Changing Baltimore’s Image One Luxury Hotel at a Time

Can a luxury hotel – or two, or three – change a city’s image?

While only 38 miles from Washington, D.C., Baltimore is a world away. The small city is frequently described as blue-collar and gritty, thanks in part to the impact of television shows like Homicide: Life on the Street and The Wire. It also doesn’t help that in recent years, national news coverage of the city’s ills has been quite extensive.

That said, other cities with similar issues have overcome less-than-stellar perceptions. Pittsburgh’s business community turned the Steel City’s image around in the latter part of the 20th century. In more recent years, Detroit is a prime example of how good public relations and community involvement can change a city’s image from horrific to hip.

But can a city’s hotel industry be the driving force behind a renaissance? Baltimore could be a test case. Until recently, the idea that Baltimore could sustain one five-star hotel may have seemed crazy. That it presently sports three may seem absurd on the face of it…until you dig deeper. After all, Baltimore is the home of Johns Hopkins, a world-class medical facility that draws in members of Middle Eastern royal families and other international elites. A number of investment banks and corporations are based here. Most importantly, there are several dedicated local millionaires/philanthropists who believe enough in their city to put their money where their mouths are.

A trinity of properties — Four Seasons Baltimore (opened 2011), The Ivy Hotel Baltimore (opened 2015) and the Sagamore Pendry Baltimore (opened 2017) — were all envisioned and financed by local business leaders. According to Baltimore Mayor Catherine Pugh: “They saw the value of the city more quickly than outsiders and the result now is that the properties they built are helping change the dynamic of the city.” Or as Junaid Siddiqi, chief financial officer of H & S Development Corporation puts it, when outsiders wouldn’t invest, “Proud Baltimoreans stepped up.”

Four Seasons came to be thanks to the Paterakis family, owners of Baltimore’s H & S Bakery. The bakery made plenty of dough over the decades as McDonald’s largest supplier of buns. The Ivy Hotel, an 18-room Relais & Chateaux property (the only one in Maryland), is majority-owned by the family of Eddie C. Brown, the founder and CEO of Brown Capital Management. The newbie, the Sagamore Pendry, is the brainchild of Kevin Plank, the visionary behind Baltimore-based Under Armour.

The Ivy Hotel is, on average, the most expensive of the three. The property’s rooms and suites range in price from $600 to $1500 all-inclusive (things like valet parking, tips and in-room mini-bar purchases are covered). Although opening such a high-priced hostelry was a big risk, Eddie Brown says, “Sometimes, you just have to build the momentum before the reality. Then, once visitors come here, word of mouth helps spread the luxury message.” His wife Sylvia adds, “We created this to encourage people to come to Baltimore. When we promote ourselves, we bring along the image of the city.”

That’s a big part of the reason Kevin Plank decided to buy and convert a 1914 recreation center into a luxury hotel. According to the Baltimore Business Journal, he was looking to create a tool for attracting people (perhaps potential employees) to the city and to help provide visitors with a quintessential Baltimore experience. Plank’s real estate company, Sagamore Development, is the owner, and Pendry, a sub-brand of Montage International, is the management company.

Both Plank and Brown had the option of benchmarking against Four Seasons, which was the pioneer in Baltimore’s luxury space.  In the early 2000s, a $500 million redevelopment project near Baltimore’s waterfront was taking shape. H & S Properties Development Corporation, the group behind Harbor East, wanted to open a luxury hotel there and approached Four Seasons. According to Siddiqi, “John Paterakis, Sr., the company patriarch, believed in the potential when no one else did.” By 2007, he had convinced the Toronto-based hotelier to take the leap of faith.

At the same time, Four Seasons had started looking at establishing properties in secondary markets, which were becoming a growing presence and a key component of the company’s growth strategy, according to Ricardo Suarez, senior vice president of development for the Americas. “We were looking for under-the-radar cities in markets where there was wide business from multiple demand generators,” notes Suarez. “In Baltimore, there was significant medical business and large corporate customers, investment banking and high-end leisure demand.”

Even with that factored in, Julien Carralero, the first and only general manager of Four Seasons Baltimore, knew there would be work cut out for his team. “Baltimore is a city that is so misunderstood. The perception when I started was that this was a challenging city. It was a drive-by city along the Northeast corridor (overshadowed by Washington, D.C., Philadelphia, and New York) and people were still talking about shows like The Wire.” But the immediate success of the hotel proved there was pent-up demand for luxury.

The buzz around the property spurred other local entrepreneurs to take notice. According to Michael Fuerstman, co-founder and creative director for Pendry Hotels, which collaborated with Sagamore Development on the new Baltimore property, “Sagamore appreciated that Four Seasons went to the market first and set the bar for luxury.”

Carralero welcomes the competition. “Now that we have three luxury hotels in Baltimore,” he says, “it legitimizes the existence of a luxury marketplace. We can now position the destination with a critical mass of high-end product.”