Sheraton Inner Harbor closes, 69 workers laid off in downtown blow

The Sheraton Inner Harbor Hotel shut its doors on New Year’s Eve, leaving an empty lobby where signage has been removed and 69 employees without jobs. The closure also ended the run of Morton's The Steakhouse, which occupied space in the hotel lobby, marking the latest exit in a string of departures that have whittled downtown hospitality and retail options.

The layoffs add to a mounting local job shock in a sector that drives foot traffic and sales tax receipts for the city. For downtown businesses that depend on hotel guests and restaurant diners, the sudden removal of a major property creates ripple effects for street-level merchants, tour operators and evening economy venues. Neighborhood observers described the loss as another blow to the Inner Harbor retail corridor, which has already seen multiple recent departures from Harborplace chains and other restaurants.

Vacancies in high-profile properties tend to reduce visitation and increase visible decline, which can reinforce a cycle of fewer customers, lower rents and more closures. Reduced occupancy at a large downtown hotel also shrinks demand for nearby services such as taxis, bars and meeting-space vendors, translating into lost hours for workers across the local service economy. The immediate hit is the 69 laid-off employees; the secondary impacts will be measured in lower weekday foot traffic and fewer group bookings for nearby retailers.

Longer term, the closure highlights structural challenges for downtown Baltimore. Urban cores across the country continue to adjust to shifts in travel patterns, corporate meetings and local consumer behavior since the pandemic, and Baltimore’s Inner Harbor has felt those pressures alongside a wave of retail contractions. Without rapid reactivation, prominent empty spaces can depress property values and city tax receipts, complicating municipal budgets that rely on sales and hotel taxes.

Policy responses that could matter locally include targeted workforce supports for displaced hospitality workers, incentives to convert vacant hotel or retail space to mixed uses, and coordinated marketing to restore conference and tourist demand. For now, the physical absence of signage in the Sheraton lobby is a visible reminder that downtown recovery remains incomplete.

For readers, the closure means fewer dining and lodging choices downtown and a likely near-term dip in activity around the Inner Harbor. The coming weeks will show whether the property is marketed for sale, repurposed or reopened under new management; how city leaders and business groups respond will shape whether this becomes another vacancy on the waterfront or a pivot point for downtown reinvention.