You know, don’t you, that Lakeside is a BILLION DOLLAR deal? That’s a Billion with a “B,” as they say. Rough numbers. Down in our little town of Trappe, pop. 1070. Seventy-five votes the other way at that April 21, 2003 referendum, and it never would have happened.
Famously, Lakeside is designed for 2,501 homes. Say an average home sales price of $400,000, so that alone is a billion. The developer’s website says 600 apartments in addition. Plus 550,000 square feet of retail space (a pretty sizable shopping center or two). And who knows what else when it’s all said and done. Typically, around thirty percent of the sales price is attributed to land. So, we’re talking about $300,000,000+ just to the land developer, leaving aside the business model for the various home builders who will be coming in.
So if like most of us, you think about Lakeside in terms of its impact on Talbot’s “rural character,” or traffic, or nutrient pollution in the Miles Creek and the already impaired Choptank, or County schools, or denuding seventeen acres of forest land, just remember the context. The forces assembled to make this deal happen are powerful indeed, and woe be to the County authority or bureaucrat or office holder who tries to slow this baby down.
My question is simply this: why can’t they just do it right? Cut no corners, be straight-up, honor all the regulations, provide a belt along with suspenders when it comes to issues of public health and the environment. God knows they can afford it (says a man whose money it is not).
I was a developer myself, you may know. (Sadly, I never did a deal anywhere near this scale.) I do not think anyone should resent the big profits that will flow to the risk-taking, patient, entrepreneurial Mr. Rocks and his team, and the investors who are backing him, so long as they really do play by all the rules (and I don’t mean the famously sarcastic golden rule—”He who has the gold makes the rules.”).
The foundation of this project, as I see it, was particularly clever in the way the developer arranged a big annexation into a tiny town, and can leverage the powers of a municipality. I remember the saying from when I was briefly in banking: “Owe the bank some money, and the bank owns you. Owe the bank enough money, and you own the Bank.” Something like has happened here as I see it: Trappe is totally dependent on the developer and his success, yet we are all counting on the Town of Trappe to regulate everything that happens in Lakeside (including re-zoning). So who will really be calling the shots, for example, respecting a $60,000,000 Special Obligation Bond issue authorized some time back? (Irony of irony, it started with Rocks paying for the Town to hire its Planner, of all things.) What could go wrong?
And ambiguity remains as to the ownership of the nominal developer, Trappe East Holdings Business Trust (“TEHBT”). Lakeside continues to be referred to around here as the project of the respected and prominent local firm, Rauch Engineering. I’m sure Talbot County would be better off were it so. But while I expect Mr. Rauch is a partner as well as the engineer—and strategically, the public face of “the developer” in Talbot County—it’s unlikely that all of that Three Hundred Million is going to stay around here.
As mentioned in an earlier column, Rocks Engineering Company of Vienna Virginia was the original developer, and still seems to be the lead. It was Nicholas P. H. Rocks who signed the most recent MDE application for the Trappe East wastewater discharge permit—the one just remanded for further review by Judge Kehoe—on behalf of TEHBT. And Lakeside is listed as a major development on the website of Rocks Engineering Company.
But billion-dollar deals (I can’t get used to saying that when referring to Trappe) are serious business, well beyond Rocks alone, much less Rauch Engineering. It seems the real money–and power–entered the scene unannounced, back in the Spring of 2019, from Pakistan.
A “boutique merchant bank” named ICA describes the deal in its Portfolio: “A Joint Venture between ICA and the Rocks Engineering for the development of the largest mixed-use Real-Estate in the East Coast of United States located in the County of Talbot site known as Lakeside At Trappe, Maryland. It is a privately funded project with a CapEx of $720 million plus. Approved 2,501 Unit PUD, with 550,000 SF of Commercial Space.”
It also asserts “The project has been endorsed by the State of Maryland,” perhaps drawing some inference from the manner in which the project has been assisted by the Maryland Department of Environment. (My sarcasm there. Sorry.)
Purportedly Pakistan’s largest “Private Banking Group” (according to its website theicagroup.com), ICA dates back to 1927. The “founder and patriarch” was Shaikh Mohammad Husain. The Company has an office in Denver, while “ICA Private Limited,” referred to in ICA’s history, has an address in Islamabad according to the information website opencorporates.com. ICA calls out its investments in theme parks in Tianjin China and Kawasaki Japan; in something called “Dolphin Discovery;” and in Pakistan Airlines and Karachi Electric Supply, among others. The only deal listed in its “Real Estate Development Portfolio” other than Lakeside is a memorandum of understanding (!) with the Government of Anguilla to exclusively operate the airport retail facilities. Nothing in there at all like Lakeside.
And for some reason, the CAI website includes an unusual “Gallery of Pictures” that includes photos of Arnold Schwarzenegger and Muhammad Ali
The Talbot County Council seems pretty relaxed about all this, so I am sure it’ll all work out fine. It better, because as Planning Commissioner Spies said, “When things are big, problems are big!”
Dan Watson is the former chair of Bipartisan Coalition For New Council Leadership and has lived in Talbot County for the last twenty-five years.