June 2, 2017

Port Covington in ten years: Stubbornly suburban

Driving down Cromwell Street toward the new Sagamore Spirit whiskey distillery in Port Covington, it's obvious and not at all difficult to imagine what Baltimore's biggest-ever development plan will look like in ten years. Just take a mental picture of the distillery site with the periphery cropped out and replaced with what's in the mind's eye.

This view neutralizes any justification to change Cromwell Street in any significant way. The new two building waterfront distillery complex on one of Port Covington's most valuable real estate parcels has set the tone for what will follow. And what one sees in these attractive rustic buildings surrounded by patios and parking lots is basically... suburbia.

Suburbia at Port Covington has now become inevitable. That's why what Port Covington needs now is not its 20 or 40 year blue-sky plan used to acquire $660 Million in TIF bonds from the city, but a solid short-to-medium term ten year plan.

Sagamore Spirit Distillery from Cromwell Street - What you see is what you get, now and for many years

Yes, we are now faced with the real Port Covington - an outcome of real economic forces and not just aerial artist conceptions of what it's supposed to look like in forty years. The view of the distillery down Cromwell Street is what Port Covington looks like now and will continue to look like for quite a long time. It's nice, but that's all it is. Port Covington is a major, major development plan which could have a major impact on the city as a whole, but for the indefinite future, it's just suburbia within the city.

What Lucy Van Pelt really wants: Real Estate

It's all rooted in basic proven real estate economics, not those fanciful future architect's renderings. As when most large new development venture get started, land is the commodity in greatest supply and the best bargaining chip to get things going.

That's how Lucy summed up what she really wanted in the classic Peanuts Christmas Special. She wanted real estate. (Pulling the football away from woebegone Charlie Brown was just an attention grabber.)

That's why, when The Baltimore Sun became Port Covington's first occupant back in the late 1980s, they negotiated to get plenty of what the city and previous landowner CSX had to give in greatest abundance: Real estate. The Sun printing press was put on a site that was about five times larger than what they needed at the time, and infinitely larger than what they need today.

It was even unabashedly touted as suburban, with the catchphrase: "Hunt Valley by the Sea", evoking the office park and shopping mall in north suburbia beyond Towson and Timonium.

Then when the Sun complex didn't ignite a development frenzy, the city's next deal was to give Wal-Mart and Sam's Club another huge piece of raw acreage, ignoring that it's highest potential geographic value was in its adjacent waterfront. It was more Hunt Valley, less sea.

The Inner Harbor even got started this way back in the 1970s. Its first building, the Maryland Science Center, turned its back on the famous waterfront with a blank wall, just like Wal-Mart, and was only re-oriented later when it expanded. Then came psuedo-suburban Harborplace, which was very controversial at the time for being an intrusion on urban open space. This is back when the Howard Street downtown retail district was still hanging on and had grandiose plans of its own. Many people envisioned the Inner Harbor as being an oasis away from downtown, not part of it.

Despite its hyped-up success, the Inner Harbor has been trying to recover from this ever since. Right now, the whole swath from Harborplace and the McKeldin Fountain to Rash Field is being gutted and demolished to get it right this time, as if it was some forlorn part of town.

Even Harbor East, the city's most successful urban development since the Great Depression (yes, even including the vaunted Inner Harbor) got started this way. Through the 1970s, it was envisioned as just a future Interstate highway corridor. When that was replaced by a development plan in the 1980s, it called for an "urban village" of modest density. The adjacent land now known as Harbor Point was then designated to be open parkland.

Victor's Cafe: Harbor East's first building, now gone, as seen from the water.
Only one building got built in conformance with the original Harbor East plan, Victor's Cafe, on its most valuable corner waterfront site. It was a very modest little building with vending machines and electric meters plopped just outside the front door, more like one would expect around Back River Neck Road near Middle River. Victor's Cafe was knocked down in the early 2000s to make way for the Legg Mason and Four Seasons towers.

In sum, all these developments started out with the value of the raw land being far greater than the buildings that got put on it. Other examples can be found in the relatively low density waterfront rowhouses with grass yards and parking pads built along Fell Street in Fells Point and Boston Street in Canton in the 1980s, and in the Key Highway corridor near Federal Hill where the Harborview project was originally supposed to have six high rise buildings but so far has still only gotten one. Most of the higher density development came later after property values increased, or in the case of Harborview, never came at all.

How Kevin Plank has really set the tone in Port Covington

The key to understanding Port Covington is not to think of Kevin Plank as some kind of development savior who will perform miracles to rescue the area from 30 years of malaise and failure. Simply think of what he's doing as the next step in the historical pattern.

What he's done so far fits that pattern. He recently built a nice but modest whiskey distillery on arguably the best piece of waterfront land, his version of Victor's Cafe in Inner Harbor East. He also took the nearby Sam's Club "big box" and re-oriented it to the water, just as the Science Center did.

Eventually Plank plans to knock down the giant Sun printing press and build something there too. The northern part of that huge parcel next to Interstate 95 (the least desirable part that's farthest from the water) is where seven high rise towers are supposed to go, but don't hold your breath. He's got The Sun paying rent every month (or beholden in some other way), so he'll just let that keep happening as long as necessary until development pressure builds. And there's so much land around it that the pressure will be near zero for a long time. Land supply is far higher than at any of the precedents, so it will continue to dwarf demand.

Current Port Covington plan bird's eye view. Highest density has been pushed away
from the existing Cromwell Street corridor in the middle, and toward the seven high rises next to Interstate 95
in the background and in the Under Armour campus in the foreground.

And just what has Kevin Plank done to induce that development demand to increase? Other than supply the hype, not much. Just look again at that distillery from Cromwell Street. Then look at the Sam's Club reoriented for Under Armour, which from a distance, doesn't look much different than when it was a "big box" retail store. And a distant view is the only view most folks will get, as long as that ominous security fence is in the way. Again, this just follows the pattern.

Those seven proposed high rise buildings next to I-95 look an awful lot like the six high rise buildings that were supposed to get built at Harborview on Key Highway, except those were right along the water within easy walking distance of Federal Hill and the Inner Harbor, in an area of relative land scarcity and high value.

The TIF Dimension: "Dawning of the Age of Aquarius?"

The biggest need in all this is to avoid getting intoxicated by Port Covington's $660 million Tax Increment Financing (TIF) slush fund, which is mortgaged against the city's future property tax revenue. This money must be spent wisely on projects that clearly lead to new development that are capable of paying it back.

The city's track record on this kind of funding is poor. The city built a Hilton Hotel in Camden Yards with TIF funds, and it has been a perennial money loser ever since. Harbor Point is being largely subsidized with TIF funds even though it's anchor project, the Exelon Tower, was legally obliged to locate in the City of Baltimore even without subsidies.

Harbor East also failed on this count, although its saving grace was that TIF funding was never used. But a large portion of its infrastructure in streets, promenades and utilities had to be ripped up and rebuilt soon after it was completed in order to accommodate revisions to the original "urban village" plan.

And the entire southeast waterfront of Harbor East, Harbor Point, Fells Point and Canton as we know it was never supposed to be developed at all. Until the 1980s, alleged visionary Mayor Schaefer didn't want any of it. He wanted it to be an Interstate Highway corridor. But plans do change.

A saving grace for Port Covington is that the Under Armour corporate headquarters campus which is planned to occupy the vast majority of the waterfront land south of Cromwell Street is not part of the TIF district, and so is protected from that particular financial "house of cards".

The Under Armour campus is also considered the major "catalyst" for the rest of the development, but this is a dubious assumption. Land glutted suburban-style development just doesn't work that way. Suburbia begets more suburbia. Under Armour will be governed far more by its own financial performance against its corporate competitors like Nike and Adidas.

Lessons to be learned: A short-term Port Covington plan

The entire Port Covington planning process has been an attempt to induce top-down proactive development by sheer force of will. It has been a fight against the forces of "organic development" that occurs at its own pace in response to the overall forces of economics.

But Port Covington can't be developed that way. The overall real estate market will have the final say and must be respected. Land parcels will be developed one at a time. All the resources at the disposal of both sides, buyers and seller, will be negotiable. And the resource in greatest abundance is land. The market will proceed at its own pace and the market will prevail.

What Port Covington needs is a short-term plan that recognizes and respects the realities. Here are the major points:

1 - Cromwell Street should be maintained as-is, a four to six lane boulevard, as the major spine of Port Covington. Such wide boulevards can be made into attractive people places in spite of heavy traffic which is inevitable as a sign of growth and vitality. It has already been tweaked with landscaping, bike lanes and on-street parking, and more can be done. It's adjacent suburban trappings are a bigger question than the street itself.

2 - For the foreseeable future, all new development in Port Covington east of Hanover Street will use Cromwell Street. Period. Make the most of it.

3 - The configuration of the east end of Cromwell Street, on the other hand, will likely need major improvement within this time frame, from where it intersects McComas Street proceeding eastward to Key Highway and accessing I-95. But new I-95 ramps are not in the offing and would be of dubious usefulness anyway.

4 - A serious rail transit plan must also be developed right now, so it can be integrated with a solid transit-oriented development plan which is crucial to the ultimate success of any major urban development. Right of way must be reserved. It cannot be an afterthought, as it has been with the abysmal failure rate of transit-oriented development in the rest of Baltimore.

5 - The rail transit plan cannot be relegated to the northernmost part of Port Covington along the McComas Street catacombs underneath Interstate 95, as is the current intention. Rail transit also cannot be made dependent upon those seven high rise buildings which are proposed to flank Interstate 95. That plan is simply not real enough.

6 - Another unavoidable point is that lower income people are the backbone of any urban transit system, not the prospective affluent market for those seven high rises (with or without a lucky few poor residents winning the "inclusionary zoning" lottery.) That's a strong reason for extending the proposed light rail spur southward to Cherry Hill and Brooklyn.

7 - The proposed separate disjointed "closed circuit" streetcar line plan is also not real enough, and needs to be scrapped. Like the distillery, too much of Port Covington will be of insufficient density for it to have any reasonable chance of success (cue Procol Harum's "Whiskey Train"). The rail transit system must be as integrated and connected as possible, which has been a huge problem in the rest of the city.

8 - Renovating the abandoned railroad bridge across the Middle Branch to link Port Covington to Westport and West Baltimore should be a priority, whether for people, light rail vehicles or likely both.

9 - The existing central light rail line should be made Port Covington-ready. That means building a new North Westport Station on the existing light rail line to serve future new Westport waterfront development as well as the rail spur to Port Covington. It would also be a transfer station for Port Covington rail riders to connect to the south, most notably to the airport.

So where is the best place in Kevin Plank's Port Covington real estate empire to put transit-oriented development? The best place might not be in Port Covington at all. It's more likely in his fallow landholding on the Westport waterfront just across the Middle Branch, where the central light rail line already goes and where the local working-class neighborhood already supports it.

Earlier highly urbanized conception by Design Collective for Port Covington. It's not going to look like this, ever.

The continuing intensification of real estate pressures toward higher density development is currently focused away from Port Covington - to Locust Point and the rest of the South Baltimore peninsula including Federal Hill and Sharp-Leadenhall, as well as southeast waterfront areas from Harbor East and Harbor Point to Canton Crossing and Brewer's Hill. Port Covington must compete with all this.

The Westport waterfront should become an active part of the Port Covington real estate sales portfolio. With the right planning and marketing, it may become the most attractive site for early urban development before much of the Port Covington "suburbia" dwarfs and the seven I-95 high rise giants on the Baltimore Sun site.

Kevin Plank has built a waterfront whiskey distillery and renovated the abandoned Sam's Club, while the rest of Port Covington waits. Cromwell Street sets the tone.

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