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New restaurant at Chesapeake site should open in a year

Redevelopment of the long-abandoned Chesapeake Restaurant in the Station North Arts District is still on track despite a key restaurateur’s rejection of the $16 million project, city officials said Monday.

Qayum Karzai, who owns the successful Helmand and Tapas Teatro restaurants, has backed out of the partnership and will not open an upscale eatery and market inside the old Chesapeake, located at 1701 N. Charles St.

Karzai was out of the country and unavailable for comment, an employee at Helmand said Monday.

M.J. “Jay” Brodie, president of the Baltimore Development Corp., a quasi-city development agency, said the redevelopment approved by the BDC board in mid-October was still on track without Karzai.

“They are fully engaged,” Brodie said, of the developers’ work at the site. “They will open in a year.”

Brodie said negotiations broke down between Karzai and the developers, Michael Shecter and Ernst Valery, who formed Station North Development Partners LLC, for the project. He was uncertain what the issues were that led to the breach.

Neither Shecter or Valery returned repeated calls for comment.

Original plans called for a chic farm-to-table restaurant and a fresh food market on the 7,000-square-foot ground floor of the old Chesapeake with offices and apartments located on the upper floors. Karzai had agreed to retain the Chesapeake name on the restaurant, Shecter and Valery told the city last fall.

More apartments would be built at a later date on what is now a parking lot behind the former Chesapeake on Lanvale Street, Brodie said.

The Chesapeake, once one of the city’s most stately restaurants and known for grilled steaks and Caesar salads, closed in 1987.

The city purchased the building for $2.54 million in 2008 following a move by Brodie to use eminent domain to take the blighted building from its owner, local attorney Robert A. Sapero. That controversial maneuver spawned a lawsuit that ended up in the Court of Appeals, which ruled in Sapero’s favor.

In the end, the city sold the Chesapeake to Shecter and Valery in mid-October for a cash price of $500,000 and two revenue sharing agreements.

Shecter owns other businesses in the arts district, just north of Pennsylvania Station, including the Charles Theater building and Metro Gallery, located across the street from the Chesapeake.

The development team has pledged to spend $16 million to renovate the building. In addition, the partners signed an agreement with the city to pay out 5 percent of gross revenues from the development, up to a total of $1 million. After that, the partners will pay the city 2.5 percent of gross revenues up to a total of another $1 million. Brodie said, the total sales price will be $2.5 million.

Brodie said workers are currently inside the old Chesapeake “doing environmental remediation” that includes abatement of lead paint and asbestos.

The building still appears abandoned and blighted from the street, a block that is normally busy with movie and theater patrons as well as diners at Tapas Teatro and Sophie’s Crepes.

Kathleen Cusack, co-owner of the Charles Theater, said the redevelopment will add to the allure of the arts in the area when the work is completed.

“It will be fabulous,” she said. “The property is fantastic and it is close to Penn Station. We’re excited about it.”