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

Baltimore Sun - - FRONT PAGE - By Jacques Kelly and Car­rie Wells

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.

LLOYD FOX/BAL­TI­MORE SUN

John Paterakis, owner of H&S Bak­ery, was known for his char­i­ta­ble and po­lit­i­cal con­tri­bu­tions.

BAL­TI­MORE SUN FILE 1990

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.

BAL­TI­MORE SUN FILE 1995

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.

BAL­TI­MORE SUN FILE 1978

John Paterakis is shown in a 1978 photo.

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