Bigger, Greener: Skyland Files Another Zoning Amendment

Skyland - the very name implies the ever distant horizon - is back for another zoning review to fully entitle the real estate development project, this time to fit Walmart into the equation.

The most recent change regarding the large ‘town center’ complex is a PUD amendment that was submitted late last week by the development team behind the project. The original PUD was approved by the Office of Zoning in September 2010, but that was before Walmart signed on as the development’s anchor store last fall. The inclusion of the mega-retailer necessitated a number of changes to the plan—though nothing particularly substantive, according to the application. “The proposed PUD modification application is NOT proposing significant changes to the approved PUD project,” reads the document.

That means the development will continue to include 450-500 residential units, some of which will be townhomes and/or affordable housing, and retail space leasing will increase only slightly, from 311,000 s.f. to 342,000 total s.f.

The most serious change appears to be a decrease in the number of parking spaces needed. The total number will be down by about 300 “which meets one of the Office of Planning’s goals,” Matt Ritz, a vice president at William C Smith &. Company, pointed out.  Smith is one of the members of the development team, along with The Rappaport Companies, Harrison Malone Development, the Marshall Heights Community Development Organization, and the Washington East Foundation.

Other changes include lowering the height of parts of the building Walmart will occupy, slightly reducing the number of townhouses, and topping a section of the project with solar panels and a green roof, rather than with a final layer of parking as originally planned.

The revamped development should include slightly more green space, and the application hints at more ‘green’ elements to come: “Walmart has several sustainable goals for this project which will be achieved by the following features: use of water efficient faucets and toilets; implementation of an energy management system; high-efficiency HVAC design; LED lighting; sun shading devices on the roof; and a construction waste stream management program."

Ritz is hoping the project will get a hearing with the Zoning Commission before the end of the year and a public hearing sometime around March 2013. But it’s all up in the air. “The dates are with a grain of salt,” he said. “It’s all contingent on the Zoning Commission.” And the company is still a very long way from soliciting construction bids.

Still, as slowly as it’s going, there is definitely movement occurring at Skyland. In September, the city celebrated the start of a demolition process of some of the buildings in the existing shopping center. And of seven legal cases that were pending in early 2011 - all linked to the city's use of eminent domain on the project--only one is still unresolved.

Washington, D.C., real estate development news

Ft. Totten on the Rise

One of Ft. Totten's most transformative developments is at last on the way, and with it, a new neighborhood. The Art Place at Fort Totten, the 826 unit mixed-use complex that sits between the Metro station and South Dakota Avenue, is ready to begin construction "within the next few weeks." The project, conceived by the Morris and Gwendolyn Cafritz Foundation, will form a new community with over 300,000 s.f. of retail, 2282 parking spaces, a children's museum, and senior's home in 4 separate buildings.

The plan has been on the boards for years - developers hoped to break ground in 2010 even after the market crash - as part of plans by the city to spur all local owners to coordinate development of the area, one of the last Metro centers that has not seen significant development. The first phase is expected to complete 30-36 months from now.

With construction fences now up, and raze permits all but finalized, developer Jane Cafritz says demolition will commence "in the next 3 to 4 weeks" on "Building A" at South Dakota and Galloway. The multi-phase project will start with the demolition of 5 of the 15 buildings on the 16 acre site in order to make way for 1 of the 4 planned mixed-use buildings. This phase will incorporate about 530 residential units and 110,000 s.f. of retail, though no grocery store at this point due to the Walmart planned across the street, which may be underway as early as this summer.
Cafritz says timing on the project was not affected by the announcement of Walmart. "We're there to be a catalyst in the neighborhood."

Phase 1 will also incorporate a small subsidized housing component and the senior living center; and about half of the 98 units of senior housing will go to current residents of Riggs Plaza. Cafritz notes that the project was designed in phases partly to accommodate existing tenants "that we have great repsect for that have been on site literally for generations." Ultimately all the buildings will be connected by an underground parking garage. All buildings have been approved by DC zoning officials but timing and design issues for Buildings B, C and D have not yet been finalized. While no office space has been planned, Cafritz notes that the first phase will incorporate flex-space that could be either retail or office. The Children's Museum is planned for the second phase of construction.

The Cafritz Foundation had earlier dangled the prospect of hosting both the Washington National Opera and the Shakespeare Theatre for storage, rehearsal space and related shops, a scenario that has now been shelved, but Jane Cafritz says her team is now talking to other similar non-profits. All residential units will be for-rent, the "Foundation owns this and intends to keep this," says Cafritz.

Master planning for the site was done by Ehrenkrantz Eckstut and Kuhn (EE&K), Shalom Baranes Architects (SBA) has designed the first of the four buildings, and MV+A Architects is designing the retail, all to meet basic LEED certification standards.

The eight-story Building C is planned as entirely residential, built in two C-shaped wings, joined at the second level, to accommodate the possibility of a new 3rd Street connecting the Arts Place property to the neighboring Food and Friends property, should the neighbors decide to sell or redevelop at a later date.

Washington D.C. real estate development news

801 New Jersey Ave Walmart Set To Break Ground In Spring, Spokesman for JBG Says

The planned Walmart at 801 New Jersey Ave. NW will break ground by spring, according to a spokesman on behalf of developer JBG Companies, one of six stores the world's largest retailer will bring to the District of Columbia.

"The planning and preparation is moving ahead quickly," said Charlie Maier, an outside spokesman on behalf of Chevy Chase-based JBG Companies. JBG Rosenfeld, JBG's sister company which focuses on mixed-use retail and will also partner on the project. Walmart has already signed its lease for the site, which will be known going forward as 77 H, as it will line up along H Street on its southern edge.

MV+A Architects, which designed the Whole Foods at 15th and P as well as mixed-use projects in Tyson's Corner, Alexandria and Herndon, along with The Preston Partnership, creator of the Kentlands plan in Gaithersburg will serve as designers, Maier said. JBG has already gotten its construction and zoning permits for the apartment and retail complex that will be built on the site, he said. "We've already started planning for a groundbreaking," he said.

Earlier this week, parts of the Ward 6 site along H Street, not far from Massachusetts Ave., and Union Station had been fenced-off and signage erected. The complex will include about 300 apartments on 280,000 feet along H Street and an 80,000 square-foot store. The red-brick exterior matches other commercial buildings in the area, including the Chicago-style Government Printing Office at North Capitol and H Street and 800 North Capitol, which was built in 1991 and designed by Hartman-Cox Architects

The entrance of red-state Walmart into deep-blue D.C. is not without controversy. As with other proposed Walmart openings in other states, many local businesses feared losing out to the retail giant, a view backed by unions like the United Food and Commercial Workers union, which represented Safeway and Giant workers in the District, who said their members would be threatened by Walmart's lower wages and benefits.

Walmart, in response, launched a Web site to help convince skeptical residents and activists that its presence would be a boon to improving access to groceries in poorer neighborhoods as well as provide jobs to DC residents, at least 1,200 spread out amid the six stores, and also 400 construction jobs. Walmart says that Washingtonians spent $40 million at its stores outside the District in 2010. Walmart also noted that the stores would contribute $10 million a year in tax revenue to the District. "The District is anxious to see something happen," Maier said. "It's not all 100 percent approved but its pretty close," he said.

Walmart now has expanded its plans in the District to six stores, all of which it says will be open before the end of 2012. Besides New Jersey Ave, there will be two in Ward 4 with one at Georgia Ave and Missouri Ave. (rendering at right), where some site prep work is happening as well.

Another store, known as Fort Totten Square will be built at Riggs Road NE and South Dakota Ave. NE (rendering above). Another is planned for Ward 5 at New York Avenue at Bladensburg Road, while two are planned for Ward 7, at East Capitol and 58th and one at Good Hope Road and Alabama Ave.

Washington D.C. real estate development news

Skyland Struggles Towards Uncertain Timeline

With the specter of a Wal-Mart vs. Safeway showdown over a decade-old exclusivity covenant having receded, the District can get back to resolving the many other issues standing in the way of the Skyland redevelopment in Southeast DC, a top priority of Mayor Vincent Gray’s embattled administration. But can Skyland overcome the many hurdles it faces?

Safeway, one of the District’s top private employers (15 stores), and high-profile retail anchor Wal-Mart squared off in November over an agreement Safeway had entered into with the owners of the shopping center, Skyland LLC, to bar certain types of competitors from the property after Safeway relocated to a nearby shopping center. Each side issued bland statements but retained powerful advisors; Safeway hired Maryland lobbyist Bruce Bereano, famously an ex-fraternity brother of Mayor Gray, and Wal-Mart hired David Wilmot, a local dealmaker who co-hosted a fundraiser with Mayor Gray just last month. Fast-forward a couple of days, and the matter was suddenly settled.

"A covenant exists on one lot of the many that comprise the Skyland redevelopment site," says Nimita Shah, Project Manager in the Office of the Deputy Mayor for Planning and Economic Development (DMPED) by way of clarification. “The District is in discussions with Safeway about the removal of the covenant and anticipates a resolution in the upcoming year. However, it is important to note that the Safeway covenant noted above will have no impact on the proposed Wal-Mart that is to be included in the redevelopment, given that its placement on the site is outside of the affected lot.”

Either no one at Safeway or Wal-Mart actually read the covenant before throwing down their respective gauntlets, or the issue was quietly resolved through backroom horsetrading (the very sort of thing that Gray denounced when he pledged to bring transparency to the mayor's office). At any rate, with this issue put to bed, does this mean that Skyland faces a clear runway to approval and groundbreaking? Far from it.

Since first seizing Skyland in 2005 by invoking eminent domain, the District has spent over $12 million on settlements. Three more tenants settled in 2011 – Hong Kong Inn, Hilltop Cleaners, and New York Fried Chicken – leaving perhaps as few as one holdout, though according to the District there are over a dozen tenants are still operating at Skyland. “Fifteen tenants remain in operation at Skyland," says Shah. “The District is in the process of working will all of the remaining tenants to coordinate their relocations over the upcoming year.”

Everyone out by the end of 2012? Count Elaine Mittleman, an attorney who represents several Skyland tenants, among the skeptics. Mittleman contends the eminent domain proceedings have been slipshod and disorganized. “Wild ineptitude,” Mittleman snaps when asked to characterize the District’s handling of Skyland. Mittleman also provided DCMud with extensive correspondence between herself and the District that seems to raise questions about who holds the titles to seized Skyland properties, as well as concerns about the eventual turnover of Skyland to private developers, one of whom is a close associate of Mayor Gray’s, and has done repairs at his home.

Serious questions also remain regarding the project itself. There’s no firm consensus on whether Skyland is in fact a viable site for redevelopment; critics have pointed to the lack of public transportation options (the nearest Metro station, Anacostia, is a mile and a half away) and an already dicey traffic situation. There are also multiple competing projects in Southeast – St. Elizabeths East, Poplar Point, and Kenilworth-Parkside, just to name a few - as well as another Walmart planned nearby, on East Capitol Street. In the face of these doubts, the conventional wisdom is that with millions and years spent and so many promises made – none more than by the present administration - the District can hardly back out now.

Or can it?

People who point to the 2005 Supreme Court ruling that empowered the city of New London to oust intransigent homeowners so they could build a Pfizer plant as proof that Skyland is all but inevitable, overlook the fact that the Pfizer plant was never actually built. The drawn-out process of settling with and vacating tenants, as well as appeals and the administrative labyrinth of state seizure of property, can often outlast the patience of prospective tenants. Before Wal-Mart agreed to anchor Skyland, a similar Target deal fell through. Who's to say Wal-Mart won't walk, if litigation drags on for another year or three? Is Mayor Gray prepared to

follow through on his threat to block Wal-Mart's four other stores in the District if they don't put one in Skyland?

Some cite the possibility that the District's resolve on Skyland is, at least in part, opportunistic. If it comes together, it will be a victory for some mayor's scorecard. But if it doesn't, that mayor (like the last three) can still curry favor with the voters of Southeast by telling them he tried. In fact, the prospect of a mayor fighting the good fight on behalf of the city's least-served quadrant, only to be stymied by other forces, is arguably a more valuable asset in a general election than a mere shopping center, however big and shiny. But the Mayor has been personally advancing the cause of Skyland to private businesses that might have a stake in the proposed development.

Elaine Mittleman disagreed with this cynical view of things – with conditions. Mittleman believes that the District sincerely wants Skyland, and wants it badly, but just got in over their heads. “The District courts rubber-stamped everything, basically, and there was never any comprehensive plan, just a back of the envelope thing,” Mittleman says. “It seems like they have just not put in the proper effort. It seems like they just magically thought it would happen.”

For their part, lead developer The Rappaport Companies, who won rights to Skyland way back in 2002, doesn’t seem the least bit perturbed by these latest developments, either stoically patient or just resigned to sticking it out for the long haul.

“The Skyland project is definitely gaining momentum, and the Mayor has made this a priority,” said Sheryl Simeck, Vice President of Marketing and Communications at Rappaport. “But it is still too early in the process for us to be able to supply construction dates," (despite Mayor Gray's prediction it would break ground last year.) "The District continues to work on resolving the outstanding legal issues involving eminent domain. Development cannot start until these last few issues are resolved.” At this time, no one is prepared to say when that will be.

Washington D.C. real estate development news

HPRB: Site of DC's First Walmart Not Historic

As was expected, the Historic Preservation Review Board voted yesterday in line with the Historic Preservation Office recommendation not to designate the Car Barn on Georgia Avenue as a historic landmark. The site is the proposed location of the District's first Wal-Mart, and a historic designation would have complicated and slowed the path to development. Property owner Foulger Pratt will be able to continue demolition (abruptly halted) of the structure.

Several individuals and parties, both for and against slapping the Barn with historic landmark status, gave impassioned testimony as to whether preservation was important based on the structure's integrity, and ability to convey the meaning for which it was deemed significant.

One testimony in opposition to preservation declared, "It's a blighted area and it has been for many years... preserving [the Car Barn] would defeat the effort of the community to revitalize the area."

However, a historian in favor noted the existence of old windows, materials, original brick walls, trusses, original roof skylights, old doors, and original layout (service and storage bay). A community member added, "It's a garage that represents the entire Brightwood community."

HPRB said preservation was an issue only of "significant integrity," most of which was lost when alterations began to convert the structure to a Chevy dealership in 1995, and in the end, the Board felt there was not enough.

Washington D.C. real estate development news