Exelon Corp.'s new headquarters in Baltimore is designed to be a glassy, 22-story skyscraper, similar in style to the Legg Mason tower, which would be a neighbor on the Harbor East waterfront, according to preliminary designs revealed Wednesday.
The building would be part of the $250 million first phase of the 27-acre Harbor Point development, which would also include a central plaza, a headquarters for U.S. Lacrosse, a six-acre waterfront park and an apartment tower, said Michael Beatty, president of Harbor East Development Corp.
Plans for the new building were released a week after Exelon picked Harbor Point over sites in the city's traditional downtown district. The choice disappointed some local business leaders, who had hoped the Chicago-based energy giant would settle on a location in the area around Pratt and Light streets.
Exelon is seeking to acquire Baltimore-based Constellation Energy Group in a $7.9 billion deal that still requires regulatory approvals. The Maryland Public Service Commission is expected to make a decision by Feb. 17.
The old McCormick and Co. site at Light and Conway streets and Baltimore City Community College's Bard Building at Lombard Street and Market Place were among the top spots considered by Exelon officials.
Speaking during a presentation on the 24th floor of the Legg Mason tower, which overlooks Harbor Point, Exelon's senior vice president of corporate affairs said the site was the best choice for the combined companies' power-selling and renewable energy businesses.
"We wanted to create a presence and make a statement that we are … here for the long term," Calvin Butler Jr. said.
Butler also said that Harbor Point provided an opportunity to expand, and that Exelon appreciated the developer's record of constructing high-rises on schedule. Exelon hopes to move into the building in 2014.
Exelon is expected to spend around $120 million for a long-term lease that could range from 15 to 20 years.
Beatty, who repeatedly said that Harbor Point was a part of downtown, brushed aside criticism of Exelon's decision to build at the site instead of in the city's traditional business district.
"We're all part of the same city," said Beatty, whose company built the Legg Mason tower and the surrounding Harbor East neighborhood.
Laurie Schwartz, executive director of the Waterfront Partnership of Baltimore, said the city was big enough for various types of development.
"I think that downtown is very resilient and [that] some people suggesting that downtown lost its vibrancy is a bit of an overreaction over the move of one tenant," she said.
Schwartz pointed to concerns that 100 Light St. would suffer when Legg Mason left it for Harbor East in 2009. Today, the Light St. building is anchored by Transamerica Life Insurance Co. and is nearly 100 percent occupied, she said.
Still, Exelon's decision to build its Baltimore headquarters outside the city's downtown core has re-ignited debate over the continued use of tax breaks to lure businesses east of the Inner Harbor — an area now full of glitzy new condos and high-end shops.
The Downtown Partnership of Baltimore, for example, wants city officials to evaluate how incentives are used to attract businesses downtown and to ensure that the older parts of the city are not slighted.
Harbor Point is in a state-approved city enterprise zone that offers tax breaks over several years.
Beatty noted that Harbor East would "not have happened" if not for tax incentives. Moreover, he said, rents at Harbor East are among the highest in Baltimore.
"So when people say, 'Oh, they're getting subsidies to take tenants away from the city,' it's factually wrong," he said.
Harbor Point also qualifies for tax increment financing, a method of funding the construction of public infrastructure for development districts. The city issues bonds to pay for the work, then repays the money with property taxes generated by the development.
Harbor Point has been approved for a $150 million TIF, which would be used to build an extension of the Central Avenue bridge, new roads, sidewalks, a waterfront promenade and other infrastructure around the development, Beatty said.
Beatty estimated that a third of the tax increment financing, or $50 million, could be used for the first phase of the Harbor Point project.
An artist's rendering shows the 22-story structure with retail space on the first two floors and a parking garage above it. The building, which could be as large as 400,000 square feet, would include a 70,000-square-foot trading floor with an atrium-like open floor plan.
Beatty said that Exelon's new building would include many green features and that a high LEED rating was sought. The surrounding development would also incorporate green features, including a wind turbine demonstration project.
Beatty cautioned that the design was preliminary and said that the developer would still need to work out details with Exelon.