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Business Year in Review: Kevin Plank steals the show

Batimore Mayor Stephanie Rawlings-Blake signed legislation Wednesday morning authorizing $660 million in public financing for Under Armour CEO Kevin Plank's proposed Port Covington development.

Kevin Plank's Under Armour is not Baltimore's biggest enterprise — the Johns Hopkins University and Health System have more than 40,000 workers combined.

But the founder and CEO of the Baltimore-based sports brand made the biggest waves on the local business scene this year, as his personal investments in real estate, whiskey, hotels, water taxis, tech companies and others started to flow.

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His biggest coup was Port Covington, the South Baltimore industrial area where Plank plans to construct a new Under Armour campus, turning the land nearby into a new neighborhood with thousands of apartments, new stores and office buildings.

His private real estate firm, Sagamore Development, powered through approvals to redevelop the waterfront zone, winning in less than nine months city support for a record $535 million in tax increment financing to help build out the site's roads, utilities, parks and other infrastructure.

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The plans mean the city has agreed to borrow up to $660 million, which would be repaid with new tax revenue generated by the project. If the tax revenue falls short, the property owner is responsible.

City officials kept early details of the financing proposal from the public, with the board of the Baltimore Development Corp. discussing the development behind closed doors. (That move led to a slap on the wrist from a state board, which said the BDC violated open-meeting laws after a complaint by The Baltimore Sun and other media groups.)

As the scope of the deal — which is also expected to involve millions in state and federal funding — became apparent, it drew criticism from organizations such as the ACLU, who said the city's decision to steer resources to the area was an example of corporate welfare based on lofty promises and came at the expense of poor, minority neighborhoods.

Despite those potential roadblocks, Sagamore won over different constituencies, launching an unprecedented public relations campaign and cutting deals with city officials, nearby neighborhoods and some activist groups for hiring city residents, affordable housing and other community benefits the company says could be worth $100 million.

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City Council approval came in September. Sagamore will have to line up financing before bonds are issued, which is expected to occur next year.

But Plank already has made his mark on the area.

Under Armour moved hundreds of employees into a former Sam's Club now known as Building 37 and opened its experimental manufacturing location, known as UA Lighthouse at the City Garage.

That building has become the hub for many of Plank's other new investments — businesses that make tote bags, powered skateboards and luxury watches. The distillery for Sagamore Spirit rye whiskey, which hit shelves in May, is nearing completion on the shores of the Middle Branch.

When it opens, visitors may one day be able to arrive by water taxi. Plank purchased Baltimore's water taxi operator this summer as the firm locked in exclusive rights to the city's docks and wharves for up to 30 years. The firm plans to launch a new fleet of Baltimore-made boats and add stops and service, including in Port Covington.

Sparrows Point logistics

Under Armour also became a player across the harbor, where investors are working on the makeover of the former Sparrows Point steel mill site, 3,100 acres now known as the Tradepoint Atlantic logistics hub.

The development, a joint venture of local investment group Redwood Capital and Hilco Global, started to gain traction this year, signing a rash of tenants to the space. Under Armour committed to opening a 1,000-employee distribution center, following deals made with FedEx, Harley-Davidson of Baltimore and auto importer Pasha Automotive Services. Atlantic Forest Products also said it would relocate from Port Covington to the the former Bethlehem Steel site.

In November, Tradepoint suggested it may need a tax increment financing deal, similar to the agreement for Port Covington, to help pay for the hundreds of millions of dollars in infrastructure upgrades needed on the site.

Cranes rise

Harbor Point marks a milestone with the opening Friday of Exelon's new headquarters. (Kenneth K. Lam, Baltimore Sun video)

A new 20-story tower for Exelon Corp. opened this year in Harbor Point, altering the city skyline. But its cranes were signs of more change to come.

Many of the downtown's other major projects, including 414 Light Street, Liberty Harbor East and the 225 N. Calvert St. conversion, involve apartments. But new development, including food halls and offices, speckled the city in neighborhoods including Sharp-Leadenhall, Remington, Hampden and Highlandtown.

The Exelon tower is the first new property to open on the former Allied chromium plant site since 2010. Beatty Development Group, which is redeveloping the 27-acre Harbor Point site, also got started on its own apartment building at the site, expected to open at the end of 2017.

Jobs, jobs, jobs

Financial giant Morgan Stanley pledged in November to add 800 jobs in Baltimore and open a new office downtown, which would bring its number of nonretail business workers in the city to about 1,800 by 2020. The plans came with a $5 million incentive package.

That sweetener paled in comparison to some of the benefits offered to other big businesses as Gov. Larry Hogan and Commerce Secretary Mike Gill aimed to make good on promises to make Maryland business- friendly.

Defense contractor Northrop Grumman received a $37.5 million tax credit, on top of a $20 million forgivable loan, for retaining its 10,000-person workforce in the state. Marriott also secured a package for a mix of local and state grants, loans and tax credits estimated to be worth about $60 million for maintaining its 3,500 workers in the state and building a new headquarters in Bethesda.

Spice company heats up

McCormick & Co., the Hunt Valley-based spice and flavor maker, continued its buying spree, making two international acquisitions. The firm in November said it would add Enrico Giotti SpA of Florence to its portfolio for $127 million. The deal followed the $114 million purchase in April of Gourmet Garden, an Australian maker of chilled herbs.

But those deals are small compared to the one that got away. McCormick dropped its pursuit of British food company Premier Foods in April after raising its offer and being turned down twice. A deal for Premier would have represented McCormick's largest acquisition ever: $2.2 billion including debt.

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Legg Mason ups and downs

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Legg Mason also was on a spending spree this year, investing more than $1 billion as it took stakes in other financial management companies, including Clarion Partners, Financial Guard and Entrust Capital, which it combined with an affiliate.

But the activity has not done much for its stock price, which tumbled further this year. In April, activist investor Nelson Peltz sold his roughly 10 percent stake in the company to a Singapore firm, even though the firm's valuation meant he did not not make a significant return. Star stock picker Bill Miller went his own way last summer. In December, Legg lost its spot on the S&P 500.

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