ISSUED APRIL 2018

2017 STATE OF DOWNTOWN BALTIMORE REPORT

SetonHill

HeritageCrossing

Pigtown/Washington

Village

Otterbein

Ridgely’sDelight/

Stadiums

FederalHillSharp-

Leadenhall

Fells Point

UpperFells

HarborPoint

HarborEast

LittleItaly

HistoricJonestown

Old Town

JohnstonSquare

StationNorth

BoltonHill

StateCenter

Upton

MountVernon

Bromo Arts District

PrestonGardens

InnerHarbor

CharlesCenter

Westport

SouthBaltimore

PortCovington

LocustPoint

University of MarylandMedical Center Midtown

UMB Bio ParkVA Hospital

of Maryland

Universityof Maryland

Medical Center

MercyMedicalCenter

JohnsHopkinsHospital

KennedyKrieger

Institute

Science + TechnologyPark at Johns Hopkins

University of Maryland,

Baltimore

Royal Farms Arena

Cross Street Market

Horseshoe Casino

ONE-MILE RADIUS MAP

Employment: 119,312

Residents: 42,626

Office Space: 28.2 M S.F.

Hotel Rooms: 8,875

1

1 New York 190,901

2 San Francisco 127,962

3 Chicago 95,635

4 Philadelphia 84,027

5 Los Angeles 75,127

6 Seattle 69,874

7 Boston 53,129

8 Washington 47,856

9 San Diego 43,874

10 Denver 42,730

11 Baltimore (10) 42,626

12 Miami 38,651

13 Minneapolis 37,133

14 Houston 27,775

15 Portland 25,198

16 Atlanta 22,681

17 Orlando 19,687

18 Charlotte 19,119

19 Dallas 18,664

20 Pittsburgh 18,537

21 Phoenix 16,099

22 St. Louis 12,162

23 Tampa 11,332

24 San Antonio 9,646

25 Detroit 6,855

1 New York $183,086

2 Chicago $153,396

3 Boston $142,154

4 Washington $134,949

5 Houston $118,836

6 Charlotte $118,566

7 Philadelphia $117,649

8 Dallas $116,521

9 San Francisco $109,236

10 Seattle $105,947

11 Tampa $104,663

12 San Diego $100,121

13 Miami $99,773

14 Baltimore (16) $91,706

15 Portland $90,710

16 Minneapolis $90,333

17 Denver $89,179

18 Orlando $83,155

19 Pittsburgh $81,950

20 San Antonio $71,345

21 Atlanta $71,312

22 St. Louis $68,187

23 Detroit $65,943

24 Los Angeles $64,524

25 Phoenix $53,688

1 New York 75,494

2 Chicago 38,798

3 San Francisco 30,735

4 Philadelphia 25,551

5 Seattle 22,016

6 Boston 16,441

7 Washington 15,917

8 Denver 11,708

9 San Diego 10,796

10 Los Angeles 10,113

11 Miami 9,175

12 Minneapolis 8,496

13 Baltimore (13) 7,677

14 Dallas 6,562

15 Portland 5,536

16 Charlotte 4,816

17 Orlando 4,086

18 Houston 4,056

19 Tampa 3,021

20 Atlanta 2,295

21 Pittsburgh 2,293

22 St. Louis 2,050

23 San Antonio 1,361

24 Phoenix 1,161

25 Detroit 1,126

1 New York 1,078,486

2 Chicago 360,413

3 Washington 323,810

4 Boston 298,683

5 Philadelphia 263,865

6 Seattle 222,892

7 Houston 190,854

8 Los Angeles 178,156

9 Minneapolis 169,499

10 San Francisco 166,586

11 Denver 140,356

12 Atlanta 128,863

13 Pittsburgh 123,088

14 Baltimore (14) 119,312

15 Dallas 107,096

16 Charlotte 83,804

17 Detroit 76,741

18 Miami 76,179

19 San Antonio 76,125

20 San Diego 74,753

21 Orlando 73,760

22 St. Louis 66,690

23 Phoenix 61,925

24 Tampa 44,196

25 Portland 41,373

Average Household Income

Households over $75,000

Employment

( ) = last year’s ranking

Population

Top 25 Largest U.S. Metro Areas: One-Mile Radius Statistics

Downtown Baltimore excels at striking a work/life balance, which is why it’s so good at attracting top talent. Pick any of our largest industry sectors— healthcare, finance, hospitality, technology, for example — and the trend of relocations to, and expansions in, Downtown Baltimore is undeniable. They’re here because the best and brightest employees want to work someplace cool.

They also know that work is not rewarding without a balance. Atop Downtown highrises, corporate names like M&T Bank, Transamerica, and Pandora now share the sky with expansive rooftop lounges, pools, and restaurants as apartment towers make Downtown the most densely packed residential neighborhood in the region. Back on the ground, the dining scene is exploding with restaurants using the bounty of our nearby farms and Chesapeake Bay, solidifying Baltimore’s place on the world’s culinary map. And though, at times, the restaurants seem to be coming and going, this is consistent with national trends. Our parks and plazas are filled with events from Spring to Fall. The Sandlot, the outdoor lounge in Harbor Point, offers a new way to watch the ships come in. And, the recent addition of bike lanes and an upgraded water taxi system offer even more pleasant ways to get to work without a car.

Though the data in this report is a crucial indicator of our city’s health, so is belief. The people who live and work in Downtown Baltimore believe in Downtown Baltimore. Our residents and employees genuinely like being here, and take great pride in their city. And it is this base that drives the economy for the entire city.

WORK/LIFE BALANCE

executive summary

Environics Analytics through Spotlight

2

housing

As developments like One Light (featured on our cover) and 414 Light Street race skyward, forever altering the Downtown skyline, many people have asked—“Can we sustain this?”

The answer is yes. In 2017, the occupancy rate rose to 93% as large-scale projects like 500 Park, 2 Hopkins Plaza, and Stadium Square came online. And, according to our Housing Demand Study: Outlook 2022, released in 2017 (which is outlined on page 4) Downtown is in a position to absorb nearly 7,000 new units over the next five years, including the two new Light Street towers and 225 N. Calvert, already in the pipeline.

Along with an improving occupancy rate, 2017 brought a healthy mix of conversion and ground-up development. Properties like 2 Hopkins Plaza and The Appraisers’ Building came online as stellar examples of converting office space to modern, stylish residences. Stadium Square and 500 Park completed construction and offer impressive amenities like private courtyards, pools, and fitness centers.

WELCOME, NEIGHBORS

2 Hopkins Plaza

414 Light StreetGoDowntownBaltimore.com

3

For-Sale Housing Market Summary

Housing Type Properties Sold Average Sale Price Median Sale Price

Condo 114 $514,619 $281,250

Townhome 248 $373,878 $314,250

Stadium Square/ 101 W. Cross Street New Construction Rental - Market Rate 299Hanover Cross Street

2 Hopkins Plaza 2 Hopkins Plaza Conversion Rental - Market Rate 182

The Appraisers’ Building 103 S. Gay Street Conversion Rental - Market Rate 137

Banner Hill 611 S. Charles Street New Construction Rental - Market Rate 349

300 St. Paul 300 St. Paul Conversion Rental - Market Rate 280

500 Park 500 Park Avenue New Construction Rental - Market Rate 153

Notable Residential Openings

Project Name Address Project Type Housing Type # of Units

Class A Apartment Building Rental Rates

Apartment Size Average Monthly Rent

Studio $1,285.35

1 Bedroom $1,511.62

2 Bedroom $2,028.85

3 Bedroom $3,150.83

All unit types $1,994.16

*Includes 23 buildings within the one mile radius defined by the followingcriteria: built after 1995; 100 units or greater; high-quality buildingamenities, and finishes in units.

Housing Occupancy Rates

93%YEAR END2017

Source: Downtown Partnership and Individual Developers

Stadium Square

225 N. Calvert Street

Source: Individual property managers and leasing agents.

“My work has taken me to cities all over, but no place I’ve visited has hit me like this one. I had no idea what I’d been missing. This city has its problems, don’t get me wrong. But in three days I didn’t meet a rude person, or see a dirty street, or talk to a single Baltimorean who wasn’t proud to live there.”

—Jay Heinrichs, Southwest: The Magazine, February 2018.

4

housing

Since 2001, Downtown Partnership has conducted a housing study every five years. The latest, released in 2017, shows that demand for both rental and for-sale housing in Downtown neighborhoods continues to be strong with the ability to absorb up to 7,000 new units in the coming five years. Our key findings are listed below.

HOUSING DEMAND STUDY

Based on a 20 percent capture of the annual potential market for new rental housing units, and a 7.5 to 10 percent capture of the annual potential market for new for-sale housing units, the Downtown Study Area should be able to support up to 1,339 new market-rate housing units per year over the short term (next two-to-three years) and up to 1,405 units per year over the longer term (three-to-five years), for a total of between 6,685 and 7,025 new rental and for-sale units over the next five years.

On average, the study predicts 8,335 households of potential renters and buyers of new multi-family and single-family attached residential units in the Downtown Baltimore Study Area each year over the next five years, an increase of 350 households per year (a growth rate of 4.4 percent per year).

More than 53 percent of these potential households currently live outside the Baltimore City limits, up from 51 percent in 2012.

More than 69 percent of the potential market consists of younger singles and couples, 20.5 percent are empty nesters and retirees, and 10.3 percent are traditional and non-traditional families. This reflects the increasing number of young people who are moving to the Downtown Study Area.

As derived from the aggregated housing preferences of the target households, 68.5 percent of the new units should be rental apartments, 15.4 percent should be condominiums (for-sale apartments), and 16.1 percent for-sale townhouses, continuing the trend toward rental in the Downtown Study Area.

GoDowntownBaltimore.com

5

Multiple hotels came online in 2017, including La Quinta, Marriot Delta, and Staybridge Suites, bringing the total current inventory to 8,875. Visitation numbers rose slightly, and Downtown’s hotel performance continued to outrank the national average by nearly 2%.

HOSPITALITY & HOTELS

hospitality & hotels

Downtown (2017) 67.30% $160.69 $108.21

National (2017) 65.90% $126.72 $83.57

Total Number of Overnight Visitors 10.6 million 10.4 million

Total Number of Visitors 25.9 million 25.2 million

Total Overnight Visitor Spending $4.26 billion $3.94 billion

Total Visitor Spending $5.64 billion $5.44 billion

Hotel Pipeline Hotel Performance

Visitation Numbers

Occupancy ADR RevPAR

UNDER CONSTRUCTION

2017

CURRENT TOTAL INVENTORY

PLANNED THROUGH 2023

Year End 2016

Year End 2015

Staybridge Suites

488

8,875

718

Source: Smith Travel Research, Inc. / STR Global, Ltd. trading as “STR”

Source: Longwoods International and Tourism Economics, as provided by Visit Baltimore

Project Name Address Project Type Number of Rooms

Marriott Delta Hotel 1 E. Redwood Street Conversion 150

La Quinta Hotel 200 W. Saratoga Street Conversion 42

Staybridge Suites 17 Commerce Street Conversion 101

Notable Hotel Openings

6

retail

In 2017, food was the name of the retail game in Downtown Baltimore. As our city’s culinary star continued to rise, several new restaurants opened, diversifying and elevating our already impressive food scene. Downtown saw several new upscale spots debut, including The Bygone in the Four Seasons, Tagliata, and The Elk Room. Filicori Zecchini and Cilantro also opened, giving an international flair to Downtown employee lunch breaks.

It’s no secret that national retail trends are precarious, and Downtown Baltimore was certainly not immune to these changes in 2017. With the massive popularity of e-commerce, the entire retail world is readjusting. But with a 90.1% occupancy rate and large-scale development projects like the new 50,000-square-foot Whole Foods and Harborplace redesign, we’re optimistic about retail in Downtown.

DOWNTOWN RETAILThe Bygone at the

Four Seasons

Elite Secrets BridalGoDowntownBaltimore.com

7

Downtown Retail Sales Retail Occupancy Rates

Tagliata 1012 Fleet Street Restaurant Open

Cilantro 30 Light Street Restaurant Open

Kabul Grill 55 Market Place Restaurant Open

Elite Secrets Bridal Boutique 330 N. Charles Street Retail Open

Charm City Cakes 618 S. President Street Bakery Open

The Charles 1110 S. Charles Street Restaurant Open

The Bygone 200 International Drive Restaurant Open

Filicori Zecchini 1 E. Pratt Street Coffee Open

Elk Room 1010 Fleet Street Restaurant Open

Notable Retail Openings And Leases

Name Address Business Type Status

Baltimore Metro

Downtown* Multi-tenant Projects

94.2% 96.2% 90.1%

National

Source: (National and Baltimore Metro): CoStar, Integra Realty Resources, Marcus and Millichap, Mackenzie Commerical Source (Downtown): CoStar, Individual property owners, managers, and leasing agents

TOTAL DOWNTOWN SALES

$1.242BILLION

Echoing the national trend of retail uncertainty, Downtown saw a flurry of restaurant and shop closings. However, multiple high-end dining experiences opened in 2017, solidifying Baltimore’s new image as a food destination. Also of note, total Downtown sales rose to $1.242 billion, up from $1.168 in 2016.

Filicori Zecchini

Source: Spotlight, as provided by Baltimore Development Corporation

8

Downtown contains over one-third of the city’s jobs despite comprising less than four percent of its geographic area. Within that small footprint are 28.2 million square feet of office space housing the 119,312 people employed in Downtown. Given Mercy Medical Center, the University of Maryland, Baltimore, and our proximity to the Johns Hopkins medical campus, it’s no surprise that a quarter of these employees work in the healthcare and social assistance sector. Downtown also welcomed the expansion of Morgan Stanley to 100 South Charles, adding hundreds of new employees to the core. And, according to our Core Tech: The State of Downtown Baltimore Tech & Innovation Report, the rapidly growing technology sector is now responsible for seven percent of the Downtown workforce, with thriving outfits like R2i, Fearless Solutions, Jellyfish, Verizon, and Exit10.

THE BUSINESS OF DOWNTOWN

State of Downtown Tech Event, November 2017

GoDowntownBaltimore.com

office & employment

9

Morgan Stanley 100 S. Charles Street New Lease Financial Services 300,000

M&T Bank 1 Light Street Relocation Bank/Financial Services 155,000

Johns Hopkins Center for Communications 700 E. Pratt Street Relocation MedTech 78,718

Vitreon America 1100 Wicomico Street Relocation Biotanical Research 50,000

US Internal Revenue Service 100 S. Charles Street New Lease Government 43,121

PricewaterhouseCoopers 100 E. Pratt Street Relocation Accounting Firm 32,000

Merrill Lynch 100 E. Pratt Street Renewal Financial Services 32,000

Cushman and Wakefield 1 E. Pratt Street Relocation Real Estate/Brokerage Services 21,000

McGuire Woods, LLP 500 E. Pratt Street Relocation Law Firm 21,000

US Department of Housing 100 S. Charles Street Relocation Government 20,000and Urban Development

Notable Lease Transactions

Name Address Type of Lease Business Type Sq. Ft.

THE BUSINESSOF DOWNTOWN

Downtown Baltimore’s Core Tech & Innovation generates $830 million in annual compensation and $1.8 billion in annual output. Strong showings like this are why Cushman & Wakefield included Baltimore as top #12 in their Tech Cities 1.0 report released in 2017.

MAKING MOVES

Jellyfish Baltimore Offices

2017 Occupancy: National and Regional Standing

Downtown Baltimore 85.35%Baltimore City 87.78%

87.45%Baltimore Metro

National 86.35%

GoDowntownBaltimore.com

Downtown Baltimore, Baltimore City, and Baltimore Metro Vacancy Sources: CBRE, Cushman & Wakefield, JLL, MacKenzie, Newmark Knight Frank, and Transwestern

National Vacancy Sources: CBRE, Cushman & Wakefield, JLL, and Newmark Knight Frank

*This category consists of the following sectors: Arts, Entertainment, Recreation, Real Estate, Manufacturing, Utilities, Transportation, Construction, Wholesale trade, and other sectors comprising less than 3% of total employment.

Healthcare and Social Assistance 25%

Public Administration 15%

13%Professional, Scientific, and Technical Services

Accommodation and Food Services 9%

8%

6%

5%

4%

17%

Finance and Insurance

Information

Educational Services

Other Services (except Public Administration)

Other*

Employment by Industry Sector

GoDowntownBaltimore.com

Presenting Sponsor

Leadership Sponsors

Community Sponsors

This report is produced by Downtown Partnership of Baltimore, Inc., which is solely responsible for its content. Data is collected by, or on behalf of, Downtown Partnership from a variety of sources and covers activity within a one-mile radius of the intersection of Pratt and Light streets. Charts, graphs, maps, and images are the property of The Partnership unless otherwise noted.

Downtown Partnership of Baltimore is a 501(c)(6) non-profit incorporated in the State of Maryland. It has approximately 650 member firms throughout the mid-Atlantic region from dozens of industry sectors.

For more information about Downtown Partnership, its reports, or to become a member, please visit GoDowntownBaltimore.com, email info@dpob.org, or call us at 410.244.1030.

You can also find Downtown Partnership of Baltimore on twitter @DowntownBalt.

Thanks to the Downtown Partnership staff who worked to compile this data and produce the 2017 State of Downtown Report.

Baltimore Development Corporation

First National Bank

Horseshoe Casino

PMS Parking

225 N. Calvert

Marks Thomas | Moseley Architects