Up Georgia Update: Demolition begins at Privacy World in Glenmont to make room for townhouses

By Sonny Goldreich

Workers began demolishing a corner of the aging Privacy World apartments this week next to the Glenmont Metro station, where developers plan to build a townhouse cluster as the first stage of a 1,550-unit mixed-use complex.

The project has been touted as the spark for broader redevelopment along the stretch of Georgia Avenue north of Wheaton, where county officials hope a new sector plan will attract investment in the dilapidated Glenmont Shopping Center and surrounding apartment complexes.

Under a permit issued August 29, three garden apartment buildings and a long-vacant bank site are being leveled at the northeast corner of Glenallan Avenue and Layhill Road. The 9.5-acre site—which includes a wooded lot that abuts a Metro rail storage yard—sits directly across Glenallan Avenue from the Metro, which is the last station on the eastern leg of the Red Line.

A pair of excavator tractors knocked down one apartment building and started work on a second Friday along Layhill Road, just west of the rail yard.

Winchester Homes plans to build 171 four-story townhouses at the corner, including 22 moderately priced dwelling units. Approved first phase construction also allows another 54 townhouses and a six-story, 250-unit apartment building with 4,000 square feet of retail space.

When completed, the new Glenmont Metrocenter complex could occupy 2.5 million square feet of space where the 352-unit Privacy World now stands. If fully built, the 31 acre-complex would include 1,325 multifamily units, 225 townhouses, and 90,000 square feet of commercial space, room enough for an upscale grocery and other retail.

Later construction would include the retail space and three new apartment buildings. Plans call for reserving 14.5 percent of the housing for moderately priced dwelling units.

County planners have been pushing redevelopment of Glenmont since a new sector plan was passed in 1997. It included denser zoning to encourage transit-oriented development next to the Metro station that opened in 1998. The updated sector plan approved this year has been paired with a new enterprise zone that offers businesses state income tax and property tax credits to help create and retain jobs.

But there has been no significant development within a mile of the subway since the Red Line was completed.

The last of the 18 existing Privacy World buildings was completed in the 1960s.

The staged redevelopment of the complex allows for plenty of time for the Glenmont market to adjust to the transformation of Privacy World. According to its website, completion of the last stage of redevelopment will be in 2022.

The new complex will offer as many as 1,550 apartment and townhouses built in six stages over two phases of construction. Developers will preserve 77 existing apartment units while 775 new apartments and townhouses are built in the first phase, according to approved planning documents. The second phase calls for replacing the 77 remaining units and constructing up to 698 new units, for a total of 775 new apartments.

That will allow current tenants to stay in Glenmont. The Privacy World website says "The management will make every effort to offer alternate units in other buildings in the community, whenever possible, for those residents who wish to remain at Privacy World."

County housing agency teams up with Lee for 3-building complex in Silver Spring

By Sonny Goldreich

The county’s Housing Opportunities Commission today approved a plan to increase its stock of affordable housing in downtown Silver Spring, under a proposal to redevelop a pair of its buildings in partnership with Lee Development Group, which will add a third tower offering a mix of low-income and market-rate units.

The proposed Elizabeth Square complex, courtesy Lee Development Group

The preliminary project plan submitted to the county Department of Planning would create a 908-unit, mixed-income complex two blocks from the Metro Red Line station, where the housing agency now owns the 160-unit seniors’ Elizabeth House and the 312-unit mixed-income Alexander House. When the multi-phase Elizabeth Square project is completed, the three buildings will occupy about 771,000 square feet of space, an increase of 314,000 square feet over the existing buildings.

“It really revives what has been a rather quiet corner and makes it an amenity-rich, transit-oriented community,” said HOC housing acquisition manager Christopher Donald. “And it’s important to understand that but for public housing, this would not be happening.”

The new community would transform the blocks bounded by Fenwick Street to the North, Second Avenue to the East, Metro rail lines to the West and Apple Street to the South. The new housing plaza will feature public-use facilities, including a swimming pool and fitness center and Holy Cross health system’s senior source and wellness center.

"Our partnership with Lee Development Group is a first-of-its-kind public/private initiative," Stacy L. Spann, HOC’s executive director, said in a press release. "With Elizabeth Square we’re looking to change the paradigm of how we connect clients to high-quality, amenity-rich housing in Montgomery County, and hopefully elsewhere, as we demonstrate this model can be successful.”

Lee Development brings to the table Fenwick Professional Park, a two-story townhouse-style office complex built in 1953. The office park will be demolished to make room for the new expanded Elizabeth House, ensuring that existing senior tenants will not face the disruption of relocating during construction of their new home, Donald said.

"We joined with HOC for this project because we are confident that Elizabeth Square will elevate the vision for HOC’s affordable housing, while bringing a new community to Silver Spring that will be attractive to retailers, residents and the surrounding neighborhood, at the same time addressing the need for more affordable homes, said Bruce Lee, president of Lee Development.

Construction on the new 277-unit Elizabeth House is expected to start in 2016 and take two years to complete. The existing 160 affordable units will be moved to the new building, and about half of the additional 117 units will be set aside for affordable housing. HOC will own the building and Lee will own the underlying property under a long-term ground lease.

In the second development phase, Lee will demolish the existing Elizabeth House, which was built in 1966, and replace it with a 319-unit, mixed-income building.

Alexander House, which was completed in 1996, will undergo a full renovation and maintain its mix of units, with 40 percent of its apartments set aside for low-income renters.
Elizabeth Square is the latest in a series of HOC redevelopments of aging properties with private partners.

“The strongest, most sustainable affordable housing deals—those that don’t need deep subsidies—are mixed income,” Donald said. “That’s best practice in affordable housing.”

The housing agency owns or manages 6,998 units and is on an aggressive campaign to add more through redevelopment with private partners. Backed by a $246.9 million budget, the HOC has positioned itself as a real estate development firm.

In the past year, the agency has moved toward a major expansion of affordable housing not just in the Georgia Avenue corridor but in expensive areas of the county where land costs typically put neighborhoods out of reach for anyone not making an upper-bracket income.

In July, the HOC won sketch plan approval from the county Planning Board to develop 329 new apartments and townhouses in Chevy Chase, which will replace 68 garden-style apartments owned by the agency. The project involves a deal with developer EYA of Bethesda, which bought a portion of the site to build the townhouses, netting $19-24 million for the housing commission.

Now, the agency is seeking higher density for its 157-unit Barclay apartment building to position it for redevelopment as part of the new Bethesda Central Business District master plan that the county is writing.

A Song for Labor Day: What the Rich Man Said

By Sonny Goldreich

Well the rich man said to the poor man
you’ve got to get a job
Yes the rich man said to the poor man
you’ve got to get a job
Can’t help you anymore
I’ve been carrying you too long

Well the poor man said to the rich man
you sent my job overseas
Yes the poor man said to the rich man
you sent my job overseas
I just want what once was mine
Give back what you stole from me

Well the rich man said don’t blame me, man
Your problem’s not with me
Yes the rich man said don’t blame me, man
Your problem’s not with me
You know that sloth’s a sin
And, yes, so is envy

Well the poor man said I work when I can
But the factory’s not hiring
Heard the poor man said I work when I can
But the factory’s not hiring
I can’t make it here anymore
But it’s not that I’m not trying

Well the rich man said stick to the plan
That’s how you get ahead
Yes the rich man said stick to the plan
That’s how you get ahead
You have to stay in school
If you want to make serious bread

Well the poor man said that’s a sham
Can’t afford no university
Yes the poor man said that’s a sham
Can’t afford no university
There’s no money on the table
after I feed my family

Well the rich man said trust in God’s plan
Heaven helps those who help themselves
Yes the rich man said pray to God, man
Heaven helps those who help themselves
Life up there is bound to be better
if you don’t depend on someone else

The poor man said I’ll go to Satan
if I can’t find another path
The poor man said I’ll go to Satan
if I can’t find another path
One day soon I’m going to help myself
to everything you have

Walmart Drops Aspen Hill Superstore Plan

By Sonny Goldreich

Citing Montgomery County’s lengthy approval process, Walmart dropped its plan to build a superstore in Aspen Hill, its would-be landlord, Silver Spring-based Lee Development Group, announced Tuesday.

This is the second time that a store proposal by the discount retail giant has fallen through since 2012, even though the Bentonville, Arkansas firm managed to fight off regulatory hurdles raised by various County Council bills.

Walmart “has decided against moving forward with its plans because of the uncertain length of the county’s planning and regulatory processes,” according to a Lee press release. The big-box company wanted to build a 118,000-square-foot store with expanded grocery offerings at 4115 Aspen Hill Rd., the site of a vacant office building.

Lee intends to move forward with its proposal to rezone the property, which sits next to the intersection of Georgia and Connecticut avenues about five miles north of downtown Silver Spring.

“We are confident that this is a great retail location, ultimately offering much-needed shopping options to the under-served Aspen Hill community,” Bruce H. Lee, president of Lee Development, said in the press release. “Once the property is zoned appropriately for retail use, we expect strong interest from retailers looking to come to Aspen Hill."

The site is occupied by a sprawling 262,923-square-foot office building, which has been empty since 2010, when BAE systems/Vitro consolidated its operations to Rockville. The county Department of Planning has recommended reclassifying the property as a commercial/residential town zone, allowing for a dense mix of uses (see Planners endorse Walmart, green office building at ends of Georgia Avenue corridor).

A public hearing for the proposal has been set for Sept. 11, when the Planning Board will consider the change under the Aspen Hill minor master plan amendment process. The minor amendment is a fast-track process designed to address smaller areas in a speedier time frame than rewriting an area’s entire master plan.

County planners said last month that a commercial/residential zone makes sense for Aspen Hill because of poor demand for large-scale office buildings throughout the region. The property is also at the site of a proposed transit station as part of a rapid bus line that would run between downtown Silver Spring and Olney.

Walmart would have brought 300 jobs to the site of a circa 1968 office building that used to provide strong foot traffic for about 1 million square feet of neighboring retail in three strip malls. The store would have added a third grocery option for Aspen Hill residents, in competition with a Giant Food across the street and a Lotte Plaza Asian Market two blocks to the south.

United Food and Commercial Workers Local 400—the union that represents Giant employees—has been in the forefront of opposition to Walmart, which is seen as a threat to nearby jobs. The group failed to win passage of a council bill that would have required big box stores to seek community benefits agreements with at least three civic groups on issues like living wages or traffic improvements.

The Planning Board approved a pair of zoning text amendments targeting big box stores. The first—enacted by the council—aimed at a proposed Walmart on Rockville Pike by limiting new stores within half a mile of a Metro station to 80,000 square feet and requiring that they be paired with smaller retailers in a mixed-use project. A second measure targeting the BAE site—but never passed by the council—would require that the proposed Aspen Hill store go through the special exception review process in addition to the property being rezoned from its current office space designation.

The Rockville Walmart plan has been frozen since the strip mall it would have replaced was sold in 2012.

The Aspen Hill Walmart would have filled a huge hole for Lee. The firm would have been positioned to create something of a superstore cluster, paired with a Kohl’s department store and a Michael’s craft store across the street in Lee’s Northgate Shopping Center.

The Walmart plan has divided Aspen Hill, where some looked forward to new jobs and retail options and others feared the effects on already crowded traffic and surrounding businesses.

A new group, Aspen Hill Homeowners Group, organized in opposition to Walmart, and many residents’ yards have been papered with signs opposing the rezoning in recent months.

The long-established Aspen Hill Civic Association—which has more than 200 members—supports rezoning the Lee property but has remained neutral on which businesses might occupy the site.

A local business owners group supported the Walmart project.

“On behalf of the Aspen Hill Business Coalition, I’d like to express our utmost disappointment with the news that Walmart is withdrawing their plans for the BAE/Vitro site,” Boris Lander, co-president of the organization and owner of two nearby Dunkin Donut stores, said in the Lee press release. “After working diligently for two years, our organization will continue to work to urge a rezoning of the property in order to help local businesses and to revitalize our community by providing the opportunity to bring in a major retailer and present more shopping choices.”

.

Upscaling of Wheaton continues with plan to redevelop low-income Ambassador Apartments

By Sonny Goldreich
The upscaling of downtown Wheaton—in size and wealth—takes another leap forward this summer at the crumbling Ambassador Apartments, where the county Housing Opportunities Commission is negotiating to redevelop the subsidized rental project into a mixed-income, mixed-use property.

Details are still undecided on the future of the 162-unit building, which sits at a prime spot opposite the Westfield Wheaton shopping center  at 2715 University Blvd. West on the northwest corner intersecting Veirs Mill Road. But new zoning pushed by the HOC allows for a much larger building that will include market-rate units to help support preserving the current number of cheaply priced apartments within walking distance of the Wheaton Metro station.

The stage was set for redevelopment in 2012, when the new Wheaton sector plan included much denser zoning that would allow for what the HOC calls a “landmark structure” that could reach as high as 130 feet and total as much as 275,252 gross square feet. That’s almost twice the size of the existing 137,675-square-foot-building, which includes the HOC’s six stories of mostly tiny efficiency apartments atop ground-floor retail space owned by the Potomac-based Willco Cos., and an attached parking garage. The complex sits back from Veirs Mill Road, at the far end of a parking lot that includes a small vacant bank building.

By comparison, The Exchange at Wheaton Station at the south end of downtown Wheaton occupies 800,000 square feet, including 486 apartment units in a 17-story building with a ground-floor Safeway grocery and underground parking.

“HOC and its development partner, Willco Companies, are in the preliminary stage of vetting design concepts and assessing feasibility,” commission spokesman Scott Ellinwood said in an email. “The team is still exploring multiple options for the site to utilize the significant [floor-to-area ratio] available to the agency.

The building—which started life as a Howard Johnson hotel in 1959—was converted into low-income housing in 1992, when kitchens were added to every unit. In between, the hotel switched brand names to Best Western and the ground-floor Embassy restraurant—a rare white tablecloth spot in Wheaton—survived for a time after the birth of the Ambassador. Now, the property is best known as the site of CASA's first day laborer employment center.

The HOC issued a request for development proposals in 2012, seeking plans to improve its finances while preserving 162 units of affordable housing. The building is carrying about $8.2 million in debt.

The HOC named Pennrose Properties as the developer of the new project last year, and will soon turn over management of the existing building to the Philadelphia-based firm. The HOC and Pennrose are working out details of a development plan, which will decide the new building’s size and the number of market-rate and low-income units.

“HOC and Willco are considering several possible mixed-income and/or mixed-use solutions,” Ellinwood wrote.

Pennrose was selected in part because its proposal most closely matched the HOC goal of maximizing use of space allowed under the new Wheaton sector plan zoning. The firm has developed 12,000 units in more than 180 affordable, mixed‐income, and mixed‐use projects, including five Baltimore properties.

The Ambassador units are little changed since the 1992 hotel-to-apartment conversion. The original apartment developer, IDI, which also built Leisure World south of Olney, created 156 efficiency units—mostly less than 300 square feet—and six one-bedroom units of about 500 square feet. All units come furnished and are reserved for renters earning less than 60 percent of area median income, pegged to the 2013 federal published income limit for a one‐bedroom unit of $48,330.

Pre-development plans calls for speeding up the relocation of tenants from the building, which was temporarily condemned in January, when pipes froze and a water main break caused fire sprinkler and central boiler systems failures. More than 200 residents were relocated to hotel rooms for 24 hours.

As of early May, 135 units were occupied, but the HOC hopes to double the pace of tenants leaving to 12 rooms per month, through a combination of natural renter attrition and relocation to other county or alternative low-income housing. The pre-development plan stipulates that “no announcement of relocation of residents or actual relocation will be undertaken prior to approval of the full relocation plan, including costs and implementation.”

With no development agreement in place, construction on the new project is at least two years away, given the time it takes to clear anything through the Planning Board’s approval process.

Transit union moving HQ to National Labor College site after $31 million sale

By Sonny Goldreich

UPDATE: The Amalgamated Transit Union today officially announced plans to move its international headquarters from DC to the site of the National Labor College in Silver Spring, which I reported yesterday.

The sale includes this 72,000-square-foot building completed in 2006.

About 40 to 50 union staff will make the move to the new White Oak headquarters, which ATU president Larry Hanley confirmed sold for $31.4 million. The facility will offer classes to train union and community leaders, he said, but it will no longer provide college degrees, as the NLC did before closing its doors in April.

The ATU will revive the "original purpose of the training center from 1970, training working union member and community leaders," Hanley said in an interview.

He also scoffed at a lawsuit against the college seeking to block the sale filed last month by DC-based Monument Realty, which signed a letter of intent to buy the property in December. The suit will not complicate the sale of the campus, Hanley said.

"We're the labor movement," he said. "We don't respond to bullies. This is just a land grab by a greedy developer and it was laughed out of court by the judge."

A judge denied Monument's motion for a temporary restraining order and preliminary injunction on July 25. The court determined that the firm had suffered no irreparable harm and had "no chance chance of success," Hanley said.

"Today the ATU has stepped up and assumed a greater leadership role in the molding of minds, values and progressive reform for both Canada and the United States, where we represent more than 190,000 workers. The state of the art conference and training center will again be a hub of activity for ATU and the entire labor movement," Hanley said in a press release. "It represents a new beginning in terms of our capacity to train not only our leaders and members, but also those who work every day to improve the life of our society."

ORIGINAL STORY 7/29/2014
The Amalgamated Transit Union plans to move its national headquarters from DC to the site of the debt-crippled National Labor College in Silver Spring, where it will continue to offer classes after paying $31.4 million for the prime property.

The deal was expected to close by Thursday (July 31), after the Maryland Board of Public Works voted to approve the sale and forgive a claim on $2.75 million granted by the state to support the college since 1999. Most proceeds of the sale will go to pay off debt owed to the Bank of America, which holds a first lien on the property and has delayed moving to foreclosure for more than two years.

“The whole house of labor is very disappointed about this turn of events but we’re glad to keep it in the labor family,” college president Paula Peinovich, said during the board’s July 23 meeting.

The property—which has dormitory, classroom and office space totaling 287,071 square feet—sold for far less than its $47.4 million assessed value after two earlier deals fell apart.

The college closed its doors in April after offering university degrees since 1974. The campus was founded and backed by $5 million annually from the AFL-CIO, but it ran into financial trouble during a recent expansion, including construction of the Lane Kirkland Center, a 72,000-square-foot conference facility completed in 2007 with the help of $2 million from state taxpayers.

The transit union will acquire the 45.8 acres campus and its 10 buildings, which sit in the middle of the White Oak science gateway master plan approved Tuesday by the Montgomery County Council. It is a mile south of the FDA headquarters complex, next to a Beltway exit at 10000 New Hampshire Avenue.

Gov. Martin O’Malley cast the only vote against approving the sale and forgiving the state grants, which are supposed to be paid back if the property changes hands. He wanted to defer a vote until officials had a chance to further explore the college’s assets.

But state Comptroller Peter Franchot and Treasuer Nancy Kopp accepted the college’s argument that the property likely would fetch a lower price at auction, should Bank of America proceeded with foreclosure next month.

Sue Payne, an aide to state Del. Pat McDonough, R-District 7 (Baltimore and Harford Counties), testified against approving the sale, which she said amounted to an “inside contract” between affiliates of the AFL-CIO, while “the taxpayers are left holding the bag.”

O’Malley also questioned why the $2.75 million in state grants couldn’t have been folded into the price paid by the transit union.

Attorney James Gentile, the college’s general counsel, responded that the transit union offer was a fair one, considering that an earlier deal struck last year with Reid Temple and the Montgomery County Housing Opportunities Commission was valued at only about $27 million before the sale fell apart.

He said the college had hoped to pay off the state and stay afloat as an online school, but the real estate market made that impossible and the threat of foreclosure did not give the college time to wait for a better deal.

“This is the best offer we got,” Gentile said. “We originally hoped to sell the property for significantly more money.”

The sale to the transit union would cover only a $31.08 million settlement with the bank and broker fees, he said.

Gentile added that the labor college is its own non-profit entity that operates independently from the AFL-CIO, which no longer owns the property.

The sale will also support the state’s interest in preserving the site as a labor education facility, because the transit group plans to train its own staff as well as other union workers, Peinovich said. The property will remain the home of the college’s Bonnie Ladin Union Skills Program, which will offer expanded continuing education classes for union leaders, staff, and activists, she said.

The transit union also will preserve the property’s national monument to workers killed on the job.

The union's move to Silver Spring also reflects a recent commitment to train its leadership and members across the nation in political engagement to support increased transit spending.

"Our board voted ... to buy the National Labor College so we could start a permanent training center," ATU president Larry Hanley said in April during the Labor Notes union organizing conference.

State turns Glenmont history into piñata as it demolishes 1953 fire station

By Sonny Goldreich

The State Highway Administration knocked down a big piece of Glenmont history today, as a crew demolished the clock tower at the fire station that protected the north Silver Spring neighborhood since 1953

Making room for a road interchange, a worker operating a Hitachi excavator tractor treated station #18 (formerly Kensington Volunteer Fire Department No. 18) like a piñata, repeatedly poking and prodding its 40-foot tower with a steel beam until it toppled.

“I was in that tower many times to stretch the fire hoses to dry them,” said Richard Bourque, a former cadet at the station.

The demolition is part of a $74.8-million project to build a traffic bypass around Glenmont, where Randolph Road will run beneath Georgia Avenue. The knockdown of the old station will be followed by the start of construction of a new $14.8 million station in the fall across Georgia at the southwest corner of the intersection with Randolph. The 19,150-square-foot structure will be about three times the size of the old one, which cost $93,000 to build, including $18,000 for the land.

When the station opened, community leaders staged a parade that drew more than 1,000 visitors.

Now, Bourque stood alone in the hot morning sun, snapping pictures as the building fell away, brick by brick. He hoped to recover a couple of those bricks in honor of his late brother, Donald Bourque, who also started at the station as a cadet and rose to fire chief of the Kensington volunteer department during a 30-year career.

"She was built to last," Bourque said, as the tractor grabbed the steel beam to take another whack at the tower.

There was a feeble attempt to preserve the old station under the process of writing the new 2013 Glenmont Sector Plan, which is designed to bring higher-density development to the 300 acres surrounding the last subway station on the Metro Red Line. Montgomery’s Historic Preservation Commission recommended saving the structure, which was the northernmost county facility when it was built.

But the station was doomed by the state highway paving imperative and the Planning Board denied it historic protection. Now all that will remain of the structure is an original architectural model on display at the county fire and rescue training academy in Rockville.

Station #18 relocated temporarily in April to the Grandview Avenue site of the former Wheaton Fire and Rescue Station, which moved to a new, $14 million station less than a mile south of the Glenmont station. The Wheaton station is 29,000 square feet and includes 7,400 square feet for a community room and kitchen on the upper floor.

The county fire department will take ownership of the new Glenmont station, which allowed it to qualify for $4 million in federal funding.

The county has chosen a colonial design with peaked roof lines for the new Glenmont station, echoing the old one. Planners rejected modern-looking options that featured flat or asymmetrical roof lines.

Plans call for four vehicle bays, which is twice the number of the old facility. The station will sit at the location of the former Glenmont Elementary School, which was leveled as part of the state interchange project.

Hughes Group Architects, based in Sterling, Va., designed both the new Glenmont and Wheaton stations.