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Business & Developmentby Melody Simmons9:34 amApr 18, 20140

Paterakis set to unveil plans for long-delayed luxury condos

Developer seeks to complete upper floors of Four Seasons Hotel as his former partner gets ready to break ground at Harbor Point

Above: Plans are afoot for finishing the upper floors of the Four Seasons Hotel.

Baltimore’s skyline is about to get some more glitz.

The unfinished upper floors of the luxury Four Seasons Hotel and Spa in Harbor East will soon be developed into luxury condominiums, a project that was delayed for five years even as the 21-story hotel potion of the building opened.

Harbor East Development, owned by the family of H&S Bakery magnate John Paterakis, is set to unveil schematic plans for the waterfront condos next week before a city design panel.

The move takes place as Paterakis’s former partner, Michael Beatty, and his year-old company, Harbor Point Development, is preparing to break ground on a 22-story skyscraper adjacent to Harbor East for energy giant Exelon at Harbor Point.

The new development activity in Harbor East is seen as a sign that the H&S group, which owns a bakery nearby in Fells Point where millions of buns for McDonald’s are made each year, is ramping up its development arm once again – and the two titans are elbowing for real estate gravitas on the city’s waterfront.

Bakery magnate John Paterakis (File photo)

Bakery magnate John Paterakis (Brew file photo)

Paterakis recently announced the move of the bakery’s one-story distribution center on the edge of Harbor East to the Hollander 95 Business Park in northeast Baltimore.

A new and expanded Whole Foods Market is expected to open on the Central Avenue site as part of a planned mixed-use development.

Non-Compete Agreement

In addition, a series of restrictive covenant agreements between the Paterakis group and Beatty signed last year limit Beatty from opening a luxury hotel at Harbor Point – namely a JW Marriott, Lowes, Intercontinental or any other luxury flag property – until after January 1, 2018, as to not compete with the Four Seasons, the document states.

The covenants also limit Beatty from developing an upscale grocery store at Harbor Point until the development has reached at least 1.2 million square feet of built-out commercial space after the January 2018 benchmark, including a smaller Eddie’s or Graul’s gourmet grocery store. Construction of a small movie theater complex is also nixed until after that date.

The covenants also state that Beatty’s development group not use the name “Harbor East” or “Inner Harbor East” as part of any of its development at Harbor Point.

Beatty last month received environmental green lights from the Maryland Department of the Environment and the U.S. Environmental Protection Agency to begin work on the Exelon Tower. He plans to begin to pierce a protective cap covering toxic chromium in more than 1,000 places on the Harbor Point site to anchor key parts of the massive development.

Unfinished Floors

The residential portion of the Four Seasons development stopped in its tracks after the 2008 economic meltdown and sales in the city’s luxury condo market evaporated.

Maryland Gov. Martin O’Malley later granted $45 million in tax-exempt federal Recovery Zone bonds to Paterakis to complete interior construction of the hotel.

The upper floors of the 256-room, $200 million property have been among the city’s most expensive – and notable – real estate vacancies as multiple stories have sat unfinished on the city’s skyline awaiting scarce development funds.

Next Thursday, the Urban Design and Architecture Review Panel (UDARP) is set to consider a revised and final design for the Harbor East PUD and the Four Seasons Condos. Original plans were to stretch the Four Seasons building to 44 stories.

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