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Howard County's approval of a massive growth plan for downtown Columbia removes some doubts about the commercial and residential renewal of the planned community.

But it also raises the question of whether General Growth Properties will sell off all or part of its Columbia portfolio to help it emerge from bankruptcy. With the nod this week from the Howard County Council, the Columbia properties suddenly seem more like marketable assets rather than debt-laden liabilities that played a role in the Chicago company's filing for Chapter 11 protection last year.

The company announced Jan. 25 that it planned to hire UBS Investment Bank, a leading global full-service financial firm, to assist in evaluating potential financial transactions for emergence from Chapter 11 and raising exit capital.

The 30-year master plan approved Monday would allow General Growth to build up to 13 million square feet of new development that county officials hope will revitalize Columbia's downtown. That's in addition to the 26 million square feet of existing commercial space. The plan lays the groundwork for a three-phase build-out that would include 4.3 million square feet of office space, 1.25 million square feet of retail space and 640 hotel rooms. The plans also include as many as 5,500 new residential units, renovation of Merriweather Post Pavilion and development of a multimodal transportation system.

"This means the 21st century renewal of one of the 20th century's great places, with an enhanced competitive position for attraction of capital and creation of high-quality jobs," Tom Nolan, General Growth president and COO, said in a statement. "For GGP, this long-sought action gives us a chance to do great things in one of the most promising regions in the country, and grow our business in ways that can enrich thousands of lives. Many of our nationwide properties have untapped value, and Columbia's is exceptionally significant."

Whether General Growth or another developer capitalizes on that untapped value is unknown, because the company is scrambling to improve a balance sheet that listed $29.6 billion in assets and $27.3 billion in liabilities when it declared bankruptcy in April. The company's Columbia properties were not part of that filing, but General Growth has struggled with debt since 2004, when it acquired the community's developer, the Rouse Co., for $12 billion.

The deal drove General Growth's leverage — defined as debt divided by underappreciated book capital — to 81.9 percent from the mid-50 percent to mid-60 percent range, according to bond rater Fitch Ratings.

Since its bankruptcy, General Growth has been delisted from the New York Stock Exchange.

Trading in its over-the-counter shares sank to a low of 31.5 cents in March, but reached as high as $13.24 in December as the Howard County vote approached. Shares were trading at $9.02 on Thursday.

General Growth, the nation's second-largest shopping mall owner, has had little luck selling off some of its prized assets, which include Baltimore's Harborplace and similar Rouse waterfront projects in New York and Boston.

The Columbia holdings might attract more interest based on their growth potential. Despite 40 years of growth, the community of almost 100,000 residents remains a collection of suburban villages clustered around The Mall in Columbia and a handful of commercial and multifamily residential projects. The legislation would allow General Growth to create a genuine downtown urban core, which was part of the original vision of the planned community developed by James Rouse in the 1960s.

"We have created a comprehensive master plan for the revitalization which will bring jobs and vitality to Downtown Columbia," Howard County Executive Kenneth S. Ulman (D) said in a press release.

"This plan incorporates green development, environmental restoration, arts and culture, workforce housing, pedestrian and bicycle connectivity, new amenity areas, transit, and a renovated Merriweather Post Pavilion, all in a carefully phased development plan with legislated benchmarks to ensure that what has been promised will be delivered," Ulman said.

Village at Waugh Chapel

sold to investor group

A team of investors led by JBG Rosenfeld Retail has bought The Village at Waugh Chapel in Anne Arundel County.

The 390,000-square-foot shopping center in Gambrills was acquired by JBG Rosenfeld of Chevy Chase and Buvermo Investments of Bethesda. The property was originally developed by Greenberg Gibbons of Owings Mills. The sellers, institutional clients advised by Prudential Real Estate Investors, were represented by Bill Kent and Gary Lawrence of CB Richard Ellis.

Financing was provided by Northwestern Mutual Life Insurance. Terms were not disclosed.

"A year ago, we would not have been able to obtain this type of financing from a conservative firm willing to invest in a retail asset," said JBG Rosenfeld principal Grant Ehat. "This clearly signals a thaw in the capital markets and an upswing in the beleaguered retail sector."

The property is 96 percent leased to more than 60 tenants including Safeway, Marshalls, L.A. Fitness, Home Goods, Rite Aid and Robert Andrew Day Spa. It is at the intersection of Route 3-Crain Highway and Waugh Chapel Road, about 6 miles west of Fort Meade.

AvalonBay buys complex

for $31.25 million

AvalonBay of Alexandria, Va., has acquired the Gables at Rothbury garden-style apartment complex in Montgomery Village for $31.25 million.

The AvalonBay deal was completed Monday, after the Montgomery County Housing Opportunities Commission backed out of a deal to buy the 204-unit complex. The community, renamed Avalon Rothbury, was acquired for approximately $154,000 per unit, AvalonBay said in its fourth-quarter earnings release.

The deal marks the company's third acquisition in Montgomery Village.

The housing agency abandoned the deal based on unspecified non-financial risks. News of the commission's decision came as a relief to community leaders in Montgomery Village, who were concerned that sale to the public housing operator would mean an expansion of the 42 units already designated as affordable housing.

Fitzgerald billed as Baltimore's

biggest green apartment

The Bozzuto Group announced that it is building The Fitzgerald at UB Midtown as the largest certified "green" apartment community in the Baltimore area.

The mixed-use development, which will include 275 apartments, 24,000 square feet of street-level retail and a 1,245-space parking garage, is being constructed for certification under the U.S. Green Building Council's Leadership in Energy and Environmental Design program. The Fitzgerald garage opened Jan. 11, and apartment units will begin to be ready for occupancy in early summer.

"As a longtime multifamily developer, we have for many years believed that growth can be both economically and environmentally sound," said Thomas S. Bozzuto, CEO of The Bozzuto Group of Greenbelt, in a statement. "We believe The Fitzgerald takes that notion to the next level."

To achieve LEED certification, Bozzuto designed the building to run with 70 percent of the building's electricity purchased from renewable sources. Dual-flush toilets, low-flow faucets and low-flow showers collectively will reduce water consumption by 40 percent, according to the developer.

Unlike many new residential and commercial projects, The Fitzgerald is a transit-oriented development at a light rail stop and within two blocks of Penn Station. The building's neighbors include the University of Baltimore, the Lyric Opera House and the Maryland Institute College of Art.

A 20,000-square-foot Barnes & Noble College Booksellers Superstore will serve as the anchor of the retail portion of The Fitzgerald.

The Fitzgerald is a joint venture between The Bozzuto Group, Gould Property Co., NYSTRS and former Baltimore Raven Michael McCrary, and sits on 4.6 acres owned by the University of Baltimore.

Commercial real estate news items may be mailed to: Steve Monroe, The Business Gazette, 9030 Comprint Court, Gaithersburg, MD 20877; e-mailed to smonroe@gazette.net; or faxed to 301-670-7183.