Whiteford, Taylor hires Pinkard to redo leaseOne of the...

COMMERCIAL REAL ESTATE

May 12, 1993|By Timothy J. Mullaney | Timothy J. Mullaney,Staff Writer

Whiteford, Taylor hires Pinkard to redo lease

One of the city's biggest law firms is preparing to test its muscle in the office market, as Whiteford, Taylor & Preston signs W. C. Pinkard & Co. to a tenant representation deal in preparation for the expiration of Whiteford's lease in 1995.

The firm calls the Signet Tower at 7 St. Paul St. home. Its offices cover 78,000 of the 374,000 square feet in the Trammell Crow Co.-affiliated tower.

The Signet Tower is all but fully leased, but it has not been immune from the pressure that emptier buildings have put on rents. In February, for example, Pinkard reported that it had helped the accounting firm Price Waterhouse renegotiate and extend its Signet Tower lease at a lower rate.

Whiteford's action does not necessarily mean the firm is moving; there are relatively few places downtown where 78,000 square feet are vacant. The options would include staying put, possibly in a Price Waterhouse-type deal, or going to the old Frank, Bernstein Conaway & Goldman space at 300 E. Lombard St., the space CSX Corp. has vacated at One Charles Center, or the new Commerce Place tower at One South Street.

One building that is not an option is 100 E. Pratt St., the IBM Corp.-T. Rowe Price Associates Inc. tower on which Pinkard holds the listing. It does not have 78,000 contiguous square feet left.

Firms offer 2 views on D.C. office market

Is the glass half empty or half full? The downtown Washington office market refracts differently when two leading real estate firms peer through the glass.

Smithy Braedon Co. looks at Washington, which is one of the healthiest office markets in the nation, and thinks things look good. Spaulding & Slye, no doubt aware that being the healthiest office market is something like being George Burns' youngest brother, points out that even with an 11 percent vacancy rate there are still some clouds around.

A new Smithy Braedon report says 1993 will bring falling vacancy rates and rising rents in Washington. "The Greater Washington area is beginning to notice initial signs of a slow, but welcomed, recovery," it says.

But Spaulding & Slye sees a slowdown coming in federal leasing, and the Boston-based firm's Washington brokers are worried about a possible glut of sublease space coming on the market this year.

"Complicating the equation is phantom space -- space that is not being used by a tenant or being sublet," Spaulding & Slye Vice President Terrance S. Amling writes. "Phantom space represents a major component of the D.C. market and cannot be overlooked when predicting future [market] trends."

It is hard to feel sorry for the District when both firms give Baltimore a raspberry by comparison.

Smithy Braedon sees a three-year wait before Baltimore office supply and demand get in balance, and says rents will continue to fall this year. Spaulding & Slye puts Baltimore's regionwide vacancy rate at 18 percent and sees a flat 1993.

Equitable Building to be auctioned

The Equitable Building at 10 N. Calvert St. will go on the auction block June 23 as the most prominent Baltimore property in a mega-auction assembled by a Montgomery County real estate firm and a Delaware auctioneer.

More than 70 properties from Baltimore to Tidewater Virginia will be auctioned, says Nathan R. Isikoff, chairman of Carey Winston Co. of Chevy Chase. That firm, along with DeCaro Real Estate Auctions of Seaford, Del., is organizing the sale.

The Equitable Building, a Class B structure, is about 29 percent available, according to Spaulding & Slye. The auction also includes a 24,000-square-foot office building at 1001 Cathedral St. and a piece of raw land in Columbia.

The Equitable Building is owned by a Washington-based partnership. Signet Bank/Maryland in December bought 1001 Cathedral St. at auction for $700,000 after the developer defaulted on a Signet loan.

Caterer feels fallout in Belvedere dispute

There has been some fallout from the recent dispute between the developers of the Belvedere condominiums and the owner of the restaurants there. The owner of the catering company that operates in the ballrooms of the 90-year-old landmark says he got caught in the confusion surrounding an advertised auction.

Thomas Stuehler, owner of Truffles, The Catering Company at the Belvedere Inc., says he has had to handhold clients who worry about the prospects of his 10-month-old business, even though it is likely to do $2 million of business its first year.

He says some moves by developers Joel Gamel and Elliott Sharaby have fed the confusion. For example, they scheduled an auction against Dion Dorizas, the owner of the building's two restaurants, in a fight over mortgage debts, building repairs and other items.

And they have advertised a "foreclosure closeout" sale to sell the handful of remaining condos.

"People get concerned when they see that," Mr. Stuehler said.

He says the confusion has cost him more annoyance than lost business so far.

"We spend a lot of time talking to people about the solvency of our project. In their minds they can't break it apart. They don't know that everyone is separate, and certainly Truffles is separate."

Now they do.

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