Tower at Harbor Point starts to rise

Three stories of a new office tower poke above the ground on the waterfront peninsula between Fells Point and Harbor East, dwarfed by a 280-foot yellow crane that represents what's yet to rise.

Incessant beeping filled the site Monday as excavators, dump trucks and loaders lumbered about in advance of a Wednesday ceremony to formally mark the end of pile driving and the beginning of the tower.

Roughly 1,050 piles are already in the ground — enough steel to stretch 12 miles laid end to end — the foundation for the 20-story building slated to house offices for the energy giant Exelon Corp. The Exelon tower is the first atop the most contaminated portion of the 27-acre site, where the former Allied Signal chromium plant operated until the 1980s.

The $270 million project, which also includes roughly 100 apartments, retail space, a central plaza and a garage, is scheduled to open in 2016. By the end, it will involve 4.5 acres of glass and 65,000 cubic yards of concrete, enough to pave a four-foot sidewalk from Baltimore to Pittsburgh.

"It's rising and it will start to accelerate," said Michael Beatty, president of Beatty Development Group LLC, which is leading the transformation of the waterfront parcel. "I think Baltimore is in such a great place right now to take off to the next level and I think this project, and the scale of it, has the ability to move that in the right direction."

Harbor Point's first building, Thames Street Wharf, was completed in 2010 and sold last year for $89 million. Beatty Development hopes to start construction of the roughly $90 million Point Street Apartments this spring, with 289 residences. The firm intends to present designs for a third building in the coming months. The entire site, authorized for up to 3 million square feet of building and expected to be valued at about $1.8 billion upon completion, could take another 10 years to build out.

Wednesday's ceremony formally marks the end of environmentally sensitive work for this building, for which crews opened the protective cap sealing the cancer-causing hexavalent chromium left by Allied to drive the piles. Months of strict monitoring have revealed no serious issues, Maryland Department of the Environment officials said.

While construction of the Exelon building is in its beginning stages, Harbor Point already has started to transform the city, spurring other projects in the area, accelerating conversations about how to address congestion in the Harbor East-Canton corridor and raising questions about public subsidy for development projects.

Harbor Point is set to receive more than $400 million in public subsidies, including roughly $110 million in tax breaks. The city also agreed last year to float $107 million in bonds to pay for public infrastructure to be repaid by rising tax revenue from the project, a deal that prompted months of acrimonious debate.

The benefits came under scrutiny again this month, as anticipated cuts to the city school budget were traced in part to a funding formula that ties state support for education to property values, but doesn't account for the city's not receiving that tax revenue, as it won't for years from Harbor Point.

"I think it's triggered a discussions to continue to have," said City Councilman James B. Kraft, who represents the area and supported the tax deal. "We were certainly justified in using them … but I don't know whether they are the tool that we need as much anymore … We can only afford to take so much property off the tax rolls."

The political fight about the project, expected to create about 1,000 construction jobs, also led to more focus on job creation. Beatty Development has committed to a goal of having Baltimore City residents represent at least 20 percent of the employees on the job site, and more than half of new hires.

Bishop Douglas Miles of Koinonia Baptist Church, the co-chair emeritus of Baltimoreans United In Leadership Development, said the civic group remains concerned about the subsidies provided to Harbor Point. The group plans to continue pressuring elected officials to make the benefits of development projects extend to city residents, particularly as the 2016 election approaches

"The jury's still out on Harbor Point, but in the past such development has not contributed significantly to reducing unemployment in Baltimore or employing a significant number of Baltimore City residents," Miles said.

Beatty said Monday he still does not understand the opposition to the infrastructure deal for what he believes will become a major public attraction with its waterfront park and open spaces.

But he said the debate did push his firm to think more about how to make jobs accessible to local residents as it moves forward with the development.

"You're going to see more and more of that," he said.

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Beatty, a Long Island native who moved to the area in 1990, already made his mark on Baltimore with Harbor East, which he developed in partnership with baker and developer John Paterakis before starting his own firm in 2013 to focus on Harbor Point.

The city is starting to grapple with the consequences of the increased development, especially as cars clog the roads between Harbor East and Fells Point and Canton.

The city is reconstructing South Central Avenue and expects to seek bids to start work on a new bridge, extending the road into Harbor Point, in the next two months, said DOT spokeswoman Adrienne Barnes. It previously estimated the project's cost at $33 million.

The Waterfront Partnership also is working with a transportation firm to map out traffic patterns and existing transit routes. The group, which is leading a task force with major employers in Harbor East and Harbor Point, expects to ask the MTA to introduce a new commuter route, connecting White Marsh in Baltimore County to the area, said Laurie Schwartz, the partnership's president.

The traffic problems have to be resolved, or they will threaten future development, Kraft said.

"It's like a one-note song," he said. "The traffic impact … will continue to intensify. Until we find a way to move people rather than cars, we're not going to solve this problem."

nsherman@baltsun.com