Caves Valley Partners Proposes Modified Plan for the Redevelopment of Cross Street Market in Federal Hill
Last month Caves Valley Partners (CVP) announced it was pulling out of an agreement with the Baltimore Public Markets Corporation (BPMC) to complete a $6.5 million redevelopment of the 31,800 sq. ft. Cross Street Market in Federal Hill. Today, however, Arsh Mirmiran of CVP told SouthBMore.com that he and his team will now be moving forward with a new plan which Mirmiran believes will address many of the concerns in the community.
“A rotting market isn’t good for anyone in the area,” said Mirmiran. “So, we are going forward with a modified plan to redevelop it.”
Rendering courtesy of Caves Valley Partners and Brown Craig Turner
BPMC began its effort to find a developer of the market in January 2015 when it issued a request for proposals. It selected the team of CVP and Scott Plank’s War Horse in June 2015, the only group to submit an offer with all the requirements according to BPMC, and reached a deal with only CVP in November 2016. CVP took over management of market on January 1st and hired Mackenzie to handle day-to-day operations.
CVP never officially ended its agreement with BPMC. As the termination documents were being drafted, Mirmiran and the CVP team received “email after email” from area residents asking them to reconsider. “I must have received 50 emails, many from complete strangers,” Mirmiran told SouthBMore.com. “Many people said they assumed that since CVP was involved, we would get it done and that they took it for granted. They pledged to be vocally supportive if we reconsider.”
Councilman Eric Costello publicly voiced his disappointment when CVP announced it was walking away.
Support of CVP’s Cross Street Market plan, and frustration that it seemingly was not going to come to fruition, has been evident in recent weeks on many Federal Hill area Facebook groups, as well as on the comments of SouthBMore.com’s social media accounts. Ideas have been shared by residents online about how to revive the plan and many have asked whom they should contact to voice their displeasure. A petition launched yesterday entitled Redevelop Cross St Market Now has also gained more than 600 supporters, many of whom have left comments about the state of the market and its need for improvements. The key call to action of this petition is asking Maryland State Senator Bill Ferguson to drop the restrictions and fees on the liquor license for the market.
CVP is pursuing a market-wide liquor license for the project, which CVP said at public meetings was a deal breaker if it didn’t pan out. There is a moratorium on new liquor licenses in the Federal Hill Business District where there are currently 40 licenses. Given this, a state bill was needed to obtain a new license.
A bill drafted by the Maryland General Assembly District 46 Representatives of Senator Ferguson and Delegates Luke Clippinger, Robbyn Lewis and Brooke Lierman, titled Baltimore City – 46th District Alcoholic Beverages Act 2017, is what led to CVP walking away from the deal. The bill required a $50,000 per year fee for the liquor license unless CVP could obtain and extinguish an existing liquor license in Federal Hill. This fee was reduced to $20,000 per year if CVP obtained and extinguished one Federal Hill liquor license and $10,000 if CVP obtained and extinguished two Federal Hill liquor licenses. With the license, last call would be at 10pm on Sunday through Thursday and 1130pm on Fridays and Saturdays. Delegate Clippinger was present at the Cross Street Market Advisory Committee meetings and gathered input from area neighborhood groups and attendees.
Mirmiran told SouthBMore.com last month that the “fees speak for themselves” and that this is “the deal the representatives felt the community wanted.” Mount Vernon Marketplace’s license in comparison has an annual fee of less than $3,000 per year. Horseshoe Casino Baltimore has an annual fee of $15,000 that allows 24-hour service of alcoholic drinks in its 335,000 sq. ft. facility.
Currently 43% of the market is occupied by businesses that allow the consumption of alcohol. The new bill required that number to be 35%. CVP was willing to agree to 30% of the market, not including its 5,000-7,500 sq. ft. “sit-down restaurant.” The bill also proposed no liquor sales for the first two years, which CVP wasn’t willing to agree to.
Mirmiran said he has had baseline discussions with Senator Ferguson and Delegate Clippinger about modifications to this bill, and that CVP is fine with fees that are in line with Mount Vernon Marketplace and Belvedere Square Market.
Delegate Clippinger told SouthBMore.com the following in an email:
Over the last several months, the entire Delegation has listened to the concerns of members of the community regarding Cross Street Market. We drafted language for a potential liquor license for the facility that we believed addressed concerns and could encourage further discussion and compromise between the community and the operator.
Upon Caves Valley’s leaving the deal, the Delegation introduced the 46th District Alcoholic Beverages Act without language that would allow for a further liquor license at Cross Street Market. The Alcoholic Beverages Subcommittee of the House Economic Matters Committee passed the bill (HB 1348) Monday, and the full committee approved the bill on Thursday. The legislation will be heard by the full House next week.
Caves Valley asked to meet with the Delegation after leaving the deal to discuss the multiple factors and structural problems that led them to conclude that their project as currently conceived wouldn’t work. We continue to be open to proposals or plans that revitalize the market and respect and balance the many interests that impact this community asset.
Mirmiran told SouthBMore.com the liquor license situation must be resolved this year in order for CVP to move forward. The Maryland General Assembly 2017 Session ends on April 10th.
CVP’s new plan will address what Mirmiran feels were the three “sticking points for opposition” from members of the community: 1.) the situation with Nick’s Inner Harbor Seafood, 2.) the appearance existing tenants wouldn’t be able to stay, and 3.) the liquor license.
Nick’s Inner Harbor Seafood
Nick’s and CVP became involved in a legal matter after CVP terminated Nick’s lease which has six and a half years left on it according to Nick’s Co-owner Kwang Lee. Mirmiran said at the January Cross Street Market Advisory Committee meeting that the termination was due to health code violations. In a formal letter to CVP, the Baltimore City Health Department previously stated that Nick’s had “at least 2 Critical Violations and 137 Good Retail Practice Violations.”
Nick’s has never been fined or shut down according to Lee and he noted that “every time the Health Department comes in, they find something” and that “it’s an education process.”
This was expected to play out at District Court of Maryland, but now CVP is looking to start fresh with Nick’s. “We originally designed the market around Nick’s and had always intended for them to stay. None of this had to do with their liquor license,” said Mirmiran. Nick’s owns a seven-day, 1 am beer/wine license.
“We are willing to work with them if they are willing to physically improve their space and operation, and collaborate with other tenants,” said Mirmiran. “We can solve the cleanliness problem in the market with the refresh we are doing, but it has to be kept clean.”
The Nick’s team was relieved and joyous when CVP first announced it was walking away from the redevelopment last month. Nick’s received an outpouring of community support during its legal dispute with CVP.
“There was the appearance that the current merchants wouldn’t make it between the ten-month shutdown and the increased rents,” Mirmiran told SouthBMore.com. CVP was going to shut down the entire market during the renovation so it could completely dig up the floor, update the plumbing, and change the layout. Now, CVP is aiming to keep the layout mostly the same with the aisle remaining down the middle of the market, as opposed to on the south side of the market as it was proposed in the previous plan. This will allow tenants to remain open during the renovation, but Mirmiran noted most tenants would have to relocate within the market before completion.
The $6.5 million renovation was to include outdoor seating on Cross St., likely eliminating six parking spaces; more natural light including new windows and glass garage doors facing Cross St.; updated utilities; a common seating area with approximately 100 seats; and facade improvements. CVP was aiming for 25 to 30 tenants within the market, with a mix of all the types of vendors that would make up a replacement for a grocery store, plus dine-in and carryout food tenants.
The plan will still have a common seating area, most likely on the south side of the market, and will still have improved natural light, though not as much as in the previous plan. Mirmiran told SouthBMore.com he would like to still have outdoor seating, and that exterior improvements will still take place. CVP will continue to aim for the same tenant mix.
The new plan will cost less than the original plan, but CVP is still working with its engineers and architect Brown Craig Tuner to determine the new cost.
The building needs $2.5 million in utility work to get it up to code according to CVP. Baltimore City has agreed to commit $2 million for these updates.
“I’m confident it’s still going to be Baltimore’s best market,” said Mirmiran. He noted, however, it will likely not be the regional draw CVP had originally planned.
Regarding rent prices, Mirmiran said less capital improvement costs should lead to some decreases in proposed rent costs. Mirmiran said he is willing to work with tenants on trial rents to see if they can make it at the new market. “They’ll have a period of time where they will pay a lower rent to see if they can afford the higher rent with the market doing as well as we expect,” said Mirmiran. “If they can’t make it, they can choose to leave, or we can see if we can find a solution in between.”
Mimiran said rents will be in line with Mount Vernon Marketplace, Belvedere Market, and R. House.
Mirmiran is also working with the State Delegation to see if there are funding sources available to help the tenants with stall improvements. This would be handled between the State, BPMC, and the merchants, not CVP.
Mirmiran told SouthBMore.com he would be meeting with the existing merchants this week to discuss.
The existing merchants have been represented by Attorney John C. Murphy.
SouthBMore.com stopped by the market after news last month that CVP would be walking away. The mood was mostly joyous as most of the vendors were happy to see that the deal would not move forward, but the merchants reiterated their desire to see a new plan that would improve the market and they wanted to be more involved in the process. A rally was held last month with more than 200 people expressing their support of the 17 existing merchants at Cross Street Market. There was also a petition titled “Help secure the future of the existing tenants at the Cross Street Market” that had 731 supporters online and a large list of physical signatures at the Cross Street Market.
SouthBMore.com will follow up with merchants at the Cross Street Market to get their reactions about the new plan.
Mirmiran has been troubled by the messaging by some in the community that Cross Street Market would be a 30,000 sq. ft. mega bar. “If we said for three years we were going to create a market and then created a bar, we would lose all of our credibility. We have so many projects in Baltimore City and it would be incredibly foolish for our reputation to turn Cross Street Market into a bar,” said Mirmiran. “There’s no validity to it. The area has enough bars, it needs balance.”
CVP also owns the mixed-use 1111 Light Street development, which is adjacent to the market, and is under construction on Stadium Square, a $275 million-project two blocks west of the market.
Mirmiran told SouthBMore.com CVP is willing to commit to 60% food sales at the market. He said the liquor license would likely be used for Nick’s, as well as for specialty drinks at a local coffee shop, for drinks at a new breakfast place, for drinks at a BBQ restaurant, for craft cocktails at a new stall, and for craft beer at a new stall.
An online petition entitled DON’T LET CAVES VALLEY TURN CROSS STREET MARKET INTO A 30,000 SQUARE FOOT BAR MALL! was started four weeks ago and has 137 signatures.
CVP does not yet have a new timeline as it works though the details, and with all involved parties, on the new plan. Mirmiran said his leasing team at Cana Development has kept in touch with the new merchants they had commitments from and he believes the project will still be attractive to these tenants, as well as other prospective new tenants.
Mirmiran told SouthBMore.com last month that CVP had existing tenant Pretzel Twist signed to a new deal at the Cross Street Market as well as agreements with a new BBQ vendor, chicken vendor, two Asian-concept vendors, a pie vendor, an ice cream vendor, a doughnut vendor, two breakfast vendors, a New York-style pizza vendor, and a local coffee vendor.
Mirmiran noted that CVP and its team “need supporters to be vocally supportive this time around.”
SouthBMore.com will follow this story as it develops.