When Wells Fargo executives decided to uproot the bank’s decades-old Baltimore headquarters on St. Paul Street, they wanted to modernize and downsize offices. But they had no intention of following other corporations in an exodus from the city’s business district.
While the city’s original business core has been hit by a wave of recent or planned corporate relocations, some to newer digs elsewhere in the city, Wells Fargo and a growing chorus of businesses are doubling down on downtown.
Wells Fargo said last week it will move from the Wells Fargo Tower on St. Paul later this year to one floor at 111 S. Calvert Street, a renovated 28-story mixed-use tower at the Inner Harbor that also includes the 680-room Renaissance Hotel and the former Gallery at Harborplace mall.
Also on Friday, the architecture firm Design Collective said it signed a 10-year-lease with room to grow at 100 E. Pratt St., the tower that is currently home to T. Rowe Price Group. Last fall, Truist Bank, formed through a merger between SunTrust and BB&T, said it planned to keep its Maryland regional headquarters downtown, at 120 E. Baltimore St., where SunTrust was located. And Alertus Technologies will be moving its headquarters from Beltsville to 10 N. Charles St., a building it bought citing downtown’s accessibility and amenities.
Additionally, about 3,300 workers at a dozen state agencies will be relocated to leased space downtown under a plan announced a year ago by Republican Gov. Larry Hogan.
While the leasing decisions stem from post-pandemic workplace evaluations and a desire to attract talent and encourage employees to return to offices full of upgrades and amenities, businesses say choosing the central business district shows a commitment and renewed confidence not only in those blocks but in the city as a whole.
Wells Fargo has done business in Baltimore for more than a century, entering the market in 1914. Relocating within the city’s central business district shows commitment to Baltimore and Maryland, said John A. Allen, Wells Fargo’s regional bank executive for Maryland and Washington, DC
“We want to be a dominant player in this market,” and that means remaining downtown, Allen said. “We want to be here.”
And many say they’ve been encouraged by momentum in key city projects, such as the redevelopment of Lexington Market opening later this year and the renovation of Royal Farms Arena. Also Friday, the city announced a new series of once-a-month, one-day festivals at the Inner Harbor this summer.
Business leaders, as well as leasing and city officials, said they expect recently announced plans for new ownership and revitalization of Harborplace to further boost both the office market and downtown investment.
Baltimore developer P. David Bramble and his MCB Real Estate firm said earlier this month they have struck a deal to acquire Harborplace, the struggling onetime centerpiece of Baltimore’s Inner Harbor redevelopment in the 1980s, out of receivership. The deal would pave the way for what Bramble described as an extensive redevelopment effort to “completely re-imagine” the faded retail attraction and revitalize the city’s downtown waterfront.
“Having these businesses commit and recommit to downtown, it gives the energy and momentum we need,” said Shelonda Stokes, president of the Downtown Partnership of Baltimore.
Such projects are already sparking more interest in downtown office leasing, even from among businesses currently located outside the city, said Bronwyn LeGette, a senior director at real estate brokerage Cushman & Wakefield, which helped Design Collective in its office search.
“A lot of people do realize that when you’re really competing for talent, that’s really where the epicenter of talent is and wants to be, specifically because they can walk to work, or bike to work or scooter to work,” LeGette said. “There’s more density in downtown Baltimore for that type of lifestyle.”
New investment downtown is expected to help counter a wave of recent or planned corporate relocations out of the central business district, some of which has come as part of downsizing in response to increased remote work as a result of the pandemic.
Danish jeweler Pandora is seeking someone to sublease its office space at 250 W. Pratt St. downtown. Transamerica, which now occupies the top nine floors of 100 Light St., plans to move to just one floor of the Wills Wharf office building in Harbor Point.
T. Rowe Price, headquartered at 100 E. Pratt St. since 1975, broke ground last month on a future 550,000-square-foot headquarters in Harbor Point. And Bank of America plans to move its Baltimore offices from downtown to the Legg Mason Tower in Harbor East.
Wells Fargo executives said they realize they are bucking a trend.
The bank said it plans to relocate all 108 corporate employees currently at St. Paul Street in retail banking and its commercial middle market banking group, which serves business clients. The move likely will start before the St. Paul Street lease expires at the end of the year, bank officials said. It is taking 17,336 square feet and will have signage prominently displayed atop the Calvert Street building.
The bank also plans to close its branch in the current Wells Fargo Tower and is negotiating to open a new branch – likely by the end of the year – in the former Jos. A. Bank Clothiers store space at 100 E. Pratt St., which bank officials said offers prime ground-floor visibility.
After re-evaluating space needs based on changes in the workplace over the past 40 years and more recently during the pandemic, Allen said bank officials decided to leave a building that was built and first occupied by Wells Fargo in 1980. For instance, an entire floor used to be dedicated to training, but now much of that work is done remotely. And the bank’s return-to-office policy now requires just three days a week in the office, but even on designated days, many workers spend more time out meeting with clients.
Derek Lynch, Wells Fargo’s commercial banking leader in Baltimore, who was involved in the new office search, said it was important to stay within the central business district.
“We’re doubling down,” he said. “Baltimore needs to succeed.”
He added that the bank is “bullish” on the Baltimore area’s economy. By midyear, the bank expects to have doubled its loan commitments over 18 months to Maryland business clients in real estate, health care, technology, manufacturing, and port-related and other businesses.
The head of Design Collective, which now has an 85-employee office in Power Plant at the Inner Harbor, said he thought it was important for the firm to remain downtown, where it moved 30 years ago from Columbia. The lease for nearly two floors at 100 E. Pratt comes with building amenities, such as a fitness center, cafe and coffee shop, harbor views and walkable amenities, said Fred Marino, the firm’s president and CEO.
“A lot of our employees live in the surrounding neighborhoods, and so we wanted to be centrally located, because a lot of them ride their bikes to work, too,” Marino said. “We looked all over the city, but for a lot of reasons, it seemed to make sense to stay in the downtown. We’re hoping to be a part of the new growth and revitalization that we’re hoping to see here in the downtown Baltimore area. ”
The company will lease about the same amount of space, nearly 27,000 square feet with capacity to grow. Though employees have the option to work remotely two days a week, the firm believes in the future of the office.
“In our profession, there’s nothing like being in the office and being surrounded by other architects where you can learn from one another on a day-to-day basis,” Marino said.
Brookfield Properties, owner of 111 S. Calvert, said the 265,000-square-feet of office space there will be 80% occupied with the addition of Wells Fargo and other new tenants announced last week. They include SIA Solutions, an engineering and consulting firm, and the law firm Evert Weathersby Houff, Brookfield said. Current tenants include Ballard Spahr, Cigna Health, Lupine Pharmaceuticals and Niles, Barton & Wilmer.
The building at Pratt and Calvert streets also includes the now shuttered Gallery mall and a five-level underground parking garage. Brookfield closed the mall at the end of the year and is continuing to explore plans for the multilevel space, a Brookfield executive said.
The building’s leasing momentum follows the final fall of a $ 12 million revamp of the office space with upgrades such as health and wellness amenities, said Robert Swennes, executive vice president and head of the mid-Atlantic and southeast regions for Brookfield Properties.
“What they want is more of a hotel-like feel,” Swennes said. “We’ve found people coming back to the office, leadership wants something appealing to get their employees back. This is an engaging place to come to work. ”
Renovations included several move-in-ready office suites, a 24th floor lounge that includes a coffee bar and pantry, a private wellness room for nursing parents, a 45-person conference room, and a 17th floor lounge with a terrace and a fitness center with locker rooms, showers, towel service and Peloton bikes.
The Evening Sun
Get your evening news in your e-mail inbox. Get all the top news and sports from the baltimoresun.com.
Not all office tenants are downsizing in the wake of the pandemic and increased remote work, Swennes said. As leases come due, some tenants want more space and others have not changed requirements, he said.
Some businesses may have reduced their space needs but are still out in the market seeking upgraded or more flexible space, said Colin Tarbert, president and CEO of the Baltimore Development Corp. Some are moving within downtown.
“A lot of businesses are re-thinking their office space in general,” Tarbert said. “Generally, businesses are creating more flexible workspaces for employees that might not be coming to the office five days a week.”
Many organizations looking downtown are re-imagining their space to be more about collaboration, said Cushman & Wakefield’s LeGette.
“These spaces are more about face-to-face, collaboration, technology … access to daylight, walkable amenities,” such as the harbor, she said. “They can just walk right out the door and hit a promenade that has 7 1/2 miles of walkable waterfront.”
Swennes said Brookfield, one of the nation’s largest owners of office real estate, remains focused on downtowns, such as Baltimore’s, that offer both access and desirable views.
Downtown Baltimore “has had some challenges on the retail front,” he said, “but … we think it’s an incredibly dynamic place to come and work.”