MaryAnne Gilmartin Eyes Data Centers At Giant Waterfront Development

Three years after taking over the 235-acre Baltimore Peninsula megaproject, MAG Partners CEO MaryAnne Gilmartin says the ultimate vision of 14M SF of housing, offices, retail, hotels and makerspaces might have to change.

The project's developers have already delivered 1.1M SF of apartments, offices and retail to the waterfront site, but they are considering a pivot for part of the site to data centers.

Gilmartin told Bisnow in an interview Monday that she is in discussions with developers about building data centers on one portion of the site. While no deal has been finalized, if the developer does decide to use part of the site for data centers, it would happen within the next year, she said.

“Am I going to try to convince you that Baltimore can produce 14M SF of demand? I’m not sure I can say that, certainly not over the next decade,” Gilmartin said. “So over the short term, what we’re focused on is the abundance of flexibility that we have so we can meet the market where it is.

“We're getting a lot of data center interest,” she added. “That's because we have a lot of land, we've got access to power.”

Power has been the most crucial hurdle for data center builders across the country as they rapidly scale up their footprints to satiate demand from Big Tech companies using the facilities for their artificial intelligence push. In many markets, like the industry's biggest hub, Northern Virginia, power shortages have pushed back data center development timelines by years. 

Gilmartin said Virginia is “kind of tapped out with the energy constraints,” but she said Baltimore utility BGE can power data centers on the Baltimore Peninsula site. BGE is preparing to spend $130M on a new substation and related infrastructure at Baltimore Peninsula to support the site's future development, The Baltimore Banner reported last month.

The Banner report didn't mention data centers as a potential use for the site, but it did raise concerns about whether the utility's residential customers would pay higher rates due to the investment in the new substation. 

A BGE spokesperson told Bisnow the utility works closely with developers anytime it plans to add power capacity but declined to respond to specific questions on Baltimore Peninsula. 

Gilmartin said she has spoken to the city about the possibility of using part of the site for data centers, and officials focused on making sure it doesn't increase residential utility bills or have negative environmental consequences.

She said that once those concerns are addressed, then data centers would be a net positive for the city. Even though they are large, windowless buildings filled with computing equipment and don't spur foot traffic, create large numbers of jobs or offer amenities for residents, they generate revenue for the city. 

“These are not heavy traffic generators, but they're juggernauts for an economy,” Gilmartin said. “For a city like Baltimore, this is a huge economic development play.” 

Baltimore Mayor Brandon Scott's office didn't respond to Bisnow's request for comment. 

Gilmartin also emphasized that if the team does pursue data center development, it will only be on a limited portion of the site and wouldn't prevent it from building the other uses like housing, office and hospitality that it has planned. 

She said the data centers wouldn't be the massive hyperscale campuses that have become more common in recent years, but rather they would be multitenant colocation facilities that can be built on smaller sites. The company hasn't yet decided how many acres data centers would take. 

The conversations about using part of the site for data centers come as the market for financing other types of commercial development has been difficult, due to high interest rates, elevated construction costs and uncertainty from tariffs.

“It's a risk-off situation,” Gilmartin said. “Most people are just not doing development right now.” 

MAG Partners is also looking at using part of the site for townhomes, which Gilmartin said have “extraordinary demand.” And she said it is looking at sports and entertainment uses, including the possibility of creating an “entertainment district.”

A study released in June identified Baltimore Peninsula as one of two potential sites for a new soccer stadium in Baltimore for a minor league affiliate of D.C. United and a women's professional team. An MAG Partners spokesperson said the firm would be “thrilled” for the site to become home to a soccer stadium.

Gilmartin has been leading the project since May 2022, when its main backers, Goldman Sachs and Under Armour founder Kevin Plank's Sagamore Ventures, tapped MAG Partners and MacFarlane Partners to replace prior developer Weller Development Partners. The new team rebranded the project from Port Covington to Baltimore Peninsula later that year. 

Last year, MAG and MacFarlane completed construction on two apartment buildings totaling 407 units, an 81-room extended-stay hotel and a three-story office building that is home to CFG Bank's new headquarters. 

The five-story headquarters of Under Armour opened in January. 

Rye Street Market, a three-building, 275K SF mixed-use complex featuring a food hall and other retail on the ground level with offices above, opened last year and has signed a series of office leases in recent months that Gilmartin said signal growing momentum at the development. 

In May, accounting giant PwC signed a 23K SF lease at the building to relocate its Baltimore office from downtown. In June, commercial real estate brokerage Newmark signed a 4,550 SF lease at the building. 

In July, the University of Maryland's Robert H. Smith School of Business leased 12K SF at Rye Street Market to relocate its satellite campus. Also last month, design firm Ayers Saint Gross signed a 25K SF lease at the building. 

Gilmartin said Baltimore Peninsula has been drawing office users away from other parts of the city for three reasons: It has higher-quality office stock, it has easier access from I-95, and it has better public safety, facilitated by its own security staff and the development being a “controlled environment.”

“Over the last year, we've had outsized success,” she said. “We’re not the cheapest space on the market — we are just the highest-performing and the one that offers the most compelling sense of place for people who want to be in Baltimore.”

So while today's market dynamics make data centers an appealing option for development in the near term, Gilmartin said she sees positive trends that will spur demand for other uses like office, retail and housing in the coming years. 

Baltimore last month was ranked the No. 3 most promising U.S. city for college graduates, based on factors like hiring options and affordability, according to a study from payroll provider ADP. Last year, Baltimore's population increased for the first time in a decade. 

And the city's commercial real estate values are rising: MSCI's second-quarter report found Baltimore led the nation in price growth over the last year across all property types. 

“I've had investors tell me it's coming across their desk,” Gilmartin said. “As people are looking at markets, Baltimore keeps showing up as an emerging urban location for young people, and that's the beginning of something very powerful.”