The first companies to commit to moving to South Baltimore’s massive Port Covington redevelopment see themselves as more than tenants.
Three cybersecurity industry firms, which announced plans Thursday to open headquarters by 2020 in the project’s first development phase, are in the business of investing in and nurturing cyber firms. And they see themselves attracting dozens of companies with hundreds of workers to what they call “Cyber Town USA,” making Port Covington the epicenter of a Silicon Valley of the East Coast.
The firms moving to the 235-acre waterfront parcel will anchor the first phase of buildings that could start opening by the end of 2020, the project’s developers announced during an event with Gov. Larry Hogan, Mayor Catherine E. Pugh and other officials.
The new companies are DataTribe, a Fulton-based cybersecurity firm that also has offices in Silicon Valley; AllegisCyber, a Silicon Valley-based cybersecurity venture capital firm; and Evergreen Advisers, a Columbia-based investment banking and corporate advisory firm to cybersecurity and other companies.
“The impact they will have cannot be overstated,” said Marc Weller, president and founding partner of Weller Development, the firm leading the $5.5 billion Port Covington project. “Some of these highly respected businesses are leaving Silicon Valley, which is thought to be the nation’s tech capital, in order to become part of something new and exciting. … With these companies on board, Port Covington is on course to become the first-of-its-kind cyber ecosystem.”
Sprawling across largely vacant industrial land just south of Interstate 95, the Port Covington site is to be redeveloped for an estimated $5.5 billion with offices, residences, stores, hotels and a future headquarters campus for Under Armour. The Baltimore-based athletic apparel company has two office buildings there, near the Sagamore Spirit distillery and Rye Street Tavern that opened last year. The Baltimore Sun leases its printing plant there, which also hosts its business and news operations.
Weller said he envisioned the site attracting growing, innovative and tech-forward companies that will collaborate to bring ideas from development to full market maturity. Weller Development was formed last year to spearhead the project for its owners, including Sagamore Development, co-founded by Weller and Under Armour founder and CEO Kevin Plank, and Goldman Sachs Urban Investment Group, which joined the development effort in 2017 with an investment pledge of $233 million.
Mike Janke, co-founder of DataTribe, and Bob Ackerman, founder and managing director of AllegisCyber, said they began meeting with Maryland representatives, including U.S. Rep. C.A. Dutch Ruppersberger, about seven years ago, floating their vision for an East Coast cyber and tech hub in Maryland.
Baltimore is better suited than other cities and states angling for that distinction, such as Atlanta, New York and Texas, they said, because it is already home to a robust cybersecurity industry, U.S. intelligence agencies, research and development laboratories and other related sectors. The state already employs 109,000 cyber-related engineering and data science professionals, Janke said.
“Those other states don’t have what Maryland has,” Janke said. “Maryland has the largest cybersecurity employee population in the United States. We have the oil, the cyber-oil.”
Janke said about 25 to 30 cyber firms already are committed and negotiating to move in to the first Port Covington office buildings to open in 2020, and that number could grow to 50 to 60 firms by the opening, employing a projected 500 to 600 people.
Ackerman, who will be moving his venture capital firm from Silicon Valley, said it has become increasingly difficult to attract cyber and tech talent to California because of the high cost of living and the reluctance of many older, established employees to uproot families. Meanwhile, he said, there is a “groundswell of innovation” taking place in government labs with enormous potential for commercialization.
Maryland also offers “the country’s deepest and largest reservoir of cybersecurity engineering talent,” Janke said, while the state’s business and regulatory climate has become more attractive to businesses and their investors, helping to lower business costs. His firm, DataTribe, which he called a “start-up studio,” invests in and helps build commercial software firms.
“We’ve always had the vision, then we met Marc [Weller] and Kevin [Plank] and the team, who had an opportunity around Port Covington, and who shared that vision,” Ackerman said. “We found a development partner that allows us to take the vision of Silicon Valley and translate it and transport it to Maryland and give it a home.”
At Port Covington, he said, “we’ve got a clean slate.”
The project’s developers had been disappointed to be passed over in their bid to house Amazon’s second headquarters. Last month they said they would soon begin putting in infrastructure for offices, apartments, shops and a market in the project’s first phase, but announced no tenants until Thursday.
That phase is expected to include a total of 3 million square feet of space, including 1.26 million square feet of office, 269,000 square feet of retail, 1.33 million square feet of residential and 156,000 square feet of hotel space. Planned features include an open-air market and food hall, street-level shops and a rooftop event space overlooking the Patapsco River. Developers plan to build a secure, redundant, private fiber-optic loop at Port Covington to provide reliable and state-of-the-art gigabit-speed internet connectivity and site-wide Wi-Fi service.
Future phases could include an additional 10 million square feet of space.
City officials are banking on the site to produce thousands of new jobs and promote economic growth. They agreed to a controversial $660 million tax increment financing deal with the developers in 2016 and will soon begin selling a set of bonds that will be used to pay for infrastructure on the site. The bonds will be repaid from new property taxes generated by the development.
Pugh said during Thursday’s event that its location and a high concentration of engineers graduating from local colleges and universities makes the site ideal for creating a tech hub. She promised another big announcement soon about Port Covington but did not elaborate.
“There is so much talent in and around our city,” Pugh said. “We get an opportunity to make sure we that keep that talent in our city.”
Hogan said he expects the project to spur development of cyber companies and bring in jobs, capital investment and business opportunities.
“Port Covington is a shining example of the potential and positive growth that this city needs,” said the governor, adding that it will help to revitalize the city and become an “incredible” economic generator for the state. “Today, we are setting the tone for the great future of Port Covington, more innovative, pioneering companies for Baltimore, which will help to further establish Maryland as a national leader in technology and as the cyber capital of America.”