PNC moving Maryland HQ to 1 E. Pratt Street
Posted: 1:35 pm Tue, May 31, 2011
Daily Record Business Writer
PNC will put its name on the former Verizon building, at Pratt and Light streets, and occupy 119,000 square feet of office space, according to CB Richard Ellis, the broker for the property owner.
“Baltimore is a major growth market for PNC and we are expanding our downtown headquarters to allow us to continue to serve clients in a premier office environment,” said Louis R. Cestello, regional president for PNC Bank, Greater Maryland. “Adding our name to the building will be a reflection of our long-term commitment to this region and provides us with greater visibility in one of the most high-traffic destinations in Maryland.”
The Pittsburgh-based bank is the third-largest in Maryland, with $10.2 billion in deposits and 229 offices in the state as of last summer. It gained its foothold here and its current headquarters in 2007, when it closed a $6 billion acquisition of Mercantile Bankshares Corp., then Maryland’s largest independent bank.
PNC will leave its office at 2 Hopkins Plaza, on Baltimore Street, over one or two months starting in July 2012. A spokeswoman for the bank’s Maryland headquarters declined to disclose how many employees will work in the new space, citing “competitive reasons.”
The bank has 140,000 square feet of office space in Hopkins Plaza, and a lease that expires in 2014.
Terms of the new lease were not disclosed.
“PNC has reconfirmed its commitment to downtown, which is of course a welcome development,” said J. Kirby Fowler, president of Downtown Partnership of Baltimore. But, he added, the bank’s move on the heels of other large relocations within the center city to upgraded Inner Harbor digs will present a challenge.
The former home of Legg Mason — across Pratt Street from the soon-to-be PNC building — was renamed last year for Transamerica Life Insurance Co., which agreed to lease more than 140,000 square feet of the tower. Law firm Ober|Kaler relocated there in April and Miles & Stockbridge PC announced last month it will move into 107,000 square feet there in 2013.
“The Pratt Street corridor is holding up very well. Off of Pratt Street, there’s a lot of weakness,” said Kevin Wille, vice president of CB Richard Ellis. “After the harbor buildings fill, it will begin to fill in behind them.”
The glut of office space in the city’s center — the office vacancy rate is 19.2 percent, according to the Downtown Partnership — has Fowler looking at other potential uses for the Hopkins Plaza building.
“There’s this core around Hopkins Plaza where we don’t need as many office buildings anymore, and a few are obsolete,” he said. “So why not build on this incredible demand we have for residential demand?”
The city center and west side neighborhood was home to the fastest-growing residential area in the city in the last decade, Fowler said, with the population doubling.
Fowler said he has broached the conversion to residential with the building’s owner, Union Labor Life Insurance Co., and said he’s hopeful they’re open to the possibility. Union Labor’s broker held an open house for potential commercial tenants last week.
Kevin M. Justh, vice president of Union Labor’s real estate investment group, did not respond to a request for comment Tuesday.
PNC’s new offices will take up three floors of the Pratt Street building owned by Griffith Properties and Fremont Realty Capital, and will include a 7,000-square-foot branch on the ground floor. Renovations will focus on using local products and lowering the office’s carbon footprint, with features like efficient toilets, bamboo flooring and furniture made from recycled materials.
It will also add more workers to an area that has been a focus for city planners, who have helped bring more dining options and streetscape improvements to Pratt.
“Pratt Street is the natural boulevard downtown,” Fowler said. “We have to continue to make sure that that environment is appealing to tourists, residents and employees.”