Downtown Baltimore is no longer just a business and tourist destination.
Last year, the Downtown Partnership of Baltimore projected demand for 7,400 new residential units “downtown” ? the mile radius of Pratt and Light streets ? between 2006 and 2012. Employment gains in Baltimore?s life science sector, which is expected to add thousands of downtown jobs in the next five years, should spur demand for downtown living.
There is concern about residential supply meeting demand, though. About 500 new downtown residential units were delivered in 2007, and about 3,700 units were delivered or were expected to be delivered in 2008 and beyond ? a total of about 4,200 units and “well shy” of what Downtown Partnership predicts will be needed by 2012, according to the organization?s State of Downtown Report.
And some of those new units being delivered include luxury condominiums that might be too pricey for new downtown residents. The Ritz Carlton Residences, for example, opening soon on the Inner Harbor, includes 192 condos that will range in price from $1.6 million to $5 million.
The remainder of 2008 seems as if it will be similar to 2004, when there was “a pause” after years of intense residential building, said Marjorie Rodgers Cheshire, executive vice president of A & R Development Corp., a real estate developer in Baltimore and Washington, D.C.
“That type of slowdown is a natural part of the building cycle,” Rodgers Cheshire said. “The challenger now is to continue to meet the demand with consistent supply.”
Downtown Baltimore, with increasingretail and recreational space, has become a desirable living destination for city workers, said Anna Custer, executive director of Live Baltimore Home Center. Excess demand could be good news for downtown?s surrounding neighborhoods.
“If the numbers don?t meet the predicted demand, we might see some spillover in other neighborhoods,” Custer said. “Certainly there are a number of places ? like Fells Point and East Baltimore ? that can help buffer those numbers.”
The appeal of waterfront residential living and job increases fueled by Baltimore?s life science and education sectors and Base Realignment and Closure will cause demand to increase, said Richard Clinch, a University of Baltimore economist. The wild card, though, is if a national economic slowdown and any regional economic slowdown will cause revisions in downtown housing demand and supply over the next five years.
“There?s definitely going to be more demand than we?ve seen in recent years,” Clinch said. “The good news is that people are coming back to the city.”
