Boom! Tysons Begins Take Off As ‘Next Great American City’

February 11, 2015 8:42 PM0 comments

451tysosnsignWEB

“Welcome to Tysons, America’s Next Great City!”

Just up the road, Route 7 to be exact, from the City of Falls Church, a new sign suddenly showed up last week identifying the already-imposing Tysons Corner area as “America’s Next Great City.”

The slogan is no joke, as anyone examining the jaw-dropping assemblage of plans for the development of that area can see, now that the four Metro Silver Line stations are complete and operational there.

It is also turns out quite fortuitous for the City of Falls Church. Less than two miles down the shared Route 7 corridor, Falls Church had already settled on its own slogan, thanks to the efforts of the creative talents at the local Smith-Gifford firm about four years ago. As much as some in Falls Church haven’t warmed to it yet (it’s in the nature of such things), the Falls Church slogan, or logo, as “The Little City” now perfectly sets the City apart, juxtaposing it to the emerging Tysons behemoth as “America’s Next Great City.”

While Falls Church has now attracted the interest of developers eager to erect a series of their own large-scale mixed use projects, that is undoubtedly due in large part to what’s now clearly coming in Tysons. It is a common tactic for developers to nibble around the edges of a big new boom area to sew up adjacent lands and political approvals for construction.

From Falls Church’s point of view, that is quite OK. The City is beginning to reap the benefits of the unfolding Tysons boom, while the task of its leaders is not to deter that dynamic at all, but to constrain it within the City’s unique identity parameters so that a distinct look and feel to the Little City will always set it apart.

Developers coming into Falls Church will like that too, as they can play for success on that unique identity while the broader parameters for success – great schools, lovely residential neighborhoods and parks, proximity to Tysons, the Metro, the interstate and beltway, equidistant from two major airports and five miles from the White House – also remain present.

Late last month, 550 developer movers and shakers came together at the McLean Hilton to hear a succession of informative talks and two panels, one focused on the “Old Tysons” and the other on the “New Tysons.” The “Tysons Update” event was hosted by BisNow.com.

The event itself centered on the announcement of a new purchase from NV Commercial, developers of the “Tysons Central” 1.5 million square foot property. Foulger-Pratt real estate developers acquired the office/retail 400,000 square foot parcel in the project located just 50 feet from the new Greensboro Metro station.

“Tysons Central” will also include a 400-unit residential tower, now controlled by Lennar, and additional parcels for residential and a hotel with condos above, according to BisNow.

Among the presenters at the Jan. 28 event, Transwestern presented the results of an office space demand study through 2040 at the four Tysons Metro stops. The study found that Tysons’ four Silver Line Metro stations will absorb 5.2 million square feet, the most demand on the entire Metro system. Demand in Tysons is highest at the Spring Hill and McLean Metro stops at 2 and 1.6 million square feet, but concern was expressed that 64 percent of existing office inventory at the four Metro stops in Tysons is composed of older Class B and C office products, while the demand will be for new or fully renovated spaces.

An explanation was provided in a panel discussion on why so much residential is now under construction at Tysons. Aaron Georgelas said that “major societal shifts” are causing the new focus. “Millennials don’t want to own cars or do traffic,” he said, according to BisNow. “They need housing close to their workplaces.”

While the growing numbers of housing units are resulting in slowed leasing and dropping prices, Tysons will be able to absorb them all, Georgelas said.

Will Tysons really be “America’s Next Great City?” According to the Meridian Group’s Gary Block speaking on Jan. 28, the combined ingredients of 28 million square feet of office with an educated workforce is combining with the recent picking up of federal spending such that a “Tier 1” status like D.C., New York City or Los Angeles is a “good chance.”

JLL Managing Director Kelly McBride told the Jan. 28 gathering, as reported by BisNow, that the company’s Arlington-based tech businesses are beginning to ask about Tysons.

That means along with residential options, delis, conference centers and gyms are to be expected. Tenants want dining options within walking distance, and RTKL’s Ray Peloquin noted that “hospitality” is big in the mindset of young workers, looking for their workplace to be more of an “experience” rather than just a 9 to 5 job.

As a result of all the coming development, construction costs are expected to be maintained at a 3-4 percent growth rate, per the last few years, although a shrinking labor pool could increase those costs over 5 percent, Lerner Vice President Jim Policaro said.

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