D.C. officials yesterday announced their choice of four companies to lead the development around a planned baseball stadium along South Capitol Street, even as new cost estimates show that building the ballpark at a site near RFK Stadium could save the District as much as $60 million.
A team led by Forest City Washington and Western Development, both based in the District, will direct development of a roughly six-acre site to the southeast of the proposed stadium. The site is currently owned by the D.C. Water and Sewer Authority (WASA). Another team led by Monument Realty of the District and the Cordish Companies of Baltimore will develop about three acres to the north on land currently owned by the Washington Metropolitan Area Transit Authority (WMATA). In all, eleven companies will be involved in the projects.
Development in the “ballpark district” will include 465,000 to 785,000 square feet of retail space and restaurants, as much as 1.6 million square feet of office space and 1,570 to 2,980 units of housing. The development teams also are expected to add nearly 7,000 parking spaces to the 1,225 planned for the ballpark site. Officials said the development could create as much as $100 million in additional tax revenues a year.
But those revenue figures are based on the assumption that a new ballpark for the Washington Nationals will be built in the South Capitol neighborhood — an assumption clouded by new estimates from D.C. Chief Financial Officer Natwar Gandhi, which place the cost of constructing the ballpark on South Capitol Street at $667.3 million, compared with $605.5 million for a site near RFK Stadium.
The new estimates for both stadiums include $376.6 million for the ballpark itself, plus land acquisition and remediation, financing, infrastructure construction and a contingency. According to the new estimates, land at the South Capitol site would cost about $109.7 million, compared with $16 million for the site near RFK, where the District already controls much of the land. The RFK site also would result in a $30 million savings in financing and infrastructure costs.
However, if financing costs are removed from the estimates, the cost of construction is $573 million at RFK and $600.5 million at South Capitol, a savings of just $27.5 million. Furthermore, the RFK estimate also includes $31 million in additional contingencies to take into account potential delays in building at the RFK site, a contingency that could prove inadequate if the project is delayed by more than two years.
The D.C. Council is scheduled to vote on a lease agreement for the South Capitol ballpark next Tuesday and must have the lease approved by Dec. 31 or face penalties from Major League Baseball. Several council members said they would vote against the lease because the project has become too costly and have urged the city to consider a site near RFK as an option.
The city is planning to borrow $535 million to fund the South Capitol Street stadium. Any costs above the $535 million would have to be paid for by other sources. The District is asking developers to help pay for infrastructure costs and has turned to the federal government to help pay for upgrades to the Navy Yard Metro station.
The new estimates do not factor the economic development potential at each site — a key factor city officials said should not be ignored.
“I think the market speaks to the value of the [South Capitol] site,” Mayor Anthony A. Williams said. “I think the market has spoken over the last 30 or 40 years to the value of the RFK site. I’m not a professional developer, but I’ve looked around RFK, and I’ve not seen a lot of development.”
And it is because of that economic development potential, officials said, that they are moving forward with redevelopment plans in the South Capitol area, with or without baseball.
“Our goal is to move this into a world-class gateway to the nation’s capital,” said Toni Griffin, vice president of the Anacostia Waterfront Corporation, the quasi-public agency that selected the development teams for the ballpark district. “The vision for the District was really to create this 24-7 mixed-use district.”
Developers said that they prefer building near South Capitol street and that a stadium will be a major driving force.
“It’s silly not to locate a stadium where you can get the spinoff development,” said David S. Cordish, chairman of the Cordish Companies. “When you have a stadium and waterfront, what you can do is create a village. You get much more than just a stadium.”
The city has been negotiating with WMATA and WASA to acquire their parcels of land in the past several months to form the ballpark district. The ballpark district also will include part of the Southeast Federal Center site and a planned development by Florida Rock, a company that owns about six acres directly south of the ballpark.