Baltimore Crossroads

MD Route 43 at Crossroads Circle
White Marsh, MD 21220
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St. John Properties, Inc.

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Hotels in talks with Somerset at Crossroads

May 22, 2007

Somerset Construction, of Bethesda, the master developer of the Crossroads @95 employment center in Middle River, recently scheduled talks with potential operators of two hotels that will help create a town center on the site.

"The hotels are a moving target until we determine what (brands) we'll get," company president Michael Carruthers said.

"We want to create a village atmosphere, not simply a strip center," he said. "A six-story hotel will add some presence to it."

Caruthers declined to say with whom Somerset is negotiating.

Somerset and St. John Properties, of Woodlawn, are developing the northern half of Crossroads—the former A.V. Williams tract—with more than 2.7 million square feet of office, flex-office, research and development, and retail space in more than 50 buildings, according to brochures.

Meanwhile, Chesapeake Real Estate Group, of Glen Burnie, and First Industrial Realty Trust, of Chicago, are working at the southern end to build 2.5 million square feet of manufacturing and warehouse space in 11 buildings.

Made possible by the $75 million, publicly funded extension of Route 43 from Pulaski Highway to Eastern Boulevard, Crossroads @ 95 and the adjacent Windlass Run Business Park have been projected to eventually employ up to 10,000 people.

By last October, when the 3.8-mile extension officially opened, St. John had finished four flex-office buildings, totaling nearly 40,000 square feet. (Flex-office space typically suits small businesses by providing space for offices or sales in front, with warehouse space and dock or drive-in doors in back to store and distribute products or equipment.)

St. John has also nearly finished three office buildings totaling 88,000 square feet, according to its Web site, but so far has not announced tenants.

In the meantime, plans are in the works for the two retail areas.

The county's Development Review Committee granted exemptions in March 2006 that allow St. John to apply directly for building permits without having to go through the regular development process, including public hearing requirements.

Retail Hubs

The village center will include the two hotels—with about 100 rooms each—as well as a conference center, a Wawa convenience store and gas station, shops, a bank branch and three restaurants with liquor licenses, one of which has already been acquired, Caruthers said.

Located on both sides of the Route 43 extension, the village center will be close to customers in four-story office buildings.

The idea is to create an inviting place where tenants of the business park may eat without taking 20 minutes to drive elsewhere, according to Caruthers.

"We're not as big as The Avenue, but we want that kind of atmosphere," he said, referring to The Avenue shopping district in White Marsh, where the former Nottingham Properties developed a mix of office, flex, warehouse, retail and residential uses.

At an April 25 conference on the impact of the federal base realignment and closure process, which is expected to bring thousands of jobs to Harford and Anne Arundel counties, St. John's marketing manager, Jerry Wit, described Crossroads as "the new White Marsh."

"We should hit our stride around the time the BRAC tsunami hits," Wit said.

Caruthers said Somerset is developing another, smaller retail center off Route 43 with marketing help from St. John.

Totaling about 40,000 square feet, it will include a Royal Farms convenience store and gas station, a bank, restaurant and fast-food restaurant, plans indicate.

Attracting tenants to undeveloped land without restaurants and other amenities is never easy, Caruthers said. Originally expected to open in late 2005, the Route 43 extension did not open until last October.

Billed as the "Road to Opportunity," the extension of Route 43 was conceived more than a decade ago as a way to open up the 1,000-acre Williams tract, as well as the 60-acre Windlass Run site, for development.

The state contributed about $54 million, the county about $19 million, and developers about $2 million, according to published reports.

Despite the delay, construction and leasing are well under way, said Caruthers, who predicted Crossroads could build out in six or seven years instead of the estimated 20 years.

"I think the activity has been astounding," he said.

Just west of the business parks, more than 2,000 housing units are in the county pipeline to meet the needs of people who will work in the parks.

If the County Council approves the draft Middle River Community Plan, as some residential developers hope, 400 units could be added.

Luring New Jobs

For several years, government officials have promoted Crossroads @95—so named because of its proximity to Interstate 95—as a prime location for a large pharmaceutical, biotechnology or other high-tech company that could bring hundreds of new jobs to Baltimore County.

But, so far, a major tenant has not materialized.

Instead of becoming a biotech park, Crossroads is developing as more of a transition area between White Marsh and new, high-end residential development along the Baltimore County shoreline, Caruthers said.

"The revitalization of Essex and Middle River—we're a gateway to that," he said. "We're evolving more in that direction."

One reason is that, last year, Maryland and the county failed to persuade the Swiss pharmaceutical company Novartis to build a flu-vaccine plant that would have employed 350 people. (Novartis chose North Carolina over Maryland and Georgia.)

Meanwhile, the military announced the transfer of thousands of jobs to the Aberdeen Proving Ground in Harford County and Fort Meade in Anne Arundel County.

Leasing and buying activity is already underway in the two counties, said David Iannucci, director of the county's economic development department.

Government contractor Booz Allen Hamilton moved into larger offices near Aberdeen, expecting to double its employees in the area from 150 to 300, and developer Trammell Crow is talking to the Army about building a $700 million complex at Fort Meade, according to newspaper accounts.

Iannucci predicted the wave of military contractors looking for space, and employees looking for housing, would hit Baltimore County within two years.

"A biotech company still remains a strong possibility," he said. "We continue to see lots of local, regional and national interest, particularly in technology, business services and defense communications related to BRAC."

The prospects are good, because Crossroads sits halfway between the two military installations, making it a good location for private contractors that service both facilities, officials say.

Should a major employer express interest in moving to Crossroads, the current buildout plan could be adapted to meet its needs, Iannucci said.

The county and Somerset have also agreed to reserve a section of the park for future development.

Caruthers said his company is no longer actively marketing two areas totaling more than 150 acres west of Route 43. They remain blank on brochures.

"We held those out," he said. "We want to wait for the project to mature."

The smaller parcel, with the potential for 300,000 square feet, could be used for more flex-office or retail space, depending on how the rest of Crossroads develops, Caruthers said.

The larger parcel, with the potential for 550,000 square feet, could be used by a pharmaceutical or biotech company, but could also be developed as a corporate office park, he said.

"We're waiting for the highest and best use, but we don't know yet what that is," he said.

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