Good medicine for HarborView Bad taste: Other taxpayers may not like it, but bailout plan makes fiscal sense for city.

March 11, 1997

EVEN THOSE who dislike the appearance of the HarborView tower should prefer the condominiums' success to a failure that might leave an empty hulk overlooking the Inner Harbor. A city bailout that will annually forgive $350,000 to $500,000 in property taxes over five years may be distasteful to people who pay their taxes on time, but it's good medicine. If HarborView uses this reprieve to make itself more appealing to potential downtown dwellers, its future value as a fully taxed property will be enhanced.

In agreeing to this arrangement, though, the city must get strong assurances from HarborView Properties Development Corp. and Parkway Holdings Ltd. to do whatever it takes to make the condos successful.

Only 39 of the 252 units have been sold since the 27-story tower opened in 1993. Purchase prices that begin at $190,000 for a two-bedroom unit at marina level may need restructuring. Better marketing and other steps appear necessary as well.

The arrangement must also take into consideration the possibility that the condos could have new ownership during the five-year deal. Parkway, a $1.5 billion conglomerate based in Singapore, announced last October that it is considering selling some of its non-health-care holdings in other countries. Any new owners of HarborView must be held to this agreement. At the end of five years, if not before, HarborView should be paying all of its taxes.

The bailout calls for HarborView to pay more than $2 million in back-taxes it owes the city. In return, the city will allow HarborView to pay annual fees that are $500,000 less than the property taxes it would pay for fiscal 1996 and 1997 and $350,000 less than it would pay during each of the subsequent three years.

Many Federal Hill residents have never liked HarborView. They say it is out of place in their neighborhood and blocks views of the harbor. But Baltimore needs the complex to be successful, especially now that it has increased its investment with a tax bailout.

That is an economic development tool the city may need to use more often. Other residential properties not as close to the water as HarborView are being rented and sold. Its owners must work harder to find and attract a niche market.

Pub Date: 3/11/97

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