The Spectrum Group, proposing development of the 4.3 acre “Mason Row” site adjacent the W. Broad and N. West Street intersection, announced new voluntary concessions Monday night in a work session before the Falls Church City Council, bringing them up to the level of concessions by other developers who’ve won approval for their projects in the City.
The Spectrum Group offered to increase their contribution to the schools’ capital fund to $7,511 per residential unit on the property, and to comply with the City’s desired level of affordable housing units as a percentage of the total housing units. There were also technical changes to address traffic issues at the intersection areas around the project.
The plan goes back to the Planning Commission now before returning to the City Council for its final vote, up or down, in early December.
Council members were mindful of the vote in last week’s City Council election that went in favor of all the candidates who were for maintaining the City’s “smart growth” momentum and against those who campaigned for a moratorium. All three of last week’s winners — Mayor David Tarter, Councilman Phil Duncan (hooked up via speakerphone from Knoxville) and Council member-elect Letty Hardi were present in the audience Monday night.
Council member Nader Baroukh, who served a stint as mayor and will be leaving the Council in January as he chose not to seek re-election to a third term, said Monday he was concerned that two major “anchors” of the project, a hotel developer and a movie theater company — had not yet been “nailed down.” Spectrum officials said that the process is still in negotiations for tenants for each.
Others on the Council said that the massing still seemed too dense, although the net revenues to the City from the project are projected to be very substantial.
Peter Batten, speaking for Spectrum, said the updated plans for Mason Row include 23 retail tenants, nine or 10 of which will be restaurants, which will create a “critical mass” that, along with an eight or nine-screen theater and hotel, will make the project a perpetual draw from surrounding areas.
“All the retail and special events, the W&OD Trail on the City’s main downtown street are brought together in this project for a powerful, visual, social and commercial destination for the City of Falls Church,” he said.
Batten cited the specific elements of adjacency and interaction with the W&OD Trail, sufficient land area for a critical mass and clustering of retail spaces, an open air pedestrian-oriented market place, outdoor cafe seating, the movie theater, a market square with scheduled events and festivals, creative retail with interesting storefront designs, convenient commercial parking and well-designed landscaping and streetscape.
The sum of the voluntary concessions include cash contributions of $2,365,000 ($1,850,000 to the schools’ capital fund, $235,000 to the Mary Riley Styles Public Library, $25,000 to the City’s ‘CATCH’ cultural, arts and history group, $150,000 to City parks, $55,0000 to bikeshare program development and $50,000 to a post-development traffic study).
Also, the number of affordable dwelling units on the site will grow to six percent of all units, within City policy guidelines, with half available for those at 60 percent of the area median income, and half at 80 percent.
There are streetscape improvements for public street purposes included in the new concessions, the market square (and its availability for public events), the undergrounding of utilities on site, a NGBS Silver certification for the apartment building and LEED certification or its equivalent for the hotel building, storm drainage and runoff provisions with on-site water quality treatment and detention.
These involve removal of contaminated soil, installation of vegetation, stormwater capacity expansion, bicycle parking and storage on site with bike racks and bike storage on site, and off-site improvements including undergrounding of aerial utilities along West Street next to the W&OD Trail, road and pedestrian improvements and a new bus shelter on W. Broad.
Fiscal impact projections show the project will yield in gross tax and other revenues to the City between $3,794,409 and $3,988,680, and a net yield between $1,709,648 and $2,612,436. These are whopping numbers given that a penny on the real estate tax rate in the City equals $370,000.
The developers continued their insistence that a theater admission tax rebate plan is essential for “to mitigate the commercial risk of an underground movie theater as a financeable element of the project.” They hold, in that context, that having the movie theater component is vital to the overall success of establishing the project as a retail entertainment and food destination.
Spectrum proposes a 20-year theater admissions tax abatement plan. The revenue would all come from theater customers in the form of a 10 percent tax on the normal ticket price, and the proceeds on an annual basis to the City’s Economic Development Authority, which in turn would provide an annual economic development grant to the developers in the amount of 100 percent of the proceeds for the first 15 years, and 90 percent of the proceeds from the years 15 to 20.
An independent consultant, Bolan Smart, in a report prepared for the City, verified that some form of subsidy like this is necessary to mitigate risk in a manner that would allow for its bank financing.