The Baltimore City Council on Monday granted preliminary approval to more than $20 million in tax breaks for the long-stalled "Superblock" development.
The council's unanimous vote provides for $22.1 million in tax breaks to the developer, Lexington Square Partners LLC. A vote for final approval is expected Thursday.
"Hopefully, this project will reignite the growth of the central business district," said City Councilman
Lexington Square Partners has promised local hiring initiatives and profit-sharing with the city, Stokes said.
If the legislation receives final approval by the council, the project — called Lexington Square — would receive a discount on its property taxes for 20 years.
"It's a major project that will bring 24-hour life to the Westside," said Kim Clark, executive vice president of the Baltimore Development Corp. "This block has been mostly vacant for several years and the project will bring energy back to the area. The Lexington Square project is key to the revitalization of the area."
The PILOT would allow the city to assess taxes on the unimproved value of the property, plus 5 percent of improvements, for the first 15 years. Then the tax rate would rise gradually over the remaining five years of the plan.
The tax break would cover only the apartments and garage space in the development.
The developer, Lexington Square Partners LLC, has said the mixed-use complex near Lexington and Howard streets will contain 296 apartments and 650 parking spots. More than 200,000 square feet of retail space also is planned for the project.
The property currently does not generate any property taxes because it is owned by the city.
The city's Department of Finance, relying on calculations by the Baltimore Development Corp., said in its analysis of the tax incentive bill that Lexington Square's apartments and garage would produce more than $48 million in revenue for the city under the 20-year PILOT plan.
The Lexington Square project has been stalled because of lawsuits since 2007, when the Board of Estimates first approved a land disposition agreement between the city and Lexington Square Partners.
Construction of the "Superblock" will cost about $150 million, according to the developer's projections. The development group has said it will invest about $35 million of cash into the project and use tax credits and bank loans for the balance.
At a Taxation, Finance and Economic Development Committee hearing in September, Harold Dawson Jr., a representative of Lexington Square Partners, told members of the council that his development group would be able to get a construction loan for the site after the PILOT is approved.