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The Board of Public Works has approved a deal for the state to lease 500,000 square feet of office space planned as part of a $1.5 billion mixed-use complex in midtown Baltimore, the largest of the public-private projects revived in the past week in the state.

New private developers also were announced for the University of Maryland's east campus in College Park and next to the Wheaton Metro station. In each case, officials enlisted partners to replace developers that dropped out of previous deals under pressure from the recession.

In Baltimore, Gov. Martin O'Malley (D) touted the $215 million phase 1 plans to begin building a pair of new high-rise office buildings this fall, including 70,000 square feet of street-level retail space, as the key to transforming a dated state office site into a 24-hour neighborhood served by nearby Metro, light rail and MARC transit stations. The 28-acre campus — between the Mount Vernon neighborhood to the east and Martin Luther King Jr. Boulevard to the west — would be anchored by state agencies and a grocery store, with residential development planned later.

"This is the beginning of an ambitious public-private partnership that will transform a stagnant, government office complex into a vibrant, walkable, ‘green space' that will link nine surrounding communities, revitalize a key part of Baltimore City, and bring thousands of private-sector jobs to the heart of Baltimore," O'Malley said in a statement. "The state commitment to lease office space opens the door for the development team to seek the private funding necessary to build the project, a project that will assist Maryland's economic recovery by supporting jobs and attracting new business to the area with work beginning this fall."

The Ehrlich administration said much the same thing in 2006 when it picked Struever Bros. Eccles & Rouse to lead the State Center redevelopment. But that developer was battered by the recession, forcing it to withdraw from the deal and declare bankruptcy at other projects. The new master developer approved by the Board of Public Works is former Struever veteran Caroline Moore, now CEO of Ekistics.

The State Center project would mark the biggest project in the city since the redevelopment of the Inner Harbor in the 1970s. State Center is now home to four office buildings and 3,500 state employees, the largest concentration of state employees in Maryland.

"The State Center redevelopment is a tremendous opportunity for Baltimore, providing more job opportunities and new investment," Mayor Stephanie Rawlings-Blake said in the statement.

State officials and developers envision breaking up the isolated complex and making it more accessible and attractive to surrounding residential neighborhoods. The project will consolidate 14 state agencies and add retail and commercial space for an additional 5,400 private jobs when the five-phase, 15-year redevelopment is completed.

"This milestone follows three years of intensive planning, research and community involvement," Moore said. "We have worked hand-in-hand with citizens and both state and city government to develop a concept that meets the various needs of the community and we have done it in award-winning fashion."

The first phase will cost $215 million, including the privately financed office buildings and a 930-space parking garage, which the state will build for $28 million. When the project is completed, officials estimate that it will create a $144 million profit for the state over 20 years after the cost of the garage and state agency leases, the first five years of which were approved for $18 million. Revenue for the state will be generated by a projected $28 million in parking fees, $30 million in ground rents and shared profits and $160 million in new state taxes.

State Center is the second major public-private partnership to move forward in the past year in Baltimore. In November, the state agreed to lease operation of Seagirt Marine terminal at the Port of Baltimore to Ports America Chesapeake. The state maintains ownership of Seagirt while day-to-day operations and capital investments are now the responsibility of Ports America Chesapeake, including constructing a new 50-foot berth using private funds.

Cordish tapped for UM town center in College Park

The University of Maryland announced that the Cordish Cos. of Baltimore will take over the commercial development of its east campus in College Park, which will be anchored by a new Birchmere music hall.

The deal revives plans for a mixed-use town center that stalled in November, when Foulger Pratt-Argo dropped out as the financial market meltdown made it impossible to fund the $900 million project. But the university has extended the time line to develop the 38-acre tract that stretches along Route 1.

"We are confident that a multiphased development approach that recognizes and responds to current fiscal conditions will lead to a timely and successful development of this vitally important project," said Ann G. Wylie, the university's vice president for administrative affairs, in a statement. "When complete, the development will bring a new urban character to College Park by creating a vibrant district of retail, residential, office, much-needed affordable graduate housing, hotel and entertainment uses that will also stimulate downtown revitalization."

In place of two development phases over five years, the first phase is decidedly scaled back, limited to building the Birchmere and a plan to relocate storage and maintenance buildings now occupying the east campus to the recently purchased former Washington Post building in Greenbelt. But construction of the Birchmere likely won't begin before 2013, according to university spokesman Millree Williams.

"We plan to start moving facilities from the East Campus to Greenbelt, which will make room for us to begin putting shovels in the ground for construction," he said.

Cordish, which has been involved with the redevelopment of Baltimore's Inner Harbor and the Boulevard at the Capital Center in Largo, submitted a winning proposal that includes the graduate housing, hotel, office, retail and entertainment spaces planned by Foulger. But the development still faces negotiations with College Park officials.

"As a Maryland based company, we are committed to delivering a gold standard development in keeping with the University's efforts to build on its position as a world-class research institution," said Cordish vice president Blake Cordish in a statement. "We also recognize the broader significance of East Campus to the surrounding community and look forward to working closely with the local community and key stakeholders."

The project is touted as a transit-oriented plan that will help revitalize the Route 1 corridor as a pedestrian-friendly neighborhood, emphasizing use of the College Park Metro station, bike and pedestrian connections.

Clark Construction of Bethesda and the Design Collective of Baltimore also are partners in the project.

B.F. Saul signs to redevelop Wheaton Triangle Metro site

A team led by B.F. Saul has signed on to develop a mixed-use center in the Wheaton Triangle area surrounding the Metro stop.

Bethesda developer the Bozzuto Group dropped out of the project last year after failing to find an office building anchor tenant. B.F. Saul will work with Montgomery County and the Washington Metropolitan Area Transit Authority on the development plan, which encompasses not just 8.2 acres of public land but private property wedged between Viers Mill Road, Reedie Drive and Georgia Avenue. The development team also consists of architect Torti Gallas and Partners, and civil engineers Loiederman Soltesz Associates.

The project is the linchpin in county efforts to revitalize Wheaton east of Georgia Avenue.

"Selection of the B.F. Saul team for the Wheaton redevelopment project mirrors the successful strategy Montgomery County employed with Silver Spring," said Montgomery County Executive Isiah Leggett (D) in a statement. "This highly qualified development team will work with community stakeholders to develop and execute a redevelopment concept that will change the face of downtown Wheaton."

The project will include the Mid-County services building on Reedie as well as leveraging private property such as Westfield Shoppingtown Wheaton mall.

"This is the first step in adding Wheaton to the list of exemplary transit-oriented development projects created as a result of Metro's Joint Development Program," said Steven Goldin, Metro's director of real estate, in a statement. "Metro has begun to forge a new relationship with the B.F. Saul Company, an experienced, high-quality developer, who we expect to lead the exciting re-creation of the Wheaton Triangle."

Throughout the Washington region, Metro has completed 21 transit-oriented development projects, and 10 more are in various stages of completion. Among them are Bethesda Metro Center, Grosvenor, Twinbrook and Wheaton east of Georgia Avenue.

"We believe there is great potential in the sites assembled by the County and Metro," said B. Francis Saul III, B.F. Saul's president. "We look forward to meeting with the diverse Wheaton community to craft a development plan that benefits all stakeholders; and to working with Montgomery County and Metro to negotiate a development agreement to implement the plan."

The Wheaton project recently was awarded $200,000 in state planning funds under a new Transit-Oriented Development program, which supports projects with financial tools, funding, tax credits and other incentives.

"We all knew that a piecemeal approach was not the answer to revitalize the Wheaton Central Business District," said Council Vice President Valerie Ervin (D-Dist. 5) of Silver Spring, whose district includes Wheaton. "This partnership with B.F. Saul Company and Metro is a tremendous opportunity for the residents of Wheaton to shape the future of the central business district and to invigorate Wheaton's core, while maintaining the quality of life in the surrounding residential neighborhoods."

Bozzuto, Pritzker announce $75M joint venture

The Bozzuto Group of Greenbelt and Pritzker Realty Group of Chicago announced the creation of a joint venture that has an initial capital commitment of $75 million.

Under the terms of the agreement, the Bozzuto/Pritzker Realty Group partnership will seek multifamily development and acquisition opportunities in high-growth locations throughout the mid-Atlantic and Northeast regions, with specific focus on the greater Washington-Baltimore metropolitan area.

"We are absolutely thrilled that Pritzker Realty Group has chosen to create a partnership with us to invest in multifamily rental opportunities in markets in which we expect an extraordinarily robust real estate recovery," said CEO Thomas Bozzuto in a statement. "With this initial $75 million dollar equity commitment, we will aggressively pursue development and acquisition opportunities that will allow us to control an assemblage of apartment properties at a time when we believe there will be an unprecedented increase in demand for — and short supply of — apartments across the country."

"This partnership allows us to tap into Bozzuto's market expertise to invest in multifamily developments," said CEO Penny Pritzker. "We look forward to a long-term relationship with The Bozzuto Group to develop and own multifamily assets that are extraordinary living environments."

Amtrak leases building in Cecil County

Transwestern announced that it has recently negotiated a five-year, 48,000-square-foot industrial lease between Amtrak and Peninsula Holdings in the Peninsula Industrial Park in Cecil County.

Amtrak will occupy the entire building, which will be home to three separate support divisions in the building at 101 Peninsula Drive in NorthEast.

The industrial park is midway between Philadelphia and Baltimore along Interstate 95, providing easy access to major markets.

Transwestern agents Tom Gentner, Mark Glagola and Brian Watts represented Peninsula Holdings. Todd Hughes of Jones Lang LaSalle represented Amtrak.

Commercial real estate news items may be mailed to: Steve Monroe, The Business Gazette, 9030 Comprint Court, Gaithersburg, MD 20877; e-mailed to smonroe@gazette.net; or faxed to 301-670-7183.