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Tom Clancy buys entire penthouse level at Ritz-Carlton Residences

Operators of the posh Ritz-Carlton Residences say they have closed on 10 units since lowering prices on some apartments this summer, three of which were bought by bestselling author Tom Clancy, who now owns the entire penthouse level of one building.

The luxury waterfront development on Key Highway has 190 units. To date, 33 have sold and contracts are pending on 14 more, said Joe Graziose, senior vice president and project executive for RXR Realtors, which owns the development.

“It’s working,” Graziose said, of the discounted prices offered on 30 units in August after only 23 had sold in nearly three years. “The market is reacting to my pricing.”

The Ritz condos were originally listed between $800,000 and $5 million. But the building largely remained vacant as the luxury condo market in the city became saturated with units and the market froze because of the recession.

In response, certain units at the Ritz were deeply discounted to spur sales. For example, one unit, a two-bedroom condo, was reduced to  $700,000 from $1.2 million.

Clancy, a former insurance salesman whose prose has made him a millionaire, has settled into the Ritz since he purchased three units, totaling almost 12,000 square feet, in November 2009 for $12.6 million.

State Department of Assessments and Taxation records show he bought three more units this fall at significant discount.

The author of the Jack Ryan spy novels purchased the condos for $785,892, $750,684 and $653,024, records show. The units total 5,224 square feet, bringing the total current living space at the Ritz for Clancy and his wife, Alexandra, to 17,183 square feet, or the entire penthouse level of one of the development’s buildings.

Attempts to reach Clancy for comment on Monday were unsuccessful.

RXR Realtors was forced to refinance $176 million in construction debt for the project in February. The restructured loan was made by a consortium of 14 lenders from around the world, and RXR officials have pledged to sell out the development within three years, the term of the loan.

Prices were cut by 10 percent after the loan restructuring in February — and this summer, Graziose ordered the pricing to drop again, with certain units listed  between $499,000 and $2.1 million.

That move, he said Monday, is paying off.

“We are on track in terms of being able to fund our payments,” he said, of the loan and weekly reports he makes to the consortium. “The lenders continue to be flexible and steadfast. It’s going extremely well.”

He said up to 30 additional units will be discounted early next year. The goal is to sell about 75 units in the development by the end of 2011, Graziose said.

The Ritz-Carlton Residences opened to great fanfare in 2007 at a cost of $220 million.

Billed as elegant and unique homesteads with all the amenities of a five-star hotel, each unit has an elevator, marble floors, state-of-the-art gourmet kitchens and sweeping views of the Inner Harbor or Federal Hill. Residents of the Ritz have access to a concierge, a full spa, an indoor pool and a private movie theatre among other opulent benefits.

Graziose said the lower prices have driven about 100 more potential buyers to visit models at the Ritz each month. New residents include empty nesters, working professionals and retirees, he said.

An overabundance of luxury condos on the city’s waterfront has been in the spotlight this year.

In June, 18 units were auctioned at the Harborview Pier Homes development, located next door to the Ritz. That auction, experts said, reset the values in the luxury market as units originally listed at or above $1 million at Pier Homes were sold for between $545,000 and $750,000.

Prices for the 30 Ritz units were dropped two months later, but Graziose insisted there was no connection because the Ritz is a different, more luxurious development.

Michael Yerman, managing partner of Yerman, Witman, Gaines & Conklin Realty, a Federal Hill-based Realtor that has brokered some of the recent Ritz sales, said the market for luxury condos in Baltimore reset as a result of the Pier Homes auction.

Where the market will lead in 2011 is still unclear, Yerman said.

“That’s the thing that is so confusing — the market is not great. People are doing a lot of looking and are slow to move,” he said. “The recent sales say the Ritz is doing something right.”

Delta Associates, a Virginia-based marketing group that analyzes the Baltimore housing market, said there were 1,618 unsold condo units in the metropolitan area in September — or 3.1 years of inventory.

Prices of condos in the metro area were down 8.8 percent in the third quarter of 2010 compared to September 2009, the group said, with declining condo prices the highest in the city, by double digits.