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Transaction time extended on sale of former Fort Ritchie

August 09, 2005|By TARA REILLY

CASCADE

tarar@herald-mail.com

A Columbia, Md., developer and the PenMar Development Corp. will have as long as 18 more months to complete the sale of the former Fort Ritchie U.S. Army base, a transaction that has been on hold because of a federal court ruling preventing the sale.

PenMar Executive Director Rich Rook said Monday that Corporate Office Properties Trust (COPT) and PenMar have extended the sale agreement by 18 months.

The agreement was to expire today, he said.

"That's a good thing," Rook said of the extension. "That shows that they are committed to moving forward with this."

COPT CEO Rand Griffin could not be reached for comment Monday. Griffin said in May that COPT remained committed to buying the base.

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"We're in this for the long haul," Griffin said at the time.

Rook said COPT approached PenMar about extending the agreement.

PenMar was created by the state in 1997 to redevelop the former base, which the Army shut down in 1998.

The injunction bars the Army from transferring the approximately 630-acre base to PenMar. PenMar agreed to sell the base to COPT in July 2004, but because PenMar cannot yet receive the property from the Army, the sale has been delayed.

The injunction had been in place since 2003, when the U.S. Court of Appeals ruled that the Army and the Department of Education violated legal requirements because an advertisement announcing the property's availability was faulty, according to court documents.

Role Models America Inc., which operated a military-style school for high school dropouts at the base from 2000 to July 2002, filed for the injunction, claiming it wasn't given proper notice that it was possible under federal law for the school to acquire base property at no cost.

Instead, starting in March 2000, Role Models subleased 253,000 square feet from PenMar for about $1.3 million a year.

Under federal guidelines, the military may transfer surplus base properties in conjunction with other federal agencies for uses such as schools, parks and prisons.

The Army and Department of Education claimed in a court filing earlier this year that the advertising process has been corrected and asked that the injunction be lifted. A federal judge in May refused to do so, saying procedural defects still remained in the disposal process.

Rook said he hopes court decisions will fall in PenMar's favor over the next 18 months so the sale can be completed.

"We're hoping that we hear something from the judge before too long," Rook said.

COPT plans to turn the base into a residential and business center.

Rook said COPT will meet with PenMar at 9 a.m. Aug. 22 to present the community center proposal at the former base.

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