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Business & Developmentby Ed Gunts and Fern Shen11:01 amJun 21, 20190

Amid Jonestown’s high hopes, concern about the stalled Hendler Creamery project

Community leaders ask what’s going on with a politically-connected developer’s project that some say was “a reach from the beginning”

Above: Work on a redevelopment of the historic Hendler building has been stalled for months. (Ed Gunts)

Visitors to the fourth annual Jonestown Festival this weekend are likely to notice some impressive additions to the historic East Baltimore community:

There’s the relocated Ronald McDonald House, the National Aquarium’s Animal Care and Rescue Center and a new children’s playground.

But there is also a glaring sight, right where the biggest change of all was supposed to have taken place:

A pile of rubble and a propped-up building shell at the former Hendler Creamery at 1100 East Baltimore Street, where work on a $75 million redevelopment stopped about eight months ago.

“I don’t know what’s going on,” said Dwight Warren, executive director of The McKim Center, a community organization that’s part of the Jonestown Planning Council and has offices in the historic McKim building next to the Hendler property.

Warren and other community leaders say they have asked city officials and others about the status of the project and haven’t gotten a clear answer. “They just say it’s been put on hold,” he said.

“I’m concerned about it as a historic site, and I’m concerned about it as a part of the growth of Jonestown,” said Marvin Pinkert, executive director of the Jewish Museum of Maryland, whose campus is one block from the Hendler property.

“The community is upset,” said Malik Jordan, president of Historic Jonestown Inc. and the Jonestown Planning Council. “I guess ‘frustrated’ is a better term. Not just about the lack of construction, but the lack of communication.”
The Jonestown Festival will take place this Sunday, June 23, from noon to 4 p.m. at the Star Spangled Banner Flag House, 844 East Pratt Street. Besides crafts, performances and food vendors, it will feature a Hamilton sing along – underscoring Jonestown’s link to American history.
The Brew was unable to reach Commercial Group CEO Kevin M. Johnson, the project’s developer – who has had a bulging portfolio in recent years amid strong ties to the last two mayors, Catherine Pugh and Stephanie Rawlings-Blake.

A woman who answered the phone at Johnson’s office in Hanover said he was unavailable and refused to take a message for him.

She referred the call to an associate, Danny Frasco. He did not respond to a request for information about the project.

Hendler (Ed Gunts)

The site of the Hendler Creamery project in East Baltimore’s Jonestown, where workers disappeared and construction equipment was removed months ago. (Ed Gunts)

A Connected Contractor

The response from Commercial was the same earlier this year when The Brew disclosed that Johnson’s Commercial Construction LLC had renovated – at a steeply discounted price – Mayor Catherine Pugh’s home in Ashburton.

The Board of Estimates, led by Pugh, later doubled the price of an underground conduit contract co-managed by Commercial from $26 million to $50 million.

The conduit contract had been non-compliant and subject to heavy fines by the city Department of Transportation when Pugh and then-City Council President Bernard C. “Jack” Young voted for the price bump-up, The Brew also reported.

Among the company’s backers, The Brew also disclosed, was Columbia businessman J.P. Grant, who has forged strong ties to mayoral administrations through years of campaign contributions and master lease and refinancing transactions for the city.

(Pugh resigned in May following an FBI raid on her home in the wake of reports about her undisclosed sale of her self-published Healthy Holly books to the University of Maryland Medical System and to Grant, among others.)

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Catherine Pugh’s house in Ashburton, where Kevin Johnson’s Commercial Group did major renovations at a steep discount, The Brew disclosed. (Fern Shen)

Johnson was more forthcoming in the early stages of the Hendler project, a plan to convert the former ice cream packing plant to “The Hendler,” a mixed-use development with 296 apartments, 218 parking spaces and 20,000 square feet of retail space.

The project was noteworthy because it was designed to be a “building within a building,” with many of the apartments located inside the shell of the original Hendler building, which dates to the 1890s.

“We have worked . . . diligently to save the fabric of the building,” Johnson said in a 2017 appearance before Baltimore’s Commission for Historical and Architectural Preservation, which had to approve the project because the property is within the city’s Jonestown Historic District.

“I really am moved by your support,” Johnson told commission members after they voted in favor of the design.

Hendler (Ed Gunts)

Some of its neighbors wonder whether the propped-up facade of the 125-year-old Hendler building is stable. (Ed Gunts)

Piles of Rubble

The Hendler project was the most ambitious of several planned for Jonestown, a historic community just east of downtown and north of the Inner Harbor waterfront hoping to lift up its profile beyond homeless shelters and soup kitchens. The tall brick Phoenix Shot Tower is a neighborhood landmark.

But the redevelopment stalled, as the Daily Record first noted in May.

While the Hendler has languished, other projects have been completed, including the $30 million Ronald McDonald House and the Aquarium’s $16 million Animal Care building.

Johnson has said he was aiming to complete construction in the third quarter of 2019. But as that milestone approaches, The Hendler project – intended for a full city block – hasn’t taken shape at all.

There has been no construction activity at the site for months and the construction equipment has been removed.

All that’s left are piles of rubble from a former Volunteers of America building, three walls of the Hendler building and construction fencing that still bears signs with the name of a Commercial Group affiliate, “Commercial Development.”

“If a bad windstorm comes along, all of it’s going to come tumbling down.”

Warren said the developer had promised to help fix up the McKim property as part of its project, but that never happened. Now he’s concerned about the safety of the Hendler building’s outer walls, which are held up by diagonal bracing.

“If a bad windstorm comes along, all of it’s going to come tumbling down,” he said.

Oversaturated Market?

Competition for financing with other city apartment projects may be the reason Hendler has stalled, said Joe Cronyn, former president of the Jonestown Planning Council.

“There is a huge amount of multi-family housing going on with a market that, from an outsider’s point of view, is somewhat saturated,” Cronyn said. “This was not the most desirable project to finance . . . this project was a reach from the beginning.”

A city official made that same observation in 2013, when Johnson persuaded the Baltimore Development Corp. to sell him – for $180,000 –  a warehouse he needed for the Hendler project that had been appraised at $455,000.

“We have a substantial question [of whether] the market will deliver the rentals projected by the developer,” Deborah Hunt Devan warned fellow BDC board members at the time.

To Jordan, the planning council president, the Hendler project represents a missed opportunity for the city.

He said East Baltimore has seen new housing along the waterfront and in place of public housing, but the Hendler would have shown that it is possible to create market-rate housing alongside institutions that help the needy, such as the Helping Up Mission.

“This was one of the pieces that was going to open up the area for more investment. It was going to be a classic example of how you do infill development without uprooting anybody.”

But the developer’s economic projections were too optimistic and construction costs were too high, he said. The same amenities that were designed to attract residents, he notes, added to the price of building the apartments.

“They can’t afford to build it,” he said. “It’s been over-designed . . . It’s like they were building a New York luxury apartment instead of thinking more market-based.”

Jordan said the community’s biggest frustration is that Johnson hasn’t met with anybody from the neighborhood to explain what’s going on.

He said the planning council has asked Johnson to come to one of its meetings so members can get a briefing, but he has never come. Group members were at least hoping to see Johnson at the recent ribbon cutting for the Ronald McDonald House, Jordan said, but he never showed up.

Meteoric Rise

A relatively obscure drywall company until about seven years ago, Commercial has raised its profile in a number of city projects, including the long-delayed Greyhound Bus Station, which Johnson wrested away from low bidder Roy Kirby & Sons.

A big boost to Johnson’s company was securing the construction management contract for the Maryland Live! casino opened at Arundel Mills by David Cordish and the Cordish Companies.

Kevin Johnson seated with then-Mayor Rawlings-Blake at a 2011 Urban League gala whee he won an award for

Kevin Johnson seated with then-Mayor Rawlings-Blake at a 2011 Urban League gala. (Brew file photo)

Pushed by the Rawlings-Blake administration to use Commercial “for site and shell-work,” the developers of the city project to bring a ShopRite supermarket to Howard Park said the company was responsible for delays.

“His integrity, business acumen and philosophy of giving back to his employees and the community has resulted in Commercial Group earning a reputation as one of the most highly sought after and respected companies in the Mid-Atlantic construction industry,” the company’s website states, referring to its CEO, Johnson.

The site lists a number of companies that Commercial has worked with as a subcontractor: the Whiting Turner Contracting Company, Gilbane Building Company and Armada Hoffler, among others.

For New East Baltimore, Commercial Interiors was a subcontractor on the John G. Rangos Building, one of the first structures in the 88-acre East Baltimore Development Inc. (EBDI) renewal area north of the Johns Hopkins medical campus.

A prolific financial supporter of local politicians, Johnson and affiliated entities contributed significantly to Stephanie Rawlings-Blake during her rapid rise from City Council member to mayor and to Catherine Pugh’s 2016 run for mayor.

Other Projects

The Hendler is one of a number of Baltimore City projects with which Commercial Group has been associated recently.

The company is the designated builder of 1234 McElderry, a 104-unit subsidized apartment building planned four blocks north of the Hendler development at the cleared site of the former Somerset Homes.

Another prospective project is the conversion to residences of the historic Tractor Building at Clipper Mill.

In January, Valstone Partners, the owner of much of the land at Clipper Mill, told members of the Woodberry Community Association that it had selected Kevin Johnson and Commercial Development to lead the effort to transform the Tractor Building.

Preliminary plans call for the building to contain 99 rental apartments and some street-level commercial space.

Asked whether Commercial is still working on the Tractor Building given its lack of progress on the Hendler site, a representative for Clipper Mill declined to comment.
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