A Maryland development team has announced plans to build a 92-unit apartment complex in downtown Baltimore, saying it hopes to have the project underway within a year. The team is seeking real estate financing for the project, which it estimates will cost approximately $20 million. They hope to redevelop five exiting properties to build the planned apartment tower, but have not yet received development rights.
Securing financing and development rights for a Commercial real estate project in Maryland can be a difficult and complex process, making it worthwhile for companies hoping to develop properties in the state to employ legal representation.
The developers say the building is likely to be profitable venture for investors, arguing that demand for housing is in high demand as occupancy in downtown Baltimore has exceeded 97 percent. The team must strike several more deals before construction can begin, but have begun identifying potential sources of funding while they wait for those agreements to materialize. "The timing is to get financing in place over the next few months," explained one of the developers. "[W]e hope to close around this time next year. That is the goal," He added.
The Baltimore Development Corporation has yet to award development rights to the team, allowing it to begin work on the apartment project. However, the BDC's outgoing president said he is "optimistic" regarding the chances of a development.
The developers took an unusual course of action when they requested a Payment on Lieu of Taxes, also known as a PILOT, with the city of Baltimore in April. A PILOT, which grants a reduced property tax to a developer for an established time period, is typically requested after receiving development rights. However, the retiring BDC president agreed to discuss a PILOT deal with the developers given then complicated nature of the project.
Source: Baltimore Business Journal, "West side residential tower developers seek financing," James Briggs, Aug. 3, 2012