Residents get creative on annual Taxpayers’ Night
Call for major institutions to pay city more to decrease shortfalls
Baltimore residents urged city officials during the annual Taxpayers’ Night to stopgap budget shortfalls by revisiting a 2016 agreement that allows major nonprofits and institutions to make annual municipal payments instead of paying taxes.
The hybrid-format forum, hosted Wednesday by the city Board of Estimates, was a more muted affair compared with previous years, with 20 speakers weighing in virtually and in person about Mayor Brandon Scott’s $4 billion proposed budget. The proposal, which faces a lengthy City Council approval process, suggests plugging a $61.9 million deficit by using parking revenues, trims to vacant positions, and a shift in funding for city police positions from the general fund to a state revenue source.
Advocates from the With Us For Us coalition urged the city to pass a charter amendment that would allow it to renegotiate a plan that allows 15 major educational and medical institutions to pay the city about $6 million per year through 2026 in lieu of taxes. The institutions covered under the agreement since 2010 include some of the city’s biggest employers, like the Johns Hopkins University, MedStar Good Samaritan Hospital, University of Maryland Medical Center, and Maryland Institute College of Art, whose real estate portfolios are worth billions of dollars. The payment-in-lieu-oftaxes (PILOT) agreement absolves those institutions from having to otherwise pay about $120 million per year in property taxes.
“It’s well beyond time for anchor institutions to pay their fair share to the city of Baltimore,” said Nicole Fabricant, a Towson University professor and South Baltimore Community Land
“The real estate business is kind of crazy right now. But it’s a significant building and we’re glad to see someone’s going to do something with it.”
The Angelos family opted to auction the property after it had entered into at least one contract to sell that had fallen through, Caplan said. The auction company offers an “accelerated process” of a no-contingency sale in less than 100 days, he said.
Angelos, who died March 23, bought the building, designed by modernist giant Ludwig Mies van der Rohe, for $6 million in 1996. The building most recently was assessed by the state at nearly $10 million.
Caplan characterized the sale price as “opportunistic,” or one that is attractive to the buyer. While the price struck some as low, they noted that other buildings have sold for less than previously as U.S. downtowns struggle with high vacancy rates and shifting workplace patterns.
“The real estate business is kind of crazy right now,” said Kim Clark, executive vice president of Baltimore Development Corp., the city’s economic development agency. “But it’s a significant building and we’re glad to see someone’s going to do something with it.”
The gleaming aluminum-and-glass skyscraper served as the headquarters for Angelos’ renowned law firm, which won hundreds of millions of dollars on behalf of victims of asbestos and tobacco and made him one of the state’s most powerful figures.
But as he fell ill and became incapacitated in recent years, a legal feud over his fortune erupted among his wife and two sons. The suit was settled in February 2023 and amid their troubles, the family sold off much of his assets: The Orioles went to a group headed by Baltimore native and private equity billionaire David Rubenstein, and the law firm to three of its senior attorneys.
The Angelos family put One Charles Center on the market with the possibility that it could be converted into apartments, as other downtown office buildings have. But it failed to sell and went to auction with a starting bid of $1.5 million.
A flurry of last-minute bids Thursday pushed the price above the reserve, and although scheduled to end at noon, the auction continued for almost 15 more minutes. Just before it ended, the Ten-X website listed a bid of $4.4 million and a purchase price of $4.51 million. Then the information on the bids dropped off the site and the building was listed as sold.
The 23-story building is about a third occupied, according to Ten-X’s listing.
Caplan declined to say how many bidders participated in the auction, but they came from across the country and included both those interested in it as an office building and those considering converting it to apartments. Bidders were required to show proof of adequate funds and were limited to bids of 110% of those funds, he said.
Downtown Baltimore has been in flux for years, with an exodus of companies moving their headquarters to newer areas like Harbor East and, since the COVID-19 pandemic, more employees working from home at least part of the time.
Still, downtown promoters note that there is an influx of employees, as the first of thousands of state workers have begun moving to the central business district from the aging State Center complex in Midtown.
Some observers note that when One Charles Center was built in 1962, it was a time when downtown’s viability was similarly uncertain. Its sale could again bode well for the central business district, they said.
“The opening of One Charles Center was of enormous importance in showing that Baltimore’s downtown could rebound from hard times,” said Johns Hopkins, executive director of the historic and architectural preservation organization Baltimore
Heritage. “It provided more than offices. It lifted the spirits of people who cared about the city and were working hard for it.
“I think today’s sale of the building and promise of new residents and tenants also provides great hope for the future of downtown,” he said.
The entire Charles Center development was a “thoughtful response to the shrinking of downtowns across the country after World War II,” Hopkins said. And its success led to Baltimore similarly re-imagining its downtown waterfront as Harborplace, he said.
Jay Brodie, a former BDC president, also pointed to One Charles Center’s earlier role in reviving downtown.
“One Charles Center was a great signal that downtown was breathing and alive,” Brodie said. “It was a breakthrough in the psyche of downtown Baltimore, which was pretty dismal at the time.”
Now, as downtown goes through yet another “metamorphosis,” he said he looks forward to what the new buyer will do with the building, whether it’s converting it to housing or the new kind of office spaces that companies now look for.
Stokes said downtown is “in the midst of the next renaissance,” citing the recently reopened CFG Bank Arena and the more than 5,000 state employees who will be moving into the “heart” of downtown.
“This investment in One Charles Center,” she said, “is a major contribution.”
— Kim Clark, executive vice president of Baltimore Development Corp., the city’s economic development agency