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Commentaryby Gerald Neily10:20 amJun 7, 20130

Harbor Point: Do we really need $80 million in bells and whistles?

Opinion: The East Baltimore project is front-loaded with city-funded projects that needn’t be started now.

Above: Artist’s rendering of Harbor Point, a $1 billion project that’s due to receive a hefty city subsidy.

The press release issued this week by the Rawlings-Blake administration to justify its $107 million financing plan for Harbor Point presses all the usual buttons: “Like the Inner Harbor revitalization effort of 30 years ago, the Harbor Point project represents a once-in-a-generation opportunity to grow Baltimore by attracting new jobs, new residents, new tax revenue, and new public amenities.”

But Harbor Point is nothing like the Inner Harbor. The latter was a gaping hole of abandoned piers and obsolete factories that needed to be filled, while Harbor Point is extraordinarily isolated from the rest of the city.

The press release promises “blight elimination.” But there is no blight to eliminate at this former site of a chromium-processing factory.

Harbor Point is literally a blank canvas, covered by an asphalt cap to contain buried factory wastes. Unlike most of Baltimore, everything at this 28-acre site is under control – and unoccupied by people or roadways or infrastructure that need to be cleared away.

Which means we don’t have to spend public money on its redevelopment until we’re good and ready.

Direct Public Money to Real Needs

Let me explain: only a relatively small amount of the proposed public financing is going for traditional infrastructure.

The mayor proposes just $23 million in TIF (tax increment) bonds for sidewalks, utilities and a bridge connecting Harbor Point with Harbor East, but well over half ($59 million) for five parks.

Parks are nice (though one wonders how many non-Harbor Point residents and office workers will use them). Let’s, though, build them when development justifies them.

Another $21 million is for the waterfront promenade. The press release misstates that the “promenade will connect Fells Point with Harbor East.” Wrong. The best pedestrian connection between those places already exists along Lancaster and/or Caroline Street.

Michael Beatty (left) listens to Mayor Rawlings-Blake extol his project at press conference yesterday. The conference was held on the cleared site, with the Harbor East skylight as a camera-friendly backdrop. (Photo by Mark Reutter)  backdropped by Harbor East.

Michael Beatty (left) listens to Mayor Rawlings-Blake extol his project at press conference yesterday. The conference was held on the cleared site, with the Harbor East skylight as a backdrop. (Photo by Mark Reutter)

The Harbor Point promenade will be a free-standing amenity that should be built when conditions warrant – not to fulfill some kind of perceived pedestrian demand or to add value for high-rent private office buildings.

Let’s Not Get Ahead of Development

So $80 million of the $107 million spending can be triggered by real-time reality, starting with the completion of the Exelon Tower, which the energy giant has committed itself to leasing regardless of what the city spends on parks and promenades.

The developer, Michael Beatty and his longtime financial benefactor, John Paterakis, are gambling on public subsidies to fill the gap between their ambitions and market reality.

Another rendering of the proposed development, biggest in Baltimore history. (Harbor Point Development)

Another rendering of the proposed development, biggest in Baltimore history. (Harbor Point Development)

The same game was played at their previous project, Harbor East, when the city allowed itself to pay for public improvements far ahead of  development (as well as subsidize with tax breaks the development itself).

The Harbor East promenade was torn up for the Four Seasons complex, and the walkway still hasn’t been rebuilt right.

On the other hand,  Morgan Stanley is currently occupying the Thames Street Wharf building – the only part of Harbor Point that’s been completed – without any public complaints about the lack of surrounding amenities.

Grand Plans Foiled Before

The city’s experience with the Harbor View development in South Baltimore is a perfect illustration of the problem of “front-loading” public assets onto private projects.

Back in the 1980s, Richard Swirnow planned a whole wall of high-rise residential buildings along Key Highway, which was approved by the city over the objections of a mostly enraged community.

Only one was actually built. The high-end waterfront residential market became oversaturated and the rest of the site was slowly built-out as townhouses.

With Harbor Point, the stakes would be much higher. The mayor’s press release summarizes a jigsaw puzzle of financial considerations with a bottom line of dubious accounting legitimacy: “average new City revenue per year (30 years), $19,623,928.”

This metric sweeps away the city’s recent history of development projects that have failed to meet their hype with a single word: “average.”

Another Detroit?

Perhaps the most comparable development plan to Harbor Point is Renaissance Center in Detroit. It, too, was hyped as Detroit’s savior, but was really just a massive isolated urban ego-trip that sapped all the city’s high-end development demand.

Detroit's showcase Renaissance Center has unintended consequences for Motor City's old downtown. (Courtesy of General Motors)

Detroit’s showcase Renaissance Center has unintended consequences for Motor City’s old downtown.

RenCen’s chronic vacancy eventually compelled General Motors to move its corporate headquarters there on its road to eventual bankruptcy and government bailout.

Harbor Point is better designed but equally isolated, with far poorer access and a far greater infrastructure budget.

RenCen took advantage of Detroit’s once powerful corporate sector – and then helped destroy that sector.

Aren’t There Higher Priorities?

Baltimore should be in no hurry to complete the promenade or stamp out alleged Harbor Point “blight.”

Instead, the mainstream development market should be encouraged to build up the Central Avenue corridor to Old Town, or to fill up vacant and underutilized downtown office buildings, or to turn around areas that are truly blighted like Westport and Poppleton.

There are plenty of needy neighborhoods and stalled projects that the mayor should address before throwing public money at what she described yesterday as one of the best real estate locations on the East Coast.
Gerald Neily was transportation planner for the Baltimore City Department of Planning from 1977 to 1996, and a consultant before and since.

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