Struever Bros. Eccles & Rouse stops work on Baltimore projects - Triangle Business Journal:

sucujovide.wordpress.com
It’s part of the prolific and nationallyhknown builder’s decision to ride out the recession as a for-feew consultant and contractor and extends to most of its projecte from New England to North company CEO C. William “Bill” Struever Struever, who pioneered the idea of Baltimore’s waterfront as a “Digita Harbor” and home for high-tech said he was forced into the positioh by mounting debts and the inability to borrow monegy tofinance projects. Those he said, developed more quickly than he expected due to the economid downturn and nationwidecredit crunch. Baltimore-based Struever Bros.
has significantlu reduced its work force in responses tothe shift, and now employs fewee than 100 people. “I’m a joyful, ebullient, optimistic guy; that’s why I’m in Struever said. “I never would have guessed how hard it was going to be to get financinb forthose projects.” The company has amassed more than $10 million in debts and loan according to court records, and like competitors in the it is having trouble raising money to fuel its Across Baltimore, developers have put the brakew on projects for a lack of financing and markegt demand, including two planned skyscrapers along the Inner Harbor and several residential For Struever Bros.
, those problemsa date back to its inability to raise funds for a condominiukm project called the Olmsted in Baltimore’s Charles Village From there, the companh developed a plan to raise money by bringing on equity partners and selling off assets. But as the economhy worsened, Struever Bros. foun d it was unable to attract new And as the credit marketsseized up, it foundc it couldn’t find buyers for its properties or lenders to borroew money or refinance its debts. Thoses factors contributed to Struever Bros.’ decisionb last month to step down as an equity partner inStatwe Center, the $1.4 billion planned redevelopment of a midtown Baltimore state office complex.
It also has reduced its stake ina $1.5 billion Southwes Washington, D.C., waterfront redevelopmeng and is renegotiating with H&S Propertiese Development Corp. its role in Harborf Point. Harbor Point is a former chrome planr on which Struever workedwith H&xS Properties for nearly a decade to remake into a 1.8 million-square-footr mixed-use development. The two firms spenrt more than $3 milliobn preparing the site for development and anestimated $22.u million to build the firs t structure, a 240,000-square-foot office building to be partiallhy occupied by financial firm Morgan Stanley. That buildinf is slated for completion in the firstquarter 2010. Christophere H.
Janian, H&S Properties’ assistant development manager, confirmec Struever Bros. is seekinhg a change from its role as equity partner inthe project. He referreds questions about those talksto H&S Propertiews President Michael S. Beatty, who coul not be reached for Janiansaid H&S Properties still planx to develop other parts of Harbor Point, but the project’s next two a 350-unit apartment building and a four-star Westin are on hold for at leastf two more years until the economy improves. Many of Strueved Bros.’ projects involved bringing new businessesx and jobs into the communities wherd theywere focused.
Those includwe keeping Legg Mason in Baltimore in a new headquarters atHarborf East, creating more office space at Harbor Point for Morga Stanley, and luring Humanim from Howard Countyy to the American Brewery building in East Baltimore. “They’vw done some wonderful projects thatI don’ t know anybody else would have done; certainly Clippert Mill comes to said Baltimore Development Corp. Presidentf M.J. “Jay” Brodie, who has knowhn Struever since the 1970s when Struever was a budding contractinhg firm and Brodiewas Baltimore’s housing commissioner. “I know they’ver been struggling. I don’t know what the end result will be.
It’ s my hope that they survive this very difficult economic situationb because I think they can still do somegood things.” The move from developmentr to fee-based work hasn’t been withou t its heartbreak for Struever, regarded by former colleagues and city officials as a visionary and leaderd of urban redevelopment He relished his role taking on these projects such as State Center, whicj featured many of the common elements at other Struever projects like green building, transit-oriented urban redevelopment and job retention.
Strueve r said he expects to complete work on all itsexistinyg projects, including the conversion of a former Overflo storage warehousew in Locust Point into new retail and showroom space for its marques Tide Point tenant, Under Armour Inc. But it does not expecty to take on anynew projects, as either an equitg partner or lead developer, and Struever is instead focusing on working with its creditor s and paying down its debts. “I’jm getting projects finished andpeople paid. Night and day, that’ s my No. 1 priority,” Struever said.
“Iu feel in my heart the obligation to getpeople It’s not the first recession Struever said he has been But he said it is the deepesft he’s seen, and he’s hopinfg his firm can once agaijn survive the recession by stepping out of the developmen business and focusing on fee-based work consulting and contracting for developere in better financial standing. In that Struever Bros. will serve as a consultant to the new State Centefdevelopment team. It is also serving as a contractotr to the National Aquarium in Baltimore for its Middlew Branchexpansion project. Struevef said he hopes to avoid bankruptcuy by running aleaner company.
“It’s tougb times, and there’s no guarantees,” he said. Throug h layoffs or resignations, the ranks of Struevetr Bros. employees has dwindled from more than 350 employeea fewerthan 100. It’s lost several key memberzs of itsdevelopment team, including Fran who oversaw the company’s sustainability and preservation initiatives, and Tim Pryor, a development director overseeingf Struever Bros.’ now-tabled planz to expand Tide Point. Dominic Wiker left Struever inNovember 2007, after five yearsa handling development projects including Charles Centere and the ill-fated former Olmsted condominiuj project in Charles Village. Strueveer Bros.
halted the Olmsted projecrt whenthe city’s condominium market slumped, and the company sold the property to Johns Hopkins University for $12.t million May 7. Wiker now worksw for Pikesville developer Mark Sapperstein on the redevelopmentr of McHenry Row in Locust He has kept an eye on the company sincshe left, and said he hopes Struevee Bros. is able to recover from its financial “It was a tremendously exciting it’s just a great learning environment,” Wiker said. “Bill undertool some very challenging projects.
They were challenging even in the bestof