Design firm sold to Dutch company

The Baltimore Sun

RTKL Associates Inc., the homegrown architecture firm that has put its stamp on much of the region as well as worldwide projects including the Beijing Olympics, has been sold to a Dutch engineering and consulting company.

ARCADIS, which specializes in environmental remediation, infrastructure and property development, announced yesterday that it had bought the privately held Baltimore firm for an undisclosed sum.

RTKL Chairman Paul Jacob III said the firm had been thinking about pursuing a merger for some time as a means to grow more rapidly globally. It hadn't considered being acquired until ARCADIS came along with an unsolicited offer.

"It's much more difficult to expand globally than across the nation," Jacob said. "While we certainly had success, the pace at which we had been going was slow."

Over its six decades, RTKL has left a lasting imprint on the Baltimore area, designing buildings large and small and helping to shape the city's revitalization. When Baltimore initiated downtown renewal, RTKL designed the master plan for Charles Center and later was heavily involved in the emergence of the Inner Harbor. Among its buildings are the Hyatt Regency hotel, one of the early structures to rise along Light Street; the tower at 750 West Pratt, now headquarters of Constellation Energy Group; and the Reginald F. Lewis Museum of Maryland African American History and Culture, which it co-designed.

Its influence pushes east and west. It created the master plan for the Camden Yards sports complex and is the architect for the Hilton convention hotel now rising next to Oriole Park. And as development migrated eastward, it drew the plans for the Bond Street Wharf in Fells Point and then moved in, forsaking the soaring tower it had designed at South and Baltimore streets. It employs about 150 there now.

Its reach extended to Baltimore's suburbs and beyond. In the 1950s, it designed the East Coast's first enclosed shopping mall, Harundale, in Glen Burnie for developer James Rouse and decades later fashioned The Avenue at White Marsh, the first "Main Street" type retail center in the Baltimore region. Its work also includes the Greater Baltimore Medical Center in Towson and the Episcopal Church of the Redeemer in North Baltimore.

ARCADIS plans to keep RTKL intact as a subsidiary, with existing management and staff in place, and has vowed to invest capital in the firm to help it grow. At first, RTKL officials were skeptical, Jacob said, especially since the industry has seen a spate of mergers and acquisitions lately and the firm had received several overtures already. But after speaking with other subsidiaries that ARCADIS had recently acquired, Jacob and the other vice presidents who held the company's shares realized ARCADIS meant what it said.

"It seemed perfect," he said.

Harrie Noy, chief executive officer of ARCADIS, said there is no reason to make changes; the company has built a brand and reputation globally that he has long admired from afar.

"RTKL is a worldwide company in architecture and urban planning," Noy said. "We do not have these types of services at ARCADIS."

ARCADIS has more than 11,500 employees, including 3,700 in the U.S. Last year, the publicly traded company reported revenue of 1.2 billion euros. The company, which has operated in the United States for a half-century, has added 2,500 employees and 80 offices here in just the Past five years, mostly through acquisitions. This year the company had a goal of adding 1,000, which it should accomplish with the acquisition of RTKL.

"We think the combination of our businesses will benefit both of us," Noy said.

Together, they plan to go after major urban design projects around the world, something RTKL has made great strides toward, particularly in China, Noy said.

With 1,100 professionals and support staff in 10 offices and gross revenue of $195 million last year, RTKL has been involved in high-profile projects around the world. It redesigned the portion of the Pentagon that was damaged during the Sept. 11 terrorist attacks. Internationally, it was on the design team that helped Beijing win the 2008 Summer Olympics.

Harold L. Adams, who spent more than 35 years at RTKL and is credited with helping to elevate the firm to the international prominence it holds today, had mixed emotions over yesterday's news.

"There's a great deal of consolidation going on in all businesses," he said. "It does not surprise me, but it does surprise me. We had been fiercely independent and wanted to stay independent for many years. [But] The growth of other companies in the international marketplace is almost mandating this."

Between 1967 and November 2003, Adams served in a variety of roles at RTKL, including president, CEO and chairman. It was a period when the company's employment base grew from 45 to 1,000, he said.

When he first arrived, the company was strictly a regional, architectural firm. It opened offices in Dallas, Los Angeles, Washington and Florida during the late 1970s and early 1980s. By the end of that decade, opportunities started opening internationally in Tokyo and then later in London, Hong Kong and Shanghai, Adams said.

Adams, who at 68 is retired but maintains the honorary title of chairman emeritus and uses the pronoun "we" in talking about RTKL, said there have been a variety of conversations through the years about being purchased or acquiring other firms involving companies other than ARCADIS.

"It came down to personalities and the fear that the firm as we knew it would be destroyed if we were acquired by the people we were talking to," he said.

International business has put RTKL on the map, Adams said. The firm is among the top 10 of U.S. design companies in international billings, he said. Master planning, retail, residential, health care and work for the government are among the keystones for RTKL, he said.

"I have high hopes that all those project types will continue to be the foundation of the firm as it grows globally," he said. "It's a very diversified practice, and I think it's important to remain diversified."

As RTKL's reach has expanded around the nation and the globe, its employee base in Baltimore has shrunk. And while some might bemoan the loss of another company born and bred in Maryland to an overseas owner, others have come to expect it.

"It's just a recognition of the fine work that RTKL has done through the years," said Donald C. Fry, president of the Greater Baltimore Committee, an organization of industry and civic leaders that works to strengthen the state's business climate. "It expands their international reach and provides them the opportunity to work on more world-class projects."

"The reality is there are going to be places where successful companies are going to be acquired by even larger companies," he said.

The sale is the latest in a series of mergers and consolidations of architectural firms in the United States and abroad.

Others include the merger of RMJM of the United Kingdom and Hillier Architecture of Princeton, N.J.; the acquisition by URS of San Francisco of Washington Group International of Boise, Idaho; and the merger of HKS Architects of Dallas and Hill Glazier Architects of Palo Alto, Calif.

In many cases, the buyer or initiator of a merger is looking for access to a market it is not currently in, without having to start from scratch. Companies also are consolidating to give themselves a wider range of architectural, engineering and interior design services in-house, so they don't have to join forces with others.

Today's firms "want to work more collaboratively," said Scott Frank, a spokesman for the American Institute of Architects. "They want to have all the disciplines they need under one roof."

RTKL's chairman said the sale would have been viewed positively by the founding fathers.

"They wanted a company that would survive them and grow into a stronger force," Jacob said, "so the generations that came after them would have a fun place to work."

allison.connolly@baltsun.com

june.arney@baltsun.com

Sun reporter Ed Gunts contributed to this article.

Some local RTKL projects

Harundale Mall in Glen Burnie, first enclosed shopping center on the East Coast

Co-designer of Episcopal Church of the Redeemer on North Charles Street

Master plan for Charles Center

Greater Baltimore Medical Center, Towson

Hyatt Regency Baltimore, Inner Harbor

One South Street, at Baltimore Street

The Avenue at White Marsh

Master plan for Camden Yards sports complex

Bond Street Wharf

750 W. Pratt St. (Constellation Energy headquarters)

Hilton convention hotel, under construction

RTKL at a glance

Founded: 1946 Chief executive: David C. Hudson Headquarters: Baltimore Other offices: Washington, Chicago, Dallas, Los Angeles, Miami, London, Madrid, Shanghai and Tokyo 2006 revenues: $195 million Employees: About 1,100, including 150 in Baltimore

RTKL TIMELINE

1946 - Architect Archibald C. Rogers opens an architecture office in his grandmother's basement in Annapolis. He is soon joined by Francis Taliaferro. 1949 - Charles Lamb joins the firm. 1961 - Urban design specialist George Kostritsky is hired and firm's name is changed to Rogers, Taliaferro, Kostritsky and Lamb. 1968 - The company's name is shortened to RTKL, courtesy of an exasperated receptionist. 1990 - RTKL opens offices in Tokyo and London. 1992 - The company moves its headquarters from Pratt Street to One South Street, which it designed. 1993 - RTKL takes on its first project in China. 1998 - The company is selected to design the Shanghai Museum of Science and Technology. 2001 - RTKL opens a Shanghai office. 2002 - RTKL moves its headquarters to Bond Street Wharf, 901 S. Bond St. in Fells Point, a building it designed.

2007 - RTKL is acquired by ARCADIS, an international consulting and engineering company based in the Netherlands.

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