A Joint Public Roundtable on PR 17-67, the “Barnaby Road Site, Parcel 238, Lot 40, Disposition Resolution of 2007;” PR 17-111, the “6428 Georgia Avenue, NW, Disposition Approval Resolution of 2007;” and PR 17- 227, the “Randle Circle, SE, Disposition Approval Resolution of 2007.”
Testimony of Lars Etzkorn
Office of Property Management
Adrian M. Fenty
COMMITTEE ON WORKFORCE DEVELOPMENT AND
Carol Schwartz, Chairperson
COMMITTEE ON ECONOMIC DEVELOPMENT
Kwame Brown, Chairperson
Thursday, 5 July 2007
Council Chamber, Room 500
John Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004-3003
Good afternoon, Chairperson Schwartz, Chairperson Brown and members of the Committees on Workforce Development and Government Operations and Economic Development. I am Lars Etzkorn, Director of the Office of Property Management (OPM). Pursuant to the authority conferred by section 10-1003 of the DC Code, OPM is charged with the responsibility of disposing of District real and personal property through sale, lease or otherwise as delegated by the Mayor. In accordance with this responsibility I am here today to testify on PR17-0067, The Barnaby Road Disposition Resolution; PR17-0111, The 6428 Georgia Avenue, NW, Disposition Resolution; and PR17-0227, The Randle Circle, SE, Disposition Resolution.
Barnaby Road, SE
Parcel 0238, Lot 0040, on the 800 block of Barnaby Road, SE, contains approximately 47,476 square feet of land and is located in the Congress Heights neighborhood. The property subject to this disposition is located within an area zoned low-density residential (R-5-A); housing in the immediate area is row townhouse and apartments. Building height is restricted to three stories and commercial or retail use is not permitted. There is limited public transportation in the immediate area.
The District intends to make a directed sale of the property to the Temple of Praise (ToP), a District of Columbia non-profit organization, for a price of $420,000; established as the fair market value based upon a just completed appraisal. This sale is a result of ToP’s unsolicited offer, a process provided for in the disposition authorizing legislation, which allows for sale of surplus property via negotiation to a non-profit entity for a specifically designated purpose. Because ToP owns the adjacent parcel and the highest and best use of the property is to assemble it with adjacent parcels for residential development, it is in the public’s best interest to sell the property for the use as proposed here, especially with the inclusion of low-income housing.
As so much time had passed from when ToP first negotiated with the District to purchase this property, we recently had the property re-appraised. I recognize ToP is proceeding with the transaction despite a substantial increase in the purchase price.
ToP owns adjacent parcels and plans to combine the properties into a 2.25 acre development site to build townhouses with a number of units designated for sale to low-income families. Construction will proceed in two phases. First, a 60-unit senior building utilizing low-income housing tax credits; second, 45-townhouse units.
The deed to ToP will contain a 10-year reservation allowing the District to reacquire the property if residential units are not constructed. For ToP to change its plan it must receive prior approval. Additionally, ToP must commit to enter contracts consistent with the District’s Certified Business Enterprise program and use District residents as the primary source for recruitment, referral and placement of its employees, presenting an additional economic benefit.
Providing more low-income housing to District residents is a goal of Mayor Fenty. This disposition does so allowing the best use of the property and is consistent with R-5-A zoning, which restricts use to residential-only purposes. The District recommends the Council deem this property surplus as there is no viable government use.
6428 Georgia Avenue, NW
The property at 6428 Georgia Avenue, NW, was initially purchased by the District in August 2006 as part of the land assembly required to relocate Fire Engine Company 22. The property, identified as Square 2945, Lot 0817, is 15,184 square feet with a vacant building of approximately 7,000 square feet.
Prior to the purchase of the land by the District, the property was in the pre-construction phase of development for residential use by Georgia Avenue Investment Partners, LLC (GAIP). After being acquired for Fire Engine Company 22 this use was deemed not to be the property’s highest and best use, as it was inconsistent with the pedestrian-oriented retail renaissance of Georgia Avenue, as envisioned by the Great Streets program.
Before introducing legislation to return the property to its original owner, other government uses for the property were considered and rejected. There are properties in the District’s inventory that can be redeveloped at a lower cost for public residential use. In addition, the property’s relatively small size does not make it attractive for government office space. Consequently, the property does not meet the District’s own needs and should be deemed surplus.
GAIP will construct a 5-story, 39-unit apartment complex on the land, 12 units of which are affordable housing. Once completed, it’s estimated the District can expect to collect $380,000 in residential property taxes yearly.
The proposed sale price of $3,942,829 recoups the money the District spent to obtain the property less recordation tax ($2.6 million appraised value plus certain pre-development costs agreed paid to avoid acquisition through eminent domain).
The Office of Planning (OP) is in discussions with the U.S. General Services Administration (GSA) about a possible site for Engine Company 22 at Walter Reed Army Medical Center. With the late uncertainty about the future of Walter Reed, those discussions were disrupted, but OP is renewing its efforts by initiating negotiations with every affected party, including the Army Command at Walter Reed, the State Department and GSA. The District is stressing the opportunity to improve fire and emergency medial services for Walter Reed and the neighborhoods with a new DC fire station site on 25,000 square feet near the SE corner of the campus at Georgia Avenue, NW, and Aspen Street, NW.
Randle Circle, SE
Located near the entrance to Fort Dupont Park and in the Hillcrest neighborhood, the property at Randle Circle, SE, identified as Square 5500, Lot 0005, was acquired by the District in 2003 through a tax deed resulting from a delinquent property tax lien. The property is a part of the District’s inventory subject to disposition by OPM. The property consists of approximately 3,657 square feet of land and is zoned as R-5-A, prohibiting commercial and retail use. The location and size of the property preclude its viable use a public residential facility. With no other allowed use, it is appropriate to deem the property surplus.
The District listed the property for sale with a real estate broker who priced it based on comparables at $99,000. The highest bid is from the proposed purchaser, 1717 Associates, LLC. It has agreed to pay $97,800 plus all settlement costs in exchange for a quitclaim deed. This purchase price is higher than the $66,340 assessed value of the land.
For the reasons I have outlined above, which are expanded upon in the Analysis of Economic Factors accompanying each respective disposition resolution, OPM concludes these three properties are surplus to the need of the District government. These sales are in the best interests of the District of Columbia and the specific economic and social benefits of their sales outweigh retaining these properties in the District’s inventory.
I am pleased to answer any questions you may have at this time.