One Charles Center, a historic, yet modern office tower owned by Peter Angelos in downtown Baltimore, could be redeveloped for luxury housing under plans to sell the 1960s-era building that kicked off the city’s Charles Center renewal area.
The family of Baltimore Orioles owner Angelos is putting the 22-story aluminum and glass skyscraper on the market next week, according to Cushman & Wakefield, the commercial brokerage handling the sale.
Angelos purchased the iconic building for $6 million in 1996, amid depressed office property prices, and relocated his law firm there. Plans to sell come at a time when several members of the now ailing 93-year-old patriarch’s family are embroiled in a bitter and public feud over control of his baseball, legal and real estate empire.
In June, Angelos’ son Louis Angelos filed suit in Baltimore County Circuit Court against his mother, Georgia K. Angelos, and brother, John Angelos, over what he characterized in court documents as his brother’s attempt to take control and ownership of their fortune. Georgia Angelos followed this month with her own suit, against Louis, her younger son. She claimed Louis Angelos sold his father’s law firm to himself and sought to invalidate that purported sale and to remove him as a co-agent under the terms of Peter Angelos’ power of attorney.
Peter Angelos, incapacitated by health problems, rarely sold anything, tending to hold on to his assets. However, according to Georgia Angelos’ suit, he wants her to sell the Orioles upon his death so she “could enjoy the great wealth they had amassed together.”
The broker marketing One Charles Center said the tower, designed in 1962 by world-renowned modern architect Ludwig Mies van der Rohe, is ideally suited to convert to apartments, given housing demand and strong rent growth in the central business district.
But, Ari Azarbarzin, senior director of Cushman’s multifamily advisory group in Baltimore and the lead broker for One Charles, said Wednesday: “We’re also casting a wide net to ensure that investors and developers of all asset classes across the real estate spectrum are looking at the deal and potentially bidding on the deal.”
He noted that multifamily and industrial have been two of “the darlings of real estate investing,” though an industrial use is not viable for the building.
“We feel that the interest will very likely come from an apartment developer, and we think that the market supports the additional supply of apartments coming on line,” said Azarbarzin, citing several recent office-to-apartment conversions in the area.
He said the building has unique attributes expected to make it especially attractive, including its iconic design, on-site parking, green space in the plaza and a layout conducive to adding residential amenities such as a pool or fitness center.
“It’s a once-in-a-generation acquisition opportunity for a developer to buy a landmark building and put their own stamp on it and be a catalyst for the continued revitalization of the Charles Street corridor,” Azarbarzin said.
In an area of downtown Baltimore that includes Harbor East, Harbor Point, Little Italy, Federal Hill, Otterbein and much of Mount Vernon, housing occupancy rose to 95.2% last year from 93% in 2020, even as new housing units hit the market, according to a report released in May by the Downtown Partnership of Baltimore. Rents for “Class A” apartments downtown ranged from $1,571 to $3,746, the report showed.
The more than 320,000-square-foot One Charles Center is about 49% occupied by nearly a dozen tenants, including the Law Offices of Peter Angelos, which has nearly 60,000 square feet, Azarbarzin said. He said he had no information on tenants’ plans, calling it a fluid process.
Jim Grieves, a vice president of MacKenzie Commercial Real Estate Services, said he was somewhat surprised to hear One Charles is being marketed for housing conversion because of its existing office tenants and because several other office-to-residential conversions are underway nearby.
Those include the transformations of the 15-story Fidelity & Deposit building at 210 N. Charles St. into 220 units and the 15-story 1 Calvert Plaza into 173 units.
“I guess it depends on how quickly everything hits the market,” he said.
He said the building may fetch a higher price as an office building because conversion costs can be high. And the central business district, which has struggled with high office vacancies amid the coronavirus pandemic, is expected to improve under a recent plan to relocate state government offices at State Center to downtown.
The Evening Sun
“The office market is going to get stronger, but as far as a pool of buyers is concerned, whenever there’s a building that could be either an office use or a redevelopment use, there’s always a much longer list of companies that would look to redevelop a property to apartments,” he said. “But once again, they’re not going to pay as much per square foot because of the costs related to conversion.”
Cushman & Wakefield is not publicly advertising an asking price for One Charles Center.
Though it’s early in marketing, Azarbarzin said, “interest has been significant, and several very strong qualified parties have already indicated that they’ll be spending serious time and potentially making an offer on the property.”
He said the Angelos family, which approached Cushman this summer about selling the tower, hired engineering firm BCT to study the feasibility of a residential conversion. The building could accommodate a range of 300 to 340 units, he said.
John Angelos could not be reached through a representative Wednesday. Plans to sell the tower were initially reported this week by the Baltimore Business Journal.
In documents filed in the Angelos family’s legal disputes, Georgia Angelos said she had transferred properties she and her husband owned in downtown Baltimore and elsewhere in Maryland in 2020 to a central holding company, JPA RE LLC. She said she did so, based on advice when her husband became incapacitated, for income tax purposes and because many of the properties were vacant and operating at a loss.
A 99.5% interest in those unnamed properties was then sold to a trust that Georgia Angelos controls and that John Angelos manages, an affidavit shows. Court documents do not specify which properties were sold to the trust. But One Charles is not among the transferred properties, according to a list in Louis Angelos’ lawsuit.