Only two formal replies came last month to a preliminary “request for proposal” to develop the City of Falls Church’s newly-acquired 36-acre parcel for what will become by far its most ambitious endeavor ever.
One bid came from a team centered around Clark Construction, whose proposed plan is expected to be similar to what it offered early in the year as a non-solicited offer, and the other is from a group assembled under the aegis of the Republic development group.
Despite the dearth of bids, the Falls Church City Council and School Board have already held two lengthy behind-closed-doors meetings, with only their own staff and consultants present, to mull the proposals and next steps in a process that is scheduled to culminate with a public referendum next November.
Now, F.C. City Hall has announced a pair of public events to provide citizens two chances this month to get up to speed on where things stand to date, and where it’s expected to be going. They are the next two Saturday mornings, Dec. 5 and 12, at 10 a.m. in the City Hall Council chambers.
Unless one just likes to hang out in that kind of company, there’s no reason to attend both. They will be identical, at least in terms of what is presented to the public, while at the same time a lot of preoccupation will be dwelling on the anticipated Dec. 14 City Council super majority vote on the 4.3 acre Mason Row project.
Falls Church City Manager Wyatt Shields told the News-Press this week that both the “closed session” meetings have been productive, with the latest this Monday night taking a full two hours. But otherwise, there was no information to be disclosed. From the public information provided about the two bids, it is noted that both call for the construction from scratch of a new high school and extensive renovations to and expansion of the middle school.
As for the question of why only two developers responded to the initial request for proposals, or RFP, from the City, Shields said, “I will leave it to others to comment on that.”
It is safe to say that the City was expecting a more robust response, especially given the big turnout of high-powered developers that showed up for a non-mandatory briefing on the contents of the RFP in August.
The RFP called for a mix of school development and economic development-oriented development on 10 of the 36 acres. Under the terms of the deal between Falls Church and Fairfax County for the transfer of the 36 acres into the jurisdictional control of Falls Church (as part of an exchange for Fairfax’s acquisition of the Falls Church Water System), only about 10 acres of the land could be put to anything other than an educational use.
But the 10 acres susceptible to commercial development could be some of the most lucrative in the entire region because of their proximity to the West Falls Church Metro station. In that context, among the boundary conditions is a long-term lease (for $1) by Falls Church in the early 1990s of significant acreage adjacent the current site to the University of Virginia and Virginia Tech for a graduate center there. The universities have an option to buy their land at the end of the lease.
The project is also bounded by the West Falls Shopping Center, home of Giant Foods and other retailers, whose owner has not yet shown an interest in being folded into a bigger development with the City. The same goes for a considerable assemblage of land that the Beyer Automotive Group has across the street.
Thus, one question that has risen to date goes to the issue of the extent to which exploring the capacity for expanding the footprint of the development of commercial component of the land in question has or has not occurred.
Another aspect has to do with the restrictions placed by the City’s “RFP” on the nature of the economic development for the 10 acres of the site.
One knowledgeable source told the News-Press that there are two problems that he feels played a major role in restricting the number of developers who bid on the project.
The first is the inability of a developer to squeeze everything that the City wants onto the land. With two schools, full athletic fields, a swimming pool and a public use performance center, there is no way, according to this source, that there would be any more than eight, not 10, acres left over for commercial development.
The second is the condition in the RFP that the commercial component include such a high percentage (as high as 75 percent) of non-residential use in a regional market that is currently overbuilt as it is, where there is no shortage of office space and commercial-retail options.
The way it plays out is a two-stage process, the first being the construction of the new school facilities and then, only after they are completed and the old facilities then demolished, can the second phase, the commercial phase, begin. That ties up the commercial component for at least four years, the component that the developer would count on for the revenue flow needed to pay for everything else and come away with some kind of profit.
“It is like they went up into their attic and pulled down every ornament they could find to put on their Christmas tree,” one developer quipped, according to the News-Press source.
According to one of the proposals, the News-Press was told, the cost of the new school facilities, a public swimming pool and road improvements is projected to cost $180 million. The cost of the athletic fields called for is estimated at $30 million (the News-Press source noted that a private school in the District with major benefactors revamped all its fields for $16 million).
Some developers considered the City’s RFP to represent “a bit of a wild goose chase” with unrealistic financial expectations and conditions on the commercial acreage component. “It is simply not financially attractive to many,” he said.
He said certain of the same constraints caused Akridge, one of the biggest commercial developers in the region, to give up on its Falls Church Gateway project on N. Washington St., which it sold to the Inova Health Systems last year. The City was demanding Akridge find a lead tenant to occupy 80,000 square feet of the site, and it was simply undoable.
The News-Press source said that the most successful use of the commercial component of the campus redevelopment project land would be residential options to attract millennials and age-targeted populations (age-targeted, as opposed to age-restricted, he emphasized). The nearby Metro could be a huge component of what would make condominiums on that land, for example, highly attractive to those demographic components.
With the prospective job explosion expected in Tysons Corner, Metro-proximate workforce housing, including micro unit housing, could be very popular and lucrative, he suggested.