Housing Complex

Feds on L Street Warehouse: A Market Sounds Nice, But Money Sounds Better

At this morning's congressional hearing at a warehouse on L Street SE, Rep. John Mica uses a visual aid to demonstrate the vacant federal properties that remain to be addressed.

A group of Capitol Riverfront residents has been pushing to turn a vacant warehouse at 49 L Street SE into a community amenity called the Half Street Market. But if a congressional hearing there this morning was any indication, they may be facing an uphill battle.

Rep. John Mica (R-Fla.), who chairs the congressional subpanel on government operations, held a hearing this morning on the site as part of a series of field-trip hearings at vacant federal properties, aiming to speed up the federal government's transfer of the properties to productive uses. There are two main ways that the General Services Administration, the federal government's landlord, could rid itself of the property: by transferring it to the District or by selling it to a private developer. Half Street Market advocates are pushing the former, hoping that the market's use as an educational facility will allow it to be "conveyed" to the District at no cost. But Mica and co. made their preferences clear this morning.

"We're bankrupted and we're looking for hard cash," said Mica, who announced at the hearing that the property had been valued at $19 million.

GSA's Michael Gelber, testifying at the hearing, said GSA's preference would be to exchange the building for construction assistance from a developer, equal in value to the L Street property, on other GSA holdings. The preferred method, Gelber told me afterward, would be an auction among developers, at which the the winning bidder would put forward a dollar value and then carry out repair work on GSA properties equal to that dollar value, either directly or through a partner company.

A private developer would most likely choose to raze the existing warehouse and build from the ground up on the valuable land. (In the burgeoning Capitol Riverfront neighborhood, the property is directly across from the Navy Yard Metro station.) That would mean no market in the warehouse space.

Mica told me after the hearing that his main priority is to dispose of the property "as efficiently as possible, get as much as you can." If it is transferred to the District, "the price they give it to the District for should be as close to market price as possible."

At the hearing, Mica asked Ward 6 Councilmember Tommy Wells if the District would be willing to pay for the property. "Absolutely," Wells replied. "This is a derelict property that's not contributing to the community. I think the District would reap a great benefit from an investment of $19 million."

But Gelber says that a transfer to the District "is not a preferred option at this time." GSA, he says, could impose conditions on the sale to a developer—like a requirement that part of the property be used for a market—if elected officials make a strong case for them, but Gelber says "properties can generate the most value when they have the fewest restrictions or conditions on the sale."

So it appears likely that the feds will be selling the property to the highest bidder—and with Union Market and Eastern Market both within a few miles of the site, the highest bidder probably won't want another market there.

  • Anonymous

    Today was a win for the residents and businesses located in Navy Yard. Bringing a congressional field hearing to the warehouse shed light on the need to reactivate the property as soon as possible. Forcing GSA to talk about options for doing so is the first step.

    There was significant bipartisan support (and even support from the GSA) to involve and consider the community when determining the building's future use. That's another win for the neighborhood residents.

    Any resident-led effort that draws attention to blight in their community should be applauded. This is a true example of engaging in the civic process, and Navy Yard residents as a whole are going to be better off due to this group’s efforts!

  • teamtango

    the McKinney act requires that homeless providers' needs to be considered simultaneously in a community's reuse planning of surplus federal property - has the dc fiscal policy institute, washington legal clinic for the homeless and other members of the dc fair budget coalition weigh in or has a certain potential ward 6 candidate in the next election discouraged this until after the election

  • Actually

    Would be awesome to use it as a Housing First facility for housing the city's homeless population!

    Great location, great opportunity for them to access jobs & transit, and hugely symbolic of our city's dedication to helping the least fortunate!

    Please Mr. Wells, let's make it happen!

  • Hillman

    So you prefer to spend our limited resources on symbolism for the homeless, rather than choosing a less expensive non waterfront property where you could provide three or four times the actual services provided, instead of spending that on land value?

    If I were homeless I'd prefer the money be spent on drug and alcohol rehab, job training, etc.

  • Hillman

    Small correction. Technically not waterfront parcel. But directly on top of a metro in a waterfront neighborhood.

    Even more reason to develop the land foe the tax revenue. Revenue that can then fund far better and far more homeless resources on a less expensive parcel of land.