When the Kelly family started looking for a spot to host their growing Hunt Valley insurance business, they didn't want to stray far. And Sparks — just a few miles up York Road — "felt pretty far out," said CEO Francis X. Kelly III.
Fast-forward seven years: the Kelly & Associates Insurance Group offices on International Circle in Hunt Valley are filled with boxes and a move north is underway.
Hunt Valley in Baltimore County became a destination of choice for businesses in the 1960s when a subsidiary of McCormick & Co. developed the area as a 435-acre industrial park. Today most of the land is developed, vacancy rates have dropped, and for those companies looking for bigger plots or to purchase their own site, some say Sparks is the natural next destination.
KCI Technologies opened a new headquarters there in 2008. This winter, Firaxis Games, which leased space from Merritt Properties in Sparks in 2009, announced an expansion. In April, U.S. Lacrosse broke ground on a new headquarters, where it plans to relocate its nearly 90 employees from Baltimore City next year. Next to Kelly's new building, formerly Fila's U.S. headquarters, Ryland Homes is building townhomes.
"There's been some growth up in Sparks. I think the move of Kelly and the move of U.S. Lacrosse says that it's relatively vibrant," said Kelly, who also sits on the U.S. Lacrosse board. "So we're excited about it."
Hunt Valley — a corporate hub of beige buildings, parking lots, and shipping and receiving signs — has long been a robust office market, drawing corporate America with its large, competitively priced floor plates; ready access to Interstate 83; and proximity to executive-sized homes, strong schools and workforces in Baltimore and southern Pennsylvania.
It fell out of favor in the late 1980s, as manufacturing tenants downsized, buildings began to show their age, development surged in Owings Mills and White Marsh, and vacancies at Hunt Valley Mall — nicknamed Death Valley Mall — cast a pall over the area even as the Light Rail extended into it in 1997.
But the tenant base evolved, adding professional services firms such as PayPal and Bank of America. The 2005 redevelopment of Hunt Valley Towne Centre with Wegman's and other stores helped shore up the area. And new real estate firms like Merritt Properties entered the picture, overhauling older buildings to make them more appealing.
At the end of 2014, the vacancy rate in the top-quality buildings in Hunt Valley-Sparks was just 4.6 percent, according to research by Colliers International, a commercial real estate company. By Baltimore County's count, vacancy in Hunt Valley office buildings had dropped from 14.5 percent in 2006 to 5.5 percent today.
"Of all of our submarkets in Baltimore, Hunt Valley has just been the healthiest and it's been this way, I would say, at least a decade," said Matt Haas, a managing director at Colliers International in Baltimore who worked on leasing office space at Hunt Valley Town Centre.
Since 2013, nearly 25 new tenants have signed leases totaling more than 100,000 square feet at the 550,000-square-foot Executive Plaza complex, boosting occupancy rates from 83 percent to 94 percent, said Hill Management, which credits a $3 million renovation.
McCormick, which gave its name to Hunt Valley's main drag and whose operations still fill the air with the scent of pepper, signed on with Greenfield Partners in April to repurpose a 339,000-square-foot Verizon building at 99 Shawan Road, moving its corporate offices back from Sparks and consolidating about 900 administrative employees in one place.
Last month, engineering firm Johnson, Mirmiran & Thompson announced plans to build a new 130,000-square-foot headquarters on an empty plot at 40 Wight Ave. in Hunt Valley for its roughly 600 Baltimore County employees.
But new construction in Hunt Valley remains the exception to the rule.
Since 2006, Hunt Valley has added just six new buildings for a total of 248, according to the county. Of the roughly 1,400 acres in Hunt Valley, about 1 percent is still open for new projects, county officials said.
"That I-83 corridor has always been an attractive place … but I would say over the past 10 years it's gotten even stronger," said Will Anderson, Baltimore County's director of workforce and economic development.
When David Kelly, Kelly & Associates' chief organization officer, started looking about seven years ago for a spot where the firm could bring its roughly 425 Baltimore County workers under one roof with room to grow — and avoid a spike in costs — there weren't many options.
The company, started by Baltimore County state Sen. Francis X. Kelly and his wife, Janet, at their Lutherville home in 1976 and now run by his four sons, wanted to remain nearby. Many of its employees and clients reside in Baltimore County.
Kelly visited the Fila building several times, and flirted with the spot now being taken by JMT in Hunt Valley. But the cost to build there was higher than the firm wanted.
Finally, last June, the company purchased 1 Fila Way — a road that will be renamed for the firm — for $9 million and embarked on a renovation of the roughly 102,000-square-foot building, adding more than 700 solar panels, 90 miles of cable and 72,500 square feet of carpet.
The firm, which is rebranding under the simplified Kelly name as it moves its divisions to one place, even has room to build a new building if needed.
"I saw it in a totally different light," said David Kelly, who declined to disclose the final cost of the renovation. "It was able to hit all our objectives."
A desire for more space and budget constraints also informed U.S. Lacrosse's decision to move, said Susie Chase, vice president of the nonprofit governing body for the sport, which paid $4.5 million for 12 acres at 2 Loveton Circle in Sparks in 2012, abandoning a proposal to build at Harbor Point.
"We never locked in specifically on one area," she said. "We were just always looking for a parcel that was large enough."
En route to Sparks, York Road narrows, winding uphill past a smattering of older homes and large trees. Visitors to U.S. Lacrosse will have views of trees and rolling hills. Cornfields and horse farms are not far away.
Bill Whitty, a senior vice president at MacKenzie Commercial Real Estate Services, said he expects to see other companies that need a lot of space make the trip.
"The Sparks area is really benefiting from the lack of space in Hunt Valley," he said. "People aren't as afraid of taking that next step."
St. John Properties' 130,000-square-foot Loveton Circle development in Sparks is just 75 percent leased right now, compared to more than 90 percent at the firm's properties located further south on the York Road corridor. More space will become available when JMT relocates.
But with the economy picking up, Richard Williamson, St. John's senior vice president of leasing, said he is not worried.
"It will be a sizable amount of space but we are very optimistic that we can backfill it," he said. "As the York Road corridor fills, the demand by default goes north to where the space is."
Gail Chrzan, first vice president at CBRE, is marketing more than 36 acres at the Sparks Business Center, where Taylor Technologies is selling developable land. The site has been on the market for several years, but Chrzan is hoping it will lure a Maryland firm — or one from out of state.
Sparks is "finally coming into its own," she said. "It will take time, of course, but I think the issue is that it's happening."