- The Washington Times - Wednesday, April 4, 2007

Redevelopment of the Skyland Shopping Center received a $40 million boost this week from the D.C. Council.

The council unanimously approved a tax increment financing (TIF) proposal Tuesday that would use property and sales taxes to help pay for retail, residential and office projects at the Ward 7 shopping center in Southeast.

The funding will move the $125 million Skyland redevelopment from five years of planning and discussions to the next stage, namely a time to start building, said Jack Evans, Ward 2 Democrat, who proposed the Skyland TIF.

“This is the second- or third-largest TIF project we’ve ever done in the city,” Mr. Evans said.

The TIF authorizes the National Capital Revitalization Corp. to borrow $40 million from lending institutions. The agency is supposed to use the money to enter into joint agreements with developers to build stores, condominiums and other projects at the 18-acre site.

The D.C. Council would repay the TIF money by allocating a portion of existing sales and property taxes at Skyland to service the debt.

The council used other TIFs to redevelop the downtown Gallery Place and build the Mandarin Oriental Hotel at 1330 Maryland Ave. SW. The Gallery Place TIF was valued at $73 million and the one for the Mandarin Oriental was $46 million.

Unlike TIFs that sought to promote downtown development, the Skyland project would revamp a neglected neighborhood.

“What they’re trying to develop is like a town center,” Mr. Evans said. “It’s going to bring all the amenities, retail stores that right now don’t exist. It’s all the things that make it nice.”

The Skyland TIF brings the District’s outlay for the redevelopment projects to $270 million so far. Last year, the D.C. Council authorized up to $500 million for TIFs.

Economic planners say the next TIFs are likely to be along the District’s “great streets,” meaning the retail sectors of older neighborhoods. Top candidates are the Shaw neighborhood, H Street, Georgia Avenue and Martin Luther King Jr. Boulevard, according to Michael Jasso, special assistant to the deputy mayor.

“Within the next 30 to 45 days, we will be introducing legislation to advance those objectives,” Mr. Jasso said. “We’re trying to focus economic tools that have been very powerful on the East End and downtown increasingly into the neighborhoods.”

The D.C. Council increased the limit for TIFs from $300 million to $500 million last year after economic successes such as the Gallery Place redevelopment demonstrated that, “Although there’s subsidy that goes in, there’s net revenue growth to the city,” Mr. Jasso said.

In other words, the District is spending tax money on the projects but getting even more back.

In other news …

• Mayor Adrian M. Fenty is scheduled to announce today plans to attract and retain retail in the District, which economic analysts say is likely to affect commercial development projects.

District residents spend more than $1 billion a year on retail in surrounding communities. Mr. Fenty said he hopes to recapture some of the spending with his “Retail Action Strategy.”

Economic analysts plan to study the possibility of using tax incentives or other subsidies to attract retail development projects, said a District official who asked not to be identified.

Property Lines runs on Thursdays. Call Tom Ramstack at 202/636-3180 or e-mail tram [email protected]


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