Planet's spot may get new tenant

Steakhouse company sets sights on premier Harborplace location

May 30, 2002|By Gus G. Sentementes | Gus G. Sentementes,SUN STAFF

A Virginia steakhouse company is negotiating with Rouse Co. to take a major retail space at Harborplace that has been vacant since Planet Hollywood shut its doors in September.

Sam & Harry's, which owns steakhouse restaurants in Washington and Tysons Corner, Va., has signed a letter of intent with Rouse and is reviewing the lease, said Michael Sternberg, Sam & Harry's co-founder and chief executive officer.

"We still have to negotiate a lease, which is a lot more difficult than negotiating a letter of intent," Sternberg said yesterday.

Rouse officials confirmed yesterday they were negotiating with Sam & Harry's Restaurant Holdings LLC of Vienna, Va., for the two-story, roughly 13,000-square-foot prime waterfront location at the western end of Harborplace's Pratt Street Pavilion.

Columbia-based Rouse, one of the country's largest commercial property owners, has struggled in recent years with tenant vacancies at its properties in the Baltimore area. Most noticeably, two large anchor stores - Sears and Lord & Taylor - have left Rouse's Owings Mills Town Center in the past two years.

A new tenant for the large space would boost Harborplace's occupancy rate from 87 percent to about 98 percent, said Craig S. White, Rouse's vice president and general manager of Harborplace and the Gallery. Harborplace consists of the Pratt Street and Light Street pavilions, with a combined 135,000 square feet.

"We think it's going to be one of our premier locations," said Phil Genovese, Rouse's director of area leasing. He said the company had considered as a "secondary thought" attracting a store for the vacant location.

"Restaurants always do well at the harbor," Genovese said.

The highly visible site has been empty for eight months, with frosted glass windows blocking views of the interior. Some exterior windows have been decorated to advertise other shops at Harborplace or the Gallery, the Rouse mall across the street.

Genovese said both sides are working through the legal documents and that a deal could be reached in 60 to 90 days.

Sternberg said that if "everything goes perfectly, we'll be open in March."

Both companies declined to release details of the negotiations.

In the past, Sternberg said, the restaurant company considered other sites in Baltimore, but not too seriously. Rouse called several months ago to say the former Planet Hollywood site was available, Sternberg said.

"I think it's a great location. It's the best location in all of Baltimore," he said. "It's the center point of the whole Harborplace development."

Sam & Harry's would open the restaurant under a new concept called Harry's, which features a less-expensive menu and more casual dining atmosphere, Sternberg said. Sam & Harry's offers dinner starting at $65 and lunch at $22; Harry's will offer $25 dinners and $10 lunches, he said.

The first Harry's will open in December at Clarendon Market Commons in Arlington, Va., he said.

David M. Fick, a managing director at Legg Mason Wood Walker Inc. and head of its real estate research department, said it is typical for a large space in a mall to be vacant for a year or more because negotiations between landlord and tenant are complex.

Fick said restaurants do well at Harborplace. "I think the more restaurants they can put in there the better," he said.

Local real estate experts say it was probably more Planet Hollywood's financial woes than the location that led the restaurant chain to close in Baltimore after 39 months in business.

Planet Hollywood, which is now in bankruptcy, depended on tourist traffic for revenue, Sternberg said Harry's will also appeal to downtown workers.

"The site is an excellent location," said Larry Mekulski, a partner and retail broker with commercial real estate firm KLNB Inc. in Towson. "It's corner waterfront with great visibility, so I don't think there's any problem" with the location.

"If you get a good operator in there, like Cheesecake Factory or Wayne's Bar-B-Que [both Harborplace tenants], they'll be successful."

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