Pure Five Inc., an investor group headed by Baltimore real estate developer Otis Warren Jr., won preliminary approval from the city's Board of Estimates to buy Harrison's Pier 5 Hotel and restaurant for $5.5 million.
Yesterday's approval by the Board of Estimates clears the way for the group to obtain necessary financing and complete the purchase in 30 to 45 days, according to Leslie Howard, development director for Baltimore Development Corp.
Late last year, the corporation, the city's economic development arm, awarded the four-man investment group exclusive negotiating rights to buy the financially troubled hotel, which was taken over by the city in 1993.
Mr. Warren, a real estate developer who built the Crescent City office complex on Howard Street, could not be reached for comment yesterday.
The preliminary pact approved by the Board of Estimates calls for Pure Five to raise $3.5 million through private financing. The group is negotiating a loan agreement with the city for the remaining $2 million.
The city guaranteed $6.6 million of an $8.8 million loan to finance construction of the Pier 5 complex in 1988. The city took it over in late 1993 after the developers defaulted on their loan and failed to pay more than $1 million in property taxes.
Earlier this year, conflict-of-interest questions were raised when it was learned that G. Gregory Russell, a partner in Pure Five was an official of the Maryland Port Administration. While Mr. Russell was putting together a proposal to buy the hotel, he was leading the port agency's negotiations on its $3 million purchase of a 3.1-acre site from AlliedSignal Inc. for a passenger ship terminal that would lure tourists to the area.
The hotel is near the terminal.