Real Estate Insider: First State Center phase good to go, maybe

There’s nothing like the future of a billion-dollar project being shrouded in confusion.

Baltimore’s spending board approved a tax break on Wednesday for the first phase of the proposed $1.5 billion State Center project, which if completed as planned would involve building 2.1 million square feet of office space, 1,500 residential units and 265,000 square feet of retail space.

But the project, which has been delayed by a lawsuit and the 2008 financial meltdown, faces an uncertain future. Advisers to Gov. Lawrence J. Hogan Jr. have expressed concern about State Center’s impact on Maryland’s debt limit, calling into question whether the state would go forward with the development.

Yet the day before the tax break vote, Mayor Stephanie Rawlings-Blake’s office said they believed Phase I of the project, which is expected to cost $215 million and involves building 515,000 square feet of office space for the state, 15,000 square feet of retail space and a parking garage, could move forward without further state approval.

“While there may be questions about future phases of State Center, Phase 1 has already been approved by the Board of Public Works and needs no additional state approvals to move forward as far as we know,” spokesman Kevin Harris wrote in an email.

But after the Board of Estimates approved the tax break, it all of the sudden became unclear what approvals the first phase of the project needs to become reality. During her regular media availability on Wednesday, Rawlings-Blake contradicted what reporters were told the day before, saying she believes the Board of Public Works still needs to sign off before the project before it can move forward.

When reporters pressed on whether the first phase of the project was ready to go, the Mayor responded, “I don’t have that answer.”

But following the press availability, Harris sent out a message reiterating the point from the day before: Phase I does not need state approval.

Meanwhile, it’s unknown whether the Hogan administration shares City Hall’s view that the first part of the project is good to go. Considering the amount of space the state leases in the project that view will carry some significant weight.

Briefs

Going big in Prince George’s County

The massive Ascend Apollo development is set for two key approvals.

The Prince George’s County Planning Board will review the preliminary plans on Thursday for the project being developed by Largo Commons LLC. The project, as proposed, calls for the construction of 1,566 multifamily dwelling units and 40,000 square feet of commercial space.

The planning board is also set to review the detailed site plan for the expedited transit-oriented development portion of the project that includes 850 multi-family dwelling units and about 19,024 square feet of retail and restaurant uses.

Planning department staff recommended approval of both plans.

Rotunda retail plans?

Mobtown Shank, the blog run by Atomic Books co-owner Benn Ray, obtained a copy of a plan outlining possible tenants at the Rotunda redevelopment in Hampden. The onetime insurance offices turned enclosed mall is being redeveloped as a mixed-use development.

Chris Bell, senior vice president of development for the Rotunda’s owner Hekemian & Co., confirmed the document was authentic.

But he said not to read too much into it because many of the companies listed as tenants haven’t signed a lease, and he warned that a variety of these maps showing potential retail mixes have been circulated to brokers in Baltimore.

“We probably have 20 versions of that,” Bell said.

‘I’m gonna tell you about Florida real estate…’

Baltimore-based Continental Realty Corp. keeps buying and selling in the Sunshine State.

The company announced it sold The Shops at Verandah in Fort Myers, Florida for $14.4 million on behalf of the CRC Fund 111 to Publix Supermarkets Inc. Continental acquired the 72,295 square foot shopping center in December of 2011 and under its ownership occupancy rose from 88.7 percent to 98 percent.

New Gig

Carroll Cavanagh joined CBRE as a senior vice president in Washington, D.C., and he will oversee the leasing of office space in the D.C. region. He was previously a vice president with Jones Lang LaSalle, where he represented occupiers and investors in transactions. He has represented various clients in Class A, Class B and trophy building transaction in the nation’s capital.

It’s all speculation

St. John Properties Inc. likes what’s happening at its Baltimore Crossroads development.

Encouraged by the leasing of more than 100,000 square feet of R&D/flex office space at the 1,200 acre mixed-use business development in the final quarter of last year the company has decided to go ahead with even more building at the site, located on Route 43 near Interstate 95 in the White Marsh area.

On Monday, the company announced plans to build three more buildings — totaling 90,000 square feet — in the development on speculation in 2015.

Adam Bednar covers commercial real estate and economic development for The Daily Record. Follow him on Twitter @Bmorejourno and on his blog, Ground Up.