Capitol Hill’s Reservation 13 Proposals to Go to Council in December


Capitol Hill�s Reservation 13 Proposals to Go to Council in December

The proposal to declare two lots on Reservation 13 next to the Stadium Armory Metro in Hill East as surplus and the land disposition agreement which would give those lots to developer partners Donatelli Development and Blue Skye Development could go before the District Council in December.  A groundbreaking on the mixed-use development would likely follow sometime in 2016.

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The entire Hill East Master Plan first created in 2002 calls for the redevelopment of  50 acres of land currently occupied by about 18 structures in various levels of use or decay to be transformed into a mixed-use urban community with direct access to the Anacostia River waterfront.

Phase 1 of development entails Parcels F-1 and G-1, bounded by 19th Street, to the west, a future extended Burke Street, SE to the north, and a future extended Massachusetts Avenue, SE to the south. The mixed use project of ground floor retail and residential–including 30% of units set aside as affordable–will sit south of the existing St. Coletta of Greater Washington site,  1901 Independence Ave. SE, and adjacent to the southern exit at Stadium Armory metro.

The project would bring 354 units of residential, about 220 below-grade parking spaces and 20,000 to 40,000 square feet of retail to the currently empty lots.

The site’s redevelopment has been a long time coming. The Council first approved funds for the master planning process in 2002. The Fenty administration released a request for proposals for redevelopment in 2008 that received four responses, but the economy took a turn and all but one group, Donatelli Development and Blue Skye Development, dropped out. In 2012 the Gray administration re-released a requests for expression of interest for the site for legal reasons and received one response again from Donatelli Development and Blue Skye Development.

Now the Office of the Deputy Mayor for Planning and Economic Development (DMPED) is proceeding with the legislative process to declare the land surplus so the District can transfer ownership of the property to the development team. DMPED anticipates bringing both the surplus declaration and the land disposition agreement (LDA) to the District Council in November and hopes for passage at that time, Ketan Gada, director of Hill East Redevelopment for DMPED, told a group of neighbors Wednesday evening.

Community leaders in attendance Wednesday all spoke in support of moving ahead with the legal process to make development possible–and quickly.

“It’s been 13 years of this. My hair was black when we started,” said Advisory Neighborhood Commissioner Francis Campbell. He urged the development team to move quickly to get the development underway.

Even assuming a quick pass through Council, the project will need to go through permitting and other steps before a groundbreaking. Gada estimated the Council process could take 3 to 4 months and between Council approval and the groundbreaking will likely take another 18 months for underwriting, plan finalization, entitlements, etc.

“This is a 2016 project. It’s not happening in 2015,” said Larry Clark, vice president of Donatelli Development about the groundbreaking timeline. “It’s a priority job for us.”

Clark said from groundbreaking it will probably be about 18 months until the very first tenant can move in and a total of 24 months for the entire project to deliver.

The surplus process now underway was also delayed while the developers worked with a potentially interested grocery tenant. The grocer would need 60,000 square feet of ground floor space, so the developers were tweaking the design to see how to accommodate such a tenant and the necessary loading and trash areas.

Clark said his team spent “months” with a  large grocer that has a “busy” location nearby. He said they went through the company’s location and facilities committees, but since then the chain was recently purchased and other expansion locations in the region have stalled.

“I hope they come back around,” said Clark.

While Clark did not mentioned the brand by name it is possible he was referring to Safeway. This year Safeway sold to private equity firm Cerberus Capital Management and merged with the Albertson brand of stores. Safeway operates a location on Capitol Hill at 14th Street between D and E streets, SE, just over half a mile from the new development site.

As part of the LDA, the developers will not pay for the land in exchange for a commitment to provide 30% of its residential units (106 units under the proposed plan) as affordable to people earning 30% and 60% of area median income.

“It’s significant. It’s 106 units,” said Gada about the affordable housing being provided, when asked about the public benefit received in exchange for the land price.

The 2013 Washington DC Metropolitan Area Median Income (AMI) for a family of four is $107,300 and rental rates assume 30% of income is allocated to housing. So a family of four earning 30% of AMI is bringing in no more than $32,200 and therefore rent would be no more than $805/month, a family of four earning 60% of AMI should pay no more than $1,610/month in rent. If that family were to pay the market rate (assuming again 30% of income goes to housing) that would come to $2,683/month.

Clark said most of his company’s project provide 20% of the units as affordable. By offering 30% as affordable, Clark said it adds about to about a $23 million hit to what they would normally be able to finance had those units been rentable at market rate. They are working on financing now.

Another item of note from the evening was a firm commitment by Gada that the F1 and G1 parcels would not be available for any potential Olympic bid–a concern for some nearby neighbors.

District Source will provide updates as the surplus and LDA proposals go before Council.

The image above is a view of the future development at Reservation 13 as seen from 19th Street with the Stadium Armory Metro at the northwest corner of the project. Image from DMPED documents. 

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