Construction ceased months ago on The Paramount, a planned concert venue between M&T Bank Stadium and the Horseshoe Casino, because the project’s funding has fallen through, according to lawsuits filed last month by contractors who say they haven’t been paid.
The announced $50 million, 3,750-seat venue was expected to open this summer, but construction came to a halt earlier this year. Though officials have been mum, court filings explain why.
In those filings, attorneys for Clark Construction, the general contractor on the project, said The Paramount informed them last year that a financing loan had been sold to another lender and was later terminated. An expected new loan didn’t materialize, and as of July, Clark claims in court papers, The Paramount said it had found another financier who wanted additional partners before it signed on.
“Despite repeated demands by Clark, to date Paramount has failed to provide evidence that it has obtained sufficient funds ... or that sufficient funding for the project exists,” Clark wrote Aug. 14 in requesting a lien for payment of about $3.69 million plus interest for unpaid work. Clark said payments over the past year from The Paramount had been issued late, and not at all since March.
Paramount’s lawyer has not responded in court, and the venue’s backers did not respond to requests for an interview. But in a joint statement issued by Clark Construction, the company and developer said they are “working collaboratively to restart the project after a pause in construction.” The project is about 60% completed, and Clark has not yet withdrawn from the property, according to the statement.
“Clark and Paramount are optimistic that the project will get back on track and become a successful destination concert venue,” the statement said.
Two other subcontractors, Telligent Masonry and Alliance Exterior Construction, in separate cases say they’re owed about $320,000 and $220,600, respectively, for their work. And a steel contractor filed a claim against The Paramount and Clark, saying they are owed about $302,000.
A series of show-cause hearings are scheduled in October.
Signage on the building touting the project has disappeared. Even if it were to move forward, it might be with a different name: Since at least the spring, the website of a Baltimore firm that says it is the architect and planner says the project was “formerly known as The Paramount” and is currently called “The Ostend,” suggesting the possible loss of partners associated with the successful Paramount in Long Island, New York. “The Ostend” trade name was registered by Paramount Baltimore Founders Group LLC in February, state business records show.
Reached for comment, Baltimore Development Corp. President and CEO Colin Tarbert said he was “not familiar enough with the issues to comment” on the status of the Paramount project. Arsh Mirmiran of Caves Valley Partners, and Caesars Entertainment, which are involved with the broader entertainment district plans, did not respond to requests for comment on the status of the concert project.
The 70,000-square-foot venue sits in the shadow of M&T Bank Stadium and along a road to the Horseshoe Casino that also includes the Topgolf venue. Paramount’s director, Robert Goldstein, who owns the production company Maryland Sound International, has said previously it would have 135 to 150 shows a year, with a goal of as many as 225 shows, and would remain open on off-nights as a restaurant and bar. There were further plans to add retail adjacent to the venue, as well as a hotel in a development referred to as The Walk @ Warner Street.
The group behind the larger plans said that pedestrian route would bring to life a transformation in South Baltimore dreamed up by Caesars when it proposed building the casino, which opened in 2014. The area surrounding the football stadium, still mostly industrial and long considered by state and city officials to be underdeveloped, would be a host to gaming and entertainment facilities, which would help expand the regional tax base and pump more visitors and businesses into downtown.
Eventually, city officials hope to build a cohesive, walkable district from the South Baltimore entertainment district that links to the Inner Harbor and carries walkers as far away as Lexington Market.
The Paramount site is adjacent to the former Paradox nightclub that was demolished to make way for the revival of Hammerjacks, which didn’t take as an outdoor venue surrounded by shipping containers. That space was put up for lease earlier this year, and SouthBmore.com reported this week that Jimmy’s Famous Seafood has signed a one-year lease to hold its “TailGOAT” tailgate party in the space during Ravens home games.
Checkerspot Brewing Co. also relocated this month to a larger facility on Ridgley Street, around the corner from where The Paramount is planned.
Clark Construction filed its request for a lien in Baltimore Circuit Court, and it also cites breach of contract, unjust enrichment, and violation of the prompt payment act. Under Maryland law, such a lien must be filed within 180 days after work stops.
“A mechanic’s lien action is simply a procedure that has to be taken at this time to prevent Clark and its subcontractors from waiving lien rights,” Clark said in a statement.
Clark entered into a contract in April 2021 to serve as the general contractor for the property, with the agreement calling for the establishment of a guaranteed maximum price for the project. Work began in January 2022.
Over the intervening months, Clark and Paramount haggled over the construction company’s scope of work, which was millions short of the project’s maximum price.
In September 2022, Paramount notified Clark for the first time that the loan it had obtained to finance the project had been sold to another lender, CVI PACE Acquisition LLC, and that that lender “had not funded a single payment” and alleged that Paramount was in breach of its loan. They said Paramount informed them that “as a result of the material change in its lending status, Paramount could no longer make timely payments to Clark.”
Clark’s August 2022 invoice wasn’t paid until November, the company says.
According to a “case study” document on the website of the Maryland Clean Energy Center, Paramount received $13 million in C-PACE financing that was incorporated “in the project’s $50.3 million capital stack.” C-PACE, or commercial property-assessed clean energy, financing involves building owners borrowing money for energy efficiency, renewable energy or other projects and making repayments through an assessment on their property tax bill.
A 2021 SEC filing also shows Paramount was soliciting investments and had sold at least $5.85 million of $8 million in securities. It’s not clear what if any other funding Paramount backers had secured.
“Beginning in September 2022 and continuing to the present, Clark has repeatedly demanded that Paramount provide proof that it has obtained sufficient financing to pay for and complete the project,” the court filing says. “To date, Paramount has not provided the requested proof.”
Paramount asked Clark to suspend portions of work in November, with roofing, exterior framing, masonry and foundation waterproofing continuing. The next month, Paramount notified Clark that it had terminated its loan with CVI PACE and was in the process of acquiring a new loan that it expected to close by January 2023. But that never happened.
Meanwhile, Paramount told Clark to resume work on the project on Jan. 12, and said it would renegotiate and compensate Clark for the cost and time impacts of the suspension of work, and increased the scope of the work.
“Despite the issues that had been encountered prior to Jan. 19, 2023, despite Paramount’s multiple material breaches of contract, and as an effort in good faith to keep the project on track, Clark continued to proceed with the limited scope of work covered by the limited notice to proceed,” Clark’s attorneys wrote in court papers.
Clark ceased active construction as of Feb. 20, the company said.
A month later, Paramount said the loan it hoped to obtain at the beginning of the year did not close. But it said it had found another lender that was performing due diligence. In July, it said the lender, Bayview Asset Management, had committed to fund a C-PACE loan of $18.9 million, but that it would not finalize it until an additional partner agreed to close a deal with Paramount.
Clark said it hasn’t been paid since February, but has not terminated the contract, due to Paramount’s continued assertions that it intends to complete the project.
Banner reporter Hallie Miller contributed to this article