Retail development heats up in Baltimore

City's first Harris Teeter supermarket opens Wednesday

  • Jim McDermott works in delicaessen in the city's first Harris Teeter. The food store will open Dec. 7 in the McHenry Row development in Locust Point.
Jim McDermott works in delicaessen in the city's first… (Kim Hairston, Baltimore…)
December 05, 2011|By Lorraine Mirabella, The Baltimore Sun

The shelves have been stocked and the cash registers tested for Wednesday's opening of Harris Teeter's upscale supermarket in Locust Point — part of a broader development push that is likely to bring Baltimore as much retail space as a regional shopping mall.

Harris Teeter, offering hundreds of gourmet cheeses, curbside pickup of online orders and cafe seating on a balcony, will anchor the mixed-use McHenry Row development, one of several shopping centers being built or planned in the city.

In Canton, developers of a proposed $50 million shopping center are talking to several large retailers as anchors. In Remington, the proposed 25th Street Station retail and housing development is to be anchored by Walmart. And along Pratt Street near Baltimore's harbor, national chains are eyeing space and hoping to serve a growing number of downtown residents.

The growth has been spread around the downtown area in smaller projects, too. Restaurants that have opened or will be opening include Panera Bread on West Baltimore Street near the Hippodrome theater, Chipotle on North Charles Street near the University of Baltimore, Starbucks on East Pratt Street, and Wit and Wisdom in the Four Seasons in Harbor East. Apparel and home-decor retailer Anthropologie is considering a Four Seasons site as well, according to proposals to the city.

"Downtown is ripe for additional expansion for retail companies that at one point dismissed coming into the city," said Mark Millman, chief executive officer of retail executive hiring firm Millman Search Group. "You'll continue to see more and more of this all over the country. Retailers are looking at cities closely as major profit areas."

Some retailers are expanding amid the recovery, and for many, urban sites are in high demand. Long after suburban retailers began tapping into urban markets, cities such as Baltimore still find themselves underserved in some areas, experts say, due in part to the slowdown in new development, store closures by struggling chains and the growth of downtown's population.

Such trends have prompted an uptick in openings or planned openings of new restaurants, groceries, drugstores and other retailers. From 2008 through March, about 371,000 square feet of retail space was built or renovated within a one-mile radius of Pratt and Light Streets, according to the Downtown Partnership of Baltimore. Combined space in several new developments, some of which could start within the next year, would amount to some 1 million square feet of retail space.

"To me, in an economy that is kind of floundering, we have exciting things happening in Baltimore City," said Geoffrey L. Mackler, a vice president with H&R Retail, a commercial real estate firm that specializes in retail tenants. Baltimore, to some extent, is feeling residual effect from demand in the Washington market, he said.

Discount stores, grocery stores, fast casual restaurants and drugstores are all among those in expansion mode, Millman said.

Retailers have expressed interest in sites along Pratt Street, where it has been difficult to find space large enough to accommodate some chains, said J. Kirby Fowler, president of the Downtown Partnership. Available individual spaces tend to be small, in the 3,000-square-foot range, while stores such as TJ Maxx or Bed Bath & Beyond typically build stores in the 30,000-square-foot to 50,000-square-foot range.

The Downtown Partnership is working with some Pratt Street property owners to find ways to expand available space, he said. And though the Inner Harbor will lose a retailer with the planned closure of Filene's Basement on Jan. 9, that store's exit might open opportunities for others, he said.

Canton Crossing would be one of the largest new retail developments in the city, one that Mackler sees as a "marquee project," with large anchors as well as smaller shops in a Main Street-style setting. The 500,000-square-foot shopping center on a former industrial site on Boston Street, just east of the current Canton Crossing office tower, will be built in two phases. Construction could start on the first portion, 325,000 square feet of retail and a 600-space underground garage, next summer, with the first stores opening in mid-2013.

Developers are talking with a number of potential anchors, including Target and Harris Teeter, but no deals have been completed, said Doug Schmidt, a principal with Chesapeake Real Estate Group. The company is building the project in a partnership with principals from Birchwood Capital Partners, which acquired the 31-acre site in June from Exxon Mobil Corp.

Plans call for a discount department store, a grocery store, medium-size big-box stores, and small shops and restaurants. Developers are negotiating with about 20 retailers, said Neil Tucker, another principal with Chesapeake Real Estate.

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