F.C. Council Searching For ‘Win-Win’ With Whole Foods Project

PRELIMINARILY, Insight Property Group is forecasting a six month period where Clare & Don’s Beach Shack, Thompson Italian and the State Theatre will have to use rented parking spaces and a valet service to accommodate their business needs. (Screenshot: News-Press)

At its first business meeting of the fall season this coming Monday, the Falls Church City Council will decide whether or not to forward for board and commission review the latest proposal for the large-scale mixed use mega-Whole Foods development on 3.16 acres at the City’s central intersection of Washington and Broad.

The prospect for the project moving forward toward a potential Dec. 16 final approval date was given a boost at Tuesday night’s virtual City Council work session by extensive testimony from the Insight Property Group. The developer demonstrated that progress is underway on a number of fronts, most notably toward an agreement on an interim parking arrangement with neighboring restaurants and improved public open spaces.

But a new feature announced Tuesday provided perhaps the biggest new boost. It involved plans to build out an initial number of eight one- and two-bedroom residential units with novel “work-at-home” designs in response to what a new post-Covid-19 world may look like.

Scott Adams and Maury Stern of Insight said the number of such units may grow depending on demand.

This was tantamount to adding office space to the overall project, the lack of which has been a concern to the Council in deliberations to date, especially as expressed by Councilman Phil Duncan. But Duncan told the News-Press after Tuesday’s work session that “the new work-from-home units concept seemed to be of interest to most on Council. That makes me happy.”

Duncan cited to the Council Tuesday a report by the National Association of Realtors that Falls Church is among the highest ranked in the U.S. among jurisdictions that are conducive to a work-from-home alternative that is bound to grow rapidly in the post-Covid era.

A workable interim parking arrangement is a major issue, and in the words of Council members David Snyder and Letty Hardi Tuesday, is key to winning their support. That’s because the Insight plan involves acquisition of the City-owned space behind the Clare and Don’s Beach Shack and Thompson Italian restaurants adjacent the site, whose 64 parking spaces have been used by those two establishments, along with the State Theatre next door.

Adams reported that while no formal agreements have yet been reached with the adjacent businesses, Insight has proposed an elaborate phased approach it thinks will work. It is a five-phased approach during the construction process, with the first two phases lasting up to a year, keeping the City lot open that entire time.

Then there will be a Phase Three during which the lot will be temporarily unavailable for six months, at which time Insight will cover the cost of providing valet service for patrons of the adjacent establishments and also secured agreements to ensure parking will be available within 1,200 feet of them.

Meanwhile, the completion of a new garage will be prioritized and when it is ready after the six months, 64 spaces will become available for parking by patrons of the adjacent establishments.

Once the construction is completed overall, about a two-year effort, the project will include 64 free parking spaces permanently available at all hours and an additional 74 pay-to-park public spaces will be provided in the garage.

The Council will have to consider whether this extensive effort to accommodate the neighbors to the site is reasonable and workable, as well as whether or not it comes with a formal agreement with the establishments in question. In Councilwoman Hardi’s terms, the solution needs to be a “win-win” for all the parties involved.

There are other major changes to the project over an earlier iteration that won unanimous approval by the Council in 2018 prior to the arrest, sentencing and stiff prison sentence of an original partner, Todd Hitt, for running a ponzi scheme. That plan included a generous sum of Class A office space, but that was designed for use by Hitt and his companies.

Having to subtract the office component was not met favorably by the Council in earlier reviews of the new plan, but there is a major glut in traditional office spaces throughout the region. The new Insight plan for the “work-from-home” apartments, in that context, represents a highly creative response to the new environment.

But also, from the standpoint of fiscal impact, Adams and Stern noted that the 50,000-square foot Whole Foods, which has already signed a 20 year lease for the space, will be expected to yield 10 times the tax revenue to the City of the earlier office space plan. Sales at Whole Foods are 10 times higher, per square foot, over almost any other option, he noted, and the site here will be bigger than the one recently opened in Tysons Corner.

Unexpectedly, however, Adams noted in passing that he would prefer that references to the lease “have the flexibility” not refer to Whole Foods, as such, since its parent company may eventually decide over the course of three years prior to its completion to use the space for something with a different brand name.

The developers reiterated their commitment to subsidizing the space for the Creative Cauldron theater troupe at a value of over $1 million.
Another major public amenity the project offers is a lush pocket park, or public plaza, in front of the project right at the Broad/Washington intersection.

“It will be very inviting and functional,” Stern said. “It is a much better offering for a public green space than the earlier plan had.”

That one was elevated, he noted, and this is right on the street at the intersection.

This one will add “vibrancy to the area” as a link between the Creative Cauldron and the State Theatre.

Council deliberations on the project will be limited to five members following the death of Councilman Dan Sze in July, whose seat will not be filled until January, and the recusal by Councilman Ross Litkenhous for reasons he did not make clear publicly at Tuesday’s meeting.

Yesterday, he told the News-Press it was because private consulting work he is doing could bear on Insight, though he made it clear he’s not working with Insight itself.

Insofar as the component of the project involving Insight’s acquisition of the City-owned parking lot, such a transaction requires a “supermajority” of the Council to approve, which could mean four out of five votes.

But City Attorney Carol McCoskrie is on vacation, so a definitive decision on that was not provided at the meeting.