The City Council took a significant step in the Takoma Junction development process on Wednesday, voting 7 – 0 to authorize Junction developer NDC to seek another anchor tenant instead of the Co-op.
This vote doesn’t mean the Co-op’s departure – they’ll remain in business at their current site, with 18 years left on their 20 year lease. And, the Co-op and NDC are still free to continue negotiating toward an anchor tenant agreement, which, as a strong supporter of an expanded Co-op, I hope they will do.
The vote does mean the City will continue working with NDC. That had not been assured, as the Council’s other option was to cut ties with NDC, but in the end that didn’t have support on the Council.
Before providing details on the vote and its impact, I would like to express my appreciation for the many comments neighbors and residents have offered about the Junction development, and especially in recent days concerning the negotiations between NDC and the Co-op. The deep engagement by the Takoma Park community – via email, in-person conversations, testimony before the City Council and in other ways – has enriched the process and helped me gain a fuller sense of the project’s potential future role in residents’ lives, not to mention the Co-op’s current and future role. I look forward to continuing to benefit from the kind of valuable input I’ve been fortunate to receive.
Under the terms of the Development Agreement (DA) the City signed in late July with NDC, the Co-op and NDC had 120 days to negotiate a Letter of Intent (LOI), which would form the basis for their relationship going forward. The DA also allowed the Council to extend the negotiation period for 30 days, and if there was no agreement after that, we had two options: authorize NDC to seek another anchor tenant, or pay off NDC for their work (up to $75,000) and sever our relationship with them.
While the two companies talked a number of times and exchanged various proposed site plans, they were unable to reach an agreement by the first deadline in early December. At that time, I was pleased to join a majority of my Council colleagues in voting for the 30 day extension, which ended last week.
With creative compromises from both parties on the table, I was hopeful leading up to Wednesday’s Council meeting that an LOI agreement could be reached. That would have meant the Council didn’t need to consider the two options discussed above, but regrettably there was no agreement.
As a result, the Council took up the two options, and I’m pleased we chose to continue working with NDC. First, it means we don’t have to start over, with the virtual certainty that the City-owned parking lot would remain undeveloped for the foreseeable future. Second, there’s still a decent chance a deal between NDC and the Co-op can be worked out. And even without a deal, if NDC doesn’t find a suitable anchor tenant the Co-op can in effect play an anchor role in its current spot.
I think the biggest challenge in the negotiations has been that the City-owned site is small. This makes it hard to address the Co-op’s unloading and parking needs while at the same time providing enough square footage for other tenants to make the project financially viable for NDC. Both parties have moved toward a compromise, with the Co-op indicating a willingness to accept something less than a full loading dock and NDC offering to scale back the footprint for other tenant space.
Those concessions represent significant progress, and could form the basis for a great design that would double the size of the Co-op through a “conjoined” building comprising the existing building and a new attached structure about the same size. But, it’s unclear whether it will be possible to resolve the remaining areas of disagreement, which include how the construction work on the Co-op’s expansion space would be designed and paid for, the financial arrangements around parking, and what other kinds of businesses would be able to operate at the site.
These are among the issues that I hope the two parties will continue working on. Of course any negotiations toward an LOI will be based on what is best for each company, and as I have noted previously the City can’t mandate a certain result.
Where the City does have a role is in Council approval of the site plan for the development. Though we’re a number of months away from that point in the process, if the loading and parking designs are not sufficient the Council can demand changes to the site plan.
And if in the end there is no LOI agreement between the two parties, the DA requires that reasonable accommodations of the Co-op’s loading and parking needs be provided. I made it clear at the Council meeting that I wouldn’t support a site plan that doesn’t achieve that.
During the Council meeting I also said that – even though we were voting to allow NDC to seek another anchor tenant – I hoped their negotiations with the Co-op would continue. I’m pleased that most of my Council colleagues along with NDC President Adrian Washington said the same thing.
So, it’s my sense that the “meaning” of Wednesday’s discussion and vote is that we want to keep working with NDC, and also not lose the chance to get an expanded Co-op as the anchor tenant. I think that would be the best result for the City. I’ve tried to keep that in mind throughout this process, and I hope we’ll stay focused on it as work on the project advances.
I welcome any comments or questions, and if reading nearly 1,000 words isn’t enough, you can check out video of my Council comments through the following link (my section starts at the 3:05 mark): http://takomapark.granicus.com/MediaPlayer.php?view_id=14&clip_id=2204
Peter Kovar, Takoma Park City Council, Ward One