Before the Pilgrims Laundry was torn down to make way for new houses last summer, developer Mary Zimmerman took her mother inside the old building in Federal Hill one last time.
Her mother, Alice, had worked there as a teen-ager during the 1930s. Walking through the empty warehouse-like space, she remembered where the dryers were, where she took her lunch break, but most of all she remembered how hot it was.
Now decades later, her daughter is in charge of the site, which is about to become the location of a group of new houses in Federal Hill, one of a handful of new residential projects coming to the popular neighborhood during the next year.
Twelve townhouses, starting at $315,000, will be built in the historic neighborhood - the first new residential construction there in about eight years. The homes will be wider and have a more modern look than other houses in Federal Hill, most of which were built during the late 19th century. Construction should begin next month, and Zimmerman expects the houses to be finished by August or September.
Meanwhile, work has also started on converting the old Holy Cross Catholic Church school at West and William streets into loft condominiums. And at Ostend and Race streets, Realtor Stephen Strohecker is developing 18 townhouses that will be priced at about $300,000. Construction should begin in the summer with work finishing in the spring of next year, Strohecker said.
Popular for many years, Federal Hill continues to attract homebuyers. During the past five years, real estate values have risen 34 percent to an average of $182,790 - double the citywide average of $91,208 - according to Metropolitan Regional Information Systems Inc., a listing agency used by agents and brokers.
Along with home prices, household income also has increased - more than 80 percent to $77,340 during past 10 years, census figures have shown. That jump is reflected in the neighborhood's upscale bars and restaurants - and now more luxury homes.
Tracy Gosson leads a nonprofit group that promotes city living. But she said Federal Hill is so popular that it doesn't need her organization's help.
"It's the prototype for what every neighborhood should be in the city," she said. "You're paying a premium for it, but it's got the amenities, it's got the location."
And because the neighborhood increasingly is being developed and its popularity is spilling over to other areas south of the harbor, experts said, it is causing a real estate phenomena: the ever-expanding Federal Hill.
"Federal Hill as a city neighborhood is really quite small." Gosson said. "But you'll hear people say 'I lived in South Baltimore for 20 years, and one day I woke up in Federal Hill.'"
Strohecker said he had renovated a few homes in the neighborhood last year, and the success of that project inspired the Ostend and Race streets development.
"If I had a 100 of those things, I could have sold every one," he said.
Kirsten Sandberg, president of the Federal South neighborhood association, says her group is excited about Strohecker's project because it makes use of a run-down site and includes parking garages.
"For any developer, the first they need to be thinking about is how they are going to accommodate parking because it's a rare commodity around here," she said.
Although Zimmerman spent the past 15 years restoring homes in southern Baltimore, using the existing Pilgrims Laundry building wasn't an option.
"It just wasn't feasible," she said, adding that the space was too open to divide and the ceiling was too low. But Zimmerman still wanted to keep the name of the family business that had been in the neighborhood for more than 50 years. "There was a lot of history there," she said. "And we didn't want to take that away."
The addition of an attached garage in the Pilgrims Landing development is a break from nearby homes, but Peter Fillat, the project's architect, said the masonry construction and the size of the windows will help the houses blend in..
"We wanted them to fit. So we added patterns to masonry with metal and steel accents. It's all about the small details of the house to give it that particular character," Fillat said.
With a gated courtyard, the three-bedroom houses will face in on themselves, creating a new street, Pilgrims Landing. The attached garages will run along the 100 block of E. Ostend St. and Pentz Court.
Zimmerman bought the building in 1998 after the commercial laundry filed for bankruptcy during the early 1990s. She saw a great opportunity in the site's proximity to the downtown businesses, the Inner Harbor and the Cross Street Market.
Zimmerman said her mother is proud of her choice. "She started out ironing clothes there, and then, years later, her daughter bought the building," Zimmerman said. "I don't know if it was coincidence or fate, but it was a really good feeling to have that accomplishment."