Financial services firm Morgan Stanley announced plans yesterday to triple a business division in Baltimore, adding up to 900 employees over 10 years at leased space in Harbor Point, a new waterfront complex under development near Fells Point.
The move bolsters the city's financial sector, which has seen a resurgence of late with recent commitments from T. Rowe Price to hire more people and renovate as well as Legg Mason's promise to move its 1,000 Baltimore employees to Harbor East in 2009.
This comeback comes after the region suffered upsetting losses. The recent acquisition of Mercantile Bankshares by Pittsburgh's PNC Financial was among a half-dozen such financial sales - including Allfirst and Maryland National - during the past two decades.
"The fact you have such major players like Legg Mason and Morgan Stanley is really important in terms of the city's economic prosperity," said C. William Struever, chief executive of Struever Bros. Eccles & Rouse, which is developing the Harbor East and nearby Harbor Point projects with H&S Properties Development Corp.
"To a large extent, certainly, that's what the city needs, people with good jobs, paying good taxes."
Baltimore's downtown has been steadily shifting eastward, in large part following Struever and H&S Properties' development efforts along the harbor. They've taken land that was once little more than dead space between the Inner Harbor and Fells Point and turned it into a bustling hub for restaurants, hotels, shops and condominiums.
The $450 million Harbor Point project, on which construction has just begun, is to span 27 acres once contaminated by a chromium plant. (The area has been cleaned and sealed through a $100 million environmental remediation.) Morgan Stanley has leased 137,000 square feet of office space - half a building - there, though it won't be able to move until January 2010.
And developers said they will have to scramble to ready the space, which they're more than willing to do.
"All the financial services companies just can't go into typical office buildings. They need new, custom-designed buildings" with certain power capacities, said Michael Beatty, president of H&S Properties.
Morgan Stanley spokeswoman Carissa Ramirez said the company decided to expand locally because its Baltimore division - a mix of financial and information technology workers supporting U.S. sales and trading operations - is doing well and because the area has "great" universities, an able work force and good access to company headquarters in New York City.
"We just anticipate a lot of growth in this area," Ramirez said.
The company also expects to receive financial incentives from the state and city to make the move.
When Morgan Stanley announced plans to come to Baltimore in 2002, officials promised to employ 600 people by 2014 in exchange for $8.1 million worth of state and city incentives. The division has reached 450 employees and outgrown its Fells Point space at Bond Street Wharf, spilling into another city location.
Now, Morgan Stanley says it probably will employ as many as 1,350 business services and information-technology people, with most, if not all, of them in Harbor Point.
The company has investment branch offices throughout Maryland, but those employees are not included in this expansion.
Incentives are included in this deal as well, according to David W. Edgerley, Maryland's secretary of business and economic development.
The details have yet to be finalized, Edgerley said, adding that such incentives are about "leveling the playing field" and "being competitive in a very competitive environment."
Maryland economic officials have been trying aggressively to recruit businesses that offer what Edgerley calls "new economy jobs," those that come with big paychecks and educated professionals.
The financial services sector falls into that category, now employing about 150,000 people throughout the state.
"I see these as jobs of the future," Edgerley said. It is "really a changing landscape and skyline in the city of Baltimore."
Sun reporter Jamie Smith Hopkins contributed to this article.