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With millions of dollars already approved for major development projects throughout Prince George's County, project managers remain wary about whether the flagging economy will stagger their build-out schedules.
A major concern lies with the nearly $300 million in state budget cuts, some of which affect road projects.
Without the Suitland infrastructure, the Maryland-National Capital Park and Planning Commission has been forced to delay its proposal to the Prince George's County Council, said Craig Rovelstad, a commission planner.
"Until this fiscal situation is straightened out, it's going to be difficult," Rovelstad said. "Nobody can predict a timetable. Everybody is kind of stuck."
He said Westphalia presents a unique opportunity to the county to offer better than the usual "run-of-the-mill" subdivisions and pull its pieces into a whole and more identified community that is mass transit-serviceable.
"It's unfortunate the market hit when it did," he said, adding that Westphalia's proximity to Andrews Air Force Base would make it easy for the development to benefit from the Pentagon's Base Realignment and Closure program. Rovelstad said the project has potential not only to house some BRAC personnel but also provide shopping and recreational opportunities.
M.H. Jim Estepp, president and CEO of the Prince George's Business Roundtable, said he thinks Westphalia will survive and that it's only going through the same hardships that some other development projects have.
Estepp said that while transportation issues still must be worked out, Tuesday's voter passage of slots and election of Barack Obama, along with a potential second economic stimulus package, could provide more money within the coming year.
"It's not a time to abandon efforts to provide more jobs," he said.
The Roundtable also hopes to foster development by promoting Prince George's opportunities to the 40,000 people expected to come into the Washington area as a result of the federal administration change.
"Traditionally, Prince George's has been left behind because we don't get the word out," he said.
Facing hurdles,
moving ahead
The Greenbelt Towne Centre, a $1 billion project, has also recently encountered several snags, ranging from difficulty in selling its residential segment to FBI raids in September on the offices of Prince George's officials and developers associated with the project.
Some of those who had their offices searched included David Byrd, deputy chief administrative officer for the county; J. Michael Dougherty, director of the county's office of finance; Lt. Col. Karl Granzow Jr. of the county fire department; and former Councilman Thomas Hendershot. The offices of developer Patrick Ricker were also searched, according to The Washington Post.
The 240-acre mixed-use development has had its $160 million tax increment financing package put on hold for the first $202 million of the project, said Sandi Gallagher, project manager for the center.
She said although sellers are having trouble, the project is still moving forward so it will be ready to go when the economy picks up.
"We're hoping the county will work with us more on development," she said, explaining more improvements will be needed as the project moves along.
Gallagher also warned state funding cuts for connections to the Metro station portion of the project could also slow down development.
The county's other Metro station projects, at Branch Avenue and New Carrollton, are also moving forward, with hopes that the latter station could host a new soccer stadium for the D.C. United team, Byrd said. D.C. United has been considering a new location after having some trouble getting a new stadium in Washington. Byrd said the highly anticipated Purple Line, which would link Bethesda and New Carrollton, would boost that project.
Lenders are
‘more cautious'
Bryant Foulger, a partner with Foulger Pratt in Rockville, said a big problem for developers is that credit is not available.
"Lenders are certainly more cautious. They are focused on the quality of a project, focused on preleasing, focused on location and track record and who the borrower is," he said.
Foulger Pratt is the leading developer behind East Campus, the 38-acre mixed use retail and residential town center expected to span the eastern part of the University of Maryland, College Park campus and extending all the way to the University Park border.
"It's a great project; there's tremendous demand, great demand for retail there and good demand for a hotel. It's a project the university really needs. They need these facilities and amenities to attract the talent the university needs," Foulger said, adding that the East Campus project is still working through financing options.
Douglas M. Duncan, former vice president of the university's administrative affairs and leading voice behind the project, said at an event last month that East Campus gives the county a chance to shape its future.
"Economic development doesn't just happen. You have to work at it," he said, urging the county to readjust its thinking so that mass transit is not more important than fostering these urban centers. Duncan could not be reached for comment for this article.
Byrd said he's more concerned about Konterra, the planned 2,200-acre mixed-use development in Laurel, which he described as the National Harbor of the northern county, referring to the 300-acre waterfront development in Oxon Hill.
He said Konterra still needs several interchanges to connect it to the Intercounty Connector, an 18-mile toll highway linking Interstate 270 in Gaithersburg to Route 1 and I-95 in Laurel, and the state funding cuts could retard that timeline.
"As major retailers look at the site, they're wondering about the exit and entrance capabilities," he said. "The slowdown of the economy puts a damper on how fast projects get done. It's too early to tell with Konterra."
Byrd said the county has seen the stagnating economy stop developers from approaching Prince George's with projects, but he said if the county continues to show that it is open to these ideas, developers will return when the market improves. He hopes that happens sometime in the spring.
"When we come to the dance, we want to make sure we look good," he said.
Byrd said the county is evaluating how to work with developments to keep projects moving.
"The commercial pieces sustain us, not residential. Residential doesn't pay for infrastructure," Byrd said. "At the present time, we don't have incentives for commercial development."
Analyst: Retail alone
is not enough
Prince George's isn't the only county focusing on improving its image through major development, as Anne Arundel County recently saw a 2 million-square-foot mixed-use development open on 32 acres outside Annapolis.
Annapolis Towne Centre, which cost $500 million, is expected to generate annual sales of $300 million and 3,000 new jobs. Greenberg Gibbons Commercial of Owings Mills developed the project.
Stephen Fuller, director for the Center for Regional Analysis and professor of public policy at George Mason University, said at the Envision Prince George's event in Adelphi last month that the county has a lot of land set aside for agricultural and warehouse uses that no longer make sense. He also chastised Prince George's for underutilizing its Metro stations by not having any office or retail builders in front of them.
"Prince George's has a lot to offer. You need to know what your economic generators are and how to make them stronger," Fuller said. "You're out of synch with the future and need to get beyond that really quickly."
He said Prince George's needs more than retail to support itself, saying that the Wegmans supermarket, heralded as the centerpiece of the Woodmore Towne Centre in Landover, will not be enough.
Byrd, meanwhile praises Target in the newly opened Brandywine Crossing, a 750,000-square-foot retail project in Bowie. He said Target has already brought in 360 new jobs, with 92 percent of the hires from Prince George's.
"A year ago, we worked hard with the developer to meet the requirements to attract Target," Byrd said, as Target was cutting back on its openings back then. "We hope our other retailers do as well."
Byrd added that with all of the county projects still in the pipeline, people are going to continue to see things move forward — perhaps just at a slower pace.
Prince George's projects
Millions of dollars have been poured into mixed-use development projects throughout Prince George's County, as it works to reshape its image. These include major commercial centerpieces such as National Harbor and Woodmore Town Center, plus equestrian centers.
Karington
Developer: NAI Michael Cos.
Cost: $900 million
Location: Near intersection of Route 214 and U.S. Route 301 in Lanham
Description: 382 acres of mixed-use commercial and residential; 700,000 square feet of office space; 300,000 square feet of retail; two hotels; an extension of Prince George's Community College; 100 acres of parks and woodlands; a 25-acre lake; and single family units.
While originally facing some trouble in the approval process due to inadequate public facilities, Karington is now having site work and planning. An additional $100 million overall must be spent to prepare Route 301 for the development, with the developers footing $3 million.
National Harbor
Developer: The Peterson Cos.
Cost: $4 billion
Location: Near Capital Beltway in Oxon Hill on the Potomac River
Description: 350 acres and 7.3 million square feet encompassing the Gaylord National Resort and Convention Center and other hotels; 1 million square feet of office buildings, retail and entertainment; 2,500 residential units; four piers; and two marinas.
National Harbor foresees no significant problems in the build-out of its residential segment and is already under way with its single-family houses, condominiums and apartments. At the same time, retailers that were expected in early winter may not move in until the spring, with the economic climate stretching timelines, said David Byrd, deputy chief administrative officer for Prince George's County.
"National Harbor has been an unqualified success," Byrd said. "The economic downturn will not stop people from coming into National Harbor; it will just make their relocation slower."
University of
Maryland M Square Research Park
Developer: Manekin
Cost: $500 million
Location: Adjacent to the College Park Metro station
Description: 130 acres and 2.5 million square feet of public and private research labs, potentially providing 6,500 new jobs.
The Center for the Advanced Study of Language and the National Center for Weather and Climate Protection have already taken 268,000 square feet. The university's Earth Systems Science Interdisciplinary Center also moved into a 120,000-square-foot office building, and Corporatate Office Properties Trust signed a 123,000-square-foot lease with the park. The Intelligence Advanced Research Projects Activity is the newest announced tenant for the area and plans to take up a 120,000-square-foot compartmentalized facility.
Steeplechase 95
Foreign Trade Zone
Developer: Atapco Properties
Cost: $150 million
Location: Capital Beltway and Ritchie Road in Capitol Heights
Description: 110 acres and 1 million square feet of industrial, flex, retail and office space. Expected to generate 900 jobs.
Developers have completed a 138,000-square-foot warehouse and continue to work on main interior roadwork, according to the Prince George's Economic Develop Corp. Site plan approval for restaurants and a retail center were approved in February 2006, as well as site designation in the U.S. Foreign Trade Zone.
University Town Center
Cost: $1.2 billion
Location: East-West Highway and Belcrest Road in Hyattsville
Description: 1.9 million square feet, with 800 to 1,900 dwelling units; office, retail and entertainment; and 16-story student housing facility.
The student housing building and second parking structure were completed in 2006, according to the county. Leases have been signed for a 14-screen movie theater and grocery store, along with detailed site plans for retail and condominium units. Work has also begun on the main street, retail and theater site.
Woodmore
Towne Centre
Developer: Petrie-Ross Ventures LLC, Greenberg Gibbons Commercial and Hovnanian Land Investment Group
Cost: $500 million
Location: Landover Road and Capital Beltway in Landover
Description: More than 245 acres of mixed use, with 900 residential units; 700,000 square feet of retail; 1 million square feet of office space; two hotels; and the anchor Wegmans supermarket.
Having broken ground on the project this summer, Woodmore remains on target for its planned opening a year from now, Byrd said. He doesn't predict any slowdown in the build-out or sale of Woodmore's residential or retail offerings.
Ritchie Station
Marketplace
Developer: The Michael Cos.
Cost: $200 million
Location: Ritchie Marlboro Road and Capital Beltway, Capitol Heights
Description: 130 acres and 1 million square feet of retail development featuring department and other stores.
The Building Investment Trust has committed $53 million in equity capital for this project and is working with the Washington Building and Construction Trades Council to ensure it meets union labor requirements, according to the trust's Web site. Three big-box stores are expected to open soon, including a Home Depot, Target and Shoppers Warehouse.
Westphalia
Cost: $3.7 billion
Location: Near Upper Marlboro, with Pennsylvania Avenue to the south, Capital Beltway to the west and Ritchie Marlboro Road to the north
Description: 6,000 acres of mixed use, including 15,000 housing units, retail, equestrian facilities and employment centers, plus schools, parks, police and fire stations, and a library.
Some of the homes in Westphalia are going through build-out, but planners have run into difficulties getting developers to use their land as collateral for county bonds. Developers would sell these bonds to pay for infrastructure improvements.
But with the unstable markets, developers cannot predict when they will be able to pay off these bonds, causing delays in construction and planning, said Craig Rovelstad, a planner for the Maryland-National Capital Park and Planning Commission.
Developers are seeking an alternative financing method, but are also facing problems with infrastructure costs in the midst of state budget costs.
Greenbelt Station Towne Centre
Cost: $1 billion
Location: Greenbelt Metro station and Capital Beltway
Description: 240 acres of mixed use, plus public parkland, encompassing 2,000 upscale residential units; 1.1 million square feet of retail and an entertainment center; and 300 hotel rooms. The county anticipates the project will bring in 7,054 new jobs, 9,526 temporary construction jobs and $2.75 billion in direct revenues.
The Prince George's County Council approved a $160 million tax increment financing package for the development, but that project could be on hold, said Sandi Gallagher, project manager for the center. She said the first phase of the project, known as the South Core, which covers the area on Greenbelt Road and Route 193 is under way, with a bridge recently completed. Although builders have run into delays with buyers finding credit for the homes, she remains confident the properties will be able to sell once the yearlong construction process is over.
"They're priced in a range that people will be willing to purchase," Gallangher said.
She warned the second phase/North Core, which is near the Metro station, faces some problems with not having necessary road infrastructure. She said the problem will worsen due to state budget cuts.
No site plan has been approved for the North Core.
Konterra
Developer: Gould Family and Forest City Enterprises
Cost: $1.7 billion
Location: 6985 Muirkirk Meadows Drive on both sides of the Capital Beltway in Laurel
Description: 2,200 acres in an upscale mixed-use community to include a 200-acre regional mall, business campus with 1.4 million square feet of building space, 1,000 single-family homes and 348 acres reserved for a government education or corporate facility. County officials say Konterra will increase the accessible tax base by $900 million and generate $7 million in annual state and county taxes.
Konterra received approval from the county Planning Board in July and developers hope to begin construction in 2009. The project is expected to take 20 years to complete. Konterra's next step will be the review of its detailed site plan this month or next.
Konterra spokeswoman Julie Chase said the slow economy hasn't had a chance to affect the project because construction hasn't begun.
East Campus
Developer: Foulger Pratt
Cost: $900 million
Location: Route 1 in College Park
Description: 38 acres of mixed use, including student apartments in six-story complexes; 1,515 housing units, retail, entertainment and office space, including the Birchmere Music Hall.
Despite the loss of its chief spearhead, Douglas M. Duncan, former vice president of administrative affairs for the University of Maryland, East Campus continues to move forward into its development approval process, said Bryant Foulger, a partner with the developer.
"We also still have to finish the general development agreement with the university," Foulger said, adding the project has several facilities currently on the land that will have to be relocated. He also said the project will require private financing and public financing, possibly through a tax increment financing package.
