Concern delays city OK on sale

Comptroller fears cost of superblock land deal may be too much

December 21, 2006|By Lorraine Mirabella | Lorraine Mirabella,SUN REPORTER

Baltimore's comptroller is questioning the proposed sale of properties in downtown's superblock area to a New York developer for $21.6 million, leading the city's Board of Estimates yesterday to postpone a scheduled vote to approve the sales agreement.

Comptroller Joan M. Pratt said she has concerns about the land disposition agreement, which allows Lexington Square Partners, led by Chera Feil Goldman Group, to deduct the cost of demolition, environmental cleanup and streetscape improvements from the purchase price.

"The city doesn't know how much it's going to get, because those costs could exceed the purchase price," Pratt said yesterday in an interview after the Board of Estimates meeting. "At the end of the day, it appears that the city could be getting nothing."

Most of the properties have been at the center of a bitter public dispute between the city and one of its largest charities, the Harry and Jeanette Weinberg Foundation, which owns more than half the 37 properties in the 3.6-acre site and has vowed to fight their seizure.

The city's economic development agency, Baltimore Development Corp., had been pushing to secure board approval for the sale by the year end, when the Chera Feil Goldman Group's exclusive negotiating privilege expires. The BDC board was to consider extending the negotiating period at its meeting today.

The land sale is also supported by Mayor Martin O'Malley, who controls three of the five votes on the city spending board and made the decision to move forward with condemnation of the Weinberg properties.

The Chera Group, selected in competitive bidding nearly two years ago, plans to build 400 market-rate apartments, 1,000 parking spaces and as much as 200,000 square feet of shops.

According to the agreement, the sale price would be reduced by about $8 million, which the developer would spend on environmental cleanup and demolition.

But Pratt said yesterday that she understood that $8 million was an estimate.

"We don't have all the costs," she said. "We don't know what it will cost to relocate other businesses or what it will cost to acquire the other buildings in the block."

More questions

Pratt also said that she only received the 122-page document on Dec. 14. She said she also needed further clarification of the city's failed negotiations with the Weinberg Foundation and the potential cost of acquiring other properties.

She said she is submitting a list of questions to BDC and expects to hear back before the land agreement comes back to the Board of Estimates at its next meeting Jan. 10.

In an e-mail yesterday, BDC president M.J. "Jay" Brodie said the agency would comply with Pratt's request.

"After briefing the comptroller and her staff Monday morning and hearing their concern that they needed more time to formulate questions - we look forward to receiving all their questions together in writing so that we can respond in a professional and comprehensive manner," Brodie wrote.

Shale D. Stiller, the Weinberg Foundation's chairman and chief executive, declined to comment yesterday. Previously, Stiller has said the foundation did not submit a development proposal in October 2003 for the site, bounded by Lexington, Liberty, Fayette and Howard streets, because Weinberg thought it had a deal with the BDC for a property swap along the north and south sides of Lexington Street. But after the deadline to submit proposals, the city notified the foundation it could not deliver on the land swap, Stiller has said. Earlier this year the foundation proposed its own redevelopment in conjunction with Baltimore-based Cordish Co.

Talks failed

Negotiations aimed at averting a court fight between the city and the Weinberg Foundation collapsed in November over the foundation's request to have impartial arbitrators determine the value of the Weinberg properties.

Westside Renaissance Inc., a group that works to encourage economic development and a supporter of the Weinberg/Cordish proposal, had also asked the Board of Estimates to defer the land disposition agreement, citing lack of time to review the agreement.

The city still needs to acquire, either through sale or eminent domain, properties owned by the foundation and other landlords and business owners in the area, some of whom also are fighting to keep their buildings.

Attorney John C. Murphy had been prepared to submit a letter at yesterday's meeting on behalf of three clients who own or run businesses in the area, all of whom have operated under the threat of condemnation since planning for west-side renewal began in 1999. Murphy plans to ask the board to honor a BDC promise that negotiations to retain the properties and businesses would continue regardless of the agreement with the developer.

Owner wants to stay

One business owner, Yun O. Park, owner of Modern Mode at 105 W. Lexington St. since 1994, wants to stay in her shop that draws a loyal following, despite many offers from the city to buy her building.

"I want to survive, that's what we want," Park said yesterday. "Most of the stores are gone. This area is getting harder and harder, but I'm still trying to survive. We're going to fight to the end."

lorraine.mirabella@baltsun.com

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.