ANNAPOLIS -- In a couple of years, $200,000 may buy more than just a piece of prime waterfront property in Baltimore. It may buy a condominium directly above the harbor, under plans approved this week by the Maryland Board of Public Works.

Board members approved two proposals to build residential and commercial properties on piers near the Fell's Point section of the city, permitting developers to rebuild the piers and lease the airspace over the harbor.

The approval, which was presided over by Gov. William Donald Schaefer, marks the first time the board has permitted a non-water-related use for a state-owned wetland in the wake of legislation passed in 1989.

The proposals meet all the requirements of state law, said Harold Cassell, the state's wetlands administrator.

Approval by the board will allow Anchorage Plaza LP to build a structure with 12 residential units along its pier and Baltimore International Yachting Center to erect a building with 46 residential units and 14 commercial units.

Jim Bradley, an official with Baltimore International Yachting Center, said condominiums in the building will sell for between $200,000 to $450,000. He said that much of the commercial space already is leased to local marine-related businesses.

Both piers now are nearly unusable and will have to replaced, after the firms obtain permission for construction plans from the Army Corps of Engineers, Cassell said.

Schaefer and the board, which includes state Comptroller Louis Goldstein and Treasurer Lucille Maurer, gave the firms permission to build new piers in the waterway and allowed them access to make periodic inspections and maintenance improvements.

The state officials also leased the airspace -- to a height of 80 feet -- above the piers, for an initial cost of $64,000 to Anchorage Plaza and $168,000 to Baltimore International Yachting Center. Both developments will have to pay the state 0.008 percent of the market value of the development each year through the 80-year term of the leases.

Sandra Sales, of the Waterfront Coalition, said the developers must be careful that the residential units do not compete with other waterfront development.

The coalition also won agreements with the developers to make sure condominium buyers obtain liability insurance to protect against damage to the piers and property.

"We have to make sure the people who buy these can afford the costs of repairs," Sales said.

Anchorage Plaza expects to build a 66-foot-long extension to its pier, which is now 200 feet long, and build a 3 1/2-story building. Baltimore International Yachting will construct a new pier and build a four-story structure.