Sylvan plans move to city in '96

November 16, 1994|By Kevin L. McQuaid | Kevin L. McQuaid,Sun Staff Writer

Sylvan Learning Systems Inc. is planning to relocate to downtown Baltimore from Howard County by the end of 1996 in an attempt to elevate the company's image and support the city.

"We think a move downtown would provide visibility for the company and provide a number of amenities for our employees," said Douglas L. Becker, the company's president. "The city has supported us, and we want to give something back, in a sense."

To underscore its proposed move from the suburbs, Sylvan hopes to build a 50,000-square-foot headquarters somewhere along Baltimore's waterfront. Mr. Becker said Sylvan, the nation's largest tutoring company, was considering several sites, including the planned $350 million Inner Harbor East project south of Little Italy, as well as parcels in Fells Point and along Key Highway.

A Sylvan move would affect 200 employees in its Columbia headquarters, which Mr. Becker estimates could grow to 300 by the time of its relocation. The company was seeking a parcel that also includes land for expansion since the company projects its needs could double by the end of 1997. Total cost for the project was estimated at between $10 million and $15 million.

Sylvan's move would come at a time when many longtime city office tenants -- including Amoco Corp., McCormick & Co. Inc. and others -- have abandoned downtown, because of rental costs, fear of crime or lack of parking.

Sylvan's move would not be unprecedented, however. Last year, architectural firms Design Collective Inc. and Kaplan Sutton & Associates relocated into Baltimore from Howard County to be closer to clients and heighten their images.

Part of Sylvan's aim, Mr. Becker said, was to establish Baltimore as an education center, in the same way the city and the state have been pushing to create a life sciences hub by capitalizing on existing institutions, such as the Johns Hopkins University and the University of Maryland.

The company, which became publicly traded in December 1993, owns or has franchise agreements with 530 educational centers in North America, including 12 in Maryland.

One of Sylvan's largest clients is the Baltimore school system, which has a $2.7 million contract with Sylvan to provide tutoring to nine elementary and middle schools. In February, Sylvan will begin work in a city high school.

Mr. Becker said the prospective move to the city was not connected to his work as chairman of the group organizing the city's planned $30 million children's museum and learning center, slated to occupy the Brokerage at 34 Market Place downtown and draw 400,000 visitors a year.

Mr. Becker acknowledged the costs associated with the planned move would be much higher than either building new quarters in Howard County, or moving into an existing downtown office building.

"We gave that heavy consideration, but we need room to grow, and we also don't want to become just another tenant taking up a few floors," Mr. Becker said. "Our feeling was we'd get lost that way."

Since its formation in February 1991, Sylvan has branched out from its tutoring base to provide computerized testing and other educational services. Core business growth and diversification have resulted in a steady climb in its earnings.

Through the first nine months of this year, Sylvan posted income of $2.2 million on revenues of $28.3 million, a 90 percent increase compared with the same period a year earlier. In 1993, Sylvan reported a net loss of $364,000 on revenues of $18.1 million, according to filings with the Securities and Exchange Commission.

Sylvan is evaluating various proposals from architectural and development firms in association with a move, and intends to decide on a designer in a matter of weeks. Mr. Becker declined to reveal the firms under consideration.

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