After years of sitting on Baltimore’s big pit, will this developer finally get a tax break?

In almost any other major East Coast city, a 1.2-acre lot atop a subway station in the middle of downtown would be a developer’s dream.

In Baltimore, it’s a big, empty pit. But a new tax break might finally change that.

For more than a decade, 1 W. Baltimore St. has been an eyesore — a fenced-off city block whose only cosmetic upgrade is a layer of artificial grass. The site was once home to the Morris A. Mechanic Theatre, a key part of downtown’s Charles Center revival in the 1960s. The Brutalist structure with its blocky concrete exterior was divisive from the day it opened.

The theater closed in 2004, and David S. Brown Enterprises, an Owings Mills-based development firm, bought the property months later for $6 million. In 2012, the company’s chairman, Howard S. Brown, unveiled plans for two apartment towers and retail space. After a contentious preservation fight, Brown’s firm demolished the theater in 2014.

Then nothing happened.

Initially, Brown blamed litigation over a nearby underground parking lot. Then it was taxes. Baltimore has the highest property tax rate in Maryland.

“Without a PILOT in the city, you can’t make the numbers work,” Brown told The Baltimore Business Journal in 2018, referencing an incentive known as payment in lieu of taxes.

“We would love to do something there, but we need some incentives,” Brown again told the business publication in 2022. “We’re open to talking with anybody.”

Now it seems as if Brown will finally get what he wanted. The Maryland General Assembly passed a bill this year making it easy for Baltimore to award PILOTs to downtown property owners.

David S. Brown Enterprises did not respond to multiple requests for comment, but city officials said they are in touch with the company about a potential PILOT agreement.

Roy Broderick, the Baltimore Development Corp.’s chief business officer, said the Mechanic Theatre site is “one of our top priorities” and the development corporation is “super excited.”

Jonas Poggi, a spokesperson for Mayor Brandon Scott, said it’s possible the Mechanic Theatre site will be labeled a TOD, short for transit-oriented development, which could provide further incentives for the company.

“This is another example of Mayor Scott’s commitment to driving investments that will build a stronger, more vibrant Downtown,” Poggi wrote in an email to The Banner.

Should the company get a PILOT under the terms of the newly passed law, it would be a boon after decades of speculation.

Under the law, downtown properties that receive PILOTs would have their tax bills frozen at their current level for a period not to exceed 25 years. By keeping the site a vacant lot, David S. Brown Enterprises has paid an annual tax bill equivalent to a well-kept home in Roland Park.

Tax records show 1 W. Baltimore St. is valued at about $1.1 million and paid about $27,500 in property tax last year. For comparison, the 334-unit mixed-used tower at nearby 1 Light St., which also receives tax breaks, is valued at $97.7 million and paid $942,000 in property tax.

Terri Harrington, a Baltimore-based commercial real estate broker, called the former Mechanic Theatre site “a missing tooth in downtown.” Harrington said she’s hopeful the new PILOT will be enough to catalyze a development there.

One person who supported David S. Brown Enterprises’ efforts to tear down the Mechanic is demanding action at the pit.

Courtenay Jenkins, an executive director with the Baltimore branch of global real estate giant Cushman & Wakefield, testified in support of the Mechanic’s demolition only to later become outspokenly critical.

Reached by phone, Jenkins said Brown can no longer rationalize keeping the site as a fenced-off pit.

“I would be very disappointed to think he doesn’t have a viable project after all he went through to tear that site down,” Jenkins said. “And now that he has a PILOT, what’s keeping him from developing it? What possible excuse could he have?”

And, if Brown doesn’t put forth a plan for the site, someone should force his hand, Jenkins said.

To Klaus Philipsen, a longtime Baltimore architect who writes about the city and urban design, the pit has become a symbol of Baltimore’s impotence.

It could have been a green space, a temporary park or pretty much anything other than a hole in the ground, Philipsen said, adding that the city should “play hardball” with Brown if the firm doesn’t act.

A few years ago, when Brown spoke publicly about the redevelopment of Security Square Mall in Baltimore County, Philipsen said he pressed the developer, asking why he hadn’t done anything with the pit downtown. Brown replied that it “just doesn’t pencil out,” Philipsen recalled

“Well, sell the damn site,” he said he shot back.

According to Philipsen, Brown said his company doesn’t sell its assets.

Brown’s strategy could soon be doubly rewarded.

That’s because David S. Brown Enterprises owns a second, smaller empty lot downtown in the 300 block of West Baltimore Street.

As it has with the Mechanic Theatre site, the firm has bided its time — in this case two decades — buying parcels one at a time to create a half-acre lot. There are plans for another mixed-use tower at this site, but the project has never gotten off the ground.

It, too, could be eligible for the new downtown tax break.