The Washington Post this past week ran an article after WMATA’s annual meeting which focused on Metro’s plans to sell or lease property around their metro stations in order to generate revenue. One commenter said that WMATA shouldn’t be selling property, because the government shouldn’t be a real estate agency and then went on to say that the parking would be reduced.
This comment demonstrates the lack of understanding people have over what we lose when we allow surface parking. West Falls Church is a prime location for new residents, young professionals, with affordable rents and access to metro. The problem is there are only a handful of units located within normal walking distance of the system.
Why?
It could have something to do with the 7 acres of surface parking lot creating a massive asphalt buffer. The current surface parking lot has about 800 parking spaces. The genius about redeveloping this space is not a single space would need to be lost. In fact there may be an opportunity to add more spaces, for free, without any tax money, subsidies, or fare increases.
The amount of space needed to recreate this 800 spaces is only 1/5th of the area that is currently taken up by the surface parking lot, given the exact same height of a parking garage currently located on the property (6-stories). The cost of the parking lot would be approximately $24 Million. This is where the curmudgeons come out of the wood work, screaming “Leave it alone I don’t wanna pay!”.
Who said you had to pay?
This surface parking lot takes up about 6.5 acres(without a new constructed parking garage). Sale of the property could easily counter balance the cost to construct the $24 Million parking garage, at a price of only $3.7 million per acre. For comparison, most property directly abutting a metro station sells at about $5 million per acre. If the property is zoned for mid and high-rise development the price could reach $10 million per acre.
What that means is that WMATA wouldn’t even need to sell the property necessarily. It could trade the construction of the parking lot, for development rights on the property and attain a portion of the profits that would be made from a developer/manager for rentals and leases on retail space. Or, if they preferred, the space could have a one time sale of approximately $65 million, paying for parking and maybe even reducing annual subsidy needs. Personally, I think holding onto long term revenue has much more benefit than a one time sale.
Why should WMATA do this? Its win-win. WMATA retains the exact same asset (800 parking spaces converted from surface to parking garage), some extra money either annually or as a one time payment, and is virtually assured of increasing steady ridership from the newly developed higher density housing and retail.
The neighborhood would likely be all for it. Instead of a desolate empty parking lot, they would gain 25,000 to 35,000 square feet of new retail that in this location would likely mean some new restaurants and hang outs. The 6-story mid-rise building which could go across the street would be stepped so that it didn’t feel imposing or block like. The 12-story high-rise would be minuscule at nearly 800′ away. This gradual rise in the building heights would make sure that the existing community doesn’t feel shadowed and have the added benefit of blocking sounds and light coming from I-66.
The new mid-rise building shown in this concept would have approximately 350,000 sf of residential and 20,000 sf of retail for an approximate cost of $39 million. The new high-rise building shown in this concept would have approximately 550,000 sf of office or residential, and 15,000 sf of retail for an approximate cost of $63.5 million. A developer looking to purchase outright, at about $65 million in land sale, would face about $167.5 million in upfront cost. Typical rents (assuming an office/residential mix) of $25 per sf residential, $35 per sf office, and $45 per sf retail would create approximately $29.5 million pr year with tax/maintenance costs of about $5 million resulting in $24.5 million in profit per year. The pay back would be under a decade, a pretty good deal for any management or financier for a prime location on a transit corridor.
The idea makes so much sense, I’m personally shocked WMATA came up with it.
Then again, there are still a few years for them to figure out how to ruin it before it can become a reality.