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Ritz-Carlton project just part of Baltimores luxury condo boom

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Ritz-Carlton project just part of Baltimore’s luxury condo boom
ROBBIE WHELAN Daily Record Business Writer May 29, 2008 6:52 PM As developers continue gobble up what remains of the Baltimore waterfront, the $250 million Ritz-Carlton Residences, an opulent luxury condo project located on Key Highway, celebrated its grand opening Thursday. Officials from the project’s developer, RexMidtown LLC, a partnership between two prominent New York real estate investment companies, said 113 of the Ritz’s 192 units are under contract to be sold, and that the first residents will move in starting in July. The Ritz-Carlton Hotel Co. opened its first fully residential project, in Jupiter, Fla., in 2003, according to a company official. The Residences in Baltimore is Ritz’ second such project, without a hotel component, but the charm of living there is all in its resort-like amenities. Residents can take advantage of a scalp massage or a North African “hammam” style hydro-therapy treatment at the Pearl, an on-site full-service spa. In time, they’ll be able to dine at the complex’s yet-to-be-built gourmet restaurant. A full-time concierge staff is on hand to book vacation packages, dinner reservations and theater tickets for its residents. The new Ritz even has an executive-style boardroom for business meetings. “[Our residents] are very busy people,” said Gabe Pasquale, head of sales and marketing for the development. “They’re very active. They’re captains of industry and very engaged in their business. The concept here is anticipating their needs so you can simplify their lifestyle.” Scott Rechler, chairman and CEO of RexCorp Realty, the $4.5 billion private real estate investment company that is one half of RexMidtown LLC, called the Ritz “pretty exclusive.” And with the price tags as high as they are, it’s easy to see why. Condos start at $1.3 million and peak at $5.5 million for one of three 5,000-square-foot penthouses, all of which


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have been sold, according to RexMidtown. “We have sports figures, people of the arts, people who don’t want to be bothered taking care of themselves,” Rechler said. ”This is a product that Baltimore does not have.” He said his company, which has also collaborated with Ritz-Carlton on residential projects in White Plains and Long Island, N.Y., chose Baltimore because it was “a good, deep market, and a great location.” Pasquale said that the residents there represent a “very diverse” demographic, including young professionals in the finance industry, married couples, doctors and professors, and affluent empty-nesters moving from the suburbs in search of a more urban lifestyle. “Lately, it’s been the upper end of the market that has been selling — over $2.2 million,” he said during a recent tour of a model unit. The $2.6 million, 2,368-square-foot ground-level condominium, which was the site of a wine-tasting during Thursday’s celebration, has Venetian gold granite wall-tiling, woodwork made of imported African dark woods and granite countertops in the kitchen. Tim Spina, who owns a business that manufactures auto parts for General Motors, was in town Thursday morning from Detroit with his wife Beth, an attorney, to tour the Ritz. “It’s so low maintenance,” he said, referring to the Ritz’s concierge service. “We can just come and go.” The Spinas, who also own a Ritz condo property in Jupiter, said that they were impressed by downtown Baltimore when they visited Goucher College a few years ago with their youngest son. If they bought a unit in the Ritz Residences in Baltimore, Tim Spina said, it would be as an investment property. “The view is definitely a plus,” Beth Spina said. Ritz-Carlton’s venture comes as Baltimore is enjoying a boom in luxury condominium development, especially ones with waterfront views, despite a slow economy and uncertainty over the number of buyers. Nearly 1,500 condo units are either under construction, in planning or have been built in the last year. Between Jan. 1, 2007, and May 2008, 50 condominium sales were settled, while 48 remained pending, or sold but not settled, in zip codes around Baltimore’s harbor, according to Metropolitan Regional Information Systems. Those statistics, however, do not include several Baltimore condominium projects, such as the Vue in Harbor East or downtown’s 414 Water Street, that don’t sell condos through multiple listing services. Baltimore developer Pat Turner expects this summer to open his 228-unit, $170 million Silo Point condo tower, a 24-story converted grain elevator in nearby Locust Point, while several other condo projects are in planning stages. Developer Richard Swirnow plans to expand his HarborView community with the construction of the Pinnacle, a luxury project with 47 units ranging from $623,000 to $7.2 million, in 2010. Edwin F. Hale Sr., owner of Baltimore’s First Mariner Bancorp, plans to build 500 condo units at his Canton Crossing development, and the $600 million Legg Mason/Four Seasons hotel, being built in Harbor East by Struever Brose Eccles & Rouse and H&S Properties Development, will have a condo component as well. “Water is magic,” said John Harrington, senior vice president with MacKenzie Commercial Real Estate. “I think [the Ritz] will add to the excitement of the Inner Harbor. … I think to attract investment into any area, you need residential. Residential is 24 hours a day, it feeds restaurants, feeds the office, feeds the retail. “Without Ritz-Carlton, without Silo Point, I’m not sure Harris Teeter would come,” Harrington said, referring to the Virginia-based grocer that recently announced it will expand into the Baltimore area. “That’s an upscale grocery. Why would they come if they didn’t think it was an upscale market?” Cindy Conklin, a Realtor with Yerman Witman Gaines & Conklin Realty, which specializes in the downtown condo market, said she does not expect the Ritz to sell out quickly, but added that sales should pick up now that the development is almost complete. “Typically, Baltimoreans are late entries into condo buildings,” she said. “They like to see a project done and kick the tires. Investors and out-of-town buyers who are not risk averse are more likely to come in and sniff around. They feel that if they take a stab at buying something early, they have more of a chance for appreciation.” Conklin, who said her company has settled on seven and has signed contracts of sale on three of the 26 condos


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at Federal Place, a recently-completed project near the Ritz on Key Highway, emphasized that the Ritz’s image is much different from other condo projects around the harbor. “The Ritz is more staid,” she said. “It has rich woods, it has very traditional environments. [Silo Point] is much more urban, gritty and edgy. It will appeal to a wider demographic. …The Ritz, that whole experience is for a wealthy clientele.”