In Baltimore's latest effort to prop up its wilting downtown, city leaders took a major step yesterday toward enticing more people to move into the business district with a $1.1 million loan to help a developer convert an empty office building into apartments.
The former YMCA building at 300 N. Charles St. is the first of several buildings that the city leaders say will become apartments catering to young professionals and college students, who want the convenience of downtown living.
The Board of Estimates approved the $1.1 million loan to Savannah Development Corp. yesterday as part of a $5.5 million conversion project that hopes to add 36 apartments to the central business district by 2001.
"This will bring life to downtown, contribute to the city's tax rolls and reverse blight and restore confidence in downtown," said Lori Gillen, director of business and economic development for the Downtown Partnership of Baltimore, which is spearheading the conversion of vacant office buildings to apartments.
In 1996, Mayor Kurt L. Schmoke put his political will behind a plan to bring about 1,000 apartments to the city's central business district. About 15,000 people live downtown.
City leaders are betting that there are enough would-be renters who want to live downtown because of the proximity to major employment sites, the Inner Harbor, clubs and restaurants.
But renters will face some inconveniences, such as distant parking and lack of a nearby major grocery store.
The five-story building would have a combination of one- and two-bedroom apartments ranging from $645 to $1,100 a month, said Catherine Caskey, development director for housing and community development. It is aimed at the same market as the Sail Cloth Factory, near the University of Maryland at Baltimore, or Tindeco Wharf in Canton.
Savannah Development will pay the loan back at 1 percent interest beginning in two years. Under the agreement, Savannah Development will not have to pay back the city in the months that the project does not make enough money to pay for its expenses.
Savannah Development, headed by Betty Jean Murphy, has links to a company called Joy Owens Interiors, which is owned by Florence Owens, the sister of Housing Commissioner Daniel P. Henson III. Savannah Development and Joy Owens Interiors share office space and have worked together on projects.
If the project is successful, the apartment building is expected to net the city about $60,000 in property taxes each year.
City leaders say they have to offer developers loans or tax credits to convert the city's large stock of Class B office buildings into apartments or the projects would not be undertaken.
A Legg Mason report concluded that public money is needed to offset renovation and acquisition costs. The report says income from rents would not be enough to pay for the conversions.
But city Real Estate Officer Anthony J. Ambridge cautioned the Board of Estimates yesterday that the city has to negotiate better deals with future developers to ensure that the city shares more of the profits when the projects are successful.
Pub Date: 7/02/98