City Chooses Pinkard For Legg Building

Warren/svatos Team Loses Out In Awarding Of Lucrative Contract

7 E. Redwood St.

Managing, Leasing Could Bring Winner Over $300,000

April 26, 1997|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

Rejecting a team selected to oversee the bulk of its real estate holdings, the city's economic development agency yesterday awarded a lucrative contract to manage and lease a 20-story office building downtown to a competitor.

The Baltimore Development Corp.'s selection of Colliers Pinkard to handle the Legg Mason Building at 7 E. Redwood St. comes less than a month after the agency picked for the main contract Warren/Svatos Real Estate Resources, a politically connected team criticized by some experts for its lack of experience.

"It's a unique property," BDC President M. J. "Jay" Brodie said of 7 E. Redwood St., the former headquarters of Legg Mason Inc. The city bought the building for $5.6 million late last year as part of a deal to keep the investment firm's operations downtown.

"It's the only high-rise [among the city properties], and it's a difficult situation that has to be dealt with," Brodie added. "People may disagree, but, after considering the city's exposure and what's at stake, we concluded it was desirable to contract with Pinkard."

Pinkard, a local commercial real estate firm and one of the region's largest commercial property managers, has managed and been headquartered at 7 E. Redwood St. for 30 years.

Pinkard was one of seven firms that lost to the Warren/Svatos team in the BDC competition for the management contract.

Both Pinkard and the BDC dismissed the idea that the 7 E. Redwood St. contract is compensation for losing the larger management package. Pinkard could make as much money leasing and managing 7 E. Redwood St. alone as Warren/Svatos will receive for working on more than two dozen buildings and land parcels, based on leasing commissions Pinkard will earn.

Later this year, the entire 153,000-square-foot building at 7 E. Redwood St. will be vacant when Legg Mason begins consolidating its headquarters to the 35-story USF&G Tower.

Pinkard is likely to earn management fees and leasing commissions of more than $300,000 if it fully leases the 72-year-old building, based on industry standards.

Neither Pinkard nor BDC would discuss terms of the proposed contract.

Otis Warren, an ally of Mayor Kurt L. Schmoke and leader of the Warren/Svatos team, could not be reached for comment. Brodie said Warren was "very disappointed" when told of the decision.

David R. Paulson, a Svatos Co. vice president and former city economic development official, brushed off the notion that, in selecting Pinkard, BDC was expressing a lack of confidence in the Warren/Svatos team, however. "I think if they didn't have a lot of confidence they wouldn't have selected us in the first place," Paulson said.

The Warren/Svatos team is expected to receive roughly $500,000 over five years to manage and lease a variety of city-owned properties, including the former Waverly Inc. headquarters on East Preston Street, the Brokerage and the South Harbor Business Center on Key Highway.

While the Legg Mason Building was initially part of the management package, the BDC removed it prior to the Warren/Svatos selection.

Brodie said Schmoke was consulted and approved of the deal prior to the BDC's board vote to give Pinkard the contract.

Like the Warren/Svatos contract, Pinkard's deal must be approved by the city's Board of Estimates.

"We know this building like the back of our hand, and therefore we have the highest probability of success with it," said Walter D. Pinkard Jr., president of Colliers Pinkard.

Pub Date: 4/26/97

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.