Friday, December 02, 2011

WBJ: "DC hands over initial McMillan work to joint venture"






See this article from the Washington Business Journal:







Commercial real estate
D.C. hands over initial McMillan reservoir work to joint venture
Premium content from Washington Business Journal by Michael Neibauer, Staff Reporter
Date: Friday, December 2, 2011, 6:00am EST
http://www.bizjournals.com/washington/print-edition/2011/12/02/dc-hands-over-initial-mcmillan.html

D.C. may have chosen to take the lead on the complicated rezoning process for redevelopment of the McMillan Reservoir sand filtration plant, but the city can`t do it alone.

Vision McMillan Partners, the lead developer on the 25-acre mixed-use project surrounding the Bloomingdale and Stronghold neighborhoods of Northwest D.C., was recently awarded a $1.34 million contract to act as D.C.`s lead agent before the Zoning Commission, the Historic Preservation Review Board and any other panels whose approval must be obtained.

``It`s not unusual for us to take on the front end entitlement work and pay for it ourselves,`` said Jeff Miller, D.C. real estate development director. ``The way we structure it in this deal is that Vision McMillan Partners takes it through the process and we end up paying for everything.``

Traditionally, when the District redevelops city-owned property, it provides the parcel or building to a developer through either a sale or ground lease. But save for St. Elizabeths and, perhaps, Hill East, few District projects are as thorny as McMillan. D.C.`s five-year capital plan includes $48.9 million for infrastructure work on the site.

``We`re not in the business of moving dirt,`` Miller said. ``We have enough fingers in this pie that we`re not afraid of losing control.``

Miller, who works under the deputy mayor for planning and economic development, said his office is ``resource constrained`` to handle this work itself.

Considering the McMillan redevelopment plan calls for medical office space, townhouses, apartments, senior housing, retail and park space, Miller said, ``You can`t assemble a better team than that group.``

Vision McMillan is a partnership of EYA, Jair Lynch Development Partners and Trammell Crow Co., said Aakash Thakkar, EYA senior vice president. Dickie Carter of Urban Service Systems Corp. is an investor, along with other unidentified investors.

Then-Mayor Anthony Williams named the joint venture master planner in 2006.

The venture ``will be working with the District and the community to take the McMillan project through the HPRB and the Zoning Commission approval process,`` Thakkar wrote in an email.

The McMillan redevelopment is among the District`s most complicated, given the historic nature of the site, the sand-filled catacombs, or cells, that weave beneath and the sand silos that stand above.

The century-old plant, shuttered by the federal government in the mid-1980s and sold to the District shortly after for $9.3 million, is just east of the McMillan Reservoir and south of the Department of Veterans Affairs Medical Center.

The city intends to control the site throughout its development, while asking Vision McMillan to handle the ``sticks and bricks of delivering pads`` through some kind of arrangement, Miller said.

The plan is fluid, and a deal has not yet been struck, he said. The project is likely to include 1 million square feet of office space, upward of 600 apartments, 175 townhomes, up to 100,000 square feet of retail and a central park of about 3 acres.

The planned-unit development application for McMillan, though virtually finished, is expected to be submitted to the Zoning Commission in the first quarter of 2012.

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