Board OKs plan for Inner Harbor building

Office, retail facility to be at Chart House site

April 22, 1999|By Ivan Penn | Ivan Penn,SUN STAFF

Over the objections of some top city officials, the Board of Estimates approved a contract yesterday that will allow the construction of a $26 million retail and office building with a restaurant in Baltimore's Inner Harbor.

The city gave the Cordish Company a 72-year lease for the Pier 4 waterfront property, currently the site of the Chart House Restaurant. Cordish, which runs the nearby Power Plant, plans to construct an eight-story, 160,000-square-foot building with a new Chart House Restaurant.

Chart House, which has had declining revenues in recent years, had 20 years left on its lease but asked the city to transfer and extend the agreement with Cordish.

Although all members of the estimates board voiced enthusiasm for the construction project, City Comptroller Joan M. Pratt and real estate officer Anthony Ambridge criticized the agreement's terms, which sets rental increases at a maximum 7.5 percent.

The city would raise the rent in the third year of the contract and every fifth year after that. The rental increase would be less than 7.5 percent, if the Consumer Price Index is lower.

The deal amounts to an average yearly increase of 1.5 percent on top of the initial $120,000 a year rent for the 20,000-square-foot property.

"I don't see why the city would enter a lease agreement like that for 72 years," said Pratt, who voted against the deal. "This is better than a sweetheart deal. It's crazy. I just can't believe the administration did that."

None of the three elected officials on the five-member board voted for the deal. Mayor Kurt L. Schmoke did not attend the meeting but sent finance director William Brown, who voted for the agreement in his place. Board chairman and City Council President Lawrence A. Bell III abstained in the vote.

M. J. "Jay" Brodie, president of the Baltimore Development Corporation, which negotiated the deal, said that while the maximum rental increases are fixed, the city and state could see strong gains in taxes with the new office building and retail space.

The new lease, Brodie said, would guarantee the city revenue that the current lease does not. At one time, Chart House paid the city $120,000 a year in rent, based on the restaurant's revenue, but declining restaurant profits means the city will receive just $90,000 this year.

"What the city does get is jobs and new office space," Brodie said. "This new office space would allow us to retain existing business. We see the potential of a $26 million development that pays taxes."

In the project's first year, Brodie said, the city and state would receive almost $700,000 in taxes.

Pub Date: 4/22/99

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