Developer disputes rail operator’s ability to pay for land in Baltimore’s Westport neighborhood that it wants to condemn

A developer fighting a condemnation bid for a large waterfront tract in Baltimore’s Westport neighborhood says the high-speed maglev train operator that wants the site has no ability to buy it.

Stonewall Capital and Westport Capital Development are seeking a court order requiring bond in the amount of $31 million to be posted by Baltimore Washington Rapid Rail LLC, which is planning a $10 billion project to link Washington and Baltimore with a superconducting magnetic levitation rail system.

The legal tug-of-war over the 43 acres where Stonewall plans housing and other development started when the rail operator filed a condemnation lawsuit last June in Baltimore City Circuit Court. Rapid Rail argued that authority to build a passenger station stems from its acquisition of the former Washington, Baltimore and Annapolis Electric Railroad Co. franchise in 2015.

After the Circuit Court dismissed the eminent domain case last August, the rail operator appealed to the Court of Special Appeals. The state’s second highest court reversed the lower court’s decision and returned the case for trial in Circuit Court. The opinion said the lower court had erred in finding that the rail operator had failed to obtain Baltimore City’s consent.

In a motion filed Tuesday in Circuit Court, the developers say they sought information during the discovery phase on the rail operator’s ability to pay the property’s fair market value. The rail developer had offered to pay a previous owner $13 million, and the land has more recently been appraised for $31 million, the motion says.

“You want to take somebody’s land, prove you can pay for it, at the bare minimum,” Stonewall Principal Ray Jackson said in an interview Thursday.

The filing said the rail operator responded that “its ability to pay the fair market value is not a relevant inquiry in this matter and has flatly refused to answer any questions relating to its ability to pay.”

In a statement sent to The Baltimore Sun on Thursday, Baltimore Washington Rapid Rail called Stonewall Capital’s motion “frivolous and baseless” and “intended to distract the public.”

Stonewall bought the property in June 2021 for $13 million after condemnation proceedings had started, the rail developer said.

“Now, in an extraordinary case of attempted profiteering and speculation, in a year without any improvement of the property, Stonewall claims the property is worth $31 million and requests a bond for its own inflated value,” the statement said. “There is no basis in law or fact for this motion.”

The statement said fair market value will be determined in a court proceeding, “not by who can jump in, buy a necessary property and inflate the value to the detriment of the public.”

The rail operator said it would continue to work to invest in and transform South Baltimore and provide jobs for the community.

Jackson, however, said the project may never amount to more than an “idea,” that it lacks necessary approvals and has shown no indication it has or can obtain funding. Meanwhile, he’s moving ahead with plans to build 1,300 units of apartments and town houses under uncertain conditions.

Stonewall, which purchased the undeveloped parcel between Kloman Street and the Middle Branch of the Patapsco River last June, has proposed a variety of housing on the site with parks, a restaurant and possibly a small office building.

About two weeks earlier, Baltimore-Washington Rapid Rail had filed its lawsuit, calling the filing “a last resort that we sincerely wish we did not have to pursue” after trying unsuccessfully to buy the property.

Rapid Rail officials have said they believe Stonewall and community members have known for years that the undeveloped parcel was to be used for the maglev station, but that Stonewall decided to buy the property anyway. Jackson disputes that.

The multibillion-dollar rail project has been in the planning stage for about a decade and received a significant boost when Japanese Prime Minister Shinzo Abe proposed financing the stretch between Washington and Baltimore to promote the Japanese maglev technology.

The trains traveling at speeds of up to 311 mph would connect Baltimore and Washington with a 15-minute trip and an intermediate stop at BWI Marshall Airport.

The Westport property is needed regardless of which of two proposed routes for the train is picked. Unlike a standard railroad, maglev uses technology that runs on a fixed underground or elevated guideway powered by magnetic forces.

Jackson said Thursday that plans are moving ahead for his project for much-needed affordable and market-rate housing with the support of city officials and community members. The land has been subdivided into six sellable parcels and a community park.

Homebuilder NVR has a contract on a parcel to build 250 town houses. Contracts are in the works on two additional parcels, including one for apartments.

“We have a viable project that’s financed and permitted,” Jackson said. “We’re ready to start moving dirt and we’re going to.”