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Hogan Announces Search for New State Center Developer

Looking to jump-start a redevelopment process that has been mired in lawsuits and inactivity for years, Gov. Lawrence J. Hogan Jr. (R) announced on Tuesday that the state will immediately begin seeking bidders on a new State Center project.

The five-building, 28-acre site in Midtown Baltimore is currently home to a dozen state government agencies, making it the largest concentration of state offices in Maryland.

Hogan said the state will immediately begin reaching out to companies interested in redeveloping the aging State Center complex. The Maryland Stadium Authority will lead the process, in coordination with the state’s Department of General Services.

The governor called the actions an “important step in the revitalization of Baltimore City,” and he said the new “bold” project will have a “transformative” impact on the surrounding communities.

He offered few details about the state’s vision for the site under a new developer. He said it is “possible” that “one or two” government agencies might return to the site in the future.

The 3,300 government employees who work at State Center now will be moved to privately-owned office space in stages, to clear the way for demolition and construction. The state will need to lease one million square feet to accommodate those workers, which the governor’s office said will “dramatically boost and stabilize downtown Baltimore.”

The buildings that make up State Center were constructed in the 1950s and 1960s. They are unremarkable and outdated structures.

Maryland is currently mired in litigation with Ekistics, a Baltimore firm that won the right to redevelop State Center a decade ago.

Michael Edney, the company’s attorney, said moving those workers represents “the hollowing out of State Center… a violation of [Hogan’s] long-term commitment to the surrounding communities.”

The decision to move forward with a new developer is “a violation of the contract and illegal,” Edney said. “He had lots of details about how he was going to move all 3,500 employees out of State Center, but he had absolutely no details about what the future of State Center would be.”

Hogan told reporters that the attorney general’s office “has recently advised us that we are now free to take the next steps,” adding that the state’s preliminary outreach to the development community last June resulted in “numerous strong expressions of interest.”

Del. Nick J. Mosby (D-Baltimore City), whose district includes State Center, said he’s “disappointed” by the governor’s announcement. It’s clear, the lawmaker said, that state workers “are not coming back” once the redevelopment is complete.

Area residents and political leaders have long envisioned a more mixed-use approach to the site, with retail, restaurants, services and job opportunities beyond the 9 a.m.-5 p.m. workday.

“This was a huge opportunity to bring real development and have an epicenter to map out and build around,” Mosby said of Ekistics’ plan, which he said was developed after years of consultation with the community.

“That’s what makes me disappointed and disheartened.”

Baltimore Mayor Bernard C. “Jack” Young (D) was not present at Hogan’s announcement Tuesday and it could not immediately be determined whether he had been invited.

“Mayor Young looks forward to reviewing the plan that the Governor put forward today,” a spokesman, James Bentley, said in an email to Maryland Matters. “The Mayor is very optimistic to hear that the Governor has committed to keeping the 3300 jobs in Baltimore City, where they belong.”

The redevelopment of State Center was conceived during the administration of Gov. Robert L. Ehrlich Jr. (R) and continued by his successor, Martin J. O’Malley (D). It has been moribund for years due to the lengthy legal battle.

Nearly a year after Hogan took office, the state sued the company, alleging a failure to fulfill its contract, a move that sparked a counter-suit by the firm. The lawsuits remain alive in Baltimore City Circuit Court.

Hogan heaped scorn Tuesday on the O’Malley administration, which he said pursed an “absurd” and “imaginary potential deal” with Ekistics.

“Unfortunately, the previous administration had gotten the state mixed up in a disastrous failed deal which never made any progress at all, which was economically unfeasible and legally improper,” said Hogan, a real estate developer before becoming governor.

Hogan accused the current State Center developers and their lawyers of being “motivated by greed” and of trying to “extort state taxpayers to pay an outrageous sum of monies over a deal which never materialized and never made any economic sense.”

He had rare and robust praise for Attorney General Brian E. Frosh (D) and his team, “who have been working tirelessly to free the state from this obstruction.”

The state’s imminent search for new office space downtown for agency employees will be welcome news to property owners there. The current vacancy rate in the central business district is 20 percent, according to an industry group.

“We are optimistic for the future potential to positively impact the surrounding community and help create a better working environment for our state workforce,” said DGS Secretary Ellington E. Churchill Jr.

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Hogan Announces Search for New State Center Developer