Residential, Not Office? Consultants Envision ‘Urban Walkable’ Development Around Loudoun Metro Stations - Leesburg Today Online—Daily News Coverage of Loudoun County, Leesburg, Ashburn: News

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Residential, Not Office? Consultants Envision ‘Urban Walkable’ Development Around Loudoun Metro Stations

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Posted: Wednesday, May 14, 2014 12:59 pm | Updated: 9:23 am, Thu May 15, 2014.

A preliminary presentation from the panel of volunteer consultants tapped to analyze development opportunities for the areas around Loudoun’s Metro stations made no bones about the importance of that land to the county’s future prosperity—and painted a picture of a future eastern landscape that will look much different than today.

“These 2,000 acres are precious to you,” panelist Chris Leinberger, president of LOCUS, a national coalition of real estate developers and investors that focuses on walkable communities, told supervisors during a presentation last week, referring to the one-mile area around each station. “This is your economic future.”

Leinberger and nine other representatives from the public and private sectors around the Washington, DC, region were part of the Urban Land Institute’s Technical Assistance Panel that spent two days in Loudoun County touring the areas around the future Rt. 606 and Rt. 772 Metro stations, meeting with stakeholders and creating recommendations. Their work was part of the Comprehensive Plan amendment the Board of Supervisors initiated to review development policies around the future Metro stations.

The panelists laid out their recommendations in a May 8 presentation to a small audience of supervisors, developers and stakeholders. They will present their formal recommendations to the Board of Supervisors in July.

One of the panel’s biggest recommendations is something that is likely to set off strong debate in the county and among supervisors. Panelists say there has to be residential development around the Metro stations—and a lot of it. According to the panel, of the 45 developments in the DC region that would be considered “urban walkable”—communities like Clarendon in Arlington or the proposed redevelopment of White Flint in Rockville, MD—all of them include at least 20 percent residential development, and some are up to 45 percent residential. And 80 percent of them are connected to Metro.

“Our projections are that there is at least another 20 to 30 years of pent-up demand for walkable urban development,” Leinberger said.

As an example of the “urbanization of the suburbs” panelists repeatedly referred to Reston Town Center and National Harbor in Maryland, but spent the largest amount of time on Arlington and how it has changed since the 1980s, with the integration of an urban setting with suburban single family home living. The single-family homes located blocks from the “downtown” feel of Arlington have a 100 percent price premium, according to the panel’s presentation “because they have the best of both worlds.”

“This is your competition,” Leinberger said. “If you don’t have this product type you are not going to be economically competitive.”

The changing office market is something that developers often tout to supervisors as they seek changes to their plans or propose plans that have less reliance on that type of development. County supervisors have bucked many of those requests, holding out for the eventual construction of more tax-positive commercial uses. But, according to the ULI panel, those changes are real—and Loudoun must adjust its development expectations accordingly.

“The trend we are seeing is a reduction in the space allocated for each employee,” Andrew Brown, of Standford Properties, said. According to the presentation, in the early 2000s companies were using about 225 rentable square feet per employee, but that number has now dropped close to 175 square feet per employee, with the trend expected to continue downward.

“…[O]n renewals of leases for general office space…tenants are taking average of 18 percent less square footage than they are coming out of previously,” Brown said. “That is probably lower in the new efficient office buildings.”

With a new eye to office development, the ULI panel took a look at the market and fiscal impact analysis done for Loudoun on the extension of the Silver Line. That study showed that Loudoun could add another 21 million square feet of office space to the existing 19 million square feet by 2040. But the panel said that number should be halved.

“It is more likely absorption would be 10 to 14 million square feet,” Anita Morrison, a partner of Partners for Economic Solutions, said. “The county needs to ratchet back the reliance and the assumption that office will be the driving factor in [Metro-area] development.”

Panel members also said they had heard a lot during their time in Loudoun about “keynote employment” uses—the high-end commercial centers long envisioned by county planners along highways such as Rt. 7 and Rt. 28.

“We just don’t see it here. Keynote is out,” Jamie Weinbaum, a development manager at JBG Companies, said. “We have heard a lot about data centers…they might make sense in the Rt. 28 corridor, but clustered around these Metro stations we don’t see it.”

Supervisors who attended the meeting and others in the audience were intrigued by what they heard, but acknowledged the ULI presentation created a lot of questions and likely a lot of decision points for the board in the near future.

While residential uses are approved around the Rt. 772 station, the airport noise districts cover most of the Rt. 606 station area, preventing residential development.

This week, County Chairman Scott K. York (R-At Large) said he personally was not interested in putting residential into high-noise areas because of the ever-increasing use of Dulles Airport.

Panelists did suggest that the county prepare to “fight the airport” on high-density residential development near Dulles.

As for Rt. 772, “the question is how much broader do we go beyond what we have done in that area,” York said. Supervisor Ralph Buona (R-Ashburn), who attended the ULI presentation, also said the county will have to look at what has been planned around that station—approved developments including Loudoun Station and Moorefield Station—to see if adjustments should be made.

“It is clear that the way we were thinking is not necessarily where we need to be thinking,” he said. “It made sense at the time, but 10 years later it might not make as much sense.”

Buona said with plans already in place, the county would have to work with landowners if they wanted to make changes.

Both York and Buona agreed that the realities of the office market would have to be discussed by the board.

“What I was really intrigued by is, on one hand, you don’t want to absorb the land with data centers around your rail sites, but on the other hand, your office is only going to be about half of what we thought it was going to be,” York said. “So what do we do?”

Buona called the information “eye opening” and confirmed for him that urban center development is what the county should be focusing on around the Metro stations.

“If we want to make these Metro areas work, I think we have to rethink this concept of just Class A office space,” he said. “It is very clear that is where [the market] is moving for decades to come.”

There also were questions after the presentation about the tax benefits and burdens of residential over commercial development. Historically the kind of development Loudoun has approved requires more in publicly funded services than it generates in tax revenue.

“When we were going through our Clarendon station area plan, we had the same debate you are having to a degree,” Bob Brosnan, head of the Department of Community Planning and Housing Development for Arlington County, said. “The market was for residential…While on its own it might not be tax positive, it isn’t tax negative if you’re not generating a lot of school children. But the spin off of the activity you’re creating…that’s where we determined it was pretty much a push as to which was better for us.”

Panel members said they understand the county’s “push-pull” between residential development and the need for services, especially schools for children. But with higher density, they said, the size of each unit could be much smaller, which in their experiences leads to almost no generation of school-aged children.

“The unit mix you bring there is going to have sway over who is going to want to live in their units,” Weinbaum said. “It’s more studios or one-bedroom units, which are not likely to result in more children coming to the area.”

Instead, the unit types around the Metro stations would be for young professionals. “Having that type of smaller unit, means having more of that type of labor force niche living in the county,” Mark Jinks, deputy city manager of Alexandria, said.

With National Harbor being used as the comparison point for the Rt. 606 station, Buona asked the panel if members really thought another convention center would be an appropriate anchor for the Loudoun station. Panelists said it could be, if it were designed and scaled for the location.

Brosnan pointed to the Dulles Expo Center on Rt. 28 in Fairfax County, and noted how often that is “in the paper” for events, “One of the reasons they use it is because they can fly people in and out so easily,” he said, adding if there were “something better” even closer to the airport it would likely be a viable use.

This week Buona said there would never have been something to the scale of National Harbor in Loudoun, but something similar, but smaller, could succeed.

“If we’re going to make this work financially, we’ve got to change course,” he said.

To promote new expectations and to get the “highest and best use” from the area around the Metro stations, the panel created a series of recommendations for the county, which the Board of Supervisors could choose to accept or not.

The first is an update to the county’s Comprehensive Plan, which the board has already started. The panel also recommends a focus on the station at Rt. 772, which will be the end of the Silver Line, where panelists said the county could see some more return on investment sooner.

When it comes to planning, the panel suggested “getting beyond colors on a map” for zoning districts and instead showing some lower level detailed plans that “sets clear expectations for the developer” and “also helps residents with what to expect.”

The panel is recommending that the county include more flexibility on timing and phasing in approved developments, which it acknowledged is a “bit of a rub” between developers and the county right now. The recommendation is not to completely remove any construction phasing requirements, but to add in the ability to move between which uses are constructed and when to respond to the market. Typically in Loudoun, developers are limited in the pace of their residential construction by their progress on building out commercial square footage.

A common refrain from developers and businesses was repeated by the panel: Loudoun County needs an easier review process. That is something that the panel said is “critical” to developers who are trying to pay off bonds, and that a two- to- three year process is not helpful. The Board of Supervisors already has been working to streamline its review process to encourage economic development in the county.

Another recommended area for improvement is one that the board already is working on—transportation. The panel gave its support to the county taking on more road construction projects and expanding the transportation network ahead of developer proffers, something the board has shown itself willing to do, especially now that there is additional transportation money coming from the state.

The creation of a Business Improvement District or an organization “that helps with ‘placemaking’ aspects” might help create a vision for the Metro station areas, the panel said.

“It is really about creating the place,” Weinbaum said. “It really depends on you all and how you view these two Metro stations. It will be up to you to figure out what is the identity of these Metro stations.”

To that end, the panel said, marketing is key. And it should start now.

“We’ve been speaking about two numbers for days,” Weinbaum said. “One is 606, and the other is 772. We should retire these numbers. These numbers for Metro stations just don’t do anything for the perception of Loudoun County.”

Acknowledging that the county—and likely WMATA—would have final say in the naming of the stations, the panel took to calling the Rt. 606 station Dulles Center International, or DCI, because of its proximity to Dulles Airport, and renamed the Rt. 772 station the Blue Ridge Gateway Station.

“The importance here is to really think about the experience of Loudoun County,” Weinbaum said. “It is really a wonderful place to be and the Metro rail is not just about providing a means for commuters who live here to get into the city, it is about attracting people and all the wonderful things that the county has to offer. This…says come and be here and experience what this county is about.”

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