Stalled plans to energize Baltimore's Charles North area are back on track after city officials settled yesterday with two property owners who contested the seizure of their buildings.
The city essentially doubled its original offers in both cases - one of which made headlines this year when the challenge resulted in the state's highest court forcing the city to change its long-standing economic development strategy.
Baltimore's Board of Estimates approved payments to the owner of what used to be the Magnet bar and package-goods shop at 1924 N. Charles St. and to the owner of a vacant building at 1820 N. Charles.
George Valsamaki, who owned the Magnet for 32 years, challenged the city's "quick-take" seizure of the bar last year. In February, Maryland's Court of Appeals ruled that Baltimore had no good reason to take the bar and sharply criticized the city's quick-take policy, saying officials have used it to "run roughshod over the owners of private property."
It was the first successful quick-take challenge. Almost immediately afterward, the high court also faulted the city's similar seizure of the former Chesapeake restaurant, another property in the Charles North area.
Though the city originally offered Valsamaki $140,000 for his three-story building, yesterday he was awarded $365,000.
Charles Dodson, who owned 1820 N. Charles, was originally offered $121,700, but yesterday the city agreed to pay him an additional $100,300.
In both settlements mediators worked with the property owners and city officials.
Valsamaki's attorney, John C. Murphy, said his client was happy with the settlement and the further-reaching effects of his challenge.
"This was a very profitable property. It doesn't look like much, but it was a liquor store and bar that had a strong income stream," Murphy said. "It had a value beyond the normal building. And I think that was recognized."
City Solicitor George Nilson also thought the payout was fair.
"We would have preferred to buy it for a little less, and I'm sure he would have liked to get a little more. But we wouldn't have settled if we didn't think it was fair," Nilson said.
Condemnation appraisals typically take only the property into account, not the value of a business. That's partly why Valsamaki's ultimate payout was so much higher than the initial offer, Nilson said.
By condemning the Magnet, 1820 N. Charles and 17 other Charles North properties, Baltimore officials aimed to assemble sizable tracts to entice developers. The goal was revitalizing the depressed area between Mount Vernon and Charles Village along the busy Charles Street corridor - an area city officials are trying to turn into an arts and entertainment district.
Paul Dombrowski, Baltimore Development Corp.'s director of planning and design, said yesterday that the settlements will enable the city to move ahead with the plan.
He said the city's economic development agency hopes to get the titles to the two properties by the end of the month and possibly offer those sites - combined with others nearby - to developers by the end of this year.
Altogether the city hopes to assemble three development sites in Station North. The Chesapeake is still in litigation.
"We're pleased to see things moving forward," Dombrowski said, adding that the city would like to see homes and shops built there - "Anything that supports the arts and entertainment in the area would be welcome."
Baltimore is rethinking how it uses eminent domain in the wake of the Valsamaki challenge, Nilson said.
City officials are using quick-take "more sparingly" and, when they do, taking more time to explain to the court exactly why it's necessary.
jill.rosen@baltsun.com