A Year in Real Estate: Portland Vacancies Cap Construction; Apartments a Bright Spot

Commercial lease rates expected to improve slowly in 2012; investors snapping up apartment buildings

With businesses still wary of expansion and major spending, Portland held on to a glut of empty office, warehouse, industrial and retail space in 2011.

Things are looking a little brighter for 2012 -- lease rates are expected to improve -- but it's going to be a long, slow slog, industry analysts say. Little new construction is expected in 2012.

There is at least one bright spot. Investors are snapping up apartment buildings in the Portland as vacancy drops and rent climbs.

New apartment buildings have boosted housing starts in the last months of the year, and permits for more apartment buildings have improved the outlook for next year.

In downtown Portland, some smaller buildings with high vacancy but good locations have sold to investors looking to fix them up and attract new tenants.

In November, TMT Development President Vanessa Sturgeon pledged to begin construction on the company's long-stalled Park Avenue West Tower in 2013. The project has left a fenced-off pit in the heart of downtown since work stopped in 2009.

And the next week, heirs to TMT founder Tom Moyer said in a court filing Sturgeon, his granddaughter, had wrongly diverted money to the project and improperly steered the company at a time Moyer was suffering from Alzheimer's disease. Sturgeon denied the allegations, but the familial strife could complicate any future for the project.

-- Elliot Njus

Follow @enjus

Copyright 2011 - The Oregonian, Portland, Ore.