 145 victories in 156 amateur bouts. In one he knocked down legend Sugar Ray Robinson, who nevertheless won in a split decision.

Moyer earned the Bronze Star for service during World War II. He served in the I Company, 186th Regiment, 41st Infantry Division.

Before entering the development business, Moyer built a theater company that eventually had more than 300 screens. He sold his Luxury Theaters chain to Act III Cinemas (now Regal Cinemas) in 1989.

That opened the door for Moyer to start TMT Development, which now is led by his granddaughter Vanessa Sturgeon. The company is continuing to bring to market Park Avenue West. The downtown office tower is scheduled to open in 2016.

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Oregon voters earlier this month delivered a blunt message when they legalized recreational marijuana use. But for landlords and developers, the future is hazier.

Though passage of Measure 91 makes marijuana legal in the state, it is still classified by the federal government as a Schedule I drug punishable with jail time and property confiscation. This disparateness creates a problem for cannabis producers and distributors seeking banks willing to do business with them, landlords willing to rent to them and developers willing to work with them.

“I was inundated with calls from developers the day after the votes were in wanting to know how the bank feels about leasing to tenants (in the cannabis industry),” said Charlotte Boxer, director of commercial real estate markets for Pacific Continental Bank. “From a lender’s viewpoint, it’s still considered illegal.”

Boxer said that most marijuana dispensary owners are willing to pay considerably more than market rate to lease space. Some landlords find the extra money tempting, but she said people willing to rent to marijuana dispensaries are placing themselves at risk.

“Leasing to those types of businesses could cause some of the other tenants to move out,” she said. “Some don’t like the possibility of the HVAC system blowing the smell – it can be pungent – into their businesses. Or they don’t like the clientele, or the constant traffic in and out.”

Meanwhile, federally insured lending institutions are worried about transactions that could generate attention from government authorities.

“Any time we get a deposit of more than $10,000 per day, we have to file a S.A.R. – a suspicious activity report – with the Treasury to inform about possible terrorist activity or money laundering,” Boxer said. “The federal government is probably going to turn a blind eye, like they’ve done in Washington and Colorado, but we all know policies can change with each different administration.”

Jeff Baker, president and CEO of Portland-based MBank, said the risks associated with lending to business owners in the marijuana industry are high. However, if those risks could be mitigated, MBank would be open to working with legitimate cannabis businesses, he said.

“We’re trying to figure out how to serve what is an underserved industry,” he said. “We’d like to be able to help because the only financing that’s been available for them comes from private lenders with a different risk appetite and is very expensive.”

Baker said that if landlords were protected from having their property confiscated by the government in cases where tenants were deemed participants in illegal activity, his bank would be more confident doing business with them.

Steve Malany, owner of P&C Construction, said he’s been approached by marijuana dispensary owners who are interested in renting space in one of his commercial buildings. He turned them down, he said, because his lending institution told him it would revoke financing if one of his tenants was committing a federal crime.

The shady legal standing isn’t scaring all developers away. Just this week the Portland Bureau of Development Services received a commercial building permit application for a proposed renovation of an existing Northeast Portland building to hold five grow rooms.

Portland-based Perlo Construction specializes in large-scale industrial buildings, but owner Jeff Perala said it’s unlikely his company would get involved in the marijuana industry because of uncertainty about legal conflicts and their possible consequences.

At a recent breakfast forum held at The Nines hotel in downtown Portland, the subject of legalized marijuana was met with stifled snickering from the audience after panelist Brian Glanville said that his firm, Integra Realty Resources, had been hired to assess a property with a building associated with the marijuana industry.

“The market for industrial space is already pretty tight,” said Vanessa Sturgeon, president and CEO of TMT Development. “We all giggle about it, but marijuana legalization is going to affect the industrial market.”

Jones Lang LaSalle reported recently that the vacancy rate for industrial space in the Portland area dropped below 5 percent in the third quarter of 2014. That is the lowest rate the area has seen in 20 years.

Marijuana grow facilities generally are concrete tilt-ups, which are inexpensive to build, Sturgeon said.

“They struggle to find financing, but people are finding creative ways to do it,” she said. “It’s not Beavis and Butt-head that are putting up these buildings.”

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Another year has brought another round of emerging trends in Portland’s real estate market. Industry professionals, during a breakfast forum on Wednesday, offered insights into what 2015 will bring.

Andrew Warren, Des Moines, Iowa-based director of real estate research for PricewaterhouseCoopers, was the keynote speaker at the event. He recapped 2014 and spoke of probable developments for the year ahead.

The rise of the “18-hour city” was first on Warren’s list of emerging trends. While New York, San Francisco and Boston, for instance, have long been considered 24-hour cities, smaller ones like Portland have fewer people on the streets outside of work hours.

“Downtown transformations combining the key ingredients of housing, dining, retail and walk-to-work to revitalize urban cores in lower-cost markets,” he said.

Warren focused much of his discussion on baby boomers and millennials, their preferences, and what they’re doing to change the face of the workforce.

“The population will be making decisions in the next five years,” he said. “Baby boomers will be choosing whether or not to retire, and millennials will be deciding whether they want to stay in the urban core or move to the suburbs.”

Warren asserted that the foundation of commerce is eroding and spending on infrastructure is down by one-third since 2009.

“It’s time for the United States to get serious about infrastructure,” he said.

Warren said that the U.S. needs to spend $3.6 trillion by 2020 on crumbling infrastructure such as surface transportation, schools, public parks, airports, wastewater treatment facilities, levees and inland waterways and dams.

Following Warren’s speech, Clyde Holland, founder of Holland Partner Group, moderated a forum. It included Warren, Portland-based Integra Realty Resources Senior Managing Director Brian Glanville, Capstone Partners Principal Chris Nelson, Greater Portland Inc. Vice President of Recruitment & Expansion Alisa Pyszka, and TMT Development President and CEO Vanessa Sturgeon.

Each panelist offered a unique viewpoint to the discussion, but the need for more office space and industrial space in the Portland area was a recurring theme.

“Vacancy rates have dropped to 4.9 percent,” Glanville said. “Someone had better build something.”

Sturgeon, who’s currently developing Park Avenue West, and Nelson both said 2014 has brought a new flood of institutional investors into the Portland market. Nelson said she doesn’t see it diminishing soon.

“It’s getting easier to find institutional capital to invest in the Portland market,” she said.

“Portland land is on people’s radar,” Sturgeon agreed. “I think we’ll continue to see institutional development in 2015.”

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Vanessa Sturgeon spent her summers working with her grandfather, Thomas P. Moyer, at his firm, TMT Development. She went on to earn a bachelor’s degree in journalism in 1999, attended Willamette University College of Law, and earned a master’s degree in business administration from the Atkinson School of Management in 2003. Shortly thereafter, she was named president of TMT Development.

The company started with theaters, and then branched out into other real estate ventures in the late 1980s to build a portfolio that now includes shopping centers, industrial buildings and historic properties like the nine-story Studio Building. She and her firm have been instrumental in helping develop Portland’s skyline with the 27-story Fox Tower as well as the Park Avenue West high-rise, which is currently under construction in the city’s downtown area.

A leader in the local development scene, Sturgeon made an unprecedented move when she decided to pursue pre-certification for both a LEED platinum rating and a Green Globes designation for Park Avenue West, which recently won two Better Bricks Awards.

Sturgeon helps young women prepare for leadership roles through involvement with Leadership Portland, as an ambassador for New Avenues for Youth and as a “big sister” in the Big Brothers Big Sisters program.

She is deeply involved with the community and has filled a long list of positions with local groups, including spots on the boards of directors for the Portland Business Alliance, NAIOP and Portland Downtown Services Inc. She also has served as a guest lecturer at Portland State University’s Center for Real Estate.

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Last week in Portland, crews began dismantling a crane that has stood idle for two years at the Park Avenue West construction site. President Vanessa Sturgeon informed the media earlier this month that work on the planned office tower will resume in 2013.

However, the project may come under greater scrutiny because of a legal dispute between Sturgeon and more than a dozen relatives. Specifically, Tim Moyer, patriarch developer Tom Moyer‘s son, claims Sturgeon, Tom’s granddaughter, misdirected money from some of the family’s assets to the Park Avenue West project. Family members disagree about the significance of the legal battle and also how it affects Park Avenue West, which is slated to open in 2015.

The dispute in the Moyer family was exposed last week when filed Nov. 14 with the Multnomah County probate office. The family is in the process of assigning a trustee for family trusts because Tom Moyer was diagnosed with Alzheimer’s disease, Tim Moyer said. Because of Tom Moyer’s deteriorating health, Sturgeon has essentially managed TMT Development since 2009, according to the documents.

“When that happened, it divided Tom Moyer Theatres into two entities – the Marilyn Moyer Trust and the Tom Moyer Trust,” said Tim Moyer, who manages family farms in Hawaii.

In the documents, 14 of Tom Moyer’s 18 descendants are represented as opposing the petition of Kimberly Moyer, Tom Moyer’s daughter and Sturgeon’s mother, to appoint First Republic Trust Co. as trustee of the Marilyn Moyer Trust.

The 14 family members, including three of Tom Moyer’s four children and several grandchildren, contend that First Republic has conflicts of interests that would prevent it from being a neutral third party, because it has sided with Sturgeon and Kimberly Moyer “repeatedly over the last 15 months … to the detriment of other beneficiaries” of the family’s trusts, according to the documents.

“Most of the family would rather have someone more independent,” Tim Moyer said.

The group contends that First Republic, as a trustee of the Tom Moyer Trust, ignored evidence that Sturgeon was involved in “improperly” diverting money from two of the family’s holdings, at 1000 Broadway and Fox Tower, to the Park Avenue West project. The family members claim that $14 million has been transferred from 1000 Broadway to Park Avenue West since 2006, including $8 million in 2009.

Those claims were brought to Arbitration Service of Portland in August by family members who are beneficiaries of the 1000 Broadway property, and were settled privately. Tim Moyer said that a result of the settlement was that “some of the money has been returned, and management is being replaced.”

“We’re really disappointed that we couldn’t settle this within the family,” Tim Moyer said. “But when someone blatantly violates operating agreements and treats someone with disdain, someone has to stand up.”

“The claims that are made in the filings are simply not accurate,” Sturgeon said. She would not comment on the allegations, citing ongoing litigation; however, she did say that the “other side of the story” would come out in future documents.

“What is written in those pleadings is just totally inaccurate,” Sturgeon said. “That’s all I can say.”

As to why the claims were being made, Sturgeon said she didn’t know.

“The issue is really narrow; it’s just about who’s going to be the successor trustee of Marilyn Moyer Trust,” said Sturgeon, who added that it is a “small part” of the family portfolio. “It includes a small suburban shopping center and some bare land. It has very little impact on the company as a whole, and it has no impact on 1000 Broadway or Fox Tower or Park Avenue West.”

Despite claims by Tim Moyer and other family members that Sturgeon has mishandled family assets, she said she expects the Park Avenue West project to move ahead as planned.

“Definitely,” Sturgeon said. “It has no impact.”

Tim Moyer said that “the market will take care of Park Avenue West.”

“It’s our hope that our father’s business will be able to move forward with all of the initiatives (TMT Development) decide to undertake,” he said.

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“It feels like the thawing of a long winter.”

Executive Vice President Bart Eberwein and others expressed relief today, when announced that in late 2013 work will resume at Park Avenue West, a downtown Portland high-rise project that stalled more than two years ago.

The scheduled restart date for the project, considered by some people to be a symbol of the recession’s impacts, is based purely on an expectation that large tenants will seek space in late 2015 and early 2016, TMT Development President Vanessa Sturgeon said.

Complete construction financing for the project was procured within the last 90 days, Sturgeon said.

Park Avenue West is planned as a 27-story office and retail building in a prominent location, on a block bounded by Eighth and Ninth avenues and Yamhill and Morrison streets. TMT Development halted the project, estimated to cost more than $100 million, in April 2009 because of financing problems. The big “hole in the ground” has since generated no work except for occasional adjustments of a towering crane that occasionally blows over the neighboring Nordstrom store.

“It’s a symbolic hole in our downtown, and getting this tower under way is a positive sign for everyone,” said Scott Andrews, chairman of the Portland Development Commission’s board and president of . “And alternatives (for leasing) are good for the marketplace.”

Activity is scheduled to take place at the site soon. To make the work-free zone more attractive, crews will soon take down the crane and install an 8-foot-high wall around the site. TMT has partnered with New Avenues for Youth for homeless and at-risk youth, under the direction of an artist, to create a mural.

Meanwhile, the project team will actively seek tenants for the building planned to offer more than 500,000 square feet of Class-A office space. Presently, no lease agreements are signed and no discussions are under way with prospective tenants, according to Sturgeon, but the team believes its opening date is on target because some large corporations and law firms are expected to shop for office space around that time.

“If we target toward that date, we’ll have exactly what they’re looking for,” said principal Scott Madsen, who is marketing Park Avenue West to potential tenants.

Madsen said the project could move forward earlier if tenant interest was to surge at the right time. The project did generate interest from prospective tenants, including law firms and , looking to lease space beginning in 2013 or 2014, but timing for construction didn’t work out for those tenants, and they stayed where they were.

Madsen said he doesn’t expect a big, local tenant to sign before 2015. The team wants to be prepared for that wave, however.

“When we look into our crystal ball … the next wave is happening in the 2015-2016 range. It makes a lot of sense just to prepare for that timeline,” Madsen said.

And in the fourth quarter of 2013, the team will be ready, said founder and principal Robert Thompson, who designed the building.

“There is steel sitting here in Portland, and curtain wall systems in Korea ready to erect,” he said. “The building is ready to go.”

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The debate over where the Portland Development Commission should headquarter its operations once its lease runs out next year is turning into a heavyweight bout of sorts. In one corner is Old Town and the PDC’s current digs, the historic Mason-Ehrman Building. In the other corner is the downtown retail district and the state-of-the-art, albeit unfinished, Park Avenue West Tower.

Each contender is circling the ring, listening to the arguments from the other side and countering with its own. The Mason-Ehrman Building would offer the PDC lower rent, the benefit of not having to move and space in a repurposed historic building within a historic district. On the other hand, Park Avenue West boasts premium office space, pre-certified LEED platinum, in a central part of town.

Both landlords have expressed what this lease would do for the residents and businesses in their respective districts, and the city as a whole.

Park Avenue West

The major tenet of the Portland Development Commission is to promote economic growth in Portland. Choosing Park Avenue West as its new headquarters would have the most direct impact toward achievement of that goal.

Construction on the yet-to-be-built high-rise, at 700 S.W. Ninth St., has been stalled since April 2009 because of funding issues. TMT Development, the company developing the 26-story mixed-use building with over 300,000 square feet of office space, already has an anchor tenant for Park Avenue West. Stoel Rives LLP is set to lease more than 150,000 square feet on 11 floors, but an additional tenant must be secured by June 1 for the project to meet the stipulations set by private financiers. Representatives of Stoel Rives will be making a decision in early June whether to fulfill their lease with TMT or seek another location.

Vanessa Sturgeon, president of TMT, said the need for the PDC to sign a lease is a matter of timing. TMT needs to lease three more floors by June and the PDC needs a lease by mid-May. No private company could commit to a lease that big in such a short time, she said.

The PDC would lease slightly less than 50,000 square feet on three floors in Park Avenue West for 10 years beginning September 2011, when the PDC’s current lease runs out. The state-of-the-art space would be constructed to the needs of PDC. The high-rise is pre-certified LEED platinum and is more centrally located than the PDC’s current home at the Mason-Ehrman Building.

“PDC would accomplish three of its goals by moving to Park Avenue West,” Sturgeon said. “It gives them the opportunity to be in a very sustainable building, puts Oregonians back to work by creating construction jobs and becomes an economic catalyst during this economy.”

If construction were to resume, 30 steel fabricators would return to work immediately for Tigard-based steel manufacturer Fought & Co., which has been hit hard by the recession. TMT estimates that 300 full-time, on-site jobs would be created if construction of Park Avenue West were to resume.

While the lease rate for Park Avenue West is presently confidential, rent will undoubtedly be higher than at PDC’s current home, the Mason-Ehrman Building. But Sturgeon pointed out that the rent differential isn’t as great as it is being perceived.

“The rent differential is insignificant,” she said. “The $975,000 in one-time, above-ground permit fees that TMT will pay the day construction resumes more than covers the rent delta between the two buildings over a 10-year lease.”

To sweeten the deal, TMT would pay to move PDC offices to Park Avenue West.

The city also would benefit from $1.8 million in annual property taxes once Park Avenue West is completed.

“There is no doubt that PDC has left a lasting footprint in Old Town,” Sturgeon said. “But the downtown business and retail district is hurting in this economy and is in need of a similar catalyst. Continuing this project could single-handedly jump-start the local economy, not to mention the effect it will have on financing big projects across the country.”

Mason-Ehrman Building

The Portland Development Commission’s current home is the Mason-Ehrman Building, a 68,000-square-foot structure at 222 N.W. Fifth Ave. in Old Town. The building was originally constructed in 1908 and is a contributing structure in the nationally registered New Chinatown/Japantown Historic District. The Kalberer Co., owner and landlord of the old warehouse, redeveloped and seismically upgraded the space in 2001. The Kalberer Co. charges the PDC $24 per square foot for the space, 8 percent above market value, in order to pay off a portion of the building’s $13 million remodel.

The Kalberer Co. has proposed two new 10-year leases for the PDC, each of which would terminate the current lease of just under 60,000 square feet. One would eliminate about 10,000 square feet from the lease due to the Portland Housing Bureau‘s relocation. The other lease would be for the entire building, but would give the PDC six months of free rent for 10,000 square feet in the building, or until a tenant was found to sublease the extra space. In each instance, the lease would be for approximately $17 a square foot, with a 3 percent annual increase.

But not only would Kalberer Co. be offering rent at a substantially lower rate, it also would be forgiving about $2 million in revenue by terminating the old lease immediately and locking into a 10-year deal, said Mike Kalberer, co-president of Kalberer Co.

“For two decades Old Town has struggled to find the right balance between retail, restaurants and services,” Kalberer said. “When PDC moved here in 2004, it showed everybody that Old Town is a good place to do business.

“The University of Oregon has even said that they didn’t decide to move to Old Town (in the White Stag Building) until PDC made that jump. The same goes for the Northwest Health Foundation as well.”

Kalberer pointed out that the PDC’s decision could ultimately affect a large proposed development at Block 33 in Old Town. The development, being proposed by the Seattle-based Uwajimaya Inc., would consist of 177 new housing units and a large-scale Asian grocery.

“The company is at a decision point right now and is waiting on this lease to determine whether to develop Block 33 or take a different route,” he said.

While leasing at the Mason-Ehrman Building would meet the charge to relocate city offices into historic buildings whenever possible, it would negate the charge to relocate city offices into sustainable buildings whenever possible. Noting this, the Kalberer Co. is in the process of applying for LEED gold certification for remodeled existing buildings. The company hopes to have the designation within a year.

There has been ample support from Old Town residents and businesses, including Central City Concern, the Historic Preservation League of Oregon and the Old Town Chinatown Neighborhood Association.

“Downtown Portland is only as strong as its weakest link, (and) right now that link is Old Town-Chinatown,” said Alexander Mace, chair of the OTCTNA, in a letter to PDC Executive Director Bruce Warner. “Today, our neighborhood has the best chance in the past quarter-century at continuing to grow into a livable balanced neighborhood for daytime workers, residents and nightlife. PDC’s relocation would tragically jeopardize that opportunity.”

Patrick Gortmaker, property manager at the Kalberer Co., said the PDC’s presence in Old Town has benefited economic growth in the area, but blight still exists. Also, removing 185 employees from the already small workforce pool in Old Town would be detrimental to future growth, he said.

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