Bakery magnate left mark by taking risks
Known as the ‘bread man,’ the owner of H&S Bakery developed Harbor East, contributed to political campaigns
John Paterakis Sr., the risk-taking Baltimore native who built his H&S Bakery into the largest privately owned bakery in the country and redeveloped Harbor East, died Sunday at Johns Hopkins Hospital from complications of myelodysplasia, a bone marrow disorder, his family said. He was 87.
He was known in local political circles for his financial support for candidates, most of them Democrats. He became known as “the bread man,” a reference not only to his bakery but also his financial clout and political influence.
“You gotta remember, I’m just a little Greek baker that got lucky,” the multimillionaire said this year at a ceremony inducting the inaugural class of The Baltimore Sun’s Business and Civic Hall of Fame. He was chosen by The Sun’s editorial board as a member of that group.
Under his direction, H&S Bakery became one of the largest bakers on the East Coast, producing more than 100 varieties of breads, rolls and specialty items. Its subsidiary, Northeast Foods Inc., is the largest source of hamburger buns for McDonald’s.
Nancy Grasmick, the former Maryland state superintendent of schools and a friend of Paterakis, called him an “extraor-
dinary” person and devoted friend.
“He was a businessman who was totally self-made and who had very special skills for both cultivating important customers and delivering an outstanding product,” Grasmick said. “But he had a vision that was beyond the bakery and its success, and that vision was to improve Baltimore.”
She called Harbor East “just a tribute to his vision, determination and huge commitment of finances.”
Mr. Paterakis was delivered by a midwife at the family home at 132 S. Bouldin St. in 1929. His father, Isidore “Steve” Paterakis, worked at the family baking business alongside his wife, Kyriaki, or Clara. Both parents were Greek immigrants.
Mr. Paterakis was a 1947 graduate of Patterson Park High School, where he was a sportswriter and aspired to build a career in journalism. He served in the Navy in the late 1940s.
Mr. Paterakis had plans to attend college, but his father became ill with leukemia, and he began running the baking side of the business. His business partner, Harry Tsakalos, who was married to his sister, delivered bread and rolls. His sister kept the books.
“After a while, I was making $20,000 a year, and that was a lot of money in the 1950s,” Mr. Paterakis told The Baltimore Sun for a profile in 2000. “So, I thought: Why go to college with this kind of money coming in?”
Mr. Paterakis baked in the 2100 block of Ashland Ave., north of the Johns Hopkins Hospital complex, and supplied customers such as the old Harley’s submarine sandwich shops. He got a big business break when the old Food Fair chain began buying from him.
“I dreamed about building the family bakery business. And to do that, we had to work very hard. And we had to take some risks,” he said in 2000.
Mr. Paterakis had watched small, independent bakeries get crushed by competition from supermarkets. Instead of fighting mechanized bread-making, Paterakis mastered it by coming up with a process for mass-producing specialty items such as Italian bread, French bread and kaiser rolls.
He moved the business into its nowfamiliar Fells Point location in the 1950s. In 1965, he spent $1.5 million building an automated, state-of-the-art roll-manufacturing plant on Moravia Road for McDonald’s before McDonald’s officials knew who he was. He was betting that McDonald’s would use his plant because it would make better buns than the competition did.
“Everything we’ve ever done, we’ve done on chance,” Mr. Paterakis said. “You’ve got to keep spending money to keep updating to remain competitive. If you don’t keep up, the big fish will eat you.”
His daughter Vanessa Paterakis Smith recalled driving with him to different supermarkets to check out competitors’ breads.
“I knew he was doing it so he could improve his product,” she said. “He was looking for the next current trend.”
Family members said Mr. Paterakis was humble. He rarely wore suits. For many years he drove a worn Lincoln with more than 200,000 miles on the odometer. Its engine was rebuilt three times. He lived in the same Timonium home for 46 years.
“He didn’t have a big house, he didn’t have a fancy car, he didn’t go on extravagant trips, and he had the means to do that,” his son Bill Paterakis said. “Instead he sank everything he had into Harbor East. Not many people would do that and take that kind of risk on Baltimore. …
“He was a risk-taker, he was fearless, he was a visionary. He wouldn’t look at why things wouldn’t work, he looked at how things could work.”
His family said Mr. Paterakis was driven by traditional Greek values of working hard to provide for his family, many of whom continue to work in businesses he built.
Mrs. Smith, his daughter, said he would often repeat the refrain, “Everything I did in my life I did for my children.”
Russ Bundy of Ohio, a lifelong friend who built a baking pan business with the help of Mr. Paterakis, said he was successful “because he was honest. People trusted him, people believed him, he didn’t say things that wasn’t right. … He was an old-fashioned businessman with great character and great ethics.”
Michael S. Beatty, head of Beatty Development Group, called Mr. Paterakis “a perfect partner for real estate development. Like many, he enjoyed the excitement of a deal but, like few, he never ran away when times got tough. ... Many people know how tough he was but they probably don’t realize how fair and generous he was at the same time. He was someone who really cared.”
Mr. Paterakis donated extensively to causes around Baltimore, including Greek businesses and the Ronald McDonald House charities. He was an active member of the Greek Orthodox Cathedral of the Annunciation on Preston Street, and was generous there and to the several other Greek Orthodox churches in the area.
The Rev. Louis J. Noplos, the pastor of Saint Demetrios Greek Orthodox Church in Parkville, said Mr. Paterakis’ donations helped make two new buildings at the church possible six years ago, but that he didn’t seek recognition for it.
“He never wanted his name on buildings,” Father Noplos said.
Every Christmas for decades, a box would arrive from Mr. Paterakis with gifts for the clergy, meticulously wrapped.
“It wasn’t, run into Macy’s and pick up a present,” Father Noplos said. “It was bowls of china, it was a statue from Greece, it was exotic-type gifts. They would be nine to 10 gifts in a box, all wrapped up in Christmas paper.”
Colleagues recalled Mr. Paterakis as speaking bluntly, but said he stayed away from the head table at a banquet.
“He did not lord it over people in a skybox,” said the former Sun reporter and editor Barry Rascovar, a communications consultant. “He was a shy and quiet individual. He was always polite and accommodating.”
When he was in his 70s, The Sun described him as a detail-obsessed workaholic who put in 20 hours a day, even coming into the office on Christmas and Thanksgiving.
He was also a behind-the-scenes heavyweight, The Sun said. He made donations to Governor and Vice President Spiro T. Agnew, a Republican, and Gov. Marvin Mandel, Sen. Paul Sarbanes and Mayors William Donald Schaefer and Kurt Schmoke, all Democrats. He donated money during the current election cycle to state Sen. Catherine E. Pugh and former Mayor Sheila Dixon, both Democrats.
Every Saturday from10 a.m. to 3 p.m., Mr. Paterakis would hold court in Broadway Market and meet with local politicians, mayors and police commissioners. In the last eight years, he moved his spot to the Harbor East Deli, where he would usually order the JP Special, a sausage, egg and cheese sandwich on a toasted English muffin — his favorite kind of bread.
“He liked being behind the scenes, but it was always to help someone else, never himself,” Bill Paterakis said. “People respected him because he was just trying to help friends and family get places, and he used his connections to make that happen.”
Accolades poured in Sunday from local politicians.
”John Paterakis Sr. dedicated himself to Baltimore, the city he loved,” Sen. Barbara A. Mikulski said. “As a visionary from humble beginnings, he grew his families’ bakery to one of the largest in the nation, all the while growing jobs and opportunity for his city. In the Greek tradition he held dear, he was unwavering in his commitment to his family.”
“Mr. Paterakis believed in Baltimore,” Mayor Stephanie Rawlings-Blake said. “He was a visionary leader focused on growing Baltimore and his impact can be seen throughout the city.”
City Council President Bernard C. “Jack” Young sometimes met with Mr. Paterakis at his Saturday lunches.
“As others understandably focus on his business acumen, I’ll spend time reflecting on Mr. Paterakis as an extremely devoted friend and family man who spent more than six decades working to improve our city and provide opportunities for countless Baltimoreans,” he said.
Mr. Schmoke, who served as mayor from 1987 to 1999, found himself aligned against Mr. Paterakis when the businessman supported rival candidates for state’s attorney and mayor. But the two men later teamed up to build the Marriott Waterfront Hotel.
Mr. Schmoke quoted a line from the Broadway musical “Hamilton” to describe his new ally, saying it was “nice to have Washington on your side.”
Mr. Schaefer called on Mr. Paterakis to bail out a section of the harbor known as the Gold Coast — a once moribund 20-acre stretch between Fells Point and the Inner Harbor.
Paterakis bought the land for $11 million, but the city reneged on a promise to buy it back later. Paterakis took a gamble and pushed ahead with Harbor East, a collection of waterfront towers holding offices, shops and homes.
Sylvan Learning Systems became Harbor East’s first tenant in 1997, and Mr. Paterakis built the first residential component, the Promenade Apartments, in partnership with the Bozzuto Group. He later built the Marriott Waterfront Hotel on his property.
Mr. Paterakis was also one of the developers behind the Four Seasons Hotel in Harbor East and one of the owners of Bulle Rock, a golf course surrounded by upscale homes in Havre de Grace that drew the LPGA Championship tournament to the area in the 2000s.
“John Paterakis was a rare Baltimorean,” said M. Jay Brodie, the veteran Baltimore development official. “He saw what the future of the Harbor East might be and he took the risk to make it happen.
“He personally wrote big checks. It was a gutsy move. My great hope is that he will be a role model for young people who would also take risks in development in the city.”
At the Marriott Waterfront Hotel, Mr. Paterakis took a risk, supposing that slot machines and gaming tables would be permitted by the General Assembly. He lost that bet.
Mr. Paterakis was indicted in 2009 on alleged campaign finance violations, and pleaded guilty to two misdemeanor charges. He was fined $26,000 and sentenced to probation. Judge Dennis M. Sweeney ordered him to refrain from future political donations until his probation ended on Jan. 1, 2012.
A viewing is to be held Wednesday at the Masonic Temple in Hunt Valley from 2 p.m. to 8 p.m. Private funeral services will be Thursday.
Survivors include his wife of one year, Roula Passon; four sons, Bill Paterakis, head of Northeast Foods, an H&S subsidiary; John J. Paterakis Jr., who heads sales; Chuck Paterakis, who is in charge of transportation and construction; and Steve Paterakis, who runs the Schmidt baking division; two daughters, Vanessa Paterakis Smith and Karen Paterakis Philippou; a sister, Despina Sfakianos; 19 grandchildren and two great-grandchildren. His 1950 marriage to Antoinette Apostolou ended in divorce. His sister Liberty Paterakis Tsakalos died two years ago.
John Paterakis, owner of H&S Bakery, was known for his charitable and political contributions.
John Paterakis stands on the site of the planned development of a new neighborhood just south of Little Italy. Harbor East welcomed its first tenant in 1997, after Mr. Paterakis invested heavily in its development.
John Paterakis Sr., seated right, is shown with the management team of H&S Bakery. Harry Tsakalos is seated at left. Standing, from left, are John, Stephen, Charles and William Paterakis, and Nicholas Tsakalos.
John Paterakis is shown in a 1978 photo.