Under Armour CEO Kevin Plank said Monday that he wants to create a new neighborhood on the waterfront acreage he has assembed in Port Covington, anchored by a relocated Under Armour headquarters and enlivened by shopping, restaurants, a distillery and horse stables.
The Port Covington land secures room for Under Armour to grow unencumbered by space limits and tensions with residents and neighboring businesess, said Plank, who founded the Baltimore-based sports apparel brand, which passed $3 billion in revenue last year.
“I do not want to limit how big of a company or how great of a company Under Armour can be because we’re landlocked,” he said. “It gives us an outlet from here and it allows us to do it from one central place.”
Plank’s first public comments on his ambitions for the South Baltimore peninsula came Monday as several smaller projects get underway.
His real estate firm, Sagamore Development, plans to break ground Wednesday on the Recreation Pier hotel in Fells Point, where it plans to open a 128-room inn around the end of 2016. It is scheduled to present plans Thursday for a rye distillery in Port Covington. The firm is also in the process of converting the former Port Covington Sam’s Club into Under Armour offices, with employees moving in around the end of this year.
Plank said he wants to build a mixed-use community on the waterfront that combines an Under Armour campus with other elements that would draw people to the area. If approved, the Sagamore Spirits distillery would be open for tours and have a restaurant. Sagamore also is talking to the Police Department about building a stable for its horses next to the distillery, helping to evoke Plank’s Sagamore Farm, where he breeds and trains thoroughbred racing horses in Baltimore County.
In addition to the distillery, the area would one day likely have a showcase Under Armour store, drawing visitors from Interstate 95.
“I think what makes a great campus is lots of different elements and not just simply a corporate campus where everyone disappears at 5 or 6 o’clock at night,” he said. “Port Covington has never had any love. It’s a beautiful place. … It just needs someone to give it a hug.”
Plank has assembled more than 120 acres in Port Covington, a former industrial area once largely controlled by the CSX railroad and its predecessors. In the 1980s, the city targeted the area for redevelopment as The Baltimore Sun relocated its presses there, but little development followed until 2002 when Wal-Mart and Sam’s Club opened stores there.
Sagamore’s holdings include both stores, the former Baltimore Sun property, where the newspaper’s printing press still operates, now-crumbling piers on the peninsula’s east side, and the Schuster Concrete facility. Sagamore is also the owner of the Nick’s Fish House property and the adjacent marina.
On land acquisition alone, Sagamore already has invested more than $90 million in the area. Plank declined to discuss specific parcels but said additional purchases are in the works. There’s no firm timeline and a master plan still is being developed.
Sagamore is focused on developing the vacant land first, said Marc Weller, president of Sagamore Development. Negotiations with existing tenants on the site are continuing.
Plank said some, such as the Wal-Mart, may need to relocate to make way for the development.
The Baltimore Sun has a long-term lease on its printing plant, which Sagamore purchased for $46.5 million in December from Tribune Media Co., which retained Tribune Co.’s broadcast and real estate assets last year when it spun off its newspapers as Tribune Publishing Co..
Eventually, Under Armour could consolidate its Baltimore operations in Port Covington, but any final decision about that is years away, Plank said. Under Armour purchased its Tide Point campus in 2011 for $60.5 million.
“We want to create one of the world’s greatest campuses that is filled with vibrancy and includes all the things you would see in a great mixed-use environment as well,” said Weller, a Washington-area developer and friend of Plank’s since their teenage years. “Under Armour is first priority.”
About 2,000 people work at Under Armour’s Tide Point headquarters and in other offices around the city, including Harbor East, Plank said. The firm, which employs about 10,700 people worldwide, also has offices in New York, San Francisco, Portland, Ore., and Austin, Texas.
Baltimore Development Corp. President Bill Cole said he has spoken to Sagamore about the early outlines of what a vision for the area might include. He said he believes Plank’s investment in the area is “great for everybody involved.”
“I don’t think anybody who looks at Port Covington sees its highest and best use as it presently sits,” he said. “The level of investment and interest in making it something a bit more dynamic is great.”
Plank said he decided to go into real estate after being rebuffed by the board of the Baltimore Museum of Industry in 2012 when he proposed an expansion that would have included its Locust Point property. The museum has declined previously to comment on Under Armour’s presentation, saying it has a policy of not discussing private meetings.
“I’m sitting there and I’m thinking to myself this is awful. … They’re stifling our growth,” he said. “How could anyone not want us to grow?”
The rejection came while he was in Dubai, a city that has experienced a massive building boom in the last decade.
“I thought to myself, we could do something like that,” he said. “Number one, I’ve got the engine in Under Armour. Number two … I can afford to make these decisions, so why am I waiting on [the Museum of Industry] board of directors?”
Today, Sagamore Development employs 13 people, Weller said. The firm operates as a unit of Plank Industries, the firm established to handle Plank’s private investments, which is guided by the principle that investments should provide at least some tangential benefit to Under Armour.
Plank said improving the city through investments such as the Recreation Pier hotel will make it easier to attract the best talent to Under Armour, while ensuring a good impression for its visitors. It also allows Under Armour to focus on its core business, he said.
“Obviously, it’s a very delicate line, but it’s one in which our interests are completely aligned,” he said of the balance between his private investments and the publicly traded company, of which he remains the largest shareholder. “The better I make my company, the better I make the city, the better we make this area, it makes it easier to attract people.”
Cole said he expects Plank will have an easier time with his plans to grow in Port Covington than in a crowded residential and industrial area like Locust Point.
“The Port Covington site itself is a much more appealing area because it has far fewer complicating factors,” said Cole, who represented Locust Point as a city councilman before taking the BDC job. “It’s a blank slate for the most part.”
