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PenMar assumes former Army base, sells to developer

October 06, 2006|by TARA REILLY

CASCADE - PenMar Development Corp. took ownership of the former Fort Ritchie U.S. Army base Thursday morning and promptly sold it to the Columbia, Md., company that plans to build homes and offices on the property.

The transaction comes after eight years of arguments, resignations from the PenMar board of directors and legal battles surrounding the base's transfer from the Army to PenMar.

"Oh, it's hard to take the smile off my face," PenMar executive director Rich Rook said Thursday. "I'm obviously very pleased. It's been a long, arduous run, but it's nice to feel that we've finally been successful."

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

Corporate Office Properties Trust (COPT) purchased the approximately 600-acre base for $5 million. The price will climb to $9 million if COPT doesn't create 1,400 jobs over nine years.

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The company plans to develop 1.7 million square feet of office space and build 673 housing units consisting of apartments, duplexes, condominiums, town houses and single-family homes over 10 to 15 years. COPT also hopes to create 4,500 jobs.

"I'm glad that this has been resolved," Washington County Commissioners President Gregory I. Snook said. "I would say the last time I saw the plan it was good, but I do think it needs to be looked at ... just to make sure everything is current and meets the expectations of everybody."

Before the base may be developed, it must receive Washington County planning approval, and COPT must resolve potential school capacity issues.

Judge Ricardo Urbina, of the U.S. District Court for the District of Columbia, on Sept. 28 dismissed a case against the federal government and lifted an injunction that barred the Army from transferring the base to PenMar, according to a written statement from PenMar.

Former Fort Ritchie tenant Role Models America filed the lawsuit seeking the injunction in 2003.

The U.S. Court of Appeals for the District of Columbia Circuit on Wednesday then dismissed two motions for a new injunction filed by two parties, including Role Models, clearing the way for the base to be transferred, according to PenMar.

The Army transferred the base to PenMar Thursday morning, and PenMar sold it to COPT.

The sale included 498.67 acres on Thursday. The remaining 91.5 acres will be transferred to COPT in March or April 2007, Rook said. The remaining acres are awaiting review by the Environmental Protection Agency and Maryland Department of the Environment, he said.

Rook said COPT has asked PenMar to manage the base through the end of the year. He anticipates the agency will remain together for some time as it decides how best to invest the money from the sale back into the community, he said.

COPT President and CEO Randall M. Griffin said development at the base will create an "economic engine" and result in significant job growth for Washington County and Franklin County, Pa.

COPT plans to invest more than $250 million in developing the former base.

PenMar board Chairman George G.B. Griffin, who is not related to Randall M. Griffin, said in a written statement that new construction, the renovation of existing buildings, the demolition of environmentally unsafe World War II structures, and improvements to roads and water, electrical, communication and sewer systems will take place "in coming months."

"We expect that Fort Ritchie will return to its previous levels of employment over the next five to 10 years, and that new jobs will be created throughout the region," George G.B. Griffin said in a written statement. "This could turn out to be one of the most viable projects Washington County has ever experienced."

He said by phone Thursday that small businesses near the base have been suffering since the base shut down and its tenants moved away and since legal hurdles prevented the property's development.

"I think this is going to be a real shot in the arm for them," Griffin said. "The pizza place across the street is going to be rich."

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