Baltimore: A City Charmed for Business
Regional business leaders agree that Baltimore is in the midst of a "second renaissance" and is ready to lead the way when the economy rebounds.
Growth in the biosciences, Information Technology (IT), the impact of the Base Closure and Realignment Commission (BRAC) along with the city's proximity to Washington, D.C. are just a few of the factors driving the region's current economic development.
"I'm not saying the recession hasn't affected Baltimore but the region as a whole is well positioned for when things start to turn," says Gene Bracken of the Greater Baltimore Committee
Tom Sadowski, president and chief executive officer of the Economic Alliance of Greater Baltimore says overall what that makes this market great is its foundation that has been established in strong and diverse sectors, such as IT, government contracting, financial services, and healthcare. "While some of those sectors are experiencing pain, others are picking up activity such as the IT, healthcare, government contracting areas and keep the economy going."Bioscience is the Word
When asked about the business climate in Baltimore, Bracken looks first to the bioscience parks located at University of Maryland, Baltimore
(UMB) to the west and Johns Hopkins to the east. According to Bracken, the two locations combined bring in more than $1 billion annually. He adds that experts predict that the biosciences will amount to 20 percent of all industry growth in the next century.
And entrepreneurs are taking notice. Jim Hughes, vice president of research and development at the University of Maryland, Baltimore says that the UMB BioPark
adds three to four new businesses per year.
"Historically, they can locate anywhere in the world," he says, but the technology transfer between UMB faculty members developing new technology and entrepreneurial startup companies has created a powerful "incubator" for new businesses in the region.
Dr. Blake Paterson, the founder and former CEO of Alba Therapeutics Corporation
is an example of the entrepreneurial development taking place in the bioscience parks. After launching Alba, the first business to take up residence in the UMB BioPark, Paterson recently launched a second company, Chesapeake Bio Discovery, also located in the UMB park.
"This is where the action is if you're looking to build an innovative bioscience business," Paterson says. "There's lots of money flowing into the region and you don't need to explain the biosciences. The investors get it. In terms of funding, there are massive amounts of work coming out of UMB and Johns Hopkins."Silicon Valley of the East Coast
But it's not just the biosciences driving development in the Baltimore region. The close proximity to D.C. has made it a hot bed for the IT industry.
"Information technology, in particular, because of the Base Realignment and Closure initiative and all the new economic activity that that is bringing portend good things for the region going forward. Because of the established presence of major contracting firms we have the No. 1 IT market in the country. We are comparable to Silicon Valley. While Silicon Valley is more active in the commercial markets we are more active in servicing the federal government. But, that has established potential for continued growth in the commercial sector as those technologies are easily transferable. And, new applications are being found for a lot of the work being down for the federal government," says Sadowski.
Clarence Wooten, Jr., has launched a number of technology companies in the Baltimore region. Wooten described his current startup, Groupsite.com, as a social collaboration platform with approximately 30,000 different groups utilizing the site.
Wooten says that the biggest difference between the Baltimore region and Silicon Valley is that in Silicon Valley most of the venture capitalists are former entrepreneurs themselves. As a result, investment for early stage technology is more conservative. However, he adds that the region does have a similar ecosystem for tech companies – especially at the federal stage – due to our proximity to D.C.
He also points out that there is another advantage to the region. "Everybody seems to know everybody. It's not too big that it becomes hard to stand out yet it's not too small that networking doesn't work."A Talented Bunch
Another boon for Baltimore is that the city has the most highly skilled and educated workforce in the country, according to Sadowski. "We are seeing dramatic growth in the area of professional, scientific, and technical workers. Now, with the cybersecurity initiative, a new $20 billion to $30 billion federal government program to enhance the security of information shared electronically, a lot of that wll be spearheaded here in the Batlimore region," he says.
"There is a thriving professional community here. In general, there's an educated workforce. Technical talent, any kind of talent, it tends to be here. There are also unique opportunities to do business with government which you find out about because you are right here it the middle of it," he says.
Paterson also says that the talent pool in Baltimore helps. "The workforce here is great. From a research perspective in which you need upper level, highly educated researchers at the Ph.D. level, there are a lot of highly qualified people. It is quite easy to get human capital in place quickly."Here Comes BRAC
Along with development in the biosciences and technology the impact of BRAC
is expected to be huge. The Economic Alliance of Greater Baltimore
estimates that BRAC will bring approximately 45,000 jobs to the region -- some of which have begun already -- and some $4 billion to $5 billion spent at Aberdeen Proving Ground and Fort Meade due to BRAC over the next three to four years. Officially, the jobs will start arriving in about 13 months during the fall in 2010 and all are to be in place by September, 2011.
"Given the nature of what they're doing today, that makes this market the home of military intelligence, communications, electronics technology. The global center for that activity," explains Sadowski.
"People don't realize the impact of the two main missions coming as a result of BRAC which are the communications control centers. This will make us the communications control center for the entire military government," Shannon Landwehr, also of the Economic Alliance of Greater Baltimore adds. "They've broken ground on the media headquarters at Ft. Meade which will bring more than 600 jobs, a third of which are straight civilian."
In addition to the government jobs, business leaders are expecting a large ripple effect as regional businesses grow to support the increasing size of the two military bases, Aberdeen Proving Ground and Ft. Meade.
Bracken adds, "BRAC, the bioscience parks. They are real. You can quantify the impact. The impact is in the immediate future."
And, while the business climate in Baltimore is changing, Baltimore's traditional corporate industries are still growing.
"We've been historically strong in the financial industry but we are seeing a transition. Even still, our financial sector is strong. Morgan Stanley is still moving forward with their expansion which will bring 900 jobs to the region and T. Rowe Price is still expanding," Landwehr says. "And although there have been layoffs, the unemployed are not leaving the region."And the Living is Easy
It's not just the economic growth that is spurring business development in the region. Many are coming to the Baltimore area because of the high quality of life the city has to offer. For Merkle
, a database marketing agency which moved its headquarters and 500 jobs to the Greater Baltimore Area last year, quality of life was a key consideration.
"Our decision to move was predicated by a natural progression of where our staff wanted to live. The cost of living between Baltimore and D.C. is significant and the region offers a great lifestyle for our employees," says David Williams, CEO of Merkle.
Previously located in Lanham a big factor in the move to Columbia was that many of their employees were commuting from Baltimore. Williams says the move to the region has worked out very well for the company. Amenities such as easy access to the Baltimore Washington International Thurgood Marshal Airport (BWI), young talent coming out of schools in the region, excellent entertainment venues and affordable lifestyle for his employees has helped make the move a success. "It's been everything we could ask for," Williams says.
Both the high-quality of life and low cost of living in Baltimore has sparked renewed growth in downtown Baltimore. Bracken says that although the city was expanding from 1990 until about 2000, at the same time it was also experiencing an exodus in population. That trend has ended and now the downtown population is on the rise.Up the Road
Less than 50 miles from D.C., the proximity to the nation's capitol has helped fuel this resurgence as people realize they can enjoy the advantages of city living without the costs associated with the District. MARC trains running from downtown Baltimore to Union Station also make it fairly easy for those commuting to D.C.
"The benefits of being close to D.C. during the recession are significant," Bracken says.
As for quality of life, Bracken added that he's always felt that Baltimore is an as of yet undiscovered treasure. "One of the things I love about Baltimore is that it has all of the things that you find in Boston without the hassle. The ocean is two hours away. The mountains are two hours away. You have a very similar lifestyle. However, the traffic in Baltimore is nothing compared to Boston."
"I've always thought that Baltimore is a well-kept secret" Jim Lodico is a freelance writer and independent commercial copywriter/marketing consultant. Send feedback here.