A decision by Sam's Club to leave a Baltimore waterfront retail development is not a sign that retail can't work in the largely industrial area, the owners of the project said yesterday.
Sam's Club is relocating its store in Port Covington - near the Vietnam Veterans Memorial Bridge in South Baltimore - to a site in Glen Burnie near more stores and housing, a spokesman for Wal-Mart Stores Inc. and Sam's Club confirmed yesterday. A Wal-Mart also on the 273,000- square-foot retail site will remain.
The property owners, Bethesda-based Finmarc Management Inc. and Kodiak Properties, said they had not been officially notified of plans by Sam's Club to vacate.
They said a departure by Sam's would be disappointing, although they don't think it would hurt the chances for future retail at the site, which is across the street from The Sun's printing plant and in an area of mostly industrial uses.
Kodiak and Finmarc have plans for a mixed-use development on the site that would include housing, service retailers such as a dry cleaner, and office space, said Scott Spector, a managing partner with Kodiak.
Spector said the project is in the preliminary stages. He said he hopes to present plans to city officials in the next two or three months, but didn't yet have a date for groundbreaking or a completion target.
As foot traffic increases in the area that will make it more attractive to other retailers, Spector said.
"Clearly the area will go through a transition, and it hasn't gotten there yet," Spector said.
"Residential is very important down there," Spector added. "Right now there is not residential there and retail obviously requires residential bodies."
The Sam's Club spokesman, Steve Restivo, wouldn't give a reason for the Port Covington closing other than to say "it was part of an effort to better serve the Baltimore metro area."
Some people familiar with the development said it never lived up to its original plans.
Wal-Mart and Sam's Club opened on the site in 2001. The developer at the time, Connecticut-based Starwood Ceruzzi Inc., had plans for 10 to 15 strip center tenants within a year. Those plans were never realized, and Starwood eventually sold the development to the current owner.
"They never built the additional retail," said M.J. "Jay" Brodie, president of Baltimore Development Corp. "There would have been synergy between the new retail and Sam's Club and Wal-Mart, which never happened."
Others said it might have been a bad location for the type of business.
"Maybe their customer base wasn't there or not willing to travel beyond 3 or 4 miles to visit a Sam's Club to make major purchases," said Mark Millman, president of Owings Mills-based Millman Search Group, an executive search firm that specializes in the retail and shopping center industry. "It could have been a bad choice location even if the rent was favorable."
Sam's Club holds a long-term lease with the developer and will have to find a new tenant for the property. Restivo said the company is preparing to market the site.
The bulk discounter will stay open until early next year while the company readies the new store in Glen Burnie.
Brodie, who said the city didn't contribute public financing to the Port Covington retail site, said it is still attractive property.
Spector also said there is plenty of potential for the development.
"We love the site," Spector said. "And we're very excited about it."