Government projects boost building permitsJune building...

COMMERCIAL REAL ESTATE

August 18, 1993|By Timothy J. Mullaney | Timothy J. Mullaney,Staff Writer

Government projects boost building permits

June building permits paint a better picture of the construction business, says the Baltimore Metropolitan Council. But nonresidential building still is dominated by government projects.

The value of new nonresidential construction permits jumped more than 80 percent, to $37 million, from $20.2 million. Most came from two government projects: a $12 million expansion to the city's wastewater treatment plant in Brooklyn and an $18 million high school in the Long Reach section of Columbia.

"We can look forward not to tremendous growth, but to a return to normalcy," said Michael A. Conte, director of the University of Baltimore's Regional Economic Studies program. Developers aren't likely to build office buildings and other big nongovernment projects for two more years, he says.

Going into the recession, metropolitan Baltimore had 50 percent more employment per capita in construction than the nation as a whole, he added. Much of the recessionary pain has come as local construction employment, compared to overall employment, moved closer to the national mix.

In Anne Arundel County, the value of June new construction permits climbed to $500,000, from only $70,000 last year. The biggest renovation permit: $5.2 million for the new Nordstrom store at Annapolis Mall.

In Baltimore County, the value of new construction permits fell to $2.9 million, from $3.6 million in June 1992. The value of alterations fell to $11.1 million, from $11.8 million.

Carroll County saw nonresidential permits fall to $1.3 million from $2.4 million last June. The biggest permit of the second quarter went to Black & Decker Corp. for a $1 million wastewater treatment facility in Manchester.

Harford County issued permits for $40,000 worth of new nonresidential construction in June, down from $5.3 million last June. Renovations fell 30 percent.

Baltimore City saw the value of new permits rise. But 87 percent of the total was for the wastewater treatment plant, and the value of alterations dropped sharply. Howard County also saw new construction permits rise because of the school project, but permits for alterations fell by more than two-thirds.

Failed condo site bought by bank

The Bank of Baltimore is the new owner of the site of the failed Grey Rock condominium project in the Pikesville area, after buying the development at auction for $8.2 million.

The venture owed the bank $14.5 million as of last November, according to a debt statement in court documents that prompted yesterday's sale by Alex. Cooper Auctioneers Inc.

The bank got a 47-acre parcel with 79 "partially finished" townhouse lots and 113 condominium lots. Developers John Dorment, Richard Carter and George McCleary had trouble competing with other luxury developments marketing to "empty-nesters."

Bank of Baltimore spokesman David Spilman said the bank is negotiating to resell the project.

Japanese holdings in U.S. slow to rebound

The Japanese may seem to have bought all the real estate worth having in some U.S. cities, but a new report suggests they aren't so happy about it.

Kenneth Leventhal & Co., the Los Angeles-based accounting firm, said Japanese investors put $72 billion into U.S. real estate between 1985 and 1992, with $44 million concentrated between 1987 and 1989, when most U.S. markets peaked.

But more than half of that money was invested in markets likely to take up to five years -- or longer -- to bounce back from the recession.

The report said the fastest recovering markets in U.S. real estate, those that should recover in one to three years, are retail space markets in Dallas and Hawaii, residential development around Phoenix and golf course development in California and Hawaii. But only 5 percent of Japanese real estate investment in the U.S. is in those areas.

Leventhal said 27 percent of Japanese investment in U.S. real estate is tied up in the New York and Chicago office markets, the New York hotel market, and in West Coast land, warehouses and retail space. Those markets will take three to five years to recover, the firm said.

Japanese real estate investors had 24 percent of their money tied up in Los Angeles office buildings, undeveloped land in Los Angeles, and Hawaii and Los Angeles-area warehouses.

Recovery there will take five years or more.

Owings Mills parcel to be auctioned

One of the few big development parcels remaining on the east side of Owings Mills will be sold Tuesday, when Michael Fox Auctioneers auctions a 16-acre tract that is zoned for up to 180 apartments.

The site is about a quarter-mile east of the Baltimore County community's main drag, near Timber Grove Elementary School. Nearby apartments lease for between $500 and $600 monthly, auctioneer Steve Fox said.

Prominent auctioneer moves to another firm

Much-photographed R. Andrew Stafford has a new job. The auctioneer, whose face became familiar as he presided over dozens of high-profile real estate auctions, has moved to Boston Auctions Co. in Baltimore from Atlantic Auctions Inc.

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