Legg Mason Realty snares a fighter

October 09, 1994|By Kevin L. McQuaid | Kevin L. McQuaid,Sun Staff Writer

PHILADELPHIA -- As a Rouse & Associates Inc. senior vice president in the mid-1980s, Peter M. Balitsaris was accustomed to fighting with historic preservationists and others interested in influencing or controlling commercial development.

But those battles never prepared him for the $1 million extortion demand he received from a city councilman and local organized crime members after the city of Philadelphia awarded the company the rights to a 37-acre waterfront parcel planned as a $1 billion, Harborplace-like project.

"I was committed to that project -- it was the fantasy of everyone with a background or interest in city planning, and I wasn't going to let thugs take it over," Mr. Balitsaris said in a recent interview here, reflecting on the events of 1986. "We could have walked away, but then they would have won."

Instead, Rouse & Associates' cooperation with the FBI and Mr. Balitsaris' testimony eventually resulted in a raft of convictions, including those of Councilman Leland M. Beloff and mob boss Nicodemo "Little Nicky" Scarfo.

Although the Penn's Landing scandal and related trial delays ended his dreams of directing a mammoth urban redevelopment -- Rouse abandoned the project a year later, amid a softening market and difficulties in arranging financing -- the events hardened Mr. Balitsaris' already fierce determination to win.

That resolve should help the 51-year-old in his new post as president of Legg Mason Realty Group Inc. Mr. Balitsaris' appointment last month comes at a time when Legg Mason Inc.'s real estate consulting and appraisal operation faces intense competitive pressure from developers, accounting firms and others attempting to capitalize on corporate downsizing and the lack of building.

With Mr. Balitsaris, the investment firm intends to further integrate its $12 billion commercial mortgage origination and servicing portfolio into a single Legg Mason Realty entity to take advantage of "transactional opportunities" -- similar to the way Goldman Sachs & Co. operates. The firm also intends to leverage Mr. Balitsaris' knowledge of the Philadelphia market to expand geographically.

To that end, Mr. Balitsaris plans to operate primarily from Philadelphia, a change from past Legg Mason Realty practices, and work more closely with Walt D'Alessio, the chief executive of Legg Mason Real Estate Services. Mr. D'Alessio previously led mortgage banking firm Latimer & Buck Inc., one of the firms Legg Mason acquired.

'Good people skills'

"I saw in Peter someone who was willing to take on issues others wanted to pass on," Mr. D'Alessio said. "He's a good marketing and development person with good people skills, and he has the ability to look at a consulting assignment and see further opportunities."

If the plan succeeds, Legg Mason Realty would offer both the ability to examine market forces and economic factors affecting a particular project and the financing mechanisms to fund it.

But Mr. Balitsaris has no intention of altering factors that led to its success.

While Legg Mason's consulting is expected to shift its focus toward commercial real estate -- especially in Philadelphia, where the emphasis has been on residential projects -- Mr. Balitsaris intends to build on the strong base that exists, including the firm's regular housing market studies.

Mr. Balitsaris becomes only the second head of the Legg Mason Realty Group, taking over from founder Robert T. Kleinpaste, who departed in April to become president of Regency Homes Corp.

The realty group has roughly 50 employees, maintains offices in Baltimore, Washington and Philadelphia and generates annual revenues of roughly $5 million. It is one of the most well-regarded advisory firms on the East Coast. Its 100-strong client base includes some of the area's largest developers, lenders, government agencies and general contractors.

"They always seem to be right on top of the market," said David deVilliers, president of FRP Development Corp., a local subsidiary of Florida-based FRP Properties Inc. that owns property in Baltimore County and has tapped Legg Mason for data on industrial trends.

A native of Knoxville, Tenn., Mr. Balitsaris inherited his fighting spirit from his father, a football coach for Vanderbilt University and later UCLA, and honed it during his own playing days at Duke University, where he majored in psychology.

"Football taught me that you either do the work necessary to win or you don't," Mr. Balitsaris said. "Growing up, my family saw things that way, too, and sports underlined the thinking. There wasn't a great deal of room for excuses. I'm that way today. I like to set a goal and strive for it."

His interest in community development began as a law student at Georgetown University, and led Mr. Balitsaris to pursue a master's degree in city planning at the University of Pennsylvania in 1970.

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