More Market House Madness

Just when you didn't think things could get any worse with the Market House situation in Annapolis, the management company operating the facility sues the City for $2 million. Site Realty Group, which won the lease for the prime property on Annapolis' harbor a couple of years ago, is suing the City for $2 million, alleging that the bungled air conditioning situation has cost them lost rent. They are also asserting that the City didn't allow them to rent sidewalk space to vendors.

With regard to the insufficient air conditioning, the City's defense appears to be that they had negotiated a situation with Site Realty whereby the unit would be fixed in January 2008, after the heavy shopping season. In the case of the absent sidewalk stalls, the Mayor claims never to have been made aware of such provisions. To be fair, I had never heard discussions of sidewalk rentals mentioned before either. Of course, I've never read the contract.

My understanding is that the situation is so bad now, that the Market House will be closed during weekdays through the winter. How the City can continue to screw up this situation, which really should have been a boon to downtown, is beyond me. It's almost as vexing as how the Mayor can allow those who got the City into this mess to stay in its employ.

The Man Behind The Market House

During the course of Ellen Moyer's 5-year tenure as Mayor of Annapolis, few issues have created as much heat for the administration as has the mishandling of the renovation and leasing of the Market House. During the 2005 election, her opponents bludgeoned her with the issue, and every time it seems like it's been laid to rest, it pops back into the papers.

There's no question that the Mayor deserves a good deal of the responsibility for how the matter has been handled, but the day to day details like handling the property's lease, making sure the renovation goes smoothly, and working with surrounding businesses to ease their discomfort throughout the process should not primarily be hers. They should be delegated to someone like the City Administrator, Robert Agee, who can carry them out competently on behalf of the Mayor.

Unfortunately, it appears that they have been delegated, but not acted on competently.

The latest embarrassment concerns Administrator Agee giving away, rent free, two prime parking spaces in the Market space to two downtown tour companies, Annapolis Carriage and Discover Annapolis Tours. As Chairman of the Parking Board, Chuck Weikel said, "There is an equity issue there. Nobody is paying for it." Of course, the employees and owners of the other businesses in the surrounding area either have to pay to park in a local garage or feed meters when they come downtown to work, a situation made worse by the fact that City Department of Central Services bungled the air conditioning calculations on the Market House. The temporary generator and air-conditioning unit currently occupy four additional parking spots at the Market space.

At almost every step, the Market House transition has been botched. It's disappointing to see that the City Administration has such a difficult time learning from its mistakes.

More Market House Mayhem

Today, the Baltimore Sun reported that the City of Annapolis had received 7 bids to redevelop the Market House down by city dock. The bidders are the Site Realty Group, which operates Eastern Market in Washington; the New Market Group, led by Annapolis business partners Gavin Buckley and Jody Danek; H.B. Properties, led by Annapolis restaurateur Harvey Blonder; O'Leary's Seafood in Annapolis; Foundos Realty in Annapolis; Siganos Management of Northfield, N.J.; and Caribee Associates LLC of Ocean City.

In the wake of the Dean & DeLuca debacle, the City (read, the Mayor) is anxious to get this issue dealt with as quickly as possible, though it seems unlikely to be resolved before the November 8th election.

The list of bidders has some interesting prospects. The folks at Eastern Market have done a great job there, and as I've said in the past, would likely turn the Market House into a real asset for the City. The other bidding team that has me intrigued is the New Market Group. Buckley and Danek have done a beautiful job restoring the "West Street Four", now Lemongrass, Metropolitan, a salon, and a couple of boutique shops. They also own the successful Tsunami a bit closer in on West Street. These two are among the leading local entrepeneurs, possessing both a respect for the City's past as well as a constructive vision for its future. My guess is that losing the Dean & DeLuca contract will ending up being better for the City in the long term.

Dean & DeLuca the Other Way

A long, long time ago, like decades and decades ago, the family that owned the property where the Market House currently sits deeded the property to the City of Annapolis with the specification, roughly, that it remain a market to serve city residents. Those long ago owners had remarkable foresight. One wonders if they foresaw how difficult it would be for the City to live up to that required mission. There is no question downtown Annapolis needs a location, in walking distance of downtown homes, that can provide basic foodstuffs and groceries. Given the wild success of farmers' markets all across the County, it's difficult to understand why there weren't stronger recent efforts to make room in the Market House's stalls for local farmers.

After removing the various vendors who recently occupied the Market House, the City put the management of the space out to bid. Apparently, only two qualified bids came in, one from Dean & DeLuca, an upscale gourmet grocer, and the other from the group that runs Eastern Market in Washington, DC. I'll confess to a strong preference for the Eastern Market group. While Dean & DeLuca may have a more polished and refined image, as anyone who has been to Eastern Market can attest, it possesses a local character and bazar-like atmosphere that is really a pleasure to behold. By comparison, Dean & DeLuca seems a bit sterile. Nevertheless, for reasons of which I am not fully aware, the City chose to go with the proposal by Dean & DeLuca. The Market House is now boarded up, and undergoing $900,000 in renovations.

The City is apparently offering Dean & DeLuca a real deal on the property ($20 a sq/ft as opposed to a going rate of $40 sq/ft). Dean & DeLuca will have a 20-year lease, where they pay the City $100,000 per year, adjusted for inflation. I'm of a mixed mind on the "deal." Under normal circumstances, I'd oppose any sort of favoritism towards businesses in a City-owned space, but this situation is rather unique in that the tenant is obligated to provide certain additional civic goods to the community. The key, really, is going to be to see if the City can ensure that Dean & DeLuca is providing the services that it's obligated to for City residents. Given the City's less than stellar record managing the property in the past, that job may well fall by the wayside.