Baltimore’s Inner Harbor:
Economic Impact, Importance, and
Opportunities for Investment
October 31, 2013
Flickr: Randy Pertiet
Executive Summary: Baltimore’s Inner Harbor drives substantial economic
and fiscal impacts through tourism visitation and local business activity.
2012 INNER HARBOR TOURISM
+ BUSINESS ACTIVITY
*
• $2.3 B in Overall Economic Activity
• 21,000 Jobs in the City and State
• $790 M in Employee Compensation
• $102 M in Annual Tax Revenue to
the City and State
Source: Longwoods, 2012; Tourism Economics, 2013; ESRI BAO; IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
*Does not include local visitors
Baltimore Inner Harbor Economic Impact Study | 1
Introduction
About HR&A
 HR&A Advisors, Inc. is an industry leading real estate, economic development, and
public policy consulting firm based in New York City, with offices in Washington, DC,
and Los Angeles.
 The firm has worked with numerous local public agencies, civic organizations, and
private sector organizations to support the revitalization of iconic urban waterfronts
and public open spaces, ranging from Brooklyn Bridge Park and the High Line to the
Toronto Waterfront and Boston’s Rose Kennedy Greenway.
 In 2005 HR&A produced a report for Baltimore Waterfront Promenade Committee,
“The Baltimore Waterfront Promenade – Parks and Public Spaces,” that helped
galvanize increased local attention to the Inner Harbor’s importance and lead to the
creation of the Waterfront Partnership of Baltimore (WPB).
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 3
About this Project
 HR&A was engaged by the Maryland Economic Development Corporation, with the
support of the Waterfront Partnership of Baltimore (WPB), to assess the impact and
importance of Baltimore’s Inner Harbor and the high-level potential of improvements
to one of its signature areas, Rash Field.
 The purpose of the study is to assist the WPB in describing the impact of the Inner
Harbor in compelling, quantifiable terms and in making the case for increased public,
private, and philanthropic investment in the Harbor to ensure it remains a strong driver
Baltimore and Maryland’s economy.
 The primary basis for the study area and potential Rash Field improvements are
concepts contained in the “Inner Harbor 2.0” Master Plan developed by Ayers Saint
Gross for the WPB and the Greater Baltimore Committee.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 4
The Study, like Inner Harbor 2.0, focuses on the “original Inner Harbor.”
The area is bounded by President St. to the East, E Pratt St. in the North, Light St. to the
West, and the Key Highway to the South: an area of 0.2 square miles.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 5
The Inner Harbor has set a global standard for urban waterfront
redevelopment.
Heritage Award, 2009
Industrial Excellence
and Substantial Contributions to the Greater
Community’s Well Being for at Least 25 Years
Prix d’Excellence, 1997 “providing society
with the optimal solution to its property needs’”
Top Ten Waterfront Places
Honor Award for Excellence on the
Waterfront, 1991
Citation, 1984
“one of the supreme
achievements of large-scale urban design and
development in U.S. history”
Honor Award, 1973
Source: Wallace Roberts & Todd, American Institute of Architects, and the International Real Estate Foundation
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 6
However, the Inner Harbor is beginning to show its age and has suffered
from a lack of reinvestment.
Limited activity on the promenade.
Repairs needed to the promenade and surrounding areas.
HR&A Advisors, Inc.
Outdated way finding and branding signs.
Baltimore Inner Harbor Economic Impact Study | 7
Other cities meanwhile have re-invested in recent years in their
waterfronts and downtowns, and a similar investment in the Inner Harbor
could restore the Inner Harbor’s iconic park status.
Flickr: HBarrison
Hudson River Park, New York City, NY.
Brooklyn Bridge Park, New York City, NY
Flickr: AndyNash
Rose Kennedy Greenway, Boston, MA.
HR&A Advisors, Inc.
Millennium Park, Chicago, IL.
Baltimore Inner Harbor Economic Impact Study | 8
These cities have been willing and able to make the public-private
investments to keep their public parks vibrant and competitive.
Capital Investment
$600
$500
Millions
$400
$300
$200
$100
$Hudson River Park,
NYC
Brooklyn Bridge
Park, NYC *
Rose Kennedy
Greenway, Boston
Millennium Park,
Chicago
Source: HR&A Advisors
* Projected
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 9
The Inner Harbor 2.0 Master Plan sets the stage for a new wave of
investment in the Inner Harbor’s future.
Source: Ayers Saint Gross Master Plan
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 10
Concepts in the Plan for Rash Field have potential to serve as initial,
catalytic investments.
Vision for Rash Field
Source: Ayers Saint Gross Master Plan
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 11
The Impact and Importance of the Inner Harbor
The Inner Harbor remains a major reason people are interested in and
visit Baltimore and Maryland.
Frequency of Google Searches in 2012
Relative Frequency of Searches
1200
1000
800
600
400
200
0
Pimlico
Source: Google Trends
HR&A Advisors, Inc.
Inner Harbor
Navy Football
National
Aquarium
Popular Maryland Attractions
St. Michaels
Google Trends analyzes a portion of Google web searches to compute how many searches have been
done for the terms one has entered, relative to the total number of searches done on Google over time.
Baltimore Inner Harbor Economic Impact Study | 13
Tourism is important to the State of Maryland’s economy.
2011MARYLAND TOURISM
34.4 M
$14.3 B
VISITORS
IN SPENDING
SUPPORTS
130,000
DIRECT JOBS
Source: Maryland Tourism, 2012.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 14
Tourism is an especially important part of Baltimore’s overall economy.
2012 BALTIMORE TOURISM
23.3 M
$5.05 B
VISITORS
IN SPENDING
SUPPORTS
78,000
DIRECT AND
INDIRECT JOBS
Source: Longwoods International, 2012. and Tourism Economics, 2013.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 15
Roughly 60% of all visitors to Baltimore visit the Inner Harbor – and
generate economic activity throughout the City.
2012 INNER HARBOR TOURISM
*
23.3 M
14 M
BALTIMORE
VISITORS
INNER
HARBOR
VISITORS
Source: Longwoods, 2012. & Visit Baltimore Study
HR&A Advisors, Inc.
*Does not include local visitors
Baltimore Inner Harbor Economic Impact Study | 16
Economic activity in the Inner Harbor is driven by this tourism visitation, as
well as business activity in the area.
2012 INNER HARBOR TOURISM
+ BUSINESS ACTIVITY
14 M
INNER
HARBOR
VISITORS
Source: Longwoods, 2012 & ESRI BAO
HR&A Advisors, Inc.
&
*
3,000
WORKERS
AT INNER HARBOR
BUSINESSES
*Does not include local visitors
Baltimore Inner Harbor Economic Impact Study | 17
Of those 14 million visitors, the average visitor spends $207 per trip,
with $202 spent locally.
Air Transport,
8%
Local Transport,
9%
Gas Stations,
3%
Food &
Beverage, 28%
Retail, 14%
Lodging, 23%
$207
Source: Tourism Economics, 2013 & HR&A Analysis.
HR&A Advisors, Inc.
Recreation,
15%
HR&A’s analysis of “local spending” in the
Inner Harbor excluded Air Transport,
bringing the average to $202 per trip.
Baltimore Inner Harbor Economic Impact Study | 18
Summary: Baltimore’s Inner Harbor drives substantial economic and fiscal
impacts through tourism visitation and local business activity.
2012 INNER HARBOR TOURISM
+ BUSINESS ACTIVITY
*
• $2.3 B in Overall Economic Activity
• 21,000 Jobs in the City and State
• $790 M in Employee Compensation
• $102 M in Annual Tax Revenue to
the City and State
Source: Longwoods, 2012; Tourism Economics, 2013; ESRI BAO; IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
*Does not include local visitors
Baltimore Inner Harbor Economic Impact Study | 19
IMPLAN Methodology: Estimate of Economic Impacts
The IMPLAN model is used to conduct economic impact analyses by leading public and private sector organizations across the
United States, including a number of federal and state agencies. IMPLAN traces the pattern of commodity purchases and
sales between industries that are associated with each dollar’s worth of a product or service sold to a customer, analyzing
interactions among 440 industrial sectors for a specific location, with assumptions about spending that takes place outside of
the location. HR&A conducted its analysis with 2011 multipliers for the economy of Baltimore City and the State of Maryland.
Multipliers are the total production requirements in the local economy for all goods and services consumed by final users in
2011. This is the most recent data available.
The figure below illustrates the structure of economic impacts produced by the model. Multiplier or spinoff activity is
comprised of two components: 1) indirect economic impacts caused by additional business spending stimulated by direct
economic spending during construction and operating activities (e.g., supplier business operations) and 2) induced economic
Threefrom
levels
of benefits
impacts stimulated by additional household spending due to wages
the direct
and indirect activity.
Overview of Economic Impacts, Direct, and Spinoff Effects
In addition to overall economic spending, the IMPLAN
input-output model also produces estimates of the number
of jobs supported and employee compensation.
Indirect
Effects from spending immediately
Compensation generated by the IMPLAN input-output
associated with
model is based on a nationally recognized econometric
project/industry/event
Direct
model, customized for local economic conditions. It includes
wage and salary income plus benefits and employer paid
Effects from business
taxes.
spending resulting from
Indirect
direct activities
Induced
Effects from household
spending resulting from
direct activities
Source: HR&A Advisors, Inc.
HR&A Advisors, Inc.
Spinoff
effects
Baltimore Inner Harbor Economic Impact Study | 20
IMPLAN Methodology
HR&A estimated the economics impacts of Tourism spending and Inner Harbor employment on Baltimore City and the State of
Maryland based on findings regarding visitor spending and motivations documented in previous studies and surveys:
1. A 2013 study by Tourism Economics for The Economic Impact of Tourism in Baltimore, estimates that the typical Baltimore
visitor spends $207 per trip on lodging, local transportation, food & beverage, retail, gas stations, air transportation and
recreation. This study combines spending across day-trippers and overnight visitors. HR&A counted $202 in local spending
(excluding air travel) as inputs in IMPLAN.
2. A recent survey conducted for Visit Baltimore reveals that 60% of all visitors to Baltimore City spend time in the Inner
Harbor, and 64% of visitors to Baltimore were motivated to come to Baltimore for discretionary leisure purposes such as a
weekend getaway or vacation. The Visit Baltimore study is ongoing, and additional data could result in a different
percentage of Baltimore visitors being credited with visiting the Inner Harbor.
3. A separate survey conducted for the National Aquarium in 2012, a major tourist draw in the Inner Harbor, revealed that
88% of Aquarium visitors chose to visit Baltimore primarily to visit to the Aquarium.
4. Based on these factors combined with our discussions with Baltimore tourism professionals and Inner Harbor venue
operators, HR&A estimates that approximately 55% (88% of 64%) of the visitor spending by the 14 million visitors to the
Inner Harbor is directly attributable to the presence of the Inner Harbor.
In addition to visitor spending, HR&A included non-tourism related employment based in the Inner Harbor based on 2012 Dun
& Bradstreet & ESRI data. HR&A included all NAICS employment categories except, Agriculture, Forestry, Fishing and
Hunting; Mining; Utilities; and those related to tourism, Retail Trade; Arts, Entertainment and Recreation; and Accommodation
and Food Services.
All spending and employment categories were modeled in IMPLAN using their corresponding industry codes. A multi-regional
analysis was conducted within IMPLAN to connect the spending directly in Baltimore City to the larger statewide economy and
trace the economic impacts of tourism spending and local employment throughout the statewide economy.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 21
Methodology: Approach to Overall Economic Output Attributable to the
Inner Harbor.
Tourists:
60% of all visitors to
Baltimore visit the Inner
Harbor.*
Employees:
Businesses directly in
the Inner Harbor
employ 3,000
people.***
Tourists:
Visitor spending for
55% of the Inner
Harbor tourists can be
primarily attributed to
the Inner Harbor. **
Employees:
54% of employees
work in non-tourism
related fields, such as
Accounting, Real Estate,
and Manufacturing***
Average visitor
spending of Inner
Harbor tourists,
along with all
non-tourism
related jobs in the
study area were
the basis of the
IMPLAN
approach.
The IMPLAN
modeling
calculates the
Direct, Indirect
and Induced
impacts of the
related economic
activity.
*Forthcoming study for Visit Baltimore
** HR&A estimate based on studies for Visit Baltimore and Sage Policy Group
*** ESRI Business Analyst Online
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 22
The Economic Strength of the Inner Harbor
As Baltimore’s primary leisure, entertainment, and recreation destination,
the Inner Harbor drives Baltimore tourism.
Power Plant Live!
U.S.S.
Constellation
Harbor
Place
National Aquarium
Pier 6 Pavilion
Maryland Science Center
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 24
The Inner Harbor is home to many institutions at the core of Baltimore
Tourism.
Image: Yelp, Rain D.
The Maryland Science Center.
Flickr: WallyG
The National Aquarium brings thousands of visitors to the Inner Harbor.
Image: Yelp, Water Taxi
Harbor Place provides a blend of food and retail shopping.
HR&A Advisors, Inc.
Water taxis ferry users around the Inner Harbor.
Baltimore Inner Harbor Economic Impact Study | 25
Inner Harbor-generated tourism spending and on-site business activity
drives economic activity throughout Baltimore City and Maryland.
$2.3 B
OVERALL ECONOMIC ACTIVITY
$1.5 B
$520 M
DIRECT ECONOMIC
ACTIVITY
SECONDARY ECONOMIC
ACTIVITY
IN BALTIMORE CITY
IN BALTIMORE CITY
$250 M
SECONDARY ECONOMIC
ACTIVITY
Source: IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
IN MARYLAND
Baltimore Inner Harbor Economic Impact Study | 26
It also supports jobs throughout Baltimore’s and the State’s economies.
21,000
JOBS SUPPORTED BY THE INNER HARBOR
16,000
3,500
DIRECT JOBS
SECONDARY JOBS
IN BALTIMORE CITY
IN BALTIMORE CITY
1,500
SECONDARY JOBS
IN MARYLAND
Source: IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 27
These jobs generate significant compensation.
$790 M
EMPLOYEE COMPENSATION
$540 M
$180 M
DIRECT
COMPENSATION
SECONDARY
COMPENSATION
IN BALTIMORE CITY
IN BALTIMORE CITY
$70 M
SECONDARY
COMPENSATION
Source: IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
IN MARYLAND
Baltimore Inner Harbor Economic Impact Study | 28
And Inner Harbor-generated spending generates revenue for the City
and State.
$102 M
TOTAL REVENUE TO THE CITY AND STATE
$43.3 M TO BALTIMORE CITY
Admissions
1%
Hotel Tax
2%
Income Tax
22%
Sales &
Service
8%
Personal
Property
4%
HR&A Advisors, Inc.
Real
Property
60%
$58.7 M TO MARYLAND
Inner
Harbor
Rentals
3%
Sales Tax
32%
Corporate
Income
Tax
8%
Individual
Income
Tax
60%
Source: Baltimore City Budget & Maryland Budget; HR&A Analysis.
Baltimore Inner Harbor Economic Impact Study | 29
Employees who work in the Inner Harbor are not limited to tourismrelated jobs.
Companies located in the Inner Harbor
employ about 3,000 people.
Human Retail, 5%
Services, 5%
Other, 2%
The Inner Harbor Supports:
54%
NON-TOURISM
Commercial Office, Manufacturing & Trade, Human
Services, & Other
Entertainment &
Recreation, 10%
And
Hospitality, 31%
Manufacturing
& Trade, 22%
Commercial
Office, 26%
46%
TOURISM
Hospitality, Entertainment & Recreation, and Retail
Source: ESRI BAO
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 30
Over a third of employees working in the Inner Harbor live in Baltimore
City.
Inner Harbor Employees County of Residency
Carroll County,
1%
Other, 18%
Harford County,
3%
Howard County, 6%
Anne Arundel
County,
8%
BaltimoreCity,
city,
Baltimore
37%
37%
Baltimore County,
27%
Source: US Census, On The Map
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 31
Over 1,700 residential units have been completed or are planned near
the Inner Harbor since 2007.
Mechanic Center :P1
306 Units: 2015
313 W. Baltimore St.
205 Units: 2016
114 E. Lexington
102 Units: 2013
10 Light Street
445 Units: 2014
Mechanic Center :P2
170 Units: 2017
The Vue Condos
112 Units: 2007
Calvert & Water St.
140 Units: 2014
Completed Development
The Ritz-Carlton Residences
190 Units: 2008
Proposed Development
1111 Light St
93 Units: 2012
Source: Market Research
HR&A Advisors, Inc.
*Not all units shown on map; buildings
Of 75 units or more.
Baltimore Inner Harbor Economic Impact Study | 32
Proximity to the Inner Harbor may have attracted residents to downtown
Baltimore, even while the rest of the City’s population has declined.
6000
760,000
Baltimore's Population
740,000
5000
720,000
700,000
4000
680,000
25%
660,000
640,000
620,000
16%
2000
600,000
1000
580,000
0
560,000
1990
Source: ESRI BAO
HR&A Advisors, Inc.
3000
Population:
2000
Baltimore
Downtown Inner Harbor Population
The population within ½ of a mile of the Inner Harbor has increased by 25% between
1990 and 2010 while the same period of time saw a general population loss of 16% in
the City of Baltimore.
2010
1/2
Milefrom Inner Harbor
½ Mile
Baltimore Inner Harbor Economic Impact Study | 33
Residents of the Inner Harbor area have higher incomes than Baltimore
City as a whole.
Average Household Income
While the average Household Income in Baltimore City has increased between 1990
and 2012, household incomes closer to the Inner Harbor have remained higher than
households further away.
$120,000
$100,000
$80,000
$60,000
Baltimore, $53,000
Baltimore, $42,000
$40,000
Baltimore, $31,000
$20,000
$1990
Source: ESRI BAO
HR&A Advisors, Inc.
¼ Mile Radius from Inner0.25
Harbor
Or 5 Minute Walk
2000
0.5
2012
½ Mile Radius from Inner Harbor
Or 10 Minute Walk
Baltimore Inner Harbor Economic Impact Study | 34
Challenges Facing the Inner Harbor
The concepts in Inner Harbor 2.0 should make the Inner Harbor more
appealing to local residents, as well as out of town visitors.
Source: Ayers Saint Gross Master Plan
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 36
An increase in Inner Harbor tourism, within variations seen in past
attendance records, could generate additional economic benefits.
Inner Harbor attendance fluctuated between 4 – 8% during the Great Recession(20062009).
+ 8%
VISITORS
1,400
$48 M
$3.5 M
MORE JOBS
ANNUAL
EMPLOYEE
COMPENSATION
ANNUAL CITY &
STATE REVENUE
Source: ESRI BAO; Tourism Economics 2013; Inner Harbor Coordinator Report; IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 37
Alternatively, a failure to invest in the Inner Harbor could lead to a
decrease in Inner Harbor tourism, which could have negative economic
impacts.
Inner Harbor attendance fluctuated between 4 – 8% during the Great Recession(20062009).
- 8%
VISITORS
-1,400
-$48 M
-$3.5 M
FEWER JOBS
LOSS IN ANNUAL
EMPLOYEE
COMPENSATION
LOSS IN ANNUAL
CITY & STATE
REVENUE
Source: ESRI BAO; Tourism Economics 2013; Inner Harbor Coordinator Report; IMPLAN; HR&A Analysis.
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 38
Works Cited
 Ayers Saint Gross, Master Plan for Baltimore’s Inner Harbor. (Ayers Saint Gross)
 Baltimore Development Corporation, Inner Harbor Coordinator Annual Report, 2008. (Inner
Harbor Coordinator Report)
 Bureau of the Budget and Management Research, Baltimore City, Summary of the Adopted
Budget, FY 2014. (Baltimore City Budget)
 Department of Budget and Management, State of Maryland, Maryland Budget Highlights, FY
2014. (Maryland Budget)
 Longwoods International, Baltimore, 2012 Visitor Report (Longwoods, 2012)
 Maryland Tourism Development Board and the Department of Business and Economic
Development, Fiscal Year 2012 Tourism Development Annual Report. (Maryland Tourism, 2012)
 Sage Policy Group, The Economic Contributions of the National Aquarium, October 2012. (Sage
Policy Group)
 Visit Baltimore, Study on Baltimore Visitation, ongoing. (Visit Baltimore Study).
 Tourism Economics, The Economic Impact of Tourism in Baltimore, June 2013. (Tourism Economics,
2013)
 U.S. Census
– ESRI’s Business Analyst Online. (ESRI BAO); and
– On The Map. (US Census, On The Map)
HR&A Advisors, Inc.
Baltimore Inner Harbor Economic Impact Study | 39