Foreclosure auction of former McCormick site canceled

November 05, 2010|By Edward Gunts, The Baltimore Sun

One of the last undeveloped parcels near Baltimore's Inner Harbor is likely to remain a parking lot for the foreseeable future after its owner filed for bankruptcy protection to prevent a foreclosure auction.

An affiliate of Philadelphia-based ARC Wheeler Equities, owner of the former McCormick & Co. spice factory property at Light and Conway streets, filed for protection on Thursday. That resulted in the cancellation of a foreclosure sale that was scheduled to take place Friday.

The 1.9-acre parcel was once slated to be the site of the city's tallest building — a proposed 59-story condominium, hotel and retail complex called 10 Inner Harbor — but the project never materialized. The auction was scheduled after the ARC Wheeler affiliate defaulted on a multimillion-dollar bank loan. The head of the skyscraper project's development team, Harold Wheeler, died this year at age 54.

Cancellation of Friday's auction means that the affiliate retains ownership of the property and that it will continue to be used as a 250-space parking lot while the case works its way through bankruptcy court. John Voneiff, a partner of ARC Wheeler when the project was announced in 2006, declined in an e-mail to comment on behalf of the organization Friday.

But "from a personal perspective," he wrote, the idea was to "create something wonderful there — a project good for the city, the state, the building trades, for all concerned. … A struggling economy made it impossible to complete a project of the anticipated magnitude within a realistic timeframe."

The auction started out as a sale on behalf of Susquehanna Bank, which claimed in court documents that it was owed $24.5 million as of September 2010. Susquehanna sold its loan recently and no longer has a stake in the proceedings, corporate communications manager Stephen Trapnell said Friday.

According to court documents, the new note holder is 414 Light Street Associates LLC, and its resident agent is listed as Stephen M. Gorn of Pikesville. Gorn could not be reached for comment Friday.

More than a dozen people came to the Light Street property on Friday prepared either to bid or watch the auction by GoIndustry DoveBid of Owings Mills.

Christopher Kurz, president and CEO of Linden Associates of Baltimore, said his group had a contract to buy the property several years ago, before ARC Wheeler acquired it, but never went ahead with the purchase. He said his group had been working with on a plan to redevelop the property in a way that would complement other Inner Harbor attractions.

James Leanos and Owen Rouse Jr. of Manekin, a real estate brokerage and development company, said they believe the land has strong potential to support a successful Inner Harbor development because of its size, location, visibility and accessibility to mass transit, among other attributes. "We wanted to talk to whoever controls the site," Leanos said. "You can do something really striking here."

For most of the 20th century, the Light Street property was the setting for a spice factory and teahouse, and the air downtown was fragrant with cinnamon, clove or whatever spice McCormick was making on a given day.

In the 1980s, McCormick consolidated its operations in Hunt Valley and sold the Inner Harbor land to an affiliate of the Rouse Co. Rouse razed the spice factory starting in 1989 to make way for potential development, but then sold the land.

The land is within blocks of many downtown attractions, including Harborplace, the National Aquarium in Baltimore, the Baltimore Convention Center and Oriole Park at Camden Yards. Current city zoning would permit a corporate headquarters or a large mixed-use project similar to the Gallery at Harborplace. As of July 1, the Light Street site had an assessed value of $16.3 million, or about $8.5 million per acre.

Donna Beth Joy Shapiro, a local preservationist who led an unsuccessful campaign and court battle in the late 1980s to save the aromatic spice plant from the wrecking ball, said she still believes it shouldn't have been torn down. "If it was there today, it would be the biggest thing going," she said Friday. "Can you imagine what a condo there would cost?"

Baltimore Sun reporters Lorraine Mirabella and Jamie Smith Hopkins contributed to this article.

ed.gunts@baltsun.com

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