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The results are in: Five teams are officially interested in developing a key portion of the city-owned St. Elizabeths East Campus near the Congress Heights Metro. A couple of the firms have extensive experience east of the Anacostia River, but what’s conspicuous is the lack of heavy-hitter development firms in the mix. Where are the likes of JBG, Akridge, Douglas Development, MRP, Hines, and Donatelli Development?
St. Elizabeths is one of the city’s signature mega-development projects, a 183-acre Metro-accessible site full of lovely historic buildings that the city is hoping will transform neighboring Anacostia and Congress Heights with a mix of residences, offices, and retail. Compare its roster of small to mid-tier respondents to the nine firms that expressed interest in developing the Walter Reed site along Georgia Avenue NW, a list that include major players like Douglas, Hines, Roadside Development, Forest City, and Western Development.
So why didn’t these firms bid on St. Elizabeths? There are a few reasons they chose to remain on the sidelines.
One is the city’s mixed messages. The city initially issued a solicitation for developers of a portion of the site back in 2012, but rescinded it shortly thereafter and decided instead to begin with a search for an academic anchor. “We looked at it and considered it the first time it went out, but not this time,” says a senior official at a leading D.C.-area development firm, who, like the other sources quoted here, was granted anonymity to speak freely about the project.
Just five days before the city released its solicitation for St. Elizabeths proposals—-and six days before the mayoral primary—-Mayor Vince Gray announced his plan to build a new hospital at St. Elizabeths. That surely sowed doubt among developers who may have been interested in St. Elizabeths. After all, the hospital was set to be located on some of the very land that was part of the city’s March 31 solicitation for St. Elizabeths developers. (The D.C. Council later voted not to fund the hospital proposal.)
“Those [hospital] parcels are the most economically viable, with limited historical restrictions and adjacent to the Metro,” says a D.C. Council aide. “Why would a busy development team submit a proposal when the availability during the response period of the most valuable land was iffy?”
One senior official at a top area development firm says his company had another reason to pass on St. Elizabeths: They believed the city had a preconceived notion of which developer it wanted to take the lead on the development project. “The city already knows who they want to have the project,” says the official, who declines to name the firm in question, “and the rest of the people are just pawns in the game of chess.” (A spokeswoman for the Office of the Deputy Mayor for Planning and Economic Development did not immediately return calls for comment.)
The official adds, “Obviously it’s a great development opportunity. Life is short.” And when there’s reason to be wary of the project, the city’s top developers appear to have concluded, it’s just not worth spending the time and effort on.
Map from the city’s request for proposals