First Fidelity may vacate office tower

March 11, 1995|By Kevin L. McQuaid | Kevin L. McQuaid,Sun Staff Writer

First Fidelity Bancorp, on the heels of a decision to eliminate roughly half the work force of the Bank of Baltimore, is considering vacating the downtown headquarters of the recently acquired bank.

But the New Jersey-based bank holding company's potential move from the 25-story office tower at 120 W. Baltimore St. -- until recently known as the Bank of Baltimore Building -- is contingent on finding a tenant to replace the bank, officials said.

Earlier this week, First Fidelity sent out proposal requests to six area commercial real estate brokerage firms, the first step in its efforts to sublease the three top floors of the office tower.

"We're not committed to moving, but if we found someone to lease the space, we would move," said Paul Levine, a First Fidelity spokesman. "But it's very exploratory at this point."

The top three floors had served as the Bank of Baltimore's executive offices since the building's completion in 1989.

Mr. Levine added that if a shift does take place, the offices would most likely move to the Bank of Baltimore's historic former headquarters at Baltimore and Charles streets.

At least part of the selection process was prompted by First Fidelity's decision in January to cut 500 Bank of Baltimore employees, part of a corporate-wide purging to control costs that is expected to trim the payroll by 8 percent by the end of the year.

The $36 billion bank acquired the Bank of Baltimore in November 1994.

Two years ago, Bank of Baltimore officials evaluated, but rejected, the idea of moving back into their former offices, distinctive with its Roman pillars.

Regardless of whether a move takes place, First Fidelity is obligated to its space under an existing lease through mid-1999, where its 51,300 square feet cost the bank roughly $1.5 million annually, or about $30 per square foot, far above current market rates.

"We're aware of what's going on, and it's unfortunate that they've decided to give up the space," said Richard M. Alter, chief executive officer of Manekin Corp., which developed the 120 E. Baltimore St. building through a partnership with the bank, Alex. Brown Inc. and construction magnate A. James Clark.

Mr. Alter said that the freeing of the space would represent an expansion opportunity for Alex. Brown, however, which is in the process of deciding on a consolidated future headquarters location.

The investment firm, which needs in excess of 250,000 square feet, currently occupies 80,000 square feet there.

First Fidelity's space becomes the latest large sublease opportunity in a market burdened by available space and a vacancy rate of 19 percent, one of the highest in the region. USF&G Corp. and CSX Corp. have also elected to sublease their respective headquarters downtown, throwing more than 500,000 square feet -- enough for two city skyscrapers -- onto the market.

"It's attractive space in a very solid building, which should help distinguish it from some of the other space out there if it comes on the market," said Steven H. Gassaway, senior vice president of CB Commercial Real Estate Group Inc., a recipient of a proposal request.

Other proposal recipients include Casey & Associates Inc., Manekin and Colliers Pinkard. The bank intends to make a selection of a real estate firm early next month.

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