RewardsPlus.com, a Baltimore Web-based manager of employee benefits that has grown rapidly since its founding in 1996, is heading to the suburbs for more room - a disappointment to city officials seeking to stem the flow of companies out of downtown.
The company will give up about 20,000 square feet it sublets in the Bank of America building on South Charles Street. Employees expect to begin moving in January to the former AAI Corp. building in Baltimore County, where RewardsPlus will occupy about four times that space. The building, on York Road in Hunt Valley, was vacated during the summer by financially troubled Creditrust Corp.
"Baltimore is a terrific city and we love being here and hate moving," said Kenneth P. Barksdale, RewardsPlus' president and chief operating officer. But Barksdale said the company couldn't find enough contiguous space in the city it liked to accommodate its growth and didn't want to split up. Lack of parking and costs were also issues. His new space is at least $5 a square foot cheaper and parking is free.
RewardsPlus is responsible for finding another tenant for the remaining 8.5 years on its lease downtown.
Barksdale declined to reveal sales at the private company, which is not yet profitable, but said they have been doubling each quarter. The company has 186 employees but could have as many as 400 in the next year and a half, he said, noting that six to eight workers are being added every other week.
The suburban space has room for 600, plus a recreational room, Barksdale said. Plus, it's closer to where about 65 percent of his work force lives.
The company recently hired a new chief executive officer, M. Gordon Gaddy, to build customers and develop the e-commerce business. RewardsPlus already claims 1,100 corporate clients and expects to go public soon.
A spokesman for the Downtown Partnership, which regularly meets with company executives to see if they're content, said RewardsPlus gave them no reason in a recent meeting to believe that it would leave the city.
Richard Cross said the partnership has been evaluating the reasons and number of companies that leave downtown and plans to release the information in its coming State of Downtown Baltimore Report.
M. J. "Jay" Brodie, president of the city's economic development arm, Baltimore Development Corp., said city officials jumped in late in the process and presented two or three office options, which RewardsPlus rejected.
Also declined was a tax credit that Brodie said could have amounted to millions of dollars over several years.