Minority-built Crescent complex is sold

The Baltimore Sun

The City Crescent, a pioneering project on Baltimore's west side and the first downtown office complex developed by a minority-led team, has sold for $75 million, the broker for the sale said yesterday.

Washington Investment Capital purchased the 270,369-square-foot building at 10 S. Howard St., commercial real estate firm Trans- western said.

A group led by minority developers Otis Warren and Theo Rodgers built the sprawling 11-story building in 1993 on a city-acquired parcel for the federal government, which leased the majority of the space for anchor tenant the U.S. Army Corps of Engineers and other federal agencies. At the time, the lease was the largest ever awarded by the General Services Administration's Mid-Atlantic office to an African-American landlord, according to the Web site of Baltimore-based The Otis Warren Group.

The building is fully leased by GSA through 2018, according to Transwestern Commercial Services.

"It was a good time for the ownership to exit because the real estate market is strong and prices are up, and for the buyers, it was an opportunity to get in on an area being revitalized at an attractive sale price," said Gerry Trainor, managing director of Transwestern's Washington Institutional Commercial Group and the broker who handled the sale.

The sale, the latest in a succession of office property transactions in the city, shows continued strength in downtown's office market, commercial brokers said yesterday.

"Baltimore continues to be viewed as an attractive market, relative to the [pricier] tier-1 cities like Washington and Philadelphia and New York," said David Baird, senior managing director for Cushman & Wakefield Inc. in Baltimore.

Seen as pioneer

The building also has going for it a long-term lease with a stable tenant, he said.

"It was ahead of its time by about five years," Baird said. "It was seen as a pioneer of the near west-side market," predating the redevelopment of new apartments, shops and offices, Baird said.

The office market has benefited as more people are moving into the city and want to work close to their homes, said Kasey Hughes, an assistant vice president for Transwestern and a leasing broker in downtown Baltimore.

Neither Warren, whose company sold the building, nor Rodgers could be reached yesterday.

In a 1990 newspaper interview, Warren talked about being part of the first minority-led team to build a major downtown development and the prospect of that sending a message of hope.

"To me that's probably the most exciting thing," he told The Evening Sun at the time. "You have a city that has come on line with thousands of square feet of new buildings and a population of over 50 percent African-Americans and none of those buildings downtown were owned by African-Americans. ... I believed it could happen."

Gaining credibility

Brokers said yesterday that the purchase price, at $277 per square foot, is in the upper range for Class A buildings, showing faith in that section of downtown and reflecting the value of a long-term lease with the government.

"There's a tremendous amount of capital seeking well-leased buildings," Baird said. "The near west side is now gaining some credibility in the institutional investment market. It's certainly a good sign for other investors looking to purchase and develop assets and deploy capital on the west side."

lorraine.mirabella@baltsun.com

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