Yesterday, the Deputy Mayor for Planning and Economic Development’s office (DMPED) announced that only one development team submitted a response to the Request for Expressions of Interest to develop parcels F1 & G1 of the Hill East/Reservation 13 project. As reported by Jonathan O’Connell of the Washington Post, the sole response was submitted by the team of Donatelli Development and Blue Skye Development. Some previous bidders, including William C. Smith & Co, decided not to bid this time around.
To say that I’m disappointed is an understatement. In making the decision to start from scratch and rebid the site, the city argued that the recovering market would translate into more development teams bidding on the site (they also referenced a shaky legal argument). Now, instead of choosing between two responses from teams who had submitted plans for the entire site back in 2008, the city and neighborhood now have only one option to evaluate.
Here are my best guesses as to why the city only received one response:
- Removal of “right of first refusal” language. In their revised RFEI, DMPED removed language that gave the development team that won the right to develop parcels F1 & G1 the right of first refusal to develop the rest of the site. The right of first refusal was a huge incentive for developers to bid on the scaled-back project and also demonstrated a commitment by the city to eventually develop the entire site.
- No money for infrastructure. The RFEI required development teams to pay for all infrastructure improvements, including the construction of public roadways. Back when Mayor Gray, Councilmember Jack Evans and former Councilmember Michael Brown were trying to lure the Redskins to build a training facility on the site, they said that while the city would not cover the cost of building the facility, the city would cover the cost of infrastructure. Unfortunately, the city is unwilling to make the same commitment to a project that is a much better use of the site – one that will provide new tax revenue, jobs and housing. The Mayor has budgeted infrastructure funds for other development projects, such as St. Elizabeth’s. Why is he not willing to do so for Hill East?
- No plan for social services. This is probably the main reason that developers remain skeptical about Reservation 13. The city does not have a plan for relocating any of the services located on the 67-acre site. I plan on continuing to urge the city to come up with a concrete and comprehensive relocation plan – one that will provide some certainty to the neighborhood and development community.
I am appreciative that Donatelli and Blue Skye submitted a response and I’m eager to learn more about their plans. Donatelli was a partner in one of the top two bids in 2008. But as I argued last year, the city should have selected one of the two scaled-back responses submitted in 2010. Instead, the city wasted another year re-bidding the project with a worse result.