Tenants sought for B&O building

January 31, 1994|By Edward Gunts | Edward Gunts,Sun Staff Writer

The Maryland Stadium Authority, which spent $11 million in 1991 to acquire the B&O Warehouse as part of Oriole Park at Camden Yards, plans to spend nearly that much to prepare the southern end for office tenants.

Authority board members voted earlier this month to proceed with a $10.5 million plan to renovate the southern end of the eight-story warehouse, vacant since the ballpark's opening in 1992.

The state's goal is to fill the warehouse with tenants such as Waverly Inc., the publishing company that wants to move its dTC headquarters from Mount Royal Avenue to Camden Yards by next January, and to use money generated by the leases to help repay the construction bonds for the ballpark.

The renovation plan, which still must be approved by the state Board of Public Works, calls for the Columbia-based Rouse Co. to be paid a nominal fee to provide "development management services" for the project, and for Design Collective of Baltimore to be the lead architect.

According to authority Executive Director Bruce Hoffman, Waverly has signed a letter of intent to occupy the sixth, seventh and eighth warehouse floors and part of the fifth floor -- between 60,000 and 70,000 square feet in all -- for at least 10 years.

Waverly had been considering sites in Anne Arundel County and the city. The company's move to the B&O Warehouse will keep 350 to 400 jobs in Baltimore.

Before Waverly can move in, Mr. Hoffman said, every floor on the south end of the 1905 warehouse must be upgraded to comply with safety codes. The work includes installing elevators, mechanical systems and sprinklers, as well as creating an entrance lobby at ground level.

He said about $4.8 million is needed to upgrade the space Waverly wants to occupy and $5.7 million to get space ready for prospective tenants.

Part of the money to improve Waverly's space will come from a $2.2 million loan provided by the state Department of Economic and Employment Development, through its Maryland Industrial and Commercial Redevelopment Fund. Additional funds will come from the Stadium Authority.

Mr. Hoffman said he could not disclose how much Waverly will pay in rent because the lease is still being negotiated. But the state's goal is to earn more than enough to cover construction costs, he said.

State law, he said, requires the authority to maximize ballpark revenues to pay off construction debts. Mr. Hoffman voiced optimism that other companies will follow Waverly's lead once construction gets under way.

"We've already gotten calls from some major prospects," he said. "I'm hoping that by June, we'll get leases for the rest of the building."

As part of the ballpark construction, the northern two-thirds of the 1,116-foot-long warehouse was recycled for baseball-related uses, such as the Orioles offices, the Camden Club restaurant and banquet space. The warehouse shell got a new roof and windows.

But because the state had no immediate use for the southern portion -- an eight-story section about 400 feet long -- the authority deferred interior improvements until tenants could be found. The unfinished section contains 176,000 square feet of space, including a basement.

With the 1993 All-Star Game and the groundbreaking for the Baltimore Convention Center addition out of the way, Mr. Hoffman said, the authority can concentrate on filling the south end of the warehouse.

Officials hope to generate additional revenue by leasing Camden Station, and the authority has given the Babe Ruth Museum until mid-June to firm up plans to open a baseball-related tourist attraction there.

Mr. Hoffman said the authority began working with Rouse when the company brought Waverly to the state as a prospective tenant for the warehouse.

He said the authority asked Rouse to continue providing development management services because the authority does not have the in-house expertise to negotiate with office tenants and because Waverly was comfortable working with Rouse.

Rouse will help the authority prepare the lower floors of the warehouse for other tenants and negotiate leases. Rouse's fee has not been set but will be about $250,000 -- subject to approval from the Board of Public Works, Mr. Hoffman added.

He said the state did not seek competitive bids for the work because it was considered a specialized service and Rouse's involvement with the project was a key in convincing Waverly to move to Camden Yards.

Robert Minutoli, senior vice president of the Rouse Co., said the arrangement is similar to the development management work that Rouse is performing for Columbus Center, the $160 million marine research facility under construction on Piers 5 and 6 at the Inner Harbor.

Mr. Minutoli said the payment will not compensate Rouse for all its costs, much less generate a profit. He said the company was willing to work under those conditions because the authority asked for help and because "we were concerned that Waverly might leave the city."

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