December 17, 2007

City Developers Agree on Financing Plan for Old Convention Site

 By Jonathan O'Connell, Washington Business Journal

D.C. Mayor Adrian Fenty announced Monday the financial details of an agreement with Hines and Archstone-Smith for an $850 million development of the old convention center site.

The project's plans include 250,000 square feet of retail, 760 housing units and 465,000 square feet of office space, parks and entertainment areas.

In the deal, the city will sell or provide long-term leases for land between Ninth and 11th streets NW along H Street, the southern portion of what is now a surface parking lot.

In return, the city will get $200 million in benefits, including $55 million to make 134 of the housing units affordable, $48 million in infrastructure improvements, including the extension of 10th and Eye streets, $28.5 million in rent and $14 million to provide entertainment in a public square between four of the six buildings.

Fenty called the project the "capstone of downtown development" and said it would transform the area into a "live, work and play environment unlike anywhere else in D.C."

The city still controls a 53,700 square-foot parcel on the north end of the site, a plot pegged by former mayor Anthony Williams as a place to relocate the city's central library from the Martin Luther King Jr. Memorial Library. When asked about his plans for the site, Fenty deferred to Neil Albert, deputy mayor for economic development, who said that retail or housing might be appropriate but that "there might be civic uses that might be just as good."

Hines and Archstone Smith have first right to develop the District's remaining site, and have made plans that include space for big box retail needing in the range of 100,0000 to 150,000 square feet.

Konrad Schlater, the city's project manager for the old convention center site, said the developers would present their ideas for that plot to the city during the first quarter of 2008, after which time the city would make its choice. He said there was interest from big retailers, but not from department stores.

The developers have been vetting a number of names for the project but have not announced one, although both Fenty and Ken Miller of Archstone-Smith used the term "city center" - one of the rumored names to describe the project at the announcement.

Councilmembers Jack Evans, D-Ward 2, and Kwame Brown, D-at large and chair of the economic development committee, joined the mayor for the announcement, at the Walter E. Washington Convention Center.