Walid Hajj is happy he followed his instincts and bought an incomplete condo redevelopment in Baltimore's Mount Vernon neighborhood last fall.
Within three days of advertising the building's 13 newly redeveloped apartments this month, Hajj had rented all but four. And prospective tenants kept on calling to tour the century-old former school on West Chase Street.
While the building's previous owner struggled to sell units amid the housing market downturn, the timing was better for Hajj, a partner in a company that bought the property in October.
The renovation of the old Calvert School is one of numerous projects that have been recently resurrected along the North Charles Street corridor in the heart of downtown. From the Inner Harbor to Charles North, construction and renovation projects are resuming or being planned as investors gain confidence in the economy and developers find deals they can't pass up.
"You're seeing little sprouts [of new development], which is very healthy," said M.J. "Jay" Brodie, president of the Baltimore Development Corp., who said Charles Street is perceived as the heart of Baltimore. "People are more optimistic about development in future years than in the last couple."
Brodie also said small might be the way to go: "Maybe the future is not huge projects, but bit by bit, incremental," he said.
Aside from a couple of visible projects — such as the University of Baltimore's $107 million John and Frances Angelos Law Center going up at North Charles and Mount Royal Avenue — much of the latest progress may not be easy to spot or even be visible at all. The projects revving up tend to be less grand than some of the pre-recession plans for harbor-area skyscrapers and hundreds of pricey new condos.
City officials say years of trying to acquire blighted properties here and there are finally paying off and sparking private investment, with property owners fixing up buildings and developers buying and transforming properties.
Regional development experts say that areas such as Mount Vernon are benefiting from the growth of "destination" institutions, such as the University of Baltimore, the Johns Hopkins University and Chase Brexton Health Services, which recently acquired the Monumental Life building at 1111 N. Charles St. All help bring business to the corridor.
Projects in the planning stages or under construction include the UB law school and a nearby student housing project at Biddle and Cathedral streets, as well as new apartments in the former Danny's restaurant at 1201 N. Charles.
Farther south, plans are being considered to expand the Baltimore Convention Center and link it to a new, 18,500-seat downtown arena. Another proposal would redevelop the shuttered Mechanic Theater into a 30-story, 400-unit apartment tower with street-level retail, and yet another plan would create a 15-story apartment building at One Light Street.
By this Friday, city, state and federal officials hope to receive proposals for a mixed-use project that would be built on North Charles Street just north of Penn Station on an Amtrak-owned parking lot.
Other projects that have been talked about for years and now are moving ahead include the conversion of the closed Chesapeake Restaurant in the 1700 block of N. Charles St., which developers are revamping into a restaurant with upper-level offices, and the long-vacant but historic Parkway Theatre on North Avenue near North Charles Street, where developers plan a performing arts center.
Hajj, a former CB Richard Ellis commercial broker who founded WRH Property Holdings two years ago, teamed up with local businessman and developer Jack Luetkemeyer to form Chase Street Apartments LLC and buy the original Calvert School.
Hajj and Luetkemeyer saw a need for apartments that would appeal to young professionals or students who wanted to live within walking distance of restaurants, bars and Penn Station. They bought the building for $550,000, a price Hajj says allows for competitive rents.
"I've gotten tremendous amount of interest in the property," Hajj said. "In my five years in dealing with multifamily [buildings], this is as strong as I've seen the rental market. People aren't buying as much as they used to."
The Mount Vernon location and the building itself — with large windows, heavy wood doors and 14-foot ceilings — all appealed to Natalie Novak, a 26-year-old University of Baltimore School of Law student. Novak, who planned to live with a roommate, was also attracted by the rents, which range from $950 to $1,800 a month.
Novak was one of about two dozen people to tour the newly completed Calvert Apartments when the project was finished this month. The Chicago resident had come to Baltimore for a couple of days to hunt for an apartment and quickly sized up the marketplace.
"The best places are leased before you see them," Novak said. "Coming from Chicago, I feel like prices here are reasonable."
Progress along the Charles Street corridor is slower in some sectors than others. Downtown continues to see office vacancies at historic highs, and the area has its share of vacant or underused buildings. Some of that has come from companies relocating to the newer Harbor East, while other office tenants have taken advantage of more competitive rental rates along Pratt Street.
Several hotel projects in the Charles Street corridor remain stuck, hurt by the recession or developers' financial troubles. Some landlords have failed to make upgrades.
But the area still boasts many local business leaders and companies, pointed out Terri Harrington, a vice president of MacKenzie Commercial Real Estate Services in Baltimore, who said she sees "a tremendous commitment from these 'known entities' to keep the corridor vibrant."
Officials with the Downtown Partnership say recent investments by office landlords have attracted new tenants. The group, a nonprofit that promotes downtown, hopes to see more such investment, from office upgrades to more street-level retail. And, it says, some underused office buildings could eventually find new life as apartments as the number of people who live in the commercial district continues to grow.
Developer J. Joseph Clarke of J.J. Clarke Enterprises, says the time is right for new housing development downtown. Clarke is proposing a $58 million, 15-story apartment tower on the site of the old Southern Hotel, which was demolished, and adjacent property near Light and Baltimore streets.
Clarke recently presented his plans for 264 one- and two-bedroom units to the city's architectural review board. Plans also call for street-level retail and a pool and clubhouse on the roof.
Originally Clarke proposed constructing a large office building after he bought the site in the late 1980s. His team has looked into various potential combinations over the years, including offices and a hotel, but could never find a way to finance the office portion.
"When the site was acquired, there was never any thought of its being for residential use," Clarke said. "In the late 1980s, if you lived downtown, it was in Mount Vernon or Federal Hill. Well, things have changed a good bit, and it strikes us that there is probably a market for a rental multifamily building here with a lot of amenities."
He envisions prospective tenants as young professionals, including those who work at firms such as T. Rowe Price or medical professionals who could take the metro to Johns Hopkins Hospital. He said construction could start as early as next year and would take 18 months to complete.
"A lot of financial companies are still hiring MBAs and they work them to death, and because they work so many hours, they don't want to spend time commuting and would prefer an apartment a block or two away from their desks," Clarke said.
Other developers say they see opportunity along the Charles Street corridor and have been able to start projects because of favorable terms on a purchase of a stalled project.
One advantage has been the stability of the area's higher-education and medical institutions, said Brad Shapiro, president of Jabber Five Real Estate Group, a local developer of retail and multifamily projects. In December, the company and PMC Property Group bought part of a stalled condo development at 1201 N. Charles.
"To the extent that there are larger private and public investments [in the neighborhood], we're trying to piggyback and share in the momentum," Shapiro said.
Under the new ownership, 30 one- and two-bedroom apartments are expected to be completed by fall and rent for $1,000 to $1,800.
"We're willing to invest in a neighborhood where we can have a positive impact," Shapiro said. "So long as UB stays in Baltimore and the Mount Vernon Belvedere Association stays strong, we feel good about the investment."