Baltimore Business Journal
Heavy Hitters: Sale of the Rotunda
By Julekha Dash
Retail experts say the Rotunda shopping center in Baltimore City is something of an enigma.
On the one hand, it is centrally located in the city with a Giant grocery store and a beloved independent movie theater that attracts residents from nearby Roland Park and Hampden.
But the shopping center suffers from retail vacancies and lacks dining options for the moviegoer who wants something other than a slice of pizza.
So when the shopping center owner AMB Property Corp. of San Francisco wanted to sell the property, the brokers knew they had to prepare a thoughtful analysis of its potential in order to find a seller who would pay a respectable price and transform it into a thriving shopping area. George L. Collins, a broker at MacKenzie Retail of Lutherville, and J. Lawrence Mekulski, a broker at KLNB Retail, undertook this task.
"A two-page letter turned into a 90-page report," Collins said.
The brokers found for instance, that there was a piece of land that is unused in the back of the parking lot -a rarity in Baltimore City. They also found that the neighbors were interested in seeing the Rotunda become a hub of activity in the area, which is minutes from downtown and a short drive to Baltimore County.
It was "time to unlock the value," Collins said. "That's how I approached the sale."
And Chris Bell, senior vice president of Hekemian & Co., Inc., which purchased the Rotunda for $29 million last August, agrees that the shopping center is full of potential. The Hackensack, N.J., developer wants to make the property the "great meeting place" it once was for the people in the neighborhood.
Hekemian's $70 million redevelopment plans include adding 400 housing units, 50,000 square feet of specialty retail, and doubling the size of the Giant store so the grocer can install its new store prototype. The redevelopment is slated to be completed in three years.
"Without Giant expanding, [the redevelopment] really isn't possible," Bell said. "They're just key to the community."
The housing units Hekemian will build include 300 apartments, 100 condominiums and 10 townhouses. Though some Hampden residents are unhappy with the developers plans to add luxury rental units in their area, Bell said the housing units are essential to the center's plan. As Hekemian worked on its plans for the site, executives saw a "huge opportunity if we could bring the vitality of people living there as well," Bell said.
Hekemian hasn't determined what retailers it will add to the site, but Bell said the new shops would be similar to the specialty stores found at the Village of Cross Keys, whose boutique shops include Heirloom Jewels Ltd and designer clothing store Ruth Shaw.
Tom Kiefaber, owner of movie theater Rotunda Cinematheque, anticipates that Hekemian's plans for the shopping center will make it as vibrant as the recently redeveloped Belvedere Square, where his other movie theater, the Senator, is located. Hekemian's plans are "forward-thinking" said Kiefaber, who is a fan of the developer's plans to add housing.
"If you can get to your neighborhood movie house without going out in the rain, you've got to love it," he said.