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MURIEL BOWSER
MAYOR
December 5, 2025
The Honorable Phil Mendelson
Chairman
Council of the District of Columbia
John A. Wilson Building
1350 Pennsylvania Avenue, NW, Suite 504
Washington, DC 20004
Dear Chairman Mendelson:
Enclosed for consideration and adoption by the Council of the District of Columbia is a bill entitled “St.
Elizabeths East Parcel 6 Surplus Declaration and Disposition Approval Act of 2025”.
This bill will declare District-owned real property known as St. Elizabeths East, Parcel 6, located at located
at the current address of 2700 Martin Luther King Jr., Ave., S.E. and known for tax and assessment
purposes as Lot 968 in Square 5868S, as no lon ger required for public purposes and approve its
disposition.
The Deputy Mayor for Planning and Economic Development (“DMPED”) completed a competitive
solicitation process to select a developer, which included issuing a request for proposals to create a mixed-
use and commercial-retail development. To review the propo sals, DMPED convened a selection panel,
which unanimously recommended the Parcel 6 Community Partners proposal as the Parcel 6 developer.
Adoption of the bill will allow for the development of the property as a mixed -use concept that includes
two residential buildings with outdoor space, parking, ground-floor retail, and nine for-sale townhomes.
I urge the Council to take prompt and favorable action on the enclosed bill.
Sincerely,
Muriel Bowser
Enclosure
1
2
3
4
5
6
7 AN BILL
8
9
10
~&:r-
at the request of the Mayor
11 IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
12
13
14
15 To declare surplus and approve the disposition of District-owned real property known as St.
16 Elizabeths East, Parcel 6, and known for tax and assessment purposes as Lot 968 in
17 Square 5868S .
18
19 BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
20 act may be cited as the "St. Elizabeths East Parcel 6 Surplus Declaration and Disposition
21 Approval Act of 2025".
22 Sec. 2. Definitions.
23 For the purposes of this act, the term:
24 (1) "Act" means An Act Authorizing the sale of certain real estate in the District
25 of Columbia no longer required for public purposes, approved August 5, 1939 (53 Stat. 1211;
26 D.C . Official Code§ 10-801 et seq.).
27 (2) "CBE Act" means the Small and Certified Business Enterprise Development
28 and Assistance Act of 2005, effective October 20, 2005 (D.C. Law 16-33; D.C. Official Code§
29 2-218.01 et seq.).
30 (3) "Certified Business Enterprise" means a business enterprise or joint venture
31 certified pursuant to the Small and Certified Business Enterprise Development and Assistance
2
Act of 2005, effective October 20, 2005 (D.C. Law 16-33; D.C. Official Code § 2-218.01 et 32
seq.). 33
(4) “Developer” means Parcel 6 Community Partners, LLC, with a business 34
address of 1227 Marion Barry Avenue, SE, Suite 107, led by Banneker Communities L.L.C., 35
with a business address of 1227 Marion Barry Avenue, SE, Suite 107, and including District 36
Development Group, RBK Construction, and their successors, assigns, or affiliates, as approved 37
by the Mayor or as permitted under the LDDA. 38
(5) “First Source Agreement” means an agreement with the District governing 39
certain obligations of the Developer pursuant to section 4 of the First Source Employment 40
Agreement Act of 1984, effective June 29, 1984 (D.C. Law 5-93; D.C. Official Code § 2-41
219.03), and Mayor’s Order 83-265, dated November 9, 1983, regarding job creation and 42
employment generated as a result of the construction on the Property. 43
(6) “LDDA” means the draft Land Disposition and Development Agreement 44
submitted with this act. 45
(7) “Property” means the real property addressed as 2700 Martin Luther King Jr., 46
Ave., S.E. and known for tax and assessment purposes as Lot 968 in Square 5868S (“Parcel 6”), 47
which is currently vacant. 48
Sec. 3. Findings. 49
(a) The District of Columbia is the owner of the Property. 50
(b) The Property consists of approximately 202,758 square feet of land. 51
(c) The Property is no longer required for public purposes. 52
(d) The District government and the public will benefit substantially from the disposition 53
of the Property for private development. 54
3
(e) The Mayor, through the Office of the Deputy Mayor for Planning and Economic 55
Development, satisfied the public hearing requirement of section 1(a-1)(4) of the Act by holding 56
a public hearing on Wednesday, January 9, 2019 to obtain community input on potential public 57
uses of the real property to inform the Mayor’s determination whether the real property is no 58
longer required for public purposes. 59
(f) The Mayor, through the Office of the Deputy Mayor for Planning and Economic 60
Development, satisfied the public hearing requirement of section 1(b-2) of the Act by holding a 61
public hearing on Wednesday, April 10, 2024 to obtain community comment and suggestions on 62
the proposed use of the property. 63
(g) The Mayor, through the Office of the Deputy Mayor for Planning and Economic 64
Development, has selected the Developer to develop the Property. 65
(h) The intended development of the Property is mixed-use building(s), townhomes, and 66
additional related uses, as further described in the term sheet submitted with this act (“Project”). 67
(i) The Mayor has proposed that the terms of the disposition of the Property include the 68
following: 69
(1) The Developer shall comply with the requirements of section 1(b-3) of the 70
Act, by dedicating at least 30% of the residential units in the Project as affordable housing units. 71
(2) The Developer shall enter into an agreement that shall require the Developer 72
to, at a minimum, contract with Certified Business Enterprises for at least 35% of the contract 73
dollar volume of the Project and shall require at least 20% equity and 20% development 74
participation of Certified Business Enterprises in the Project, in accordance with section 2349a of 75
the CBE Act and section 1(b)(6) of the Act. 76
(3) The Developer shall enter into a First Source Agreement. 77
4
(j) The method of disposition shall be a ground lease of greater than 15 years for a 78
portion of the Property and a private sale for a portion of the Property as further described in the 79
executed term sheet submitted with this act. 80
(k) The LDDA for the disposition of the Property shall not be inconsistent with the 81
substantive business terms of the transaction submitted by the Mayor with this act in accordance 82
with section 1(b-1)(2) of the Act, unless revisions to those substantive business terms are 83
approved by the Council in accordance with section 1(b-4) of the Act. 84
Sec. 4. Surplus declaration and disposition approval. 85
(a) Notwithstanding any other provision of law, including the Act, the Council 86
determines that the Property is no longer required for public purposes and approves the 87
disposition of the Property. 88
(b) The authority of the Mayor to dispose of the Property pursuant to this act shall expire 89
4 years after the effective date of this act. 90
Sec. 5. Fiscal impact statement. 91
The Council adopts the fiscal impact statement in the committee report as the fiscal 92
impact statement required by section 4a of the General Legislative Procedures Act of 1975, 93
approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 94
Sec. 6. Effective date. 95
This act shall take effect following approval by the Mayor (or, in the event of veto by the 96
Mayor, action by the Council to override the veto), a 30-day period of Congressional review as 97
provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 98
24, 1973 (87 Stat. 813, D.C. Official Code § 1-206.02(c)(1)), and publication in the District of 99
Columbia Register. 100
2
GOVERNMENT OF THE DISTRICT OF COLUMBIA
OFFICE OF THE ATTORNEY GENERAL
BRIAN L. SCHWALB
ATTORNEY GENERAL
Legal Counsel Division
MEMORANDUM
TO: Tomás Talamante
Director
Office of Policy and Legislative Affairs
FROM: Adele El-Khouri
Deputy Attorney General
Legal Counsel Division
DATE: October 8, 2025
SUBJECT: Legal Sufficiency Review of the St. Elizabeths East Parcel 6 Surplus Declaration and
Disposition Approval Act of 2025
AE-25-414
_____________________________________________________________________________________
This is to Certify that the Office of the Attorney General has reviewed the
St. Elizabeths East Parcel 6 Surplus Declaration and Disposition Approval Act of 2025, and
determined that it is legally sufficient. If you have any questions, please do not hesitate to call me at
(202) 262-6402.
_________________________________
Adele El-Khouri
400 Sixth Street, NW, Suite 9100, Washington, DC 20001 Tel. (202) 724-6658 Fax (202) 741-8930
GO
VERNMENT OF THE DISTRICT OF COLUMBIA
OFFICE OF THE ATTORNEY GENERAL
ATTORNEY GENERAL
BRIAN L. SCHWALB
Co
mmercial Division
ME
MORANDUM
TO: Susa
n Longstreet
General Counsel
Office of the Deputy Mayor for Planning and Economic Development
THR
OUGH: David Fisher
Deputy Attorney General
FR
OM: Lawrence Wolk
Assistant Attorney General
DATE
: August 20, 2025
SU
BJECT: Land Disposition and Development Agreement with Respect to Property Located at
2700 Martin Luther King, Jr. Avenue, SE, Square 5868S, Lot 968, Known as the St.
Elizabeths East Campus Parcel 6, By and Between the District of Columbia (District)
and Parcel 6 Community Partners, LLC (Developer) Pursuant to D.C. Official Code
Sec. 10-801(b)(8)(C) and (F) (Disposition)
_____________________________________________________________________________________
This is to Certify that the Commercial Division of the Office of the
Attorney General has examined the following documents provided by the Office of the Deputy
Mayor for Planning and Economic Development (DMPED) (Transaction Documents) in connection
with the Disposition:
1. Lan
d Disposition and Development Agreement between the District and Developer (unsigned,
undated Council Draft)
2. Exhibit A – Property Description
3. Exhibits B-1 & B -2 – ADU covenants (Rental and For Sale)
4. Exhibit C – Affordable Housing Plan
5. Exhibit D - CBE Agreement (Fully Executed)
6. Exhibit F – Form Development and Completion Guaranty
7. Exhibit G - First Source Agreement (Fully Executed)
8. Exhibit H - Concept Plans
9. Exhibit J – Form of Letter of Credit
10.Exhibit K - Schedule of Performance
11. Exhibit L – Term Sheet
(for Lawrence Wolk)
2
12. Exhibit N - Project Funding Plan
13. Exhibit O – Project Budget
14. Exhibit Q – Developer’s Organizational Chart
After a detailed examination of the Transaction Documents, we conclude that they do not
contravene or violate any known legal requirements, obligations, or commitments of the District
government. Accordingly, in their present form as provided to us, the Transaction Documents are
approved for legal sufficiency. This Office has not reviewed any transactional documentation other
than the above Transaction Documents and provides no legal opinion about any transactional
documentation other than the above Transaction Documents. It is noted that in connection with the
portion of the Property being disposed of by ground lease, neither a form ground lease nor draft
ground lease was provided by DMPED for review. If you have any questions, please do not hesitate
to call me at 202-236-4654.
Government of the District of Columbia
Office of the Chief Financial Officer
Glen Lee
Chief Financial Officer
1350 Pennsylvania Avenue, NW, Suite 203, Washington, DC 20004 (202)727 -2476
www.cfo.dc.gov
MEMORANDUM
TO: The Honorable Phil Mendelson
Chairman, Council of the District of Columbia
FROM: Glen Lee
Chief Financial Officer
DATE: November 4, 2025
SUBJECT: Fiscal Impact Statement – St. Elizabeths East Parcel 6 Surplus
Declaration and Disposition Approval Act of 2025
REFERENCE: Draft Bill as provided to the Office of Revenue Analysis on October 7,
2025
Conclusion
Funds are sufficient in the fiscal year 2026 through fiscal year 2029 budget and financial plan to
implement the bill.
The developer will be responsible for a nominal rent of $1 annually under a 99 -year ground lease
that will be paid in a lump sum amount of $99 when the transaction closes. A portion of the surplus
property, which will be developed as townhomes, will be sold fee simple to the developer for $1.
Background
The St. Elizabeths campus is a National Historic Landmark located in Southeast Washington, D.C. and
comprised of a West and East campus. In 1987, the federal government transferred ownership of the
East campus to the District. The St. Elizabeths East redevelop ment framework plan 1 and the
subsequent St. Elizabeths East Master Plan and Design Guidelines established the vision, scope, and
details of how the District would revitalize the East campus.
The bill declares as surplus and approves for disposition 202,758 square feet of land, known as Parcel
6, located on the St. Elizabeths East campus. 2 The District will dispose of the property to a private
1 Saint Elizabeths East Redevelopment Framework Plan Approval Resolution of 2008, approved December 16,
2008 (Resolution 17-899; 56 DCR 516).
2 The property is known for assessment and taxation purposes as Square 5868-S, Lot 968.
The Honorable Phil Mendelson
FIS: “St. Elizabeths East Parcel 6 Surplus Declaration and Disposition Approval Act of 2025,” Draft Bill as
provided to the Office of Revenue Analysis on October 7, 2025
Page 2 of 2
developer, Parcel 6 Community Partners, LLC,3 to construct affordable housing and related amenities.
The District will convey a little more than 9,200 square feet of Parcel 6 to the developer to build eight
affordable and workforce townhomes through a fee simple transaction. The remaining
approximately 193,000 square feet of Parcel 6 will be leased to the developer through a 99 -year
ground lease for the development of two affordable housing multifamily buildings and retail space.
The first component, named the Martin Component, comprises 221 residential units, commercial
space, parking, and a public park. The second component, named the Malcolm Component, comprises
286 residential units, commercial space, and parking. The developer will buy the townhome
component for $1 at closing and will lease the two multifamily, mixed -use components for $1
annually over the lease period, paid as a $99 lump sum at closing. The bill gives the mayor four years
from the bill’s effective date to close on the transaction with the developer.
The property is currently vacant and is no longer needed for public purposes.
Financial Plan Impact
Funds are sufficient in the fiscal year 2026 through fiscal year 2029 budget and financial plan to
implement the bill. There are no costs associated with declaring Parcel 6 as surplus property. The
developer will lease most of the property for $1 annually under a 99-year ground lease, paid fully at
closing, and purchase a smaller portion of the property for $1. The District will deposit the rent and
purchase payments into the Local Fund. The District has four years from the bill’s effective date to
dispose of Parcel 6.
3 Community Partners, LLC is comprised of Banneker Communities L.L.C., District Development Group, and
RBK Construction.
SURPLUS ANALYSIS
Project Name: St. Elizabeths East Parcel 6
Property Description: Lot 968, in Square 5868S (the “Property”)
Size of Property: 4.65 acres
Zoning of Property: St-E 6
Ward: Ward 8
Proposed Lessee: Parcel 6 Community Partners, LLC, or its permitted
successors/assigns (“Developer”)
1. History of Parcel: description of parcel (including approximate square footage,
description of any structure/improvements on the parcel and whether such
structure/improvements are historically landmarked, and any available parking on and
off the parcel), how and when the District acquired this property; the terms of the
acquisition; a description of the property’s former and current use; and, if the
improvements are occupied.
St. Elizabeths East is located at 2700 Martin Luther King Jr. Avenue SE in the Congress Heights
neighborhood of Washington, D.C., approximately three miles from the U.S. Capitol, and is
directly across the street from the historic St. Elizabeths West Campus, home to the U.S.
Department of Homeland Security’s (“DHS”) consolidated headquarters.
St. Elizabeths East is positioned strategically along the Green Line, the North-South spine of the
Washington, D.C. Metrorail system. The Congress Heights Metrorail station provides residents
and occupants of St. Elizabeths East with a direct link to downtown Washington, D.C., as well as
connections to Ronald Reagan Washington National Airport, most federal agencies and labs,
other regional business hubs, and local universities. St. Elizabeths East also provides excellent
access to I-295, I-395, the Suitland Parkway, and the Capital Beltway, linking it easily to the
entire metro region.
In 1987, the federal government transferred the 183-acre St. Elizabeths East Campus to the
District. Due to the hospital’s rich history, the St. Elizabeths East and West campuses were
added to the National Register of Historic Places in 1979, designated as a National Historic
Landmark in 1990, and declared a local historic district in 2005.
The Property to be surplused (as fully depicted in Attachment A) is located on the St. Elizabeths
East Campus in Southeast Washington, D.C. and is serviced by the Congress Heights Metro
Station. The Property runs along 13th Street SE on the St. Elizabeths East Campus. The Property
is 202,758 square feet (approximately 4.65 acres) and currently vacant.
Parcel
StE-6
Parcel 6 is situated along 13th Street and helps connect the campus to the ravine's
green space.
A Framework Plan for the East Campus was completed in 2005. The Plan recommends a phased
development program, with over 1,000 additional housing units and millions of square feet of
office and retail space, new academic and cultural facilities, and new city parks and plazas. In
2008, the District refined and updated the St. Elizabeths East Campus Framework Plan to
establish development principles.
The District further developed the St. Elizabeths East Master Plan & Design Guidelines (the
“Master Plan”) in 2012 to provide guidelines for the redevelopment of the entire East campus.
The Master Plan was completed with significant community input and, because of the historic
nature of the campus, was developed in coordination with the historic preservation community.
The Master Plan envisions creating a unique and innovative environment, with newly
constructed offices alongside the existing historic buildings across 5 million square feet of
mixed-use development in multiple parcels. More specifically, the Master Plan calls for:
• Office: 1.8 million SF, including 500,000 SF of “Innovation Hub” space
• Residential: 1,300 units
• Retail: 206,000 SF
• Hospitality: 330,000 SF
• Civic & Educational: 250,000 SF for non-commercial activity centers
The Plan promotes the interaction among all components of the development, from large and
small firms to government agencies and academic institutions. The Master Plan also
contemplates the creation of both civic and tech space within specified historic structures, to
create a gateway for local residents to the innovation economy.
In 2013, the District’s Zoning Commission approved the St. Elizabeths East (StE) zone district
for St. Elizabeths East in Final Rulemaking published at 60 DCR 4834, 4842 (March 29, 2013);
11 DCMR §§ 3301 et seq. The zoning established 19 sub-districts within St. Elizabeths East and
will allow +5 million square feet of new construction and the reuse of historic buildings. This
zone allows for “by-right” development with flexible uses across the campus, including all
parcels included as part of the Property.
2. Describe the surrounding neighborhood, including the following information: What
does the neighborhood offer in terms of housing, shopping, recreation, and commercial
space?
St. Elizabeths East offers a vibrant and diverse neighborhood that blends housing, shopping,
recreation, and commercial space. The redevelopment of St. Elizabeths East Campus is
transforming Congress Heights into a dynamic neighborhood with diverse housing options,
expanded retail and commercial spaces, enhanced recreational facilities, and improved healthcare
services, fostering a vibrant and inclusive community.
Housing:
The Residences at St. Elizabeths, which opened in November 2019, is a 252-unit
apartment community with 202 affordable housing units for households earning less than
50 percent of the median family income (MFI), or $58,600 for a family of four. Residents
enjoy amenities such as a fitness center, clubroom, playground, and outdoor recreational
areas, all within walking distance of the Metro. Parcels 10 and 14 feature 88 for-sale
townhomes, while Parcel 15 includes planned residential space as part of a mixed-use
development.
Shopping and Commercial Space:
Sycamore & Oak, an interim retail village, incubates 13 Black-owned businesses and four
restaurateurs, offering a variety of retail and dining options. Parcel 17 has introduced
commercial and Class A office buildings, with Whitman-Walker Health occupying a
118,000-square-foot, state-of-the-art facility that provides critical health care services.
Parcel 15 will add additional Class A office space, retail, and a town square that enhances
the community’s commercial offerings.
Recreation and Entertainment:
Gateway DC, an innovative pavilion and urban park that opened in Fall 2013, hosts
concerts, community festivals, parades, and other special events. The R.I.S.E.
Demonstration Center, which opened in Fall 2014, serves as a community space for
events, conferences, job training programs, and community initiatives.
Sports and Events:
The CareFirst Arena, formerly the Entertainment and Sports Arena, opened in 2018 and
is home to the WNBA Champion Washington Mystics, the NBA G League’s Capital City
Go-Go, and the practice facility for the NBA’s Washington Wizards. This 4,200-seat
arena attracts over 380,000 annual visitors to the Congress Heights neighborhood,
making it a major draw for sports and entertainment.
Congress Heights is currently experiencing some of the most exciting redevelopment activity
east of the Anacostia River, including improvements to the nearby Oxon Run Park, Malcolm X
Park, and developments underway on the St. Elizabeths West Campus by the U.S. Department of
Homeland Security (“DHS”). St. Elizabeths East continues to evolve as a dynamic community,
offering residents and visitors a well-rounded mix of housing, commerce, and recreation.
3. No Necessary District Use. (D.C. Code § 10-801(a-1)(2)(A).
a. Please describe allowable future uses for the subject property.
The District of Columbia Comprehensive Plan and Future Land Use Map notes that
redevelopment of the St. Elizabeths campus “offer[s] an unprecedented opportunity to catalyze
economic development in the Far Southeast/Southwest area.” The Comprehensive Plan
recommends redevelopment of the Property with medium-to-high density mixed uses, including
supportive retail services to office workers and residents alike and providing housing
opportunities to people who want to live and work in the area.
The Comprehensive Plan anticipates that the redevelopment of St. Elizabeths East as a new
community containing a mix of uses, including mixed density housing, retail shops, offices, a
comprehensive mental health care facility, and parks and open space. The Comprehensive Plan
anticipates that the mixed-use development, including retail and service uses, will be promoted
along Alabama and Martin Luther King Jr. Avenues, SE, facing the public streets and opening
the campus to the public. Other uses such as satellite college campuses, civic uses, and local
public facilities are planned to be incorporated into the redevelopment.
The Comprehensive Plan also specifically calls for additional housing on St. Elizabeths East,
noting:
Parcel 6 sits across 13th Street from Building 92, the central
building in the historic Maple Quadrangle complex. This important
relationship, along with the ravine directly to the east, defines the
key opportunities of Parcel 6: to allow for high-density
development on Saint Elizabeths East Campus, to promote activity
along 13th Street, and to help connect the campus to the green
space of the ravine. The development of Parcel 6 does not
incorporate historic resources. Therefore, no guidance is provided
on addition or modification.
The 2012 Master Plan expands on the vision created for the campus in the Comprehensive Plans
and provides specific details of the Property, calling for the following uses:
Parcel 6 Residential, Commercial
Retail
4. How were other District facility needs considered? Please explain if the Property has
any viable District use or why the Property has no viable use by the District,
including the process for making the determination not to implement the viable
District use or that the Property has no viable use by the District.
DMPED reviewed the Property’s potential uses established under the District’s Comprehensive
Plan, the Framework Plan for the East Campus, the St. Elizabeths East Master Plan, and
applicable zoning.
5. Why determination that the real property is no longer required for public purposes
is in the best interest of the District. DC Code § 10-801(a-1)(2)(B).
a. Please describe most viable and reasonable future use(s) for the subject
property.
As a publicly owned site, the Property offers the potential for redevelopment as a unique historic
gem that features affordable housing and homeownership opportunities, retail and mixed-use
development close to the Congress Heights metro, that spur small business development and
excellence in urban design/architecture.
This vision is consistent with the goals outlined in the Master Plan, which provides that the
redevelopment of the St. Elizabeths East campus will:
1. Proximity to the Congress Heights Metro Station, allowing for the creation of a Transit-
Oriented Development;
2. Retailers that can activate the 13th Street frontage and the Pocket Park between the
existing parking structure and the proposed mixed-use development.;
3. New construction that creates 100% affordable mixed-income dwelling units and for-sale
workforce and affordable townhouses;
4. Ground-up development pads for potential retail uses walking distance to the Congress
Heights Metro Station and Alabama, Ave.;
5. Opportunity to take full advantage of below-grade parking to serve campus visitors;
6. Establish a re-use and preservation strategy for a unique and sustainable redevelopment;
7. Create new employment and education opportunities for DC residents, particularly those
of Ward 8;
8. Maximize value to the District through land proceeds and long-term financial returns
through increased tax revenues, maximizing the Property's value.
9. Activate the St. Elizabeths East Campus and create a distinct and unique place in
Washington D.C.
Given the redevelopment goals outlined by in the St. Elizabeths East Master Plan, DMPED
concluded that the Property can serve as an essential first phase of development on the St.
Elizabeths East campus by providing additional mixed-use commercial and residential
development that leverages the ongoing public and private investments in the neighborhood as a
mixed-use destination.
b. Please describe what potential uses of the Property would be in the best interest
of the District (economic, social, educational, provision of affordable housing
potential).
See above. As a publicly owned site, the redevelopment of the Property will allow the District to
maintain the momentum of revitalization of this historic landmark with mixed-income housing
and provide homeownership opportunities in a mixed-use development that creates a successful
urban innovation cluster.
In addition, the planned redevelopment includes substantial affordable housing opportunities. For
Parcel 6 into 507 for-rent units that will be priced for residents earning between 30% and 100%
of the Area Median Income. Building 2 – 20.8% of the units will be Studio, 36.7% of the units
will be one-bedroom, 32.6% of the units will be two-bedroom,10% of the units will be three
bedrooms. Building 3 – 20.3% of the units will be Studio, 36.0% of the units will be one-
bedroom, 33.6% of the units will be two-bedroom, 10.1% of the units will be three-bedroom.
Additionally, 9 for-sale townhomes is being proposed and will be priced for those earning 80-
100% of the Area Median Income.
6. Public Outreach and Comment. DC Code § 10-801(a-1)(2)(C).
a. What specific outreach was done to solicit community input on the proposed
surplusing and disposing of the current property, including any outreach
conducted in addition to the public hearing required under DC Code § 10-
801(a-1)(2)(C).
DMPED conducted extensive community outreach during the Request for Proposals (“RFP”)
process for the Property throughout 2023. After issuing the RFP for a development partner in
June 2023. DMPED also hosted a pre-offer conference for members of the public interested in
the solicitation. DMPED’s presentation and the names and contact information for the attendees
at the pre-offer conference was also posted on the St Elizabeths East website
(www.StElizabethsEast.com). The Parcel 6 Community Partners (‘P6CP’) team also presented
their development plan at the full ANC 8C meeting on March 10, 2024 and April 10, 2024 for
the public and encouraged comments directly to the teams. The community presentations were a
success, allowing attendees to share their comments verbally, in writing, and via email. The
public was also encouraged to submit written feedback on each team’s proposal directly to
DMPED. ANC 8C provided a letter in support of the P6CP project dated April 26, 2024.
In each of the meetings DMPED provided an overview of the disposition plans and process,
complemented by presentations by the development partner with details on the development.
In addition to the extensive outreach and community input solicited, ANC 8C also developed an
on-line survey to solicit comments. Comments on the surplus process are included as Attachment
B. ANC 8C, as well as other interested stakeholders including for the surplus hearing for Parcel 6
held on January 9, 2019.
Summary of Public Hearings on Surplus and Disposition
Meeting Date and Location (Surplus hearing):
Date: January 9, 2019
Time: 6:30 pm – 8:00 pm
Location: R.I.S.E. Demonstration Center
2730 Martin Luther King Jr., Ave., SE
Washington, D.C. 20032
Approximate Number of Attendees (Disposition hearing): 20
Date: April 10, 2024
Time: 6:30 pm – 8:00 pm
Location: R.I.S.E. Demonstration Center
2730 Martin Luther King Jr., Ave., SE
Washington, D.C. 20032
Approximate Number of Attendees: 15 in-person 10 - virtually
Attachment A
Surplus Overview
Attachment B
Summary of Public Comments
Below is a summary of the comments on Parcel 6 from the transcript of the public surplus
meeting on January 9, 2019:
The meeting began with a summary of the surplus process, explaining the steps involved in
determining that certain parcels are no longer needed for public use by the District. This process
included clarifying that the District does not intend to build on these parcels and that part of the
meeting’s objective was to show attendees the specific areas proposed for surplus. Initially, there
were technical difficulties with the PowerPoint presentation, but they were resolved before the
presentation continued.
The audience was informed that, while the final decision on the surplus designation lies with the
Council, community input remains essential. Residents were encouraged to voice their
perspectives, with Ms. Owens emphasizing that verbal feedback during the meeting was
welcomed, and written comments would also be accepted through January 24, allowing
additional community input to accompany the legislation. It was noted that the surplus process
aims to ensure that parcels not needed for District development can be repurposed for
community benefit.
The presentation highlighted the entire campus, identifying parcels under consideration for
surplus. Mr. Parks introduced each parcel, detailing their location on the campus and allowable
uses per the master plan, including recommended floor-to-area ratios.
Ms. Loraine Stanislaus, a resident living across Alabama Avenue in a condominium community
established in 2006, expressed support for the development at St. Elizabeth’s, noting that many
residents in her area work on the property. She emphasized the hope that the development will
lead to an increase in property values for homeowners nearby. Loraine and her community
would like to see more restaurants rather than an overabundance of social service programs,
which are already prevalent in the Ward 8 area, especially in Congress Heights. Her support for
the surplus is contingent on its benefits for local homeowners and workers in the community.
Julia Jessie, a Ward 8 resident and business owner, emphasized the need for affordable office
space specifically for Certified Business Enterprises (CBEs) and workspaces at reasonable rates.
She also recommended designated parking for both residential and commercial users at the
R.I.S.E. Center, a site where parking conflicts could arise due to mixed-use development.
Wendy Glenn stressed the importance of allocating at least 10 percent of the development for
affordable housing, given the pressing housing crisis, particularly in Ward 8. She advocated for
the inclusion of affordable housing to address local needs. Each comment reflects community
interests in balanced development, increased property value, affordable workspaces, and housing
inclusivity, aligning with strategic goals for revitalization.
No feedback was provided during the public surplus meeting held on January 9, 2019, for
Parcels 8 and 9.
St. Elizabeths East Parcel 6 Disposition Analysis
DISPOSITION ANALYSIS
IN SUPPORT OF DISPOSITION OF REAL PROPERTY
Project Name: St. Elizabeths East Parcel 6
Property Description: Lot 968, in Square 5868S (the “Property”)
Size of Property: 4.65 acres
Zoning of Property: St-E 6
Ward: Ward 8
Proposed Lessee: Parcel 6 Community Partners, LLC, or its permitted
successors/assigns (“Developer”)
1. Description of Development Program:
The St. Elizabeths East Parcel 6 will introduce a vibrant, walkable, mixed-use community, with
office, retail, and additional homeownership opportunities along the 13th Street, SE corridor.
These uses will come together to increase retail activity, foot traffic, and access to food options
on the St. Elizabeths East site from the Congress Heights Metro to Pecan Street, SE. The
proposed redevelopment program will consist of retail, townhomes, apartment units, parking a
park as described below and depicted in the Parcel 6 plan included as Attachment A. Since the
St. Elizabeths East campus is a National Historic Landmark District, the Development Program
outlined is approximate; the proposed project will be reviewed by the District’s Historic
Preservation Review Board and the DC Office of Historic Preservation, subject to design and
layout revisions.
A Request for Proposals (RFP) was released on June 14, 2023, inviting qualified entities to
submit development proposals that align with the District’s goals. On Parcel 6, new development
is encouraged to promote connection to and awareness of the ravine landscape, so that the
verdant character of St. Elizabeths East continues to be present along this built-up street. At the
north end of 13th Street, where new buildings are adjacent to historic ones, particular attention
should be paid to the scale and detail of architectural relationships. Since the Development
Parcel comprises an especially long block, adjacent façades should be varied and segmented to
give the illusion of multiple buildings in this location. The development of the Development
Parcel does not incorporate historic resources.
Positioned as the central feature where Cypress Street terminates at 13th Street, Cypress
Commons is intended to be a quiet neighborhood-oriented open space. The Commons will be
surrounded by residential and potential office uses
Plans for Parcel 6 align with the St. Elizabeths East Master Plan & Design Guidelines (the
“Master Plan”), which envisions over 5 million square feet of mixed-use development on St.
Elizabeths East. Further details are in the St. Elizabeths East Surplus Analysis.
The Parcel 6 plan will follow the proposal from Parcel 6 Community Partners LLC, which
envisions a mixed-use concept that includes two residential buildings totaling approximately
618,000 square feet of building space with outdoor areas and limited parking planned for the
northern end of the site. Ground-floor retail is planned along the 13th Street side of the
St. Elizabeths East Parcel 6 Disposition Analysis
Development Parcel to activate that pedestrian and vehicular corridor. A generous outdoor
area/plaza is planned between the existing precast garage to the south and the first multifamily
building to the north, which presents opportunity for placemaking and potentially one or two
retail kiosks. In addition, the program includes nine (9) for-sale townhome-styled live/work units
which would line the 13th Street side of the existing garage – creating additional opportunity for
home ownership within St. Elizabeths East, while offering the opportunity to farther expand the
retail corridor towards the stadium and metro station.
2. Proposed Method of Disposition. DC Official Code § 10-801(b)(8).
A negotiated sale to the Developer for specifically designated purposes for a portion of the
property and a ground lease for a period of greater than 15 years for a portion of the property.
DC Official Code § 10-801(b)(8)(B), (C).
3. Description of efforts to dispose of Property for direct “public benefit” as described
on specific government plan adopted by the Mayor or Council (e.g. Community
Development Plan, the Comprehensive Plan, the Strategic Neighborhood Plan, or
the Comprehensive Housing Strategy Plan). DC Official Code § 10-801(a-2).
The Office of the Deputy Mayor for Planning and Economic Development (“DMPED”) carefully
evaluated the Property and the proposed development program to ensure that it reflects and
maximizes the District’s economic development and land use goals and provides substantial
“public benefit” as set forth by specific government plans and policies.
DMPED’s evaluation was informed by the St. Elizabeths East Master Plan, which provides
guidelines for the redevelopment of the entire East campus. The Master Plan was completed in
June 2012 with significant community input and, because of the historic nature of the campus,
was developed in coordination with the historic preservation community. The Master Plan allows
for newly constructed offices and residential buildings with larger footprints alongside the
existing historic buildings promoting interaction among all components of the development from
large and small companies to retailers and new residents to the campus.
For Parcel 6, the Master Plan envisions a mixed-use building featuring commercial, multi-family
and office. Cypress Commons planned open space is also required in the Plan. Parcel 6 sits
across 13th Street from the historic Maple Quadrangle complex. The Maple Quadrangle group
comprises the largest buildings expected to remain on St. Elizabeths East and, thus, presents a
major opportunity for both economic development and historic preservation. The 13th Street
Sector includes areas to the east of 13th Street, along the ravine separating the historic St.
Elizabeths Campus from the current Saint Elizabeths East hospital. This important relationship,
along with the ravine directly to the east, defines the key opportunity of the Development Parcel:
to allow for high-density development on the St. Elizabeths East to connect the campus to the
green space. As there are no historic buildings and few roads in this area, the development must
have a dignified character, be welcoming to the public, and encourage activity along 13th Street.
St. Elizabeths East Parcel 6 Disposition Analysis
St. Elizabeths East campus, it’s important to provide additional mixed-use commercial and
residential development that leverages ongoing public and private investments.
Consistent with these goals, Parcel 6 were identified because of their ability to achieve
affordable housing goals, sense of place, leverage the activities of the CareFirst Arena
Entertainment and Sports Arena, establish additional tenants, and increase retail activity at St.
Elizabeths East. Specifically, the proposed Parcel 6 offers:
• Proximity to the Congress Heights Metro Station, allowing for the creation of a Transit-
Oriented Development;
• Retail space beneath the multifamily buildings measure over 17,000 square feet;
• New construction that creates 507 units of affordable mixed-income dwelling units and 9
for-sale live/work townhomes;
• Ground-up development pads for potential retail uses walking distance to the Congress
Heights Metro Station along 13th Street, SE to Pecan Street, SE.; and
• Creation of 48 permanent jobs in the District and 1,648 jobs during construction with half
of these jobs going to District residents.
a. Public Benefits Requested in Solicitation.
In accordance with the St. Elizabeths East Master Plan, as discussed above, as well as other
District economic and land use goals and objectives, DMPED issued an RFP that solicited
development proposals that met or exceeded those goals. The solicitation called for the
following:
• Respond to the development goals and planning principles of the Master Plan;
• Improve connectivity along the 13th Street Sector with the Congress Heights
neighborhood by building new high-quality, resilient, public infrastructure;
• Promote activity along 13th street and help connect the central portion of St. Elizabeths
East to the green space of the ravine;
• Provide new landscaping that is unobtrusive and does not detract from the new
development;
• Improve the quality of life for the surrounding neighborhood;
• Address District and stakeholder concerns and requirements;
• Respond to the goals and objectives of the Comp Plan;
• Address community preferences;
St. Elizabeths East Parcel 6 Disposition Analysis
• Maximize affordable housing, particularly family-sized units and homeownership
opportunities;
• Create job opportunities and/or apprenticeship programs for District of Columbia
residents—particularly for District of Columbia residents within 1-mile of the
Development Parcel—and exceed the requirements of the CBE Act (which requirements
are detailed in the “First Source” and “Certified Business Enterprises” sub-sections of the
“Common Requirements” section);
• In addition to any proposed terms to satisfy the “Equitable Development Focus” section
of this RFP, promote social equity generally, including but not limited to, maximizing
opportunities for CBEs, community serving retail, businesses based in the District of
Columbia, and/or businesses that hire District of Columbia residents, with priority given
to hiring and contracting Ward 8 residents and businesses, and fresh food access; and
• Meet any other additional goals identified throughout this RFP and any other District
policy documents.
In addition to the goals specifically stated in the RFP, DMPED carefully reviewed the
requirements of the An Act Authorizing the sale of certain real estate in the District of Columbia
no longer required for public purposes, approved August 5, 1939 (53 Stat. 1211; D.C. Official
Code § 10-801 et seq.) which requires 30% of all multi-family units that are part of a District
disposition and development project that includes a housing component be offered as affordable
housing units at specified AMI levels. For Parcel 6, these requirements are met, thereby offering
significant public benefit in the form of long-term affordable housing units.
b. Describe any Public Benefits in proposed Developer’s Development Plan.
The Developer’s proposal for redeveloping the Property, as negotiated between the Developer
and DMPED, meets the public benefits requested as part of the RFP, which include:
Maximizing CBE participation:
The Malcolm, The Martin, and the towns at St. Elizabeths East Parcel 6 (the
“Development”) will be developed by an experienced team of Ward 8-based
organizations. The ownership entity, P6CP will be comprised of three CBE-certified and
minority-owned companies, Banneker Communities, lead developer, District
Development Group, co-lead developer, RBK Construction & Development, co-
developer, one community development corporation, Congress Heights Community
Training and Development Corporation, and one development management services
company, Roth & Associates. The team also consists of Torti Gallas Urban, architect and
SK&A, structural engineers, who are also CBE’s.
Distinct and unique architecture:
St. Elizabeths East Parcel 6 Disposition Analysis
The Developer has designed new buildings that align with both the historic and future
aesthetic of the St. Elizabeths East campus. The color palette and materials of the
buildings reflect the distinctive red clay hues of the historic structures, while also
complementing the proposed all-glass mixed-use buildings on the campus. Additionally,
they architecture will also compliment the historic buildings on Parcels 8 and 9 and the
new Cedar Hill Regional Medical Center GW Health located nearby on Pecan Street, SE.
Additionally, the buildings have been designed in accordance with the 2012 Master Plan
design guidelines and fit within the current aesthetics of the campus.
St. Elizabeths East Parcel 6 Disposition Analysis
Residential Section:
The Developer’s proposal describes plans for of 507 rental units within the multifamily
buildings that will contain a range of unit sizes from efficiencies to one, two, and three
bedrooms. 30% of these units will be affordable dwelling units with a range of AMIs
including 25% of that figure targeted towards residents who earn at or below 30% AMI.
The remaining affordable units will be targeted towards residents who earn up to 60% AMI.
Retail space beneath the multifamily buildings measuring over 17,000 square feet. There
will be additional opportunities to activate the ground floor of the live/work townhomes
that line the existing garage.
Generate New Job Opportunities for DC Residents:
The Developer expects to create Creation of 48 permanent jobs in the District and 1,648
jobs during construction with half of these jobs going to District residents. $134 million
in salaries and wages during the construction period.
Maximize Value to the District:
The Parcel 6 plan seeks to provide long-term financial returns by creating a project that
produces jobs, tax revenue, and maximizes the value of the Property by developing
affordable housing and retail opportunities. The Developer will be required to pay the
ground lease payments outlined in the current form of the LDDA, as well as real estate
taxes on the Parcels. The Developer anticipates that the District will receive an estimated
generation of $840K in new sales taxes and $1.5 million in District personal income
taxes.
Activate the Campus:
The Parcel 6 plans will activate the campus and create a location with retailers on 13th
Street, SE that will create walkability from the Congress Heights Metro to Pecan Street,
SE. Additionally, the activation of Cypress Commons Park adjacent to the Parcel 6
garage.
c. Public Uses included in proposed Developer’s Development Plan (such as
public parks, construction of roads, sidewalks, and other public amenities).
The District’s Department of General Services, in partnership with the District’s Department of
Transportation, completed Stage 1 infrastructure in 2019 and is working to complete the Stage 2
roadway infrastructure. The St. Elizabeths East Campus Stage 2 Infrastructure and Utility
Improvement project will:
• Provide connectivity within the East Campus and between the campus and adjacent
neighborhoods,
St. Elizabeths East Parcel 6 Disposition Analysis
• Upgrade and replace existing utility infrastructure to support planned development for the
183-acre campus, and
• Provide multi-modal transportation options (public transit, bicycle and pedestrian) to
support the redevelopment of the East Campus.
The infrastructure improvements will provide increased access to Parcel 6 from 13th Street, SE to
Alabama Ave., SE. The Stage 2 Infrastructure and Utility Improvement project is underway and
is an essential step to advancing the complete redevelopment planning efforts for the
connectivity and modernization of the campus.
4. The chosen method of disposition, and how competition was maximized. DC Official
Code § 10-801(b-1)(1)(A).
Parcel 6 will be conveyed by the District to the Developer by ground lease with a term of 99
years in accordance with the terms of the LDA to be entered into between the District and the
Developer. DC Official Code § 10-801(b)(8)(B), (C).
a. Description of solicitation process (include form of solicitation, how solicitation
was advertised).
The District completed a thorough solicitation process to select a developer to develop
Parcel 6. On June 14, 2023, DMPED issued an RFP and an extension of the Submission
Deadline to September 28, 2023, for a Parcel 6 developer, seeking proposals to create a
mixed-use and commercial-retail development. Information relating to the Parcel 6
solicitation process, including a copy of the RFP was posted on the DMPED website at
https://dmped.dc.gov/page/st-elizabeths-east-redevelopment-parcel-6-rfp.
b. Please describe the competitive bid process, including number of responses. Please
also summarize each qualified bidder for the property. If no competitive process
was followed, please explain why not, and how the developer was chosen and all
key terms of the arrangement.
On September 28, 2023, the extended proposal due date, DMPED received two proposals from
the following teams:
1. Parcel 6 Community Partners (“P6CP”)
2. Cedar Hill Community Partners, LLC (“CHCP”)
On February 6, 2024, DMPED convened a review panel consisting of representatives from
DMPED’s Real Estate team, D.C. Office of Planning (Ward Eight Planner), and the District
Department of Transportation. The selection panel was presented with the development
proposals. The panel was given selection criteria and discussed the merits and drawbacks of
each.
St. Elizabeths East Parcel 6 Disposition Analysis
In April 6, 2024, the selection panel unanimously recommended the Parcel 6 Community
Partners (“P6CP”) proposal as the Parcel 6 developer. On August 23, 2025, the District
announced the selection of the P6CP team as the district’s development partner of the
Parcel 6 development on St. Elizabeths East.
c. Please describe any public hearings on the potential disposition and any public
comment received during the public hearings.
After issuing the RFP for a development partner on June 14, 2023, DMPED hosted a pre-offer
conference for members of the public interested in the solicitation. Comments on the surplus
process are included as Attachment C. ANC 8C was provided advanced written notice for the
surplus hearing for Parcel 6 held on January 9, 2019, and a disposition hearing was held on April
10, 2024, and notice of the public meeting was published in the District of Columbia Register.
The development teams also presented their development virtually to the ANC 8C Executive
Board on March 5, 2024, and at the required Public Disposition Hearing on April 10, 2024, ANC
8C provided a resolution letter dated April 11, 2024, for the support of P6CP in which it
summarized the elements it prefers in the redeveloped Property, and they are:
• Job creation
• All phases of Housing (Affordable/Workforce and Market)
• Business Development
• Retail
5. The manner in which economic factors were weighted and evaluated, including
estimates of the monetary benefits and costs to the District that will result from the
disposition. The benefits shall include revenues, fees, and other payments to the
District, as well as the creation of jobs. DC Official Code § 10-801(b-1)(1)(B).
a. Identify all relevant costs, including property value for the subject and
surrounding property, cost of potential rehabilitation, current and / or past cost
for upkeep on the property.
The Developer’s proposed sources and uses for the development of Property are provided in
Attachment B, along with the total development cost and the plan for funding those costs.
An independent appraisal was completed by Newmark Valuation & Advisory on May 21, 2025,
which appraised the Property as follows:
St. Elizabeths East Parcel 6 Disposition Analysis
Current Site Condition Use Appraised Value
Parcel 6 Unimproved Parcel Residential,
Commercial/Retail
“As-Is” Development – Valued at
$15.5 million.
“Proposed Development Plan” –
Valued at $1, reflecting
The appraisal report on St. Elizabeths East Parcel 6 provides a thorough valuation analysis of the
development site. The appraisal assesses two potential development scenarios for the 4.65 acres
or 202,758 square feet site: the Property’s market value unencumbered and market value under
development plan. Given the project’s historical and economic implications, the appraisal
follows Uniform Standards of Professional Appraisal Practice (USPAP) guidelines.
The appraisal, classified as an “Appraisal Report” per USPAP Standards Rule 2-2a,
incorporated:
1. Inspection, Market and Data Collection: The data collection process for the appraisal
involved a comprehensive analysis of both property-specific and market-related
information. This included evaluating exposure and marketing time, examining
neighborhood and land use trends, and assessing demographic patterns that may impact
the property. Market trends specific to the subject property type were reviewed, along
with the physical characteristics of the site and any improvements. Real estate tax data
and relevant comparable sales or lease information were gathered to inform the valuation.
Additionally, investment rates were analyzed, the property's flood zone status was
determined, and its compliance with zoning regulations was verified. All data were
analyzed using accepted industry methods, and the results were reconciled through
appropriate valuation approaches to arrive at a credible estimate of market value for the
intended use of the report.
2. Scenario-Based Valuations:
o Scenario A1: “As-Is” Development – Valued at $15.5 million.
o Scenario A2: “Proposed Development Plan” – Valued at $1, reflecting
anticipated high development costs.
The proposed development plan leverages St. Elizabeths East as a mixed-use project that
includes:
Parcel 6: 202,758 square feet of development with a mix of residential, retail, and community-
serving spaces designed to support a vibrant, inclusive neighborhood. The project will deliver
17,700 square feet of retail space across two buildings, 11,900 square feet in Building 2 and
5,800 square feet in Building 3, creating opportunities for neighborhood-serving businesses and
amenities.
The residential component includes 515 units, thoughtfully designed to meet a wide range of
income levels. This includes 507 apartment units and eight live/work townhomes located in
St. Elizabeths East Parcel 6 Disposition Analysis
Building 1. Of the total units, 36 will be reserved for households earning 30% of the Median
Family Income (MFI), 120 units for those at 50% MFI, two townhomes for families at 80% MFI,
six townhomes at 100% MFI, and 358 units also set at 100% MFI.
Building 2 will house 221 residential units, including the largest share of retail space, and feature
a community park that serves as a shared outdoor amenity for residents and neighbors. Building
3 will offer 286 residential units along with additional retail to round out the neighborhood’s
offerings. The development will be supported by 185 parking spaces, providing accessibility
while encouraging walkability and community interaction.
This redevelopment plan aligns with D.C.’s regulatory frameworks, encompassing zoning,
affordable housing mandates, and environmental codes. The development scope envisions
substantial capital for infrastructure and public services, necessary for both adaptive reuse and
new construction elements, ultimately supporting a long-term vision for economic and
community revitalization.
This appraisal is to develop an opinion of the value of the property under two major
scenarios: first, assuming the property is unencumbered and may be put to its highest and best
use (effective the “unrestricted market value” which is hypothetical); and second, assuming that
the Subject Property is developed to its highest potential under a provided Development Plan.
The Subject Property benefits from strong access to public transportation, including walking
distance to the Congress Heights Metrorail Station, and proximity to major employers like the
Department of Homeland Security and the CareFirst Arena. Market conditions—such as
increasing multifamily developments, improving vacancy and rental rates, and high demand for
affordable housing—support the feasibility of the proposed multifamily and townhome
development. While demand for affordable units and new townhomes appears strong, limited
projected population and household growth in the immediate area may constrain long-term
multifamily demand.
Altogether, the project represents a bold investment in mixed-income housing, walkable
commercial corridors, and thoughtfully designed community spaces that reflect the values of
equity, accessibility, and long-term neighborhood sustainability.
The District will ground lease the property at $1 annually.
b. Describe potential revenue that could be derived from the property and how it
was maximized in selected disposition method.
The proposed disposition and development of the Property will enable the District to generate
revenue through ground lease proceeds and commercial real estate taxes. Currently, the Property
remains unused and is not producing any revenue, despite the value of the underlying land. The
amount of these proceeds will depend on development financing and economic factors, as
outlined earlier.
The proposed development is projected to generate a significant fiscal boost for the District of
Columbia during the construction phase, with an estimated $4.6 million in total tax revenue
St. Elizabeths East Parcel 6 Disposition Analysis
flowing to the city. This substantial contribution will support public services, infrastructure, and
local economic vitality, and is broken down as follows:
• $840,000 in New Sales Taxes: Construction activities will drive the purchase of
materials, equipment, and related services, generating nearly a million dollars in
sales tax revenue for the District.
• $1.6 Million in Permitting and Other Municipal Fees: Through building permits,
inspections, and other required municipal processes. This project will contribute
over $1.6 million directly to the District’s regulatory and administrative
operations.
• $1.5 Million in District Personal Income Taxes: The employment of local
workers, contractors, and consultants during construction is expected to generate
$1.5 million in personal income tax revenue, resulting in job creation and
opportunities for District residents.
• $647,000 in District Corporate Profit Taxes: Generated from businesses involved
in the construction process, including developers, architects, engineers, and
subcontractors.
In total, this $4.6 million in tax revenue over 10 years represents not just a return on public-
private investment, but a meaningful contribution for revenue into the city’s economy.
The proposed Development Program is projected to generate the following additional revenues
and economic benefits for the District.
Jobs:
• Temporary Construction Jobs: 1648
• Permanent Jobs (per Developer): 48
• First Source Agreement in place for DC Residents
Tax Revenues (breakdown above):
• Approximately $4.6 million (per Developer) over 10 years inclusive of real property
taxes, sales and use taxes and other business-related taxes (per Developer)
• All construction related taxes and revenues
St. Elizabeths East Parcel 6 Disposition Analysis
Additional Community Benefits:
The current form of LDDA anticipates that the Developer will enter into a Memorandum of
Community Benefits with ANC 8C to create the following benefits and more:
• Workforce Development Training – The Developer will work with their development
partner, Congress Heights Community Training and Development Corporation, to
incorporate career training during the construction process and for permanent positions at
the site.
• First Source Hiring – The Developer has agreed to comply with all First Source
Employment Agreement requirements and to provide access to Ward 8 residents for all
new jobs created within the project. The First Source Agreement provides that the
Developer will use good faith efforts to ensure that at least 30% of all new jobs created
by the Project will be performed by DC residents residing in Ward 8.
• CBE Contracting – The Development Team is made up entirely of CBEs; however, they
also indicated that they would collaborate with their CBE design, construction, and
engineering partners to provide services that support achieving the Project’s CBE
participation goals.
The Developer has commitments with local partners, although the partners are subject to change
as the project evolves.
6. Please describe all disposition methods considered and provide a narrative of the
proposed disposition method that contains comparisons to the other methods and
shows why the proposed method was more beneficial for the District than the others
in the areas of return on investment, subsidies required, revenues paid to the
District, and any other relevant category, or why it is being proposed despite it
being less beneficial to the District in any of the measured categories. DC Official
Code § 10-801(b-1)(1)(C).
For redevelopment, the primary options available and considered for disposition were fee simple
for the townhomes proposed in front of the Parcel 6 garage and a ground lease for the balance of
the Parcel. DMPED carefully evaluated these options, considering upfront capital requirements,
development feasibility, and long-term project viability. It was determined that Parcel 6, which is
currently vacant, would-be ground leased for a 99-year term.
A disposition hearing was held on April 10, 2024, in conjunction with the ANC 8C monthly
meeting and notice was provided and distributed on the ANC monthly agenda and published in
the District of Columbia Register. The community were able to make all their comments
verbally, in written format, and through e-mail. Members of the public were encouraged to
submit written responses on each team’s proposal directly to DMPED. In each of the meetings
DMPED provided an overview of the disposition plans and process, complemented by
St. Elizabeths East Parcel 6 Disposition Analysis
presentations by the development partner with details on the development. The meeting was held
at the R.I.S.E Demonstration Center on the St. Elizabeths East Campus.
Parcel 6 Disposition Transcript Summary
Below is a summary of the comments from the hearing that Community members voiced strong
support for:
• Affordable and diverse housing options, including homeownership opportunities (e.g.,
condos for seniors and young professionals).
• Mixed-use development that addresses intergenerational needs without concentrating
poverty.
• Cultural and economic diversity, with attention to the complex identity and lived
experiences within Ward 8.
• Grocery and dining options to address the persistent food desert.
• Prioritization of Ward 8 businesses in leasing retail space.
• Consideration for transient workers, interns, and healthcare professionals, particularly as
the new hospital activates.
• Sustainable planning for future workforce overflow from DHS and other federal agencies
in the area.
Concerns included:
• Overconcentration of affordable housing (up to 435 units proposed by Cedar Hill), with
some feeling it replicates patterns of poverty.
• Lack of clear pathways from rental to ownership.
• Absence of short-term housing or live-work options for healthcare workers and
researchers.
• The need for better integration of federal workforce and mixed-use support in the plan.
• Cultural relevance and inclusion in marketing and job development.
The above points a summation of the feedback received during April 10, 2024, Disposition
Hearing. A complete transcript will be provided with the Council package.
St. Elizabeths East Parcel 6 Disposition Analysis
Attachment A
Approved Parcel 6 Plan
St. Elizabeths East Parcel 6 Disposition Analysis
Attachment B
Market Rate Sources and Uses
St. Elizabeths East Parcel 6 Disposition Analysis
Attachment C
Surplus Transcript
Below is a summary of the comments on Parcel 6 from the transcript of the public surplus
meeting on January 9, 2019:
The meeting began with a summary of the surplus process, explaining the steps involved in
determining that certain parcels are no longer needed for public use by the District. This process
included clarifying that the District does not intend to build on these parcels and that part of the
meeting’s objective was to show attendees the specific areas proposed for surplus. Initially, there
were technical difficulties with the PowerPoint presentation, but they were resolved before the
presentation continued.
The audience was informed that, while the final decision on the surplus designation lies with the
Council, community input remains essential. Residents were encouraged to voice their
perspectives, with Ms. Owens emphasizing that verbal feedback during the meeting was
welcomed, and written comments would also be accepted through January 24, allowing
additional community input to accompany the legislation. It was noted that the surplus process
aims to ensure that parcels not needed for District development can be repurposed for
community benefit.
The presentation highlighted the entire campus, identifying parcels under consideration for
surplus. Mr. Parks introduced each parcel, detailing their location on the campus and allowable
uses per the master plan, including recommended floor-to-area ratios.
Ms. Loraine Stanislaus, a resident living across Alabama Avenue in a condominium community
established in 2006, expressed support for the development at St. Elizabeth’s, noting that many
residents in her area work on the property. She emphasized the hope that the development will
lead to an increase in property values for homeowners nearby. Loraine and her community
would like to see more restaurants rather than an overabundance of social service programs,
which are already prevalent in the Ward 8 area, especially in Congress Heights. Her support for
the surplus is contingent on its benefits for local homeowners and workers in the community.
Julia Jessie, a Ward 8 resident and business owner, emphasized the need for affordable office
space specifically for Certified Business Enterprises (CBEs) and workspaces at reasonable rates.
She also recommended designated parking for both residential and commercial users at the
R.I.S.E. Center, a site where parking conflicts could arise due to mixed-use development.
Wendy Glenn stressed the importance of allocating at least 10 percent of the development for
affordable housing, given the pressing housing crisis, particularly in Ward 8. She advocated for
the inclusion of affordable housing to address local needs. Each comment reflects community
interests in balanced development, increased property value, affordable workspaces, and housing
inclusivity, aligning with strategic goals for revitalization.
No feedback was provided during the public surplus meeting held on January 9, 2019, for
Parcels 8 and 9.
COUNCIL DRAFT
LAND DISPOSITION AND DEVELOPMENT AGREEMENT
by and between the
DISTRICT OF COLUMBIA
and
PARCEL 6 COMMUNITY PARTNERS
for the
DISPOSITION AND DEVELOPMENT OF
THAT CERTAIN PARCEL OF LAND LOCATED AT
2700 Martin Luther King, Jr. Avenue, SE
(COMMONLY KNOWN AS PARCEL 6)
ST. ELIZABETHS EAST CAMPUS, WASHINGTON, DC
LOT 968 IN SQUARE S-5868
[Date]
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS ...................................................................................................................... 1
1.1 DEFINITIONS. ................................................................................................................................................. 1
1.2 RULES OF CONSTRUCTION.. ...................................................................................................................... 12
1.3 OTHER DEFINITIONS.. ................................................................................................................................ 12
ARTICLE II CONVEYANCE OF THE PROPERTY; PROJECT DEPOSIT; CONDITION OF
PROPERTY
2.1 SALE OF THE PROPERTY; PURCHASE PRICE;LEASE OF PROPERTY. ...................................................... 12
2.2 PROJECT DEPOSIT; LETTERS OF CREDIT. ................................................................................................ 12
2.3 CONDITION OF PROPERTY. ........................................................................................................................ 14
2.4 TITLE. ........................................................................................................................................................... 18
2.5 RISK OF LOSS. ............................................................................................................................................. 19
2.6 CONDEMNATION. ........................................................................................................................................ 19
2.7 SERVICE CONTRACTS AND LEASES; TEMPORARY LICENSEES. . .......................................................... 20
ARTICLE III REPRESENTATIONS AND WARRANTIES .............................................................. 20
3.1 REPRESENTATIONS AND WARRANTIES OF DISTRICT. ........................................................................... 20
3.2 REPRESENTATIONS AND WARRANTIES OF DEVELOPER. ...................................................................... 21
ARTICLE IV APPROVAL OF CONSTRUCTION PLANS AND SPECIFICATIONS AND
OTHER SUBMISSIONS .......................................................................................................................... 22
4.1 CONSTRUCTION PLANS AND SPECIFICATIONS. ...................................................................................... 22
4.2 DISTRICT REVIEW AND APPROVAL OF CONSTRUCTION PLANS AND SPECIFICATIONS. ................... 22
4.3 CHANGES IN CONSTRUCTION PLANS AND SPECIFICATIONS; GOVERNMENT REQUIRED CHANGES.
24
4.4 PROJECT PROFESSIONALS.......................................................................................................................... 24
4.5 RETAIL PLAN. .............................................................................................................................................. 25
4.6 COMMUNITY PARTICIPATION PROGRAM. . ............................................................................................. 25
4.7 CONSTRUCTION CONSULTANT. ................................................................................................................ 25
4.8 PROJECT FUNDING PLAN; PROJECT BUDGET. ........................................................................................ 26
4.9 ZONING COMMISSION AND HPRB APPROVAL. ..................................................................................... 26
4.10 NAMING OF PROJECT. ................................................................................................................................ 27
4.11 SUBMISSION DEADLINE EXTENSIONS. ..................................................................................................... 27
4.12 SUBDIVISION. .............................................................................................................................................. 27
ARTICLE V CONDITIONS TO CLOSING .......................................................................................... 27
5.1 CONDITIONS PRECEDENT TO DEVELOPER’S OBLIGATION TO CLOSE. ................................................ 27
5.2 CONDITIONS PRECEDENT TO DISTRICT’S OBLIGATION TO CLOSE. ..................................................... 28
ARTICLE VI CLOSING ......................................................................................................................... 30
6.1 CLOSING DATE AND OUTSIDE CLOSING DATE. ..................................................................................... 30
6.2 DELIVERIES AT CLOSING. .......................................................................................................................... 31
6.3 RECORDATION OF CLOSING DOCUMENTS; CLOSING COSTS. ............................................................... 33
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ARTICLE VII DEVELOPMENT OF PROPERTY AND CONSTRUCTION OF
IMPROVEMENTS; AFFORDABLE HOUSING REQUIREMENT .................................................. 33
7.1 OBLIGATION TO CONSTRUCT IMPROVEMENTS. ..................................................................................... 33
7.2 GOVERNMENTAL APPROVALS. ................................................................................................................. 33
7.3 ISSUANCE OF PERMITS. .............................................................................................................................. 33
7.4 SITE PREPARATION. .................................................................................................................................... 34
7.5 AFFORDABLE HOUSING REQUIREMENT. ................................................................................................ 34
7.6 OPPORTUNITY FOR CBES. . ....................................................................................................................... 34
7.7 EMPLOYMENT OF DISTRICT RESIDENTS; FIRST SOURCE AGREEMENT............................................... 34
7.8 DAVIS BACON ACT; LIVING WAGE ACT ................................................................................................. 35
7.9 GREEN BUILDING ACT AND CLEAN ENERGY. ...................................................................................... 35
ARTICLE VIII POST-CLOSING GUARANTIES OF PERFORMANCE ........................................ 35
8.1 DEVELOPMENT AND COMPLETION GUARANTY. .................................................................................... 35
8.2 PERFORMANCE LETTER OF CREDIT ......................................................................................................... 36
8.3 PAYMENT AND PERFORMANCE BONDS ................................................................................................... 36
ARTICLE IX DEFAULTS AND REMEDIES ....................................................................................... 36
9.1 DEFAULT. ..................................................................................................................................................... 36
9.2 DISTRICT REMEDIES IN THE EVENT OF A DEVELOPER DEFAULT. ....................................................... 37
9.3 DEVELOPER REMEDIES IN THE EVENT OF A DISTRICT DEFAULT. ....................................................... 37
9.4 LIMITATION ON REMEDIES; CURE PERIODS. .......................................................................................... 38
9.5 NO WAIVER BY DELAY; WAIVER. ......................................................................................................... 38
9.6 ASSIGNMENT OF DEVELOPMENT WORK PRODUCT.. ............................................................................. 38
9.7 ATTORNEYS’ FEES ...................................................................................................................................... 38
9.8 RIGHTS AND REMEDIES CUMULATIVE. . ................................................................................................. 39
ARTICLE X CONSTRUCTION FINANCING ..................................................................................... 39
10.1 LIMITATIONS ON ENCUMBRANCES. ......................................................................................................... 39
10.2 SUBMISSIONS............................................................................................................................................... 39
ARTICLE XI ASSIGNMENT AND TRANSFER ................................................................................. 40
11.1 ASSIGNMENT. .............................................................................................................................................. 40
11.2 TRANSFER OF MEMBERSHIP INTERESTS. ................................................................................................. 40
11.3 NO UNREASONABLE RESTRAINT. ............................................................................................................. 40
ARTICLE XII INSURANCE OBLIGATIONS; INDEMNIFICATION ............................................. 40
12.1 INSURANCE OBLIGATIONS. ....................................................................................................................... 40
12.2 INDEMNIFICATION. ............................................................................................................................ 40
ARTICLE XIII NOTICES ....................................................................................................................... 41
13.1 TO DISTRICT. ............................................................................................................................................. 41
13.2 TO DEVELOPER. .......................................................................................................................................... 41
ARTICLE XIV MISCELLANEOUS ...................................................................................................... 42
14.1 PARTY IN POSITION OF SURETY WITH RESPECT TO OBLIGATIONS. .................................................... 42
14.2 CONFLICT OF INTERESTS; REPRESENTATIVES NOT INDIVIDUALLY LIABLE. ..................................... 42
14.3 SURVIVAL; MERGER .................................................................................................................................. 42
14.4 TITLES OF ARTICLES AND SECTIONS. ...................................................................................................... 42
14.5 GOVERNING LAW; FORUM FOR DISPUTES .............................................................................................. 42
14.6 ENTIRE AGREEMENT; RECITALS; EXHIBITS. .......................................................................................... 43
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14.7 COUNTERPARTS.. ........................................................................................................................................ 43
14.8 TIME OF PERFORMANCE. ......................................................................................................................... 43
14.9 SUCCESSORS AND ASSIGNS. .................................................................................................................... 43
14.10 THIRD PARTY BENEFICIARY. ................................................................................................................. 43
14.11 WAIVER OF JURY TRIAL. .......................................................................................................................... 43
14.12 FURTHER ASSURANCES. ........................................................................................................................... 44
14.13 MODIFICATIONS AND AMENDMENTS. .................................................................................................... 44
14.14 SEVERABILITY. .......................................................................................................................................... 44
14.15 ANTI-DEFICIENCY LIMITATION; AUTHORITY. ...................................................................................... 44
14.16 TIME OF THE ESSENCE; STANDARD OF PERFORMANCE. ...................................................................... 44
14.17 NO PARTNERSHIP. ..................................................................................................................................... 44
14.18 EACH PARTY TO BEAR ITS OWN COSTS. ............................................................................................... 45
14.19 DISCRETION. ............................................................................................................................................... 45
14.20 FORCE MAJEURE. ...................................................................................................................................... 45
14.21 JOINT PREPARATION.. ............................................................................................................................... 45
14.22 ESTOPPEL CERTIFICATES. ........................................................................................................................ 45
14.23 D.C. HUMAN RIGHTS ACT. ..................................................................................................................... 45
14.24 PROJECT SIGNAGE. ................................................................................................................................... 46
14.25 PROJECT PRESS RELEASES AND PROMOTIONAL MATERIALS. ............................................................ 46
14.26 PROJECT PUBLIC EVENTS. . ...................................................................................................................... 46
EXHIBITS
Exhibit A Legal Description of Property
Exhibit B-1 Form of Affordable Housing Covenant (Rental)
Exhibit B-2 Form of Affordable Housing Covenant (For Sale)
Exhibit C Affordable Housing Plan
Exhibit D CBE Agreement
Exhibit E Form of Construction and Use Covenant
Exhibit F Form of Guaranty
Exhibit G First Source Agreement
Exhibit H Concept Plans
Exhibit I-1 Form of Deed
Exhibit I-2 Form Ground Lease
Exhibit J Form of Letter of Credit
Exhibit K Schedule of Performance
Exhibit L Council Term Sheet
Exhibit M Right of Entry
Exhibit N Project Funding Plan
Exhibit O Project Budget
Exhibit P Underground Storage Tank Disclosure Form
Exhibit Q Developer’s Organizational Chart
Exhibit R Form of Memorandum of Ground Lease
Exhibit S Insurance Requirements
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LAND DISPOSITION AND DEVELOPMENT AGREEMENT
THIS LAND DISPOSITION AND DEVELOPMENT AGREEMENT (this
“Agreement”), is made effective for all purposes as of the _____ day of ___________________,
20__ between (i) DISTRICT OF COLUMBIA, a municipal corporation, acting by and through
the Office of the Deputy Mayor for Planning and Economic Development (“ District”), and (ii)
Parcel 6 Community Partners LLC, a District of Columbia limited liability company
(“Developer”) (individually a “Party” and collectively, the “Parties”).
RECITALS:
R-1. District owns the real property located at 2700 Martin Luther King Jr. Avenue SE
in the District of Columbia and known for taxation and assessment purposes as Lot 968 in Square
5868S (the “Property”), as further described on Exhibit A.
R-2. District intends to (a ) convey fee simple title to a portion of the Property to
Developer for development and construction of the Townhome Component (as hereinafter
defined); and (b) lease the balance of the Property to Developer, and Developer shall develop and
construct the Martin Component and the Malcolm Component of the Project (as hereinafter
defined) on the Property, all of the foregoing in accordance with the terms of this Agreement.
District and Developer have agreed that the Project will consist of several components, as follows:
(x) the Malcolm Component (as hereinafter defined) ; (y) the Martin Component (as hereinafter
defined); and (z) the Townhome Component (as hereinafter defined) (each, a “Component” and
collectively the “Components”),
R-3. The disposition of the Property to Developer was approved on _______________
by the Council of the District of Columbia (the “ Council”) pursuant to the
__________________________________________ Approval Act of 20___, Resolution
___________ (“Act”), subject to certain terms and conditions incorporated herein.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged
by the Parties hereto, District and Developer do hereby agree as follows, to wit:
ARTICLE I
DEFINITIONS
1.1 Definitions. For the purposes of this Agreement, the following capitalized terms
shall have the meanings ascribed to them below:
“Acceptable Letter of Credit” is defined in Section 2.2.2.
“Affiliate” means with respect to any Person (“first Person”) ( a) any other Person
directly or indirectly Controlling, Controlled by, or under common Control with such first Person,
(b) any officer, director, partner, shareholder, manager, member, or trustee of such first Person, or
(c) any officer, director, general partner, manager, member , or trustee of any Person described in
clauses (a) or (b) of this sentence.
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“Affordable Housing Covenant ” is that certain Affordable Housing Covenant
between District and Developer in the form attached hereto as Exhibit B-1 and Exhibit B-2, to be
recorded in the Land Records against the Property at the Closing pursuant to Applicable Law and
this Agreement.
“Affordable Housing Plan” is attached hereto as Exhibit C.
“Affordable Unit” means an affordable dwelling unit constructed as part of the
Improvements.
“Agreement” means this Land Disposition and Development Agreement.
“Applicable Law ” m eans all applicable District of Columbia and federal laws,
codes, regulations, and orders, including, without limitation, Environmental Law s, laws relating
to historic preservation and zoning, laws relating to accessibility for persons with disabilities, and,
if applicable, the Davis-Bacon Act.
“Approved Plans and Specifications” is defined in Section 4.2.1.
“Architect” means the architect of record for the Project, who shall be licensed to
practice architecture in the District of Columbia.
“Bonds” is defined in Section 8.3.
“Business Day ” means Monday through Friday, inclusive, other than holidays
recognized by the District of Columbia government , or days on which the District of Columbia
government is officially closed.
“CBE Agreement ” is that certain Certified Business Enterprise Utilization and
Participation Agreement, by and between Developer and DSLBD, governing certain obligations
of Developer under the Small and Certified Business Enterprise Development and Assistance Act
of 2005, as amended (D.C. Law 16-33; D.C. Official Code §§2-218.01, et seq.) with respect to the
Project, attached hereto as Exhibit D.
“Closing” is the consummation of the transactions involving the sale or lease of the
Property from District to Developer, as contemplated by this Agreement.
“Closing Date” is defined in Section 6.1.
“Commencement of Construction ” means the time at which Developer has ( a)
executed a Construction Contract with its Contractor; (b) given the Contractor a notice to proceed
under said Construction Contract; (c) caused the Contractor to mobilize on the Property equipment
necessary for demolition, if any, and/or excavation; (d) obtained the required Permits for
demolition, excavation and sheeting and shoring; and (e) commenced demolition, if any, and/or
excavation upon the Property pursuant to the Approved Plans and Specifications. For purposes of
this Agreement, the term “Commencement of Construction” does not mean site exploration,
borings to determine foundation conditions, or other pre -construction monitoring or testing to
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conduct due diligence activities or to establish background information related to the suitability of
the Property for the Project or the investigations of environmental conditions.
“Community Participation Program” is defined in Section 4.6.
“Component” is defined in the Recitals.
“Concept Plans” are the design plans that serve the purpose of establishing the
major direction of the design of the Improvements, which are attached as Exhibit H.
“Construction and Use Covenant” is that certain Construction and Use Covenant
between District and Developer, in the form attached hereto as Exhibit E, to be recorded in the
Land Records against the Property in connection with Closing.
“Construction Consultant” is defined in Section 4.7.
“Construction Contract ” means a contract with the Contractor for the
construction of the Improvements in accordance with the Development Plan, the Approved Plans
and Specifications, this Agreement, the CBE Agreement, and the First Source Agreement.
“Construction Drawings” mean the detailed drawings and specifications for all
aspects of the Improvements in accordance with the approved Permit Set Documents that are
referenced in the Construction Contract to direct the construction of the Improvements.
“Construction Plans and Specifications ” mean the Schematic Design
Documents, the Design Development Documents, the Permit Set Documents, and the Construction
Drawings, individually or collectively, as the context shall appear, which shall be delivered by
Developer to District, and approved by District, to the extent required by, and in accordance with
the standards set forth in, Article IV of this Agreement. As used in this Agreement, the term
“Construction Plans and Specifications” shall include any changes to such Construction Plans and
Specifications that are made in accordance with the terms of this Agreement.
“Contractor” means the general contractor for the Project.
“Control” means the possession, directly or indirectly, of the power to direct, or
cause the direction of, the management and policies of a Person, whether through ownership of
voting securities, membership interests or partnership interests, by contract or otherwis e, or the
power to elect at least fifty percent (50%) of, as applicable, the directors, managers, managing
partners, or Persons exercising similar authority with respect to the subject Person . The terms
“Control,” “Controlling,” “Controlled by” or “under common Control with” shall have meanings
correlative thereto.
“Council” is defined in the Recitals.
“Council Term Sheet ” means the term sheet attached as Exhibit L executed as
required by D.C. Official Code § 10-801(b-1)(2).
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“Debt Financing” shall mean the financing to be obtained by Developer from one
or more Institutional Lenders to fund the costs set forth in the Final Project Budget, other than any
Equity Investment.
“Deed” means the quit claim deed conveying to Developer the portion of the
Property on which Townhome Component will be developed, which Deed shall be in the form
attached hereto as Exhibit I-1.
“Design Development Documents” are the design drawings and specifications
produced after review and approval of the Schematic Design Documents that reflect refinement of
the approved Schematic Design Documents , showing all aspects of the Improvements at the ir
proposed size and shape. The Design Development Documents shall include details of materials
and design, including size and scale of façade elements, which are presented in detailed
illustrations.
“Developer” is defined in the Preamble.
“Developer Default” is defined in Section 9.1.1.
“Developer’s Agents” mean s Developer’s agents, officers, directors, employees,
consultants, contractors, subcontractors, and representatives.
“Development Plan” means the Developer’s plan to develop the Property into
Components and to construct the following (a) the Martin Component, to consist of approximately
two hundred twenty- one ( 221) rental Residential Units ( all of which are Affordable Units ),
commercial and/or retail space, parking, and a public park; (b) the Malcolm Component, to consist
of approximat ely two hundred eighty -six (286) rental Residential Units (all of which are
Affordable Units), commercial and/or retail space, and parking ; and (c) the Townhome
Component, to consist of approximately eight (8) for sale Affordable Units and workforce
Residential Units.
“Development Work Product” is defined in Section 9.6.
“Disapproval Notice” is defined in Section 4.2.3.
“District” is defined in the Preamble.
“District Certificate of Final Completion” shall have the meaning given in the
Construction and Use Covenant.
“District Default” is defined in Section 9.1.2.
“DOEE” is the District of Columbia Department of Energy and Environment.
“DOES” is the District of Columbia Department of Employment Services.
“DSLBD” is the District of Columbia Department of Small and Local Business
Development.
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“Effective Date” is the date first written above, provided that all Parties shall have
executed and delivered this Agreement to one another by that date.
“Environmental Laws” means any present and future federal, state, or local law
and any amendments (whether common law, statute, rule, order, regulation, or otherwise), permits,
and other requirements or guidelines of Governmental Authorities and relating to (a) the protection
of health, safety, and the indoor or outdoor environment; (b) the conservation, management, or use
of natural resources and wildlife; (c) the protection or use of surface water and groundwater; (d)
the management, manufacture, possessi on, presence, use, generation, transportation, treatment,
storage, disposal, release, threatened release, abatement, removal, remediation, or handling of or
exposure to Hazardous Materials; or (e) pollution (including any release to air, land, surface water,
and groundwater) ; including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq.; the Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, and
subsequently amended, 42 U.S.C. § 6901 et seq.; the Hazardous Materials Transportation Act, 49
U.S.C. § 5101 et seq.; the Federal Water Pollution Control Act, as amended by the Clean Water
Act of 1977, 33 U.S.C. § 1251 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. § 32701 et seq.;
the Federal Insecticide, Fungicide, and Rodenticide Act, as amended, 7 U.S.C. § 136- 136y, the
Clean Air Act, as amended, 42 U.S.C. § 7401 et seq.; the Toxic Substances Control Act of 1976,
as amended, 15 U.S.C. § 2601 et seq.; the Safe Drinking Water Act of 1974, as amended, 42 U.S.C.
§ 300f et seq.; the Emergency Planning and Community Right -To-Know Act of 1986, 42 U.S.C.
§ 11001 et seq.; the Occupational Safety and Health Act of 1970, 29 U.S.C. § 651 et seq.; the
National Environmental Policy Act of 1969, 42 U.S.C. § 4321 et seq.; and any similar,
implementing, or successor law, and any amendment, rule, regulatory order , or directive issued
thereunder.
“Equity Investment” shall mean the funding for the Project that is provided by any
Person with a direct or indirect ownership interest in Developer, which funding shall cover the
difference between the proceeds of all Debt Financing and the costs set forth in the Final Project
Budget.
“Final Project Budget” is defined in Section 4.8.3.
“Final Project Funding Plan” is defined in Section 4.8.3.
“Financing Commitments ” shall mean bona fide commitment(s) for the Debt
Financing and Equity Investment.
“Financing Documents ” means (a) the final loan documents for the Debt
Financing, (b) the agreements evidencing the Equity Investment, and (c) a statement detailing the
disbursement of the proceeds of the Debt Financing and Equity Investment.
“First Source Agreement ” is that agreement between Developer and DOES,
attached hereto as Exhibit G, governing certain obligations of Developer regarding job creation
and employment generated as a result of the Project.
“Force Majeure” is an act or event, including, as applicable, an act of God ; fire;
earthquake; flood; explosion; war; invasion; insurrection; riot; mob violence; sabotage; terrorism;
6
; inability to procure or a general shortage of labor, equipment, facilities, materials, or supplies in
the open market; failure or unavailability of transportation; strike, lockout, or other actions of labor
unions; a taking by eminent domain or requisition; and laws or orders of government or of civil,
military, or naval authorities enacted or adopted after the Effective Date ; so long as such act or
event: (a) is not within the reasonable control of Developer, Developer’s Agents, or its Members,
or of District in the event District’s claim of delay is based on a Force Majeure event ; (b) is not
due to the fault or negligence of Developer, Developer’s Agents, or its Members, or of District in
the event District’s claim of delay is based on a Force Majeure event ; ( c) is not reasonably
avoidable by Developer, Developer’s Agents, or its Members or by District in the event District’s
claim is based on a Force Majeure event ; and (d) directly result s in a delay in performance by
Developer or District, as applicable; but specifically excluding: (i ) shortage or unavailability of
funds or Developer’s financial condition or (ii) changes in market conditions such that the Project
is no longer practicable under the circumstances.
“Governmental Approvals” means all applicable governmental approvals that are
required under Applicable Law to construct the Improvements, including those that pertain to any
subdivision, tax lot designations, street closing(s), public space permits, and other regulatory
approvals, including, without limitation, approval by the District of Columbia Board of Zoning
Adjustment or Zoning Commission, but expressly excluding the Permits.
“Governmental Authority” means the United States of America, the District of
Columbia, and any agency, department, commission, board, bureau, instrumentality or political
subdivision of the foregoing, now existing or hereafter created, having jurisdiction over Developer
or the Project or a portion thereof, or any street, road, avenue, or sidewalk comprising a part of, or
in front of, the Property , or any vault in or under the Property , or airspace within or over the
Property.
“Ground Lease” means the ground lease agreement by which District will lease
the Martin Component and the Malcolm Component to Developer in the form attached hereto as
Exhibit I.
“Guarantor” is, as of the Effective Date, ______________________, or such other
Person(s) selected by Developer and approved by District pursuant to Section 8.1, who will enter
into a Guaranty at Closing.
“Guarantor Submissions” shall mean the (a) audited financial statements (or
unaudited and reviewed by an independent third party certified public accountant if the proposed
guarantor is a Person that does not do audits in the ordinary course of its business ) and audited
balance sheets (or unaudited and reviewed by an independent third party certified public
accountant if the guarantor is a Person that does not do audits in the ordinary course of its business)
for the preceding three (3) consecutive fiscal years of the proposed guarantor, including such
proposed guarantor’s profit and loss statements, cash flow statements, and other financial reports));
(b) schedule of real estate owned by the proposed guarantor, including the then-current outstanding
debt and debt service; and (c) and other financial information of a proposed guarantor as District
may reasonably request, together with a summary of such proposed guarantor’s other guaranty
obligations and the other contingent obligations of such proposed guarantor (such financial
statements, balance sheets, and other financial statements and information also must be certified
7
by such proposed guarantor or an officer of such proposed guarantor as being true, complete, and
correct). Additionally, for any proposed guarantor that is not a natural person, the following
documents evidencing the due organization and authority of such guarantor to enter into, join, and
consummate the actions required under the Guaranty: ( i) the organizational documents and a
current certificate of good standing issued by its state of formation and the District of Columbia
for the proposed guarantor; (ii) authorizing resolutions, in form and content satisfactory to District,
demonstrating the authority of the proposed guarantor and of the Person executing the Guaranty
on behalf of such proposed guarantor; and (iii) a customary opinion of counsel that such proposed
guarantor is validly organized, existing and in good standing in its state of formation, and is
authorized to do business in the District of Columbia, that such proposed guarantor has the full
authority and legal right to carry out the terms of the Guaranty, that such proposed guarantor has
taken all actions to authorize the execution, delivery, and performance of the Guaranty, that none
of the aforesaid actions, undertakings, or agreements violate any restriction, term, condition, or
provision of the organizational documents of such proposed guarantor , or, to counsel’s actual
knowledge, any contract or agreement to which such proposed guarantor is a party or by which it
is bound.
“Guaranty” means a development and completion guaranty to be executed by
Guarantor in substantially the form attached hereto as Exhibit F, which shall, among other things,
obligate the Guarantor to develop and otherwise construct the Improvements in the manner and
within the time frames required by the terms of the Construction and Use Covenant.
“Hazardous Materials” means (a) asbestos and any asbestos containing material;
(b) any substance that is then defined or listed in, or otherwise classified pursuant to, any
Environmental Law or any other Applicable Law as a “hazardous substance,” “hazardous
material,” “hazardous waste,” “infectious waste,” “toxic substance,” or “toxic pollutant” or any
other formulation intended to define, list, or classify substances by reason of deleterious properties,
such as ignitability, corrosivity, rea ctivity, carcinogenicity, toxicity, reprodu ctive toxicity, or
Toxicity Characteristic Leaching Procedure (TCLP) toxicity; (c) any petroleum and drilling fluids,
produced waters, and other wastes associated with the exploration, development, or production of
crude oil, natural gas , or geothermal resources; and (d) any petroleum product, polychlorinated
biphenyls, urea formaldehyde, radon gas, radioactive material (including any source, special
nuclear, or by-product material), medical waste, chlorofluorocarbon, lead or lead- based product,
and any other substance the presence of which could be detrimental to the Property or hazardous
to health or the environment. “HPRB” is the Historic Preservation Review Board.
“HPRB Application ” shall mean the application, together with any supporting
documentation, for approval of the Project by HPRB, or modification to a prior approval by HPRB,
which application shall be based on the Concept Plans and the Development Plan and shall
otherwise be consistent with the requirements of this Agreement.
“Improvements” mean s the buildings, landscaping, hardscape, and other
improvements to be constructed or placed on the Property in accordance with the Development
Plan and Approved Plans and Specifications ; provided, however, that in no event shall trade
fixtures, furniture, operating equipment (in contrast to building equipment), stock in trade,
inventory, or other personal property used in connection with the conduct of any business within
the Improvements be deemed included in the term “Improvements” as used in this Agreement.
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“Institutional Lender” shall mean a Person that is not an Affiliate of Developer or
a Prohibited Person and is, at the time it first makes a loan to Developer, or acquires an interest in
any such loan, or issues an Acceptable Letter of Credit (a) a commercial bank, investment bank,
investment company, savings and loan association, trust company, or national banking association,
acting for its own accord ; (b) a finance company principally engaged in the origination of
commercial mortgage loans or any financing related subsidiary of a Fortune 500 company; (c) an
insurance company acting for its own account or for special accounts maintained by it or as agent
or manager or advisor for other entities covered by any of clauses (a) – (j) hereof; (d) a public
employees’ pension or retirement system; ( e) a pension, retirement, or profit sharing, or
commingled trust or fund for which any bank, trust company, national banking association, or
investment adviser registered under the Investment Advisors Act of 1940, as amended , is acting
as trustee or agent; ( f) a real estate investment trust (or umbrella partnership or other entity of
which a real estate investment trust is the majority owner), a real estate mortgage investment
conduit, hedge fund, private equity fund, or securitization trust or similar investment entity; (g)
any federal, state, or District of C olumbia government agency regularly making, purchasing, or
guaranteeing mortgage loans, or any governmental agency supervising the investment of public
funds; (h) a profit-sharing or commingled trust or fund, the majority of equity investors in which
are pension funds having in the aggregate no less than $1 billion in assets; ( i) any entity of any
kind actively engaged in commercial real estate financing and having total assets in the aggregate
of no less than $1 billion; or (j) such other lender, subject to approval by District, in its sole and
absolute discretion, provided that such other lender is at the time of making the loan of a type
which is then customarily used as a lender on projects like the Project.
“Land Records” means the property records maintained by the Recorder of Deeds
for the District of Columbia.
“Letter of Credit” means a stand-by letter of credit from an Institutional Lender in
the form attached hereto as Exhibit J.
“Managing Member” means Banneker Ventures LLC.
“Material Change” means ( a) any change in size or design from the Approved
Plans and Specifications that substantially affects the general appearance of the Improvements, or
the building bulk or the number of floors of the Improvements or any change or series of changes
that result in a diminution or increase of square footage of the Improvements in excess of five
percent (5%); (b) any change to the structural integrity of exterior walls or elevations; (c ) any
change in exterior finishing materials that substantially affects the architectural appearance from
those shown and specified in the Approved Plans and Specifications ; ( d) any change in the
functional use and operation of the Improvements from those shown and specified in the Approved
Plans and Specifications; (e) any change in design or construction of the Improvements requiring
approval of, or any changes required by any Governmental Authority; (f) any change in the number
of parking spaces in the Improvements by five percent (5%) or more from the Approved Plans and
Specifications; (g) any significant change that affects the appearance of landscape design or
plantings from the Approved Plans and Specifications; ( h) any significant change that affects the
general appearance or structural integrity of exterior pavement, exterior lighting, and other exterior
site features from the Approved Plans and Specifications ; or (i) any change in or design or
construction of the Improvements that is inconsistent with the Development Plan.
9
“Member” means any Person with an ownership interest in Developer.
“Memorandum of Ground Lease ” shall mean that certain m emorandum of
ground lease in the form attached as Exhibit R.
“Malcolm Component” means the Component to be developed and constructed
by Developer as indicated for the Malcolm Component in the Development Plan.
“Martin Component” means the Component to be developed and constructed by
Developer as indicated for the Martin Component in the Development Plan.
“Mortgage” means a mortgage, deed of trust, mortgage deed, or such other classes
of legal documents that secures Debt Financing.
“Outside Closing Date” is defined in Section 6.1.
“Parcel” or “Parcels” means the land comprising a portion of the Property, as the
context requires, on which the Townhome Component, the Malcolm Component, and the Martin
Component will be constructed, as generally depicted in Exhibit A.
“Party” or “ Parties” means, when used in the singular, either District or
Developer; when used in the plural, both District and Developer.
“Performance Letter of Credit” is defined in Section 8.2.
“Permit Set Documents ” mean the detailed drawings and specifications for all
aspects of the Improvements in accordance with the approved Design Development Drawings and
that are used to apply for the building permit.
“Permits” means all demolition, site, building, construction, excavation, and other
permits, , licenses, and rights required to be obtained from any Governmental Authority having
jurisdiction over the Property necessary to commence and complete construction of the
Improvements in accordance with the Development Plan, the Approved Plans and Specifications,
the Construction and Use Covenant, and this Agreement.
“Permitted Exceptions” is defined in Section 2.4.2.
“Person” means any individual, corporation, limited liability company, trust,
partnership, association, or other entity.
“Progress Meetings” is defined in Section 4.1.3.
“Prohibited Person” shall mean any of the following Persons: ( a) any Person (or
any Person whose operations are directed or controlled by such Person) who has been convicted
of, has pleaded guilty in a criminal proceeding for, or is an on- going target of a grand jury
investigation concerning, a felony for one or more of the following: (i) fraud, (ii) intentional
misappropriation of funds, (iii) bribery, (iv) making false statements to a governmental agency,
(v) improperly influencing a governmental official, (vi) extortion, (vii) crimes committed against
10
minors, (viii) kidnapping, (ix) sexual assault, (x) human trafficking, (xi) murder, (xii) gambling,
(xiii) arson, and (xiv) conspiracy to commit any of the foregoing (i) through (xiii) ; or (b) any
Person organized in or controlled from a country, the effects of the activities with respect to which
are regulated or controlled pursuant to the following United States laws and the regulations or
executive orders promulgated thereunder: (x) the Trading with the Enemy Act of 1917, 50 U.S.C.
§ 4301 et seq., as amended; (y) the International Emergency Economic Powers Act of 1977, 50
U.S.C. § 1701 et seq., as amended; and (z) the Antiterrorism and Arms Export Amendments Act
of 1989, codified at Section 6(j) of the Export Administration Act of 1979, 50 U.S.C. § 4605, as
amended; or (c) any Person who has engaged in any dealings or transactions (i) in contravention
of the applicable money laundering laws or regulations or conventions or (ii) in contravention of
Executive Order No. 13224 dated September 24, 2001 issued by the President of the United States
(Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism), as may be amended or supplemented from time-to-
time or any published terrorist or watch list that may exist from time to time; or (d) any Person
who appears on or conducts any business or engages in any transaction with any person appearing
on the list maintained by the U.S. Treasury Department’s Office of Foreign Assets Control located
at 31 C.F.R., Chapter V, Appendix A or is a person described in Section 1 of the Anti -Terrorism
Order described above; or (e) any Person who could be debarred if the standards applied in Title
27, Section 2213 of the D.C. Municipal Regulations were applied to such Person’s failure to satisfy
a contractual obligation to the District of Columbia; or (f) any Person who is on the District of
Columbia’s list of debarred, suspended or ineligible Persons ; or ( g) any Affiliate of any of the
Persons described in any one or more of clauses (a) through (f) above.
“Project” means the design, development, and construction of the Improvements
on the Property in accordance with the Governmental Approvals, the Development Plan, this
Agreement, and the Approved Plans and Specifications.
“Project Budget” has the meaning given in Section 4.8.2.
“Project Deposit” has the meaning given it in Section 2.2.1(a).
“Project Funding Plan” has the meaning given it in Section 4.8.1.
“Property” is defined in the Recitals.
“Purchase Price” has the meaning given in Section 2.1.2.
“Remediation Plan” is defined in Section 2.3.1(b).
“Residential Units” means the residential dwelling units to be constructed on the
Property in accordance with the Development Plan and this Agreement, including the A ffordable
Units
“Resolution” is defined in the Recitals.
“Resubmission Period” is a period of thirty (30) days commencing on the day after
Developer receives a Disapproval Notice from District, or such other period of time as District and
Developer may agree in writing. In the event either Developer or District reasonably believes that
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the Resubmission Period should be longer or shorter than such thirty (30) day period, such Party
shall promptly notify the other in writing of the period of time that such Party reasonably believes
should apply and the reasons therefor.
“Retail Plan” is defined in Section 4.5.
“Review Period” is defined in Section 4.2.2.
“ROE” is defined in Section 2.3.1(a).
“Schedule of Performance” means that schedule of performance, attached hereto
as Exhibit K and incorporated herein, and as it may be further modified pursuant to Section 4.11
setting forth the timeline for design, development, construction, and completion of the
Improvements together with the dates for submission of documentation required under this
Agreement, which Schedule of Performance shall be further delineated prior to Closing with
additional interim milestones and a construction timeline in customary form and attached to the
Construction and Use Covenant.
“Schematic Design Documents” means drawings and plans for the Improvements
that include and show, at a minimum, the following: (a) site survey; ( b) site plan; (c ) ground
level plan; (d) preliminary building elevations; (e) a landscape plan (1”=30’) showing the proposed
location of plantings, including trees and shrubs on the Property; (f) the approximate gross square
footage of each building to be developed as part of the Improvements; (g) the location of parking
facilities and approximate number of spaces; ( h) schematic building plans, inclusive of any
underground garage facility (1/20”=1’); ( i) typical floors plans, inclusive of any underground
garage facilities (1/20”=1’); ( j) a chart showing expected floor areas, expected floor area ratio,
expected building coverage of the Property, expected building height, areas dedicated to pedestrian
and recreational uses, and expected location of loading docks; ( k) a topographic survey for the
Property; (l) expected open spaces, driveways, access roads, private streets, sidewalks, loading,
and curb cuts on the Property; and (m) the intended A ffordable Unit count and proposed unit
location, which shall be consistent with the requirements of the Affordable Housing Covenant.
“Second Notice” means that notice given by Developer to District in accordance
with Section 4.2.2 and/or Section 4.2.3 herein. Any Second Notice shall (a) be labeled, in bold, 18
point font, as a “SECOND AND FINAL NOTICE”; (b) contain the following s tatement: “A
FAILURE TO RESPOND TO THIS NOTICE WITHIN FIFTEEN (15 ) BUSINESS DAYS
SHALL CONSTITUTE APPROVAL OF THE [NAME OF SUBMISSION ] ORIGINALLY
SUBMITTED ON [DATE OF DELIVERY OF SUCH SUBMISSION]”; and (c) be delivered in
the manner prescribed in Section 13.1, in an envelope conspicuously labe led “SECOND AND
FINAL NOTICE”.
“Settlement Agent” means Answer Abstracts, the title agent selected by Developer
and mutually acceptable to Developer and District.
“Settlement Statement” is the settlement statement prepared by Settlement Agent
setting forth the sources and uses of all funds associated with Closing.
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“Submissions” means those certain plans, specifications, documents, items, and
other matters to be submitted by Developer to District pursuant to the terms of this Agreement.
“Studies” is defined in Section 2.3.1.
“Townhome Component” means the Component to be developed and constructed
by Developer as indicated for the Townhome Component in the Development Plan.
“Transfer of Membership Interests” is defined in Section 11.2.
“UST Act” is defined in Section 2.3.3.
“UST Regulations” is defined in Section 2.3.3.
“Zoning Application” is defined in Section 4.9.
“Zoning Commission” means the District of Columbia Zoning Commission.
1.2 Rules of Construction. Unless the context clearly indicates to the contrary, for all
purposes of this Agreement , (a) words importing the singular number include the plural number
and words importing the plural number include the singular number; (b) words of the masculine
gender include correlative words of the feminine and neuter genders; (c) words importing persons
include any Person; (d) any reference to a particular Section shall be to such Section of this
Agreement; and (e) any reference to a particular Exhibit shall be to such Exhibit to this Agreement;
and to all sub- exhibits related thereto (e.g., references to Exhibit A shall include Exhibit A -1,
Exhibit A-2, etc.).
1.3 Other Definitions. When used with its initial letter(s) capitalized, any term which
is not defined in this Article I shall have the definition assigned to it elsewhere in this Agreement.
ARTICLE II
CONVEYANCE OF PROPERTY; PROJECT DEPOSIT; CONDITION OF PROPERTY
2.1 Conveyance of the Property; Purchase Price; Ground Rent
2.1.1 Sale of a Portion of the Property. Subject to and in accordance with the
terms of this Agreement, District shall sell to Developer, and Developer shall purchase from District,
all of District’s right, title, and interest in and to the Parcel on which Developer will develop and
construct the Townhome Component for a purchase price of One Dollar ($1.00) (the “Purchase
Price”), which shall be paid at Closing in immediately available funds.
2.1.2 Lease of Remaining Property. Subject to and in accordance with the terms
of this Agreement and the Ground Lease(s), District shall lease to Developer the Parcels other than
that being conveyed to Developer pursuant to Section 2.1.1 above at Closing for a period of ninety-
nine (99) years. The Ground Rent shall be One Dollar ($1.00) per annum payable in one (1) lump
sum of $99.00 at Closing for each Ground Lease.
2.2 Project Deposit; Letters of Credit.
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2.2.1 Project Deposit.
(a) As of the Effective Date, Developer has delivered to District an
Acceptable Letter of Credit in the amount of fifty thousand dollars ($50,000.00) (the “Project
Deposit”).
(b) The Project Deposit is not a payment on account of and shall not be
credited against the Purchase Price or any payment of rent required under the terms of the Ground
Lease; rather, the Project Deposit shall be held by District to be used as security to ensure
Developer’s compliance with this Agreement and may be drawn on by District in accordance with
the terms of this Agreement. The Project Deposit and any replacement Letters of Credit provided
under this Agreement is, or shall be, an Acceptable Letter of Credit. Notwithstanding any provision
herein to the contrary, District shall return the Project Deposit to Developer at the last Closing.
2.2.2 Acceptable Letters of Credit.
(a) Each letter of credit delivered by Developer to District pursuant to
this Agreement shall be in the form attached hereto as Exhibit J and otherwise in form and
substance reasonably satisfactory to District, provided that such letter of credit shall be: (i) issued
by a commercial bank with an office located in the Washington, D.C. metropolitan area; (ii) made
payable to District ; (iii) payable at sight upon presentment to a Washington, D.C. metropolitan
area branch or office of the issuer (or such other branch or office of the issuer as may be reasonably
acceptable to District) of a simple sight draft stating only that District is permitted to make such
draw on the letter of credit under the terms of this Agreement and setting forth the amount that
District is drawing; and (iv) of a term not less than one (1) year and shall on its face state that same
shall be renewed automatically, without the need for any further notice or amendment, for
successive minimum one-year periods, unless the issuer notifies District in writing, at least thirty
(30) days prior to the expiration date thereof, that such issuer has elected not to renew the letter of
credit. A letter of credit satisfying all of the requirements set forth above shall be an “Acceptable
Letter of Credit”.
(b) Developer shall ensure that the Acceptable Letter of Credit shall be
renewed (or automatically or unconditionally extended) from time to time until, (i) with respect to
the Project Deposit, thirty (30) days following the scheduled Closing Date, or ( ii) with respect to
the Performance Letter of Credit, (1) with respect to the Townhome Component, the ninetieth
(90th) day after the issuance of the District Certificate of Final Completion for the Townhome
Component and ( 2) with respect to the Malcolm Compon ent and the Martin Component, the
ninetieth (90th) day after issuance of the District Certificate of Final Completion for the final
Component.
(c) Developer shall deliver to District a replacement Acceptable Letter
of Credit in the event of either (i) the Project Deposit will expire prior to the Closing Date or (ii)
if the issuer of the Acceptable Letter of Credit notifies District in writing that it will not renew the
same. Any such replacement Letter of Credit shall be delivered to District at least ten (10) days
prior to the expiration date of the expiring Acceptable Letter of Credit.
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(d) In the event the issuer of any Acceptable Letter of Credit is insolvent
or is placed into receivership or conservatorship by the Federal Deposit Insurance Corporation, or
any successor or similar entity, or if a trustee, receiver, or liquidator is appoint ed for the insurer,
then, effective as of the date of such occurrence, said letter of credit shall no longer meet the
requirements of an Acceptable Letter of Credit, and, within ten (10) days thereof, Developer shall
deliver to District a replacement Acceptable Letter of Credit.
(e) If District draws any part of the Project Deposit without also
terminating this Agreement, Developer shall replenish the Project Deposit to its full amount within
ten (10) days following District’s draw on the Project Deposit.
(f) In the event Developer fails to deliver a replacement Acceptable
Letter of Credit pursuant to Section 2.2.2( c) or Section 2.2.2(d) or fails to replenish the Project
Deposit pursuant to Section 2.2.2(e), the same shall be a Developer Default hereunder, whereupon
District shall be entitled to draw on the Project Deposit in its full amount and terminate this
Agreement in accordance with Section 9.2(a).
2.3 Condition of Property.
2.3.1 Feasibility Studies; Access to Property.
(a) Developer hereby acknowledges that, prior to the Effective Date, it
has had the right to perform , or caused to be performed, Studies (as hereinafter defined) on the
Property using experts of its own choosing and to access the Property for the p urposes of
performing Studies pursuant to the terms of that certain Right-of-Entry Agreement (the “ ROE”)
by and between Developer and District , attached hereto as Exhibit M and incorporated herein.
From time to time prior to Closing, provided this Agreement is in full force and effect and no
uncured Developer Default has occurred , Developer and Developer’s Agents shall continue to
have the right to enter the Property for purposes of conducting surveys, soil tests, environmental
studies, engineering tests, and such other tests, studies, and investigations (hereinafter “Studies”)
as Developer deems necessary or desirable to conduct due diligence and to evaluate the Property
pursuant to the terms of this Agreement and the terms and conditions of the ROE, as if such terms,
conditions, and agreements were expressly set forth herein. In the event of any conflict between
the terms of the ROE or the terms of this Agreement, the terms of this Agreement shall control and
be paramount.
(a) In the event that Developer or its Agents disturbs, discovers, or removes any
materials or waste that are determined to be Hazardous Materials from the District Property while
conducting the Studies, or otherwise during its entry on the District Property, Developer shall
notify District and the District of Columbia Department of Energy and Environment (“ DOEE”)
immediately after its discovery of such Hazardous Materials.
(b) Developer shall submit to the District and DOEE no later than fifteen (15) days
after Regulated Materials (hereinafter defined) are introduced, generated, or produced, a proposed
plan for disposal of any such Regulated Materials (“Disposal Plan ”) that complies with all
applicable federal and District of Columbia laws and regulations. For purposes of this Agreement,
the term “ Regulated Materials ” shall mean Hazardous Materials that are introduced onto or
15
generated or produced from the District Property while conducting the Studies or otherwise as a
result of other activities of Developer or its Agents during their entry on the District Property. The
Disposal Plan shall contain all identifying information as to the type and condition of the Regulated
Materials and a detailed account of the proposed removal and disposal of such Regulated
Materials, including the name and location of the hazardous waste disposal site. DOEE may
conduct an independent investigat ion of the District Property, including, but not limited to, soil
sampling and other environmental testing as may be deemed necessary. Upon completion of
DOEE’s investigation, District and/or DOEE shall notify Developer of its findings and shall notify
Developer by notice of its approval or disapproval of the proposed Disposal Plan. In the event
DOEE disapproves the proposed Disposal Plan, Developer shall resubmit a revised Disposal Plan
to District and DOEE. Developer shall seek the advice and counsel of D OEE prior to any
resubmission of a proposed Disposal Plan. Upon review of the revised Disposal Plan, District or
DOEE shall notify Developer of its decision. Upon approval of the Disposal Plan, Developer shall
remove and dispose of all Regulated Materials in accordance with the approved Disposal Plan and
all applicable federal and District of Columbia laws. Developer shall not be required to prepare a
Disposal Plan for or remove or dispose of Hazardous Materials other than the Regulated Materials
unless and until after Closing. Within seven (7) Business Days after the disposal of any Regulated
Materials, Developer shall provide District such written evidence and receipts confirming the
proper disposal of all Regulated Materials removed from the District Property.
(c) Developer expressly agrees that, pursuant to applicable federal and District of
Columbia laws, Developer is the sole “generator”, as defined in D.C. Official Code §8- 1302, of
any Regulated Materials, and agrees to assume all liabilities and responsibilities regarding
generation, transport, and disposal of said Regulated Materials.
(d) Developer shall not have the right to object to any condition that may be discovered,
offset any amounts from the Purchase Price or payable as rent pursuant to the Ground Lease , or
terminate this Agreement as a result of any Studies conducted after the Effective Date.
(e) In the event of a termination of this Agreement prior to Closing, neither Developer
nor any of Developer’s Agents shall have any continuing liability or obligations regarding the
Remediation Plan or the removal or remediation of any Hazardous Materials on the Property,
except for any Hazardous Materials introduced by, or disturbed by, Developer or Developer’s
Agents.
(f) Developer covenants and agrees that Developer shall keep confidential all
information obtained by Developer as to the condition of the Property; provided, however, that (i)
Developer may disclose such information to its Members, officers, directors, attorneys,
consultants, Settlement Agent, contractors and subcontractors, and potential lenders and investors
so long as Developer directs such parties to maintain such information as confidential; and (ii)
Developer may disclose such information as it may be legally compelled so to do. The foregoing
obligation of confidentiality shall not be applicable to any information which is a matter of public
record or, by its nature, necessarily available to the general public. This provision shall survive
Closing or the earlier termination of this Agreement.
(g) Developer shall indemnify and hold harmless District, its officials, officers,
employees, and agents from all liabilities, obligations, damages, penalties, claims, costs, charges,
16
and expenses (including reasonable attorneys’ fees), of whatsoever kind and nature for injury,
including personal injury or death of any person or persons, and for loss or damage to any property
occurring in connection with, or in any way arising out of the use and occupancy of the Property
during and in the performance of, the Studies ; provided, however, the foregoing indemnity shall
exclude any claims or liabilities caused by the gross negligence or willful misconduct of District
or its officials, officers, agents, employees, or contractors. This provision shall survive Closing or
earlier termination of this Agreement
2.3.2 Soil Characteristics. District hereby states that the soil on the Property has
been described by the Soil Conservation Service of the United States Department of Agriculture in
the Soil Survey of the District of Columbia and as shown on the Soil Maps as _______________
[FILL IN].
2.3.3 Underground Storage Tanks . In accordance with the requirements of
Section 3(g) of the D.C. Underground Storage Tank Management Act of 1990, as amended by the
District of Columbia Underground Storage Tank Management Act of 1990 Amendment Act of 1992
(D.C. Official Code §§ 8-113.01 et seq .) (collectively, the “ UST Act ”) and the applicable D.C.
Underground Storage Tank Regulations, 20 DCMR Chapter 56 (the “UST Regulations”), District’s
Underground Storage Tank Disclosure Form is attached hereto as Exhibit P. Information pertaining
to underground storage tanks and underground storage tank removals of which the D.C. Government
has received notification is on file with DOEE, Underground Storage Tank Branch, 1200 First St.,
NE, 5th Floor, Washington, DC 20002, telephone (202) 535-2600. District’s knowledge for purposes
of this Section shall mean and be limited to the actual knowledge of the Deputy Mayor for Planning
and Economic Development. The foregoing is set forth pursuant to requirements contained in the
UST Act and UST Regulations.
2.3.4 Heritage and Special Tree Requirements. District hereby states, and
Developer acknowledges and agrees, that if a “Heritage Tree” or “Special Tree” (as such term s are
defined in D.C. Official Code §8-651.02) exists on the Property as of the Effective Date, Applicable
Law restricts the removal of such trees.
2.3.5 AS-IS. OTHER THAN THE EXPRESS REPRESEN TATIONS IN
SECTION 3.1, DISTRICT IS NOT MAKING, AND HAS NOT AT ANY TIME MADE , ANY
WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTIES OR REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, TITLE, ZONING, TAX CONSEQUENCES,
LATENT OR PATENT PHYSICAL OR ENVIRONMENTAL CONDITION, UTILITIES,
OPERATING HISTORY OR PROJECTIONS, VALUATION, GOVERNMENTAL
APPROVALS, THE COMPLIANCE OF THE PROPERTY WITH LAWS, THE TRUTH,
ACCURACY, OR COMPLETENESS OF ANY DOCUMENTS OR OTHER INFORMATION
PERTAINING TO THE PROPERTY, THE STATUS OF ANY LITIGATION OR OTHER
MATTER, OR ANY OTHER INFORMATION PROVIDED BY OR ON BEHALF OF DISTRICT
TO DEVELOPER, OR ANY OTHER MATTER OR THING REGARDING THE PROPERTY.
DEVELOPER ACKNOWLEDGES AND AGREES, THAT UPON CLOSING, DISTRICT SHALL
CONVEY OR LEASE, AS APPLICABLE, TO DEVELOPER AND DEVELOPER SHALL
ACCEPT THE PROPERTY, “AS IS, WHERE IS, WITH ALL FAULTS.” FURTHER,
17
DEVELOPMENT OF THE PROPERTY IN ACCORDANCE WITH THIS AGREEMENT AND
THE CONSTRUCTION AND USE COVENANT SHALL BE “AS IS, WHERE IS, WITH ALL
FAULTS.” DEVELOPER IS ADVISED THAT MOLD AND/OR OTHER MICROSCOPIC
ORGANISMS MAY EXIST AT THE PROPERTY AND THAT MOLD AND/OR OTHER
MICROSCOPIC ORGANISMS MAY CAUSE PHYSICAL INJURIES, INCLUDING, WITHOUT
LIMITATION, ALLERGIC REACTIONS, RESPIRATORY REACTIONS OR OTHER
PROBLEMS, PARTICULARLY IN PERSONS WITH IMMUNE SYSTEM PROBLEMS,
YOUNG CHILDREN, AND ELDERLY PERSONS. OTHER THAN THE EXPRESS
REPRESENTATIONS MADE BY DISTRICT IN SECTION 3.1 , DEVELOPER HAS NOT
RELIED, AND WILL NOT RELY ON, AND DISTRICT IS NOT LIABLE FOR OR BOUND BY,
ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES, STATEMENTS,
REPRESENTATIONS, OR INFORMATION PERTAINING TO THE PROPERTY OR
RELATING THERETO MADE OR FURNISHED BY DISTRICT, ANY MANAGER OF THE
PROPERTY, OR ANY AGENT REPRESENTING OR PURPORTING TO REPRESENT
DISTRICT, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, ORALLY OR
IN WRITING. DEVELOPER REPRESENTS TO DISTR ICT THAT DEVELOPER HAS HAD
THE OPPORTUNITY TO CONDUCT, AND/OR HAS CONDUCTED, SUCH
INVESTIGATIONS OF THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, THE
PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS DEVELOPER DEEMS
NECESSARY TO SATISFY ITSELF AS TO THE CONDITION OF THE PROPERTY AND THE
EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH RESPECT
TO ANY MOLD, FUNGI, VIRAL OR BACTERIAL MATTER, HAZARDOUS MATERIALS,
OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY, AND WILL RELY
SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON
BEHALF OF DISTRICT OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO.
DEVELOPER SHALL ASSUME THE RISK THAT ADVERSE MATTERS, INCLUDING, BUT
NOT LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS (INCLUDING MOLD, FUNGI, VIRAL OR BACTERIAL
MATTER, HAZARDOUS MATERIALS, RADIOLOGICAL CONDITIONS OR ITEMS , OR
TOXIC SUBSTANCES), MAY NOT HAVE BEEN REVEALED BY DEVELOPER’S
INVESTIGATIONS, AND DEVELOPER SHALL BE DEEMED TO HAVE WAIVED,
RELINQUISHED, AND RELEASED DISTRICT FROM AND AGAINST ANY AND ALL
CLAIMS, DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT),
LOSSES, DAMAGES, LIABILITIES, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’
FEES AND COURT COSTS) OF ANY AND EVERY KIND OR CHARACTER, KNOWN OR
UNKNOWN, WHICH MIGHT HAVE BEEN ASSERTED OR ALLEGED AGAINST DISTRICT
AT ANY TIME BY REASON OF OR ARISING OUT OF ANY LATENT OR PATENT
CONSTRUCTION DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF ANY LAWS
(INCLUDING, WITHOUT LIMITATION, ANY ENVIRONMENTAL LAWS), AND ANY AND
ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES , OR MATTERS
REGARDING THE PROPERTY. DEVELOPER AGREES THAT SHOULD ANY CLEANUP,
REMEDIATION, OR REMOVAL OF MOLD, FUNGI, VIRAL OR BACTERIAL MATTER,
HAZARDOUS MATERIALS , TOXIC SUBSTANCES , OR OTHER ENVIRONMENTAL
CONDITIONS ON THE PROPERTY BE REQUIRED FROM AND AFTER THE CLOSING, OR
EARLIER IF CAUSED BY DEVELOPER, SUCH CLEAN-UP, REMOVAL, OR REMEDIATION
SHALL BE THE RESPONSIBILITY OF AND SHALL BE PERFORMED AT THE SOLE COST
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AND EXPENSE OF DEVELOPER. DISTRICT SHALL HAVE NO RESPONSIBILITY TO
PREPARE THE PROPERTY IN ANY WAY FOR DEVELOPMENT AT ANY TIME.
2.4 Title.
2.4.1 Developer hereby acknowledges that it has reviewed the title to the Property
and conducted any survey studies of the Property and ha s deemed the same acceptable, subject
only to the Permitted Exceptions.
2.4.2 At Closing, District shall convey fee simple title to or lease the Parcels, as
applicable, subject to the Permitted Exceptions. The “Permitted Exceptions” shall be the
following collectively: (i) all title and survey matters, encumbrances or exceptions of record as of
the Effective Date; (ii) encroachments, overlaps, boundary disputes, or other matters which would
be disclosed by an accurate survey or an inspection of the Property as of the Effective Date; (iii)
any documents described in this Agreement that are to be recorded in the Land Records pursuant
to the terms of this Agreement; (iv) defects or exceptions to title to the extent such defects or
exceptions are created by Developer or Developer’s Agents or created as a result of or in
connection with the use of or activities on the Property or any portion thereof by Developer or
Developer’s Agents; (v) all building, zoning, and other Applicable Law affecting the Property; (vi)
any easements, rights-of-way, exceptions and other matters required in order to obtain necessary
approvals from Governmental Authorities for the Project; and (vii) any matter to which Developer
has objected, District is unable or unwilling to cure , and Developer elects to proceed to Closing
pursuant to Section 2.4.3.
2.4.3 From and after the Effective Date through Closing, District agrees not to
take any action that would cause a material adverse change to the status of title to the Property
existing as of the Effective Date, without the approval of Developer, which approval shall not be
unreasonably withheld, conditioned, or delayed, except as expressly required by Applicable Law
or permitted by this Agreement.
2.4.4 Developer may, no later than ninety (90) days prior to the Closing Date,
notify District in writing of any material adverse changes to the status of title to the Property or
survey matters that occurred after the Effective Date as a direct result of action by (or the failure
to act of) District. With respect to any objections to title or survey set forth in such notice, District
shall have the right, but not the obligation, to cure such objections. Within ten (10) Business Days
after receipt of Developer’s notice of objections, District shall notify Developer in writing whether
District elects to attempt to cure such objections. If District fails to timely give Developer such
notice of election, then District shall be deemed to have elected not to attempt to cure such matters.
If District elects to attempt to cure, District shall have until the Closing Date to attempt to remove,
satisfy or cure the same and for this purpose District shall be entitled to a reasonable adjournment
of Closing if additional time is required, but in no event shall the adjournment exceed sixty (60)
days after the scheduled Closing Date (but in no event later than the Outside Closing Date). If
District elects not to cure any objections specified in Developer’s notice, or if District is unable to
effect a cure prior to Closing, Developer shall have the following options: (i) to proceed to Closing
and accept the conveyance or ground lease, as applicable of the Property subject to the Permitted
Exceptions, in which event Developer shall be obligated to develop the Property in accordance
with this Agreement and the Construction and Use Covenant, or (ii) to terminate this Agreement
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by sending notice thereof to District, and upon delivery of such notice of termination, this
Agreement shall terminate , the Project Deposit shall be returned to Developer and thereafter
neither Party hereto shall have any further rights, obligations or liabilities hereunder except to the
extent that any right, obligation or liability set forth herein expressly survives termination of this
Agreement. In the event District provides notice (or is deemed to have provided such noti ce) to
Developer that District does not intend to attempt to cure any objection, or if, having commenced
to attempt to cure any objection, District later provides notice to Developer that District will be
unable to effect a cure thereof, Developer shall, within five (5 ) Business Days after such notice
has been given, provide notice to District whether Developer shall elect to accept conveyance
under clause (i) or to terminate this Agreement under clause (ii). In the event Developer does not
provide notice to District within such five (5 ) Business Day period, then Developer shall be
deemed to have elected to accept the conveyance or lease, as applicable, under clause (i).
2.5 Risk of Loss . No casualty prior to Closing to all or any portion of the existing
improvements on the Property (if any) shall excuse Developer from its obligation to proceed to
Closing hereunder, but neither Developer nor District shall have any obligation to rebuild or restore
any existing improvements damaged by such casualty unless otherwise required by Applicable
Law.
2.6 Condemnation.
2.6.1 Notice. If, prior to Closing, any condemnation or eminent domain
proceedings shall be commenced by any other competent public authority against the Property,
District shall promptly give Developer notice thereof.
2.6.2 Total Taking. In the event of a taking of the entire Property prior to Closing:
(a) District shall return the Project Deposit to Developer, (b) this Agreement shall terminate, and the
Parties shall be released from any and all rights, obligations and liabilities hereunder (unless such
rights, obligations, and liabilities expressly survive termination pursuant to this Agreement), and (c)
District shall have the right to receive any and all condemnation proceeds..
2.6.3 Partial Taking . In the event of a partial taking of the Property prior to
Closing, District and Developer shall jointly determine in good faith whether the development of the
Project remains physically and economically feasible. If the Parties reasonably determine that the
Project is no longer feasible, whether physically or economically, as a result of such condemnation,
this Agreement shall terminate, District will return the Project Deposit to Developer, the Parties shall
be released from any further liability or obligation hereunder, except as expressly provided otherwise
herein, and District shall have the right to collect all condemnation proceeds . If the Parties jointly
determine that the Project remains economically and physically feasible, the Parties shall be deemed
to have elected to proceed to Closing with respect to the portions of the Property not subject to the
condemnation, and Developer shall accept the Property without any adjustment to the Purchase Price
or rent due under the Ground Lease. In no event shall District (as the seller or the lessor hereunder,
as opposed to as the condemning authority) have any liability or obligation to make any payment to
Developer with respect to any such condemnation. In the event that within forty-five (45) days after
the date of receipt by District of notice of such condemnation, the Parties have not jointly
determined, in accordance with the foregoing provisions, to elect to terminate or proceed to Closing
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hereunder, such failure shall be deemed the Parties’ election to terminate this Agreement, and the
termination provisions of this Section 2.6.3 shall apply.
2.7 Service Contracts and Leases; Temporary Licensees. District will not hereafter
procure or enter into any (i) service, management, maintenance, or development contracts, or (ii)
lease, license, easement, or other occupancy agreements affecting the Property that will survive
Closing. Notwithstanding the above, District may enter into licenses to third parties for temporary
use of the Property, upon such terms as may be agreed to by District, which licenses shall be
terminable by District upon thirty (30) days’ advance notice to such licensees. Such licenses shall
not contain any provisions that will survive the Closing without the approval of Developer.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of District.
3.1.1 District hereby represents and warrants to Developer as follows:
(a) District (i) has all requisite right, power, and authority to execute
and deliver this Agreement and to perform its obligations under this Agreement and (ii) has taken
all necessary action to authorize the execution, delivery, and performance of this Agreement. This
Agreement has been duly executed and delivered by District, and constitutes the legal, valid , and
binding obligation of District, enforceable against it in accordance with its terms. The Person
signing this Agreement on behalf of District is authorized to do so.
(b) No agent, broker, or other Person acting pursuant to express or
implied authority of District is entitled to any commission or finder ’s fee in connection with the
transactions contemplated by this Agreement or will be entitled to make any claim against
Developer for a commission or finder ’s fee. District has not dealt with any agent or broker in
connection with the conveyance of the Property.
(c) There is no litigation, arbitration, condemnation, administrative, or
other similar proceeding pending, or, to the current actual knowledge of District, threatened against
District, which relates to the Property. There is no other litigation, arbitration, administrative
proceeding, or other similar proceeding pending or , to District’s current actual knowledge ,
threatened against District which, if decided adversely to District, would impair District’s ability
to perform its obligations under this Agreement.
(d) The execution, delivery, and performance of this Agreement by
District and the consummation of the transactions contemplated hereby do not violate any of the
terms, conditions, or provisions of any judgment, order, injunction, decree, regulation, or ruling of
any court or other Governmental Authority, or Applicable Law, to which District is subject, or any
agreement or contract to which District is a party or to which it is subject.
3.1.2 Survival. The representations and warranties contained in Section 3.1.1
shall survive Closing for a period of one (1) year. District shall have no liability or obligation
hereunder for any representation or warranty that becomes untrue because of reasons beyond
District’s control, but District shall promptly notify Developer upon learning of same.
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3.2 Representations and Warranties of Developer.
3.2.1 Developer hereby covenants, represents, and warrants to District as follows:
(a) Developer is a [__________________________________], duly
formed and validly existing and in good standing, and has full power and authority under, the laws
of [_________________________] [and is registered and in good standing as a foreign
[______________________] with the District of Columbia] to conduct the business in which it is
now engaged.
(b) Attached as Exhibit Q is a true, accurate, and complete
organizational structure chart of Developer showing all Members and their respective ownership
interests in Developer. Neither Developer, any Member of Developer , nor any Person owning
directly or indirectly any interest in Developer or any Member is a Prohibited Person.
(c) The execution, delivery, and performance of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly authorized by
Developer and Managing Member of Developer . Upon the due execution and delivery of this
Agreement by Developer, this Agreement constitutes the valid and binding obligation of
Developer, enforceable in accordance with its terms.
(d) The execution, delivery, and performance of this Agreement and the
consummation of the transactions contemplated hereby do not violate any of the terms, conditions,
or provisions of: (i) Developer’s organizational documents, (ii) any judgment, order, injunction,
decree, regulation, or ruling of any court or other G overnmental Authority, or Applicable Law to
which Developer or Managing Member is subject, or (iii) any agreement or contract to which
Developer is a party or to which it is subject.
(e) No agent, broker, or other Person acting pursuant to express or
implied authority of Developer is entitled to any commission or finder’s fee in connection with the
transactions contemplated by this Agreement or will be entitled to make any claim against District
for a commission or finder’s fee. Developer has not dealt with any agent or broker in connection
with its purchase of the Property.
(f) There is no litigation, arbitration, administrative, or other similar
proceeding pending or, to Developer’s knowledge, threatened against Developer that, if decided
adversely to Develo per, would (i) impair Developer ’s ability to enter into and perform its
obligations under this Agreement or (ii) materially adversely affect the financial condition or
operations of Developer.
(g) Developer’s acquisition or ground lease , as applicable, of the
Property and its other undertakings pursuant to this Agreement are for the purpose of constructing
and operating the Improvements in accordance with the Development Plan and the Approved Plans
and Specifications and not for speculation in land holding.
(h) Neither Developer nor any of its Members is the subject debtor
under any federal, state, or local bankruptcy or insolvency proceeding, or any other proceeding for
dissolution, liquidation, or winding up of its assets.
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3.2.2 Survival. The representations and warranties contained in Section 3.2.1
shall survive Closing for a period of one (1) year. Developer shall have no liability or obligation
hereunder for any representation or warranty that becomes untrue because of rea sons beyond
Developer’s control, but Developer shall promptly notify District upon learning of same.
ARTICLE IV
APPROVAL OF CONSTRUCTION PLANS AND SPECIFICATIONS AND OTHER
SUBMISSIONS
4.1 Construction Plans and Specifications.
4.1.1 Developer’s Submissions for the Project. Developer shall submit to District
for District’s review and approval the Construction Plans and Specifications for the Improvements
within the timeframes set forth on the Schedule of Performance. All Construction Plans and
Specifications shall be prepared and completed in accordance with this Agreement and the
Development Plan.
4.1.2 Requirements for Construction Plans and Specifications. Notwithstanding
anything to the contrary herein, prior to the issuance of any Permit by a Governmental Authority ,
Developer shall cause the Construction Plans and Specifications applicable to such Permit to become
Approved Plans and Specifications pursuant to Section 4.2. All Construction Plans and
Specifications shall conform to and be consistent with Applicable Law, including the applicable
zoning requirements, and shall comply with the following:
(a) The Construction Plans and Specifications shall be prepared or
supervised and signed by the Architect or engineer as appropriate.
(b) A structural, geotechnical, and civil engineer, as applicable, who is
licensed by the District of Columbia, shall review and certify all final foundation and grading
designs.
(c) Upon Developer ’s submission of all Construction Plans and
Specifications to District, the Architect shall certify (with standard professional language
reasonably acceptable to District) that the Improvements have been designed in accordance with
all Applicable Law relating to accessibility for persons with disabilities.
4.1.3 Progress Meetings. During the preparation of the Construction Plans and
Specifications, District’s staff and Developer shall hold periodic progress meetings (“ Progress
Meetings”), during which meetings Developer and designated representatives of District and other
District staff shall coordinate the preparation, submission, and review of the Construction Plans and
Specifications, as well as any other pending matters involving the Project , including, without
limitation, the status of Developer’s activities regarding the Community Participation Program.
4.2 District Review and Approval of Construction Plans and Specifications.
4.2.1 Generally. District shall have the right to review and approve or disapprove
all or any part of each of the Construction Plans and Specifications , which approval shall not be
unreasonably withheld, conditioned, or delayed; provided such Construction Plans and
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Specifications are consistent with the Development Plan, the Concept Plans, and with the
information exchanged in Progress Meetings and are in accordance with the requirements of the
terms herein and Applicable Law. Any Construction Plans and Specifications approved (or any
approved portions thereof) pursuant to this Section 4.2 shall be “ Approved Plans and
Specifications”.
4.2.2 Time Period for District Review and Approval. District shall complete its
review of each submission of Construction Plans and Specifications and provide a written response
thereto within thirty (30) days after its receipt of the same (the thirty (30) day review period may be
referred to herein as the “Review Period”). If District fails to respond with its written response to a
submission of any Construction Plans and Specifications within the Review Period, Developer shall
notify District, in writing, of District’s failure to respond by deliverin g to District a Second Notice.
Failure of District to respond within fifteen (15) Business Days after its receipt of the Second Notice
shall constitute and shall be deemed to be District approval of the applicable Construction Plans and
Specifications.
4.2.3 Disapproval Notices. Any notice of disapproval (“ Disapproval Notice”)
delivered to Developer by District shall state the basis for such disapproval in reasonably sufficient
detail so as to enable Developer to respond to District. If District issues a Disapproval Notice,
Developer shall have a period of time equal to the Resubmission Period to revise the Construction
Plans and Specifications to address the comments of District and shall resubmit the revised
Construction Plans and Specifications for approval by District prior to the expiratio n of such
Resubmission Period. District shall complete its review of such revised Construction Plans and
Specifications and provide written response thereto within the Review Period, which Review Period
shall commence the day following District’s receipt of such revised Construction Plans and
Specifications from Developer. If District fails to notify Developer of its approval or disapproval of
such revised Construction Plans and Specifications within the Review Period, Developer may
provide a written Second Notice to District with respect to such revised Construction Plans and
Specifications. Failure of District to respond within fifteen (15) Business Days after its receipt of
the Second Notice shall constitute and shall be deemed to be District approval of the revised
Construction Plans and Specifications. The provisions of this Section 4.2 relating to approval,
disapproval, and resubmission of any Construction Plans and Specifications shall continue to apply
until such Construction Plans and Specifications (and each component thereof) have been approved
by District. In no event will District’s failure to respond to any submission of Construction Plans
and Specifications be deemed an approval except as otherwise expressly set forth in this Section 4.2.
Any Construction Plans and Specifications may not be later disapproved by District unless any
disapproval and revision is mutually agreed upon by the Parties. District’s review of any
Construction Plans and Specifications that is responsive to a Disapproval Notice shall be limited to
the matters disapproved by District as set forth in the Disapproval Notice but shall not be so limited
with regard to any new matters shown on such Construction Plans and Specifications that were not
included or indicated on any prior Construction Plans and Specifications.
4.2.4 No Representation; No Liability . District’s review and approval of the
Construction Plans and Specifications is not and shall not be construed as a representation or other
assurance that they comply with any building codes, regulations, or standards, including, without
limitation, building, engineering, and structural design or any other Applicable Law. District shall
incur no liability in connection with its review of any Construction Plans and Specifications and is
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reviewing such Construction Plans and Specifications solely for the purpose of ensuring that the
Construction Plans and Specifications are consistent with the Development Plan and in accordance
with the terms of this Agreement.
4.3 Changes in Construction Plans and Specifications; Government Required Changes.
4.3.1 No Material Changes. Once approved, Developer may make changes to the
Approved Plans and Specifications without the prior approval of, but with notice to , District,
provided such changes are (a) consistent with Applicable Law and (b) not Material Changes. Such
notice shall specifically identify the changes made and shall include any modifications to the Project
Budget as a result of such changes. Developer shall not make any Material Changes to the Approved
Plans and Specifications without District’s prior written approval, except those changes required by
a Governmental Authority pursuant to Section 4.3.2. If Developer desires to make any Material
Changes to the Approved Plans and Specifications, Developer shall submit in writing the proposed
changes to District for approval, including a written description of the Material Change and the
modified Constructions Plans and Specifications with notations highlighting such Material Change.
The procedures set forth in Section 4.2 shall apply to District’s review and approval (or disapproval)
of any such proposed Material Changes in the same manner as if the submission of such proposed
Material Change was the Submission of the original Construction Plans and Specifications for
District’s review. In the event Developer makes a Material Change to the Construction Plans and
Specifications but does not comply with the procedures in this Section 4.3.1, such Material Change
shall be deemed disapproved, notwithstanding the inclusion of the Material Change in a
subsequently submitted Construction Plans and Specifications receiving approval by District.
4.3.2 Government Required Changes . Notwithstanding any other provision of
this Agreement to the contrary, District acknowledges and agrees that District shall not withhold its
approval (if otherwise required by the terms of this Agreement) of any elements contained in
proposed changes to Appr oved Plans and Specifications that are required by any G overnmental
Authority; provided however, that (i) District shall have been afforded a reasonable opportunity to
discuss such element of, or change in, the submission with the G overnmental Authority requiring
such element or change and with the Architect, (ii) the Architect shall have reasonably cooperated
with District and such Governmental Authority in seeking such reasonable modifications of the
required element or change as District shall deem reasonably necessary, and (iii) such element or
change is consistent with Applicab le Law. Developer and District each agree to use diligent, good
faith efforts to resolve District’s approval of such elements or changes, and District’s request for
reasonable modifications to such elements or changes required by a Governmental Authority, as
soon as reasonably possible and in no event later than ten (10) Business Days after the submission
of the applicable Construction Plans and Specifications or Approved Plans and Specifications .
Developer shall promptly notify District of any changes required by a G overnmental Authority
whether before or during construction.
4.4 Project Professionals.
4.4.1 Approval of Project Professionals. Any Person that Developer proposes for
any of the following Persons, and the contracts with such Persons, shall be subject to District’s
approval, which approval shall not be unreasonably withheld, conditioned, or delayed: (i) the
Architect; (ii) the Contractor; and (iii) any replacement of either of the foregoing. District’s review
25
of any proposed Person under this Section 4.4.1 shall be limited to whether the Person (i) reasonably
has the experience and technical qualifications to provide the services required and (ii) is not a
Prohibited Person. Developer shall submit documentation as to the identity of the applicable Project
professional and a copy of the proposed contract with such Project professional (x) with respect to
the Architect, within thirty (30) days after the Effective Date, (y) with respect to the Contractor, on
or before the date set forth on the Schedule of Performance, but in no event later than thirty (30)
days prior to Closing, and (z) with respect to the Architect, the Contractor, or any replacement of
either of the foregoing, in any event prior to Developer signing the contract with such Project
professional. Upon execution of the contract with the Architect and the Construction Contract,
Developer shall provide to District a copy of such executed contracts.
4.4.2 Copies of Contracts. Upon District’s request, Developer shall provide to
District copies of the contracts with any Persons providing materials or services with respect to the
Project, pursuant to Section 4.4.1.
4.4.3 No Prohibited Persons . No Person, who is a Prohibited Person, shall be
engaged as contractor or a subcontractor or otherwise provide materials or services with respect to
the Project.
4.5 Retail Plan. Prior to Closing, Developer shall submit to District for District’s review
and approval, which shall not be unreasonably withheld, conditioned, or delayed, a retail strategy
and marketing plan for the retail component of the Improvements (the “Retail Plan”).
4.6 Community Participation Program . No later than ninety (90) days afte r the
Effective Date, Developer shall provide District a description of Developer’s program for public
involvement, education, and outreach with respect to the Project (including input from the
community that is impacted by the Project as it is designed, developed, constructed, and operated)
(the “Community Participation Program”), including a plan for implementing the Community
Participation Program and shall include, without limitation, the organization(s) with whom
Developer propose s to discuss the P roject, a schedule for public meetings and the type of
information that Developer proposes to submit to the public. The Community Participation
Program shall include a mechanism to document all public meetings, including a narrative
description of (a) the events of each meeting, (b) the concerns raised by members of the public,
and (c) Developer’s responses to such concerns. Developer shall submit such documentation of
each public meeting to District and shall, at each Progress Meeting, otherwise include a summary
of Developer’s activities with respect to, and in furtherance of, the Community Participation
Program at each Progress Meeting.
4.7 Construction Consultant. At least thirty (30) days prior to Closing, Developer shall
appoint an independent third-party construction consultant , who may be the construction
consultant engaged by the senior construction lender , for supervision of construction of the
Improvements reasonably approved by District (the “Construction Consultant”) and provide
written confirmation from the Construction Consultant that it will provide a report to District in
accordance with this Section 4.7 . The Construction Consultant shall review and report, in writing,
to the Parties on a monthly basis on the following matters: (a) the construction documents relating
to the construction of the Improvements and the conformity of such matters to the Approved Plans
and Specifications, (b) the construction of the Improvements and the conformity of such
26
construction to the Approved Plans and Specifications, (c) the schedule and costs of construction
and the conformity of the current construction progress with the Schedule of Performance and the
Final Project Budget, (d) any change orders for the Improvements, and (e) any other issues relating
to the Project. The Construction Consultant shall provide regular written status updates and
promptly report, in writing, any issues to District and Developer. If the Construction Consultant
determines there is a non -conformity with the Approved Plans and Specifications or a deviation
from the Schedule of Performance or Final Project Budget, District may require Developer to
propose and adopt a recovery and modification plan that is reasonably satisfactory to the
Construction Consultant and District. In addition, the Construction Consultant shall provide such
certifications as are required in the Construction and Use Covenant. The Construction Consultant’s
time, expenses, reports, and certification shall be at Developer’s sole cost and expense and may be
paid from any source of funds set forth in the Final Project Funding Plan.
4.8 Project Funding Plan; Project Budget.
4.8.1 Project Funding Plan. As of the Effective Date, Developer has provided
District its initial funding plan describing the sources and uses of funds for the Project and the
methods for obtaining such funds (including lending sources), which plan is attached hereto as
Exhibit N (such plan, as may be modified from time to time in accordance with this Agreement
being the “Project Funding Plan”).
4.8.2 Project Budget. As of the Effective Date, Developer has provided District
its initial Project Budget describing the expenditure of direct and indirect costs for the Project, which
shall include a cost itemization prepared by Developer specifying all “hard” and “soft” costs (direct
and indirect) by item, including (i) the costs of all labor, materials, and services necessary for the
Project and (ii) all other expenses anticipated by Developer incident to the Project (including,
without limitation, anticipated interest on all financing, taxes, and insurance costs) and the
construction thereof (such budget, as may be modified from time to time in accordance with this
Agreement being the “Project Budget”). The Project Budget is attached hereto as Exhibit O.
4.8.3 Final Project Budget and Funding Plan. On or before the date set forth on
the Schedule of Performance, Developer shall provide District with a revised Project Budget and
Project Funding Plan and such supporting documentation as District may reasonably request. In
addition, Developer shall deliver to District copies of the Project Budget and Project Funding Plan,
and any updates thereto, that are submitted to the providers of the Equity Investment and Debt.
Financing. Developer shall further modify the Project Budget and Project Funding Plan (i) upon
receipt of the Financing C ommitments and (ii) within sixty (60) days but no later than thirty (30 )
days prior to Closing. Upon District’s approval of the modified Project Budget and Project Funding
Plan submitted pursuant to clause (ii), such modified Project Budget and Project Funding Plan shall
be the “Final Project Budget” and “Final Project Funding Plan”, respectively. The Final Project
Budget and Final Project Funding Plan shall be identical to the budget and financing plans submitted
to, and approved by, the providers of the Equity Investment and Debt Financing.
4.9 Zoning Commission and HPRB Approval . In order to undertake the Project in
accordance with the Development Plan, Developer will need to seek either approval of a PUD or
a zoning map amendment from the Zoning Commission and approval from HPRB . Prior to
submission of the PUD Application or application for zoning map amendment, (such application,
27
a “Zoning Application”) to the D.C. Office of Zoning or the HPRB Application to the District of
Columbia Historic Preservation Office , or request to modify approval already obtained from the
Zoning Commission or HPRB, as applicable, Developer shall submit its draft Zoning Application
or HPRB Application, respectively, to District for District’s review and approval in accordance
with Section 7.2. Any submissions in support of the Zoning Application and the HPRB Application
shall be consistent with the Development Plan and this Agreement and any Construction Plans and
Specifications submitted therewith shall be approved by District as Approved Plans and
Specifications prior to such submission. Once approved by District, Developer shall not modify
the Zoning Application or the HPRB Application without District’s prior approval.
4.10 Naming of Project. Once approved by District, Developer shall not change the
name of the Project without District’s prior approval.
4.11 Submission Deadline Extensions. If Developer is proceeding diligently and in good
faith and desires to extend a specified deadline in the Schedule of Performance for any submission
of Construction Plans and Specifications or other Submissions, Developer may request such
extension in writing, and, for good cause shown, District may, in its sole and absolute discretion,
grant such extension by notice to Developer.
4.12 Subdivision. On or before the first Closing, Developer hereby agrees to subdivide
the Property into Parcels [or establish a land condominium regime ] in order to delineate the lots
for development under the terms of this Agreement. Prior to submitting documents, certificates,
plats, and applications required with respect to any subdivision [or land condominium regime] of
the Property or any portion thereof, Developer shall seek District’s prior written consent thereto,
which consent shall not be unreasonably withheld, conditioned, or delayed provided that all such
documents, certificates, plats, and applications are consistent with the Development Plan and the
provisions of this Agreement.
ARTICLE V
CONDITIONS TO CLOSING
5.1 Conditions Precedent to Developer’s Obligation to Close.
5.1.1 The obligations of Developer to consummate Closing on the applicable
Parcel on the Closing Date shall be subject to the following conditions precedent:
(a) the representations and warranties made by District in Section 3.1.1
of this Agreement shall be true and correct in all material respects on and as if made on the Closing
Date;
(b) District shall have performed all of its material obligations and
observed and complied with all material covenants and conditions required at or prior to Closing
under this Agreement;
(c) this Agreement shall not have been previously terminated pursuant
to any provision hereof;
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(d) District shall have delivered (or caused to be delivered) the original,
executed documents required to be delivered pursuant to Section 6.2.1 herein;
(e) as of the Closing Date, there shall be no rezoning or other statute,
law, judicial, or administrative decision, ordinance, or regulation (including amendments and
modifications of any of the foregoing) by any G overnmental Authorities or any public or private
utility having jurisdiction over the Property that would materially adversely affect the acquisition,
development, sale, or use of the Property such that the Project is no longer physically or
economically feasible (this provision shall not apply to any normal and customary reassessment
of the Property for ad valorem real estate tax purposes); and
(f) title to the Property shall be subject o nly to the Permitted
Exceptions.
5.1.2 Failure of Condition. I f all of the conditions to Closing set forth above in
Section 5.1.1 have not been satisfied by the applicable Closing Date, provided the same is not the
result of Developer’s failure to perform any obligation of Developer hereunder, Developer shall
have the option, in its sole discretion, to: (i) waive such condition(s) and proceed to Closing
hereunder; (ii) terminate this Agreement by delivering notice of such termination to District ,
whereby District will release the Project Deposit to Developer and the Parties shall be released
from any further liability or obligation hereunder except those that expressly survive termination
of this Agreement; or (iii) delay Closing for up to sixty (60) days (or such longer time as may be
agreed to by the Parties) to permit District to satisfy the con ditions to Closing set forth in
Section 5.1.1. In the event Developer proceeds under clause (iii), Closing shall occur within sixty
(60) days after the conditions precedent set forth in Section 5.1.1 have been satisfied , but in no
event later than the Outside Closing Date. If such conditions precedent have not been satisfied by
the end of the sixty (60) day period, provided the same is not the result of Developer’s failure to
perform any obligation of Developer hereunder, Developer may again proceed under clause (i),
(ii), or (iii) above, in its sole discretion. The foregoing notwithstanding, Closing shall not occur
after the Outside Closing Date. If Closing has not occurred by the Outside Closing Date , this
Agreement shall immediately terminate and be of no further force and effect, except for those
provisions that expressly survive termination of this Agreement. Notwithstanding anything set
forth above to the contrary, if any such failed condition precedent is a result of a District Default,
then Developer may exercise its remedies in Section 9.3.
5.2 Conditions Precedent to District’s Obligation to Close.
5.2.1 The obligation of District to convey the Property and consummate Closing
on the applicable Parcel on the Closing Date shall be subject to the following conditions precedent:
(a) Developer shall have performed all of its material obligations
hereunder and observed and complied with all material covenants and conditions required at or
prior to Closing under this Agreement;
(b) the representations and warranties made by Developer in
Section 3.2.1 of this Agreement shall be true and correct in all material respects on and as if made
on the Closing Date;
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(c) this Agreement shall not have been previously terminated pursuant
to any other provision hereof;
(d) District’s authority, pursuant to the Resolution, to proceed with the
disposition, as contemplated in this Agreement, shall have not previously expired;
(e) the Construction Plans and Specifications for the Improvements
shall have been approved as Approved Plans and Specifications in their entirety pursuant to Article
IV;
(f) all Submissions required to be submitted prior to Closing shall have
been approved by District in their entirety;
(g) Developer shall have certified to District in writing that it is ready,
willing, and able in accordance with the terms and conditions of this Agreement to
[purchase][lease] the Property and achieve Commencement of Construction on or before the date
set forth in the Schedule of Performance;
(h) Developer shall be in compliance with the terms of the First Source
Agreement;
(i) Developer shall be in compliance with the terms of the CBE
Agreement;
(j) Developer sh all have obtained all Governmental Approvals
necessary to complete the Project (including the approval of the Zoning Application by the Zoning
Commission and approval by HPRB) and shall have delivered copies of the same to District;
(k) Developer shall have obtained, and furnished to District certificates
of insurance or duplicate originals of insurance policies, for the insurance coverage required under
the Construction and Use Covenant and Ground Lease;
(l) Developer shall have provided District with satisfactory evidence of
its authority to purchase or lease, as applicable, the Property and to perform its obligations under
this Agreement and the Construction and Use Covenant;
(m) Developer shall have obtained all Permits for demolition (if any),
excavation, sheeting and shoring, and the building permit for construction of the Improvements,
except for those Permits which are normally obtained during the course of construction of the
Improvements, such as Permits for trades, and shall have delivered the copies of the same to
District;
(n) Developer shall have delivered (or caused to be delivered) the
original, executed documents required to be delivered pursuant to Section 6.2.2 herein;
(o) Developer shall have delivered to District the documents required
under Section 10.2 and District shall have approved the Financing Commitments;
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(p) District shall have approved the Final Project Funding Plan and the
Final Project Budget, and there shall have been no changes to the same, except to the extent such
changes have been approved by District;
(q) Developer shall have executed a Construction Contract;
(r) Developer shall have retained the Construction Consultant and
District shall have approved the same in accordance with Section 4.7;
(s) Developer shall have provided to District updated Guarantor
Submissions and District shall have confirmed that such Person has sufficient net worth and
liquidity to satisfy its obligations under the Guaranty or District has approved a substitute
guarantor pursuant to Sections 8.1.2 and 8.1.4;
(t) Developer shall have subdivided the Property into record lots [or the
land condominium regime], to delineate the Parcels on which the Components will be constructed;
and
(u) Developer shall have delivered the Bonds pursuant Section 8.3.
5.2.2 Failure of Condition. If all of the conditions to Closing set forth above in
Section 5.2.1 have not been satisfied by the Closing Date, provided the same is not the result of
District’s failure to perform any obligation of District hereunder, District shall have the option, in
its sole discretion, by notice to Developer, to: (i) waive such condition(s) and proceed to Closing
hereunder; (ii) terminate this Agreement by delivering notice of such termination to Developer
whereby the Project Deposit shall be retained by District and the Parties shall be released from any
further liability or obligation hereunder except those that expressly survive termination of this
Agreement; or (iii) delay Closing for up to sixty (60) days (or such longer period as may be agreed
to by the Parties), to permit Developer to satisfy the conditions to Closing set forth in Section 5.2.1.
In the event District proceeds under clause (iii), Closing shall occur within sixty (60) days after
the conditions precedent set forth in Section 5.2.1 have been satisfied but in no event later than the
Outside Closing Date. If such conditions precedent have not been satisfied by the end of the sixty
(60) day period, provided the same is not the result of District’s failure to perform any obligation
of District hereunder, District may again proceed under clause (i), (ii) , or (iii) above, in its sole
discretion. The foregoing notwithstanding, Closing shall not occur after the Outside Closing Date.
If Closing has not occurred by the Outside Closing Date , this Agreement shall immediately
terminate and be of no further force and effect, except for those provisions that expressly survive
termination of this Agreement. Notwithstanding anything set forth above to the contrary, if any
such failed condition precedent is a result of a Developer Default, then District may exercise its
remedies in Section 9.2.
ARTICLE VI
CLOSING
6.1 Closing Date and Outside Closing Date. Developer and District shall consummate
Closing for each Parcel upon satisfaction (or waiver by the Party entitled to waive the same) of all
conditions to Closing, but no later than the applicable Closing Date shown on the Schedule of
Performance (each, a “Closing Date”). In no event shall the Closing be held after [THE DATE
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THAT IS FOUR (4) YEARS AFTER DATE OF THE ACT] (the “Outside Closing Date ”).
Closing shall occur in the District of Columbia in a location acceptable to the Parties.
6.2 Deliveries at Closing.
6.2.1 District’s Deliveries . On or before the Closing Date for the applicable
Parcel, subject to the terms and conditions of this Agreement, District shall execute, notarize, as
applicable, and deliver to Settlement Agent:
(a) the Deed in recordable form to be recorded in the Land Records
against the applicable Parcel, the Ground Lease, together with the Memorandum of Ground Lease
in recordable form to be recorded in the Land Records against the applicable Parcel;
(b) the Construction and Use Covenant in recordable form to be
recorded in the Land Records against the applicable Parcel;
(c) the Affordable Housing Covenant in recordable form to be recorded
in the Land Records against the applicable Parcel;
(d) a certificate, duly executed by District, stating that all of District’s
representations and warranties set forth herein are true and correct as of and as if made on the
Closing Date; and
(e) any and all other deliveries required from District on the Closing
Date under this Agreement and such other documents and instruments as are customary and as
may be reasonably requested by Developer or Settlement Agent, and reasonably acceptable to
District, to effectuate the transactions contemplated by this Agreement.
6.2.2 Developer’s Deliveries. On or before the Closing Date for the applicable
Parcel, subject to the terms and conditions of this Agreement, Developer shal l execute, notarize, as
applicable, and deliver to Settlement Agent:
(a) the Purchase Price in full and the rent due to be paid as of the
effective date of the Ground Lease, and any additional funds, if so required by the Settlement
Statement to be delivered at Closing;
(b) the Performance Letter of Credit;
(c) the Deed in recordable form for recordation in the Land Records
against the applicable Parcel, and the Memorandum of Ground Lease in recordable form to be
recorded in the Land Records against the applicable Parcel;
(d) the Construction and Use Covenant in recordable form to be
recorded in the Land Records against the applicable Parcel;
(e) the Affordable Housing Covenant in recordable form to be recorded
in the Land Records against the applicable Parcel;
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(f) the fully executed Guaranty;
(g) the Financing Documents and any other documents required to close
on the Debt Financing and Equity Investment for the Project;
(h) a certificate, duly executed by Developer, stat ing that all of
Developer’s representations and warranties set forth herein are true and correct as of and as if made
on the Closing Date;
(i) a certificate, duly executed by Developer, stating that (i) there is no
default, or event which with the passage of time or giving of notice or both would become a default,
by any party under the Financing Documents and (ii) the terms of the Financing Documents are
consistent with the terms of the Financing Commitments approved by District;
(j) the following documents evidencing the due organization and
authority of Developer and Managing Member to enter into, join, and consummate this Agreement
and the transactions contemplated herein:
(i) organizational documents and a current certificate of good
standing for Developer issued by the District of Columbia;
(ii) authorizing resolutions, in form and content reasonably
satisfactory to District, demonstrating the authority of the entity and of the Person executing each
document on behalf of Developer and Managing Member in connection with this Agreement and
the Project; and
(iii) an opinion of Developer’s counsel that Developer and
Managing Member are validly organized, existing , and in good standing in the District of
Columbia, that Developer and Managing Member have the full authority and legal right to carry
out the terms of this Agreement and the documents to be recorded in the Land Records, that
Developer and Managing Member have taken all actions to authorize the execution, delivery, and
performance of said documents and any other document relating thereto in accordance with their
respective terms, that none of the aforesaid actions, undertakings, or agreements violate any
restriction, term, condition, or provision of the organizational documents of Developer or
Managing Member or any contract or agreement to which they are a party or by which they are
bound; provided, however, that if a separate opinion is provided by Developer ’s counsel to an
Institutional Lender covering such matters, that Developer may satisfy the requirements of this
clause (iii) by delivering a counsel letter to District stating that District shall be entitled to rely on
the legal opinion provided to the Institutional Lender; and
(k) any and all other deliveries required from Developer on the Closing
Date under this Agreement and such other documents and instruments as are customary and as
may be reasonably requested by District or Settlement Agent, and reasonably acceptable to
Developer, to effectuate the transactions contemplated by this Agreement.
6.2.3 On the Closing Date, Settlement Agent shall record and distribute
documents and funds in accordance with closing instructions provided by the Parties so long as
they are consistent with this Agreement.
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6.3 Recordation of Closing Documents; Closing Costs.
6.3.1 At Closing, Settlement Agent shall file for recordation among the Land
Records the Deed or the Memorandum of Ground Lease, as applicable, the Affordable Housing
Covenant, and the Construction and Use Covenant. Such documents shall be recorded prior to any
security instruments to be recorded in connection with the Debt Financing.
6.3.2 At Closing, Developer shall be responsible for and pay all costs pertaining
to the transfer of the Property and financing of the Project , including, without limitation: (i) title
search costs, ( ii) title insurance premiums and endorsement charges, ( iii) survey costs, ( iv) all
recordation and transfer taxes, and (v) all of Settlement Agent’s fees and costs.
6.3.3 All real estate and personal property taxes and all utilities and other
operating expenses, if any, applicable to the P roperty shall be prorated between District and
Developer as of the Closing Date based on estimates of the amounts that will be due and payable
on the next payment date, unless final readings or invoices therefor as of the Closing Date shall
have been obtained, in which event such final readings shall be utilized as the basis for adjustment.
All items to be apportioned and adjusted pursuant to this Section 6.3.3 shall be prorated as of
midnight of the day immediately preceding the Closing Date, based on the actual number of days
of the month which shall have elapsed as of the Closing Date and the actual number of days in the
month and a three hundred sixty-five (365) day year.
ARTICLE VII
DEVELOPMENT OF PROPERTY AND CONSTRUCTION OF IMPROVEMENTS;
AFFORDABLE HOUSING REQUIREMENT
7.1 Obligation to Construct Improvements. Developer hereby agrees to develop,
construct, use, maintain, and operate the Improvements in accordance with the requirements
contained in the Construction and Use Covenant and the Schedule of Performance, subject only to
Force Majeure. Developer shall construct the Improvements in accordance with the Approved
Plans and Specifications and in compliance with all Permits , Governmental Approvals, and
Applicable Law. All costs of the Project, including all due diligence, predevelopment , and soft
costs, shall be borne solely by Developer.
7.2 Governmental Approvals. Developer shall obtain all necessary Governmental
Approvals to construct the Improvements. Any application for a Governmental Approval, or
modifications to existing Governmental Approvals, shall be prepared and filed by Developer on
behalf of District as the owner of the Property. All applications for Governmental Approvals shall
be subject to prior approval by District. Developer shall submit a copy of the proposed application
to District for its review and approval prior to submission of the application. District shall have
thirty (30) days to review and comment on the application. District shall cooperate , at no cost to
District, with Developer in connection with all such applications approved by District and shall
join such applications (as fee owner of the Property) as reasonably requested by Developer.
7.3 Issuance of Permits. Developer shall have the sole responsibility for obtaining all
Permits and shall make application therefor directly to the applicable Governmental Authority .
Developer shall submit to District copies of its applications for Permits prior to submission of the
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applications with the relevant Governmental Authority. District shall, upon request by Developer,
execute applications (as fee owner of the Property ) for such Permits, at no cost, expense,
obligation, or liability to District. In no event shall Developer commence site work or construction
of all or any portion of the Improvements until Developer shall have obtained all Per mits for the
work in question. Developer shall submit its applications for Permits on or before the date set forth
in the Schedule of Performance, which shall be within a period of time that Developer believes in
good faith is reasonably sufficient to allow issuance of such Permits prior to the Closing Date.
From and after the date of Developer’s submission of an application for a Permit, Developer shall
diligently prosecute such application until receipt. In addition, from and after submission of any
such application until issuance of the Permit, Developer shall report Permit status in writing on a
periodic basis to District, not more frequently than once every thirty (30) days.
7.4 Site Preparation. Developer, at its sole cost and expense, shall be responsible for
all preparation of the Property for development and construction in accordance with the
Development Plan and Approved Plans and Specifications , including costs associated with
excavation, construction of the Improvements, utility relocation and abandonment, relocation and
rearrangement of water and sewer lines and hook-ups, and construction or repair of alley ways on
the Property and abutting public property necessary for the Project. All such work, including but
not limited to, excavation, backfill, and upgrading of the lighting and drainage, shall be performed
under all required Permits and Governmental Approvals and in accordance with Applicable Law.
7.5 Affordable Housing Requirement . Developer will comply with all affordable
housing requirements of D.C. Official Code §10- 801 and the requirements of District of
Columbia’s Inclusionary Zoning program . As of the Effective Date, Developer has delivered to
District, and District has approved, the Affordable Housing Plan governing the requirements for
the Affordable Units, including specific affordability levels, tenure type, unit mix, and number of
bedroom breakdowns. The proposed “Affordable Unit Index” to be attached to the Affordable
Housing Covenant, which shall include the f loor plans depicting the A ffordable Units for the
Property, shall also be presented to District for review and approval prior to Closing. At Closing,
Developer shall execute the Affordable Housing Covenant, which shall reflect the Affordable
Housing Plan.
7.6 Opportunity for CBEs. Developer shall comply with the terms and conditions set
forth in the CBE Agreement.
7.7 Employment of District Residents; First Source Agreement . Pursuant to D.C.
Official Code § 10-801(b)(7), the Workforce Intermediary Establishment and Reform of the First
Source Amendment Act of 2011 (D.C. Law 19- 84, D.C. Official Code §§ 2- 219.01 et seq.) and
the rules and regulations promulgated thereunder, and Mayor’s Order 83- 265, Developer has
entered into a First Source Agreement with DOES that shall, among other things, require
Developer to: (i) hire , and require its architects, engineers, consultant s, contractors, and
subcontractors to hire, at least fifty-one percent (51%) District of Columbia residents for all new
jobs created by the Project, all in accordance with such First Source Employment Agreement and
(ii) ensure that at least fifty-one percent (51%) of apprentices and trainees employed are residents
of the District of Columbia and are registered in apprenticeship programs approved by the DC
Apprenticeship Council as required under D.C. Official Code §§ 32-1401 et seq.
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7.8 Davis Bacon Act; Living Wage Act. If applicable, Developer shall, and shall cause
the Contractor to, comply with the provisions of the Davis-Bacon Act, 40 U.S.C. §§ 3141 et seq.,
and the regulations promulgated therewith. In addition, as required under D.C. Official Code § 2-
220.06, Developer shall, and shall cause the Contractor to, to comply with all requirements under
the Living Wage Act of 2006, D.C. Official Code §§ 2- 220.01 et seq, as amended. To the extent
applicable, t he Contractor shall notify all subcontractors of the requirements under the Davis-
Bacon Act and the Living Wage Act and shall post the notice required thereunder in a conspicuous
site at its place of business.
7.9 Green Building Act and Clean Energy.
7.9.1 Developer shall design and construct the Improvements in accordance with
the Green Building Act of 2006, D.C. Official Code §§ 6- 1451.01 et seq. , as amended, and the
regulations promulgated therewith.
7.9.2 In addition, to the extent the building permit(s) for the Improvements is not
issued prior to December 31, 2026, and all or any part of the Improvements is a “covered building”,
Developer shall design and construct such Improvements in accordance with the Clean Energy DC
Building Code Amendment Act of 2022 (D.C. Law 24-177; 69 D.C. Reg. 9924; D.C. Official Code
§6-1453.01) and the regulations promulgated therewith.
ARTICLE VIII
POST-CLOSING GUARANTIES OF PERFORMANCE
8.1 Development and Completion Guaranty.
8.1.1 Delivery at Closing. Developer shall deliver to District on, as a condition
of Closing, a Guaranty executed by Guarantor.
8.1.2 Approval of Guarantor. The Guaranty shall be from one or more Persons
approved by District in District’s sole and absolute discretion, which approval shall include District’s
determination as to whether such Person has sufficient net worth and liquidity to satisfy its
obligations under the Guaranty, taking into account all relevant factors, including, without limitation,
such Person’s obligations under other guaranties and the other contingent obligations of such Person.
District may, at its sole option, require the Guaranty to be delivered by the Person who is delivering
the guaranty that guaranties repayment to the primary lender providing Debt Financing or the
investor providing the Equity Investment. In no event shall a Guarantor be a Prohibited Person.
8.1.3 Guarantor Submissions . In order for District to approve a Person as a
Guarantor under Section 8.1.2, Developer shall deliver or cause the Person to deliver to District the
Guarantor Submissions. Developer shall submit to District updated Guarantor Submissions (a) a t
any time upon District’s request and (b) no later than sixty (60) days prior to Closing.
8.1.4 Material Adverse Change in Financial Condition of Guarantor. In the event
District determines, in its sole and absolute discretion, that a material adverse change in the financial
condition of the Guarantor has occurred that impacts, or could threaten to impact, the Guarantor’s
ability to perform under the Guaranty, Developer shall, within five (5) Business Days after notice
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from District, identify a proposed substitute guarantor and request District’s approval of the same,
which request shall include delivery of the Guarantor Submissions for such proposed substitute
guarantor.
8.2 Performance Letter of Credit. Developer shall deliver to District Acceptable
Letters of Credit as follows: (i) At Closing on the Townhome Component, an Acceptable Letter
of Credit in the amount of fifty thousand dollars ($50,000) ; (ii) at Closing on the Martin
Component, an Acceptable Letter of Credit in the amount of one hundred thousand dollars
($100,000.00); and (iii) at Closing on the Malcolm Component, an Acceptable Letter of Credit in
the amount of fifty thousand dollars ($50,000.00) (each a “Performance Letter of Credit ”) to
secure Developer’s performance of the obligations contained in the Construction and Use
Covenant.
8.3 Payment and Performance Bond s. Prior to Closing, Developer shall obtain, or
require its Contractor to obtain, and deliver to District, payment and performance bonds with
respect to the work to be performed under the Construction Contract. The payment and
performance bonds (the “ Bonds”) shall (a) be issued by a surety company that is admitted as a
bonding carrier listed on the then- most current version of U.S. Treasury Circular 570 or any
replacement or substitute U.S. government listing, has an A.M. Best’s rating of at least A-:VIII or
better and is duly licensed and authorized to conduct and transact surety business in the District of
Columbia by the Commissioner of the D.C. Department of Insurance, Securities and Banking, (b)
be on a form consistent with AIA Document 312 or another form that provides substantially
equivalent protection to the owner, with such changes as District may reasonably request, (c) name
District as a beneficiary, and (d) be in the amount equal to the total price of the Construction
Contract.
ARTICLE IX
DEFAULTS AND REMEDIES
9.1 Default.
9.1.1 Default by Developer. Developer shall be in default under this Agreement
if (each, a “Developer Default”):
(a) any of Developer’s representations and warranties under Section
3.2.1 is not true and correct as of the Effective Date or as of the Closing Date;
(b) Developer fails to achieve a milestone on the Schedule of
Performance by the Outside Date therefor, and such failure shall continue for a period of ten (10)
days after notice from District;
(c) Developer shall (i) admit in writing in a legal proceeding its inability
to pay its debts as they mature, (ii) file a voluntary petition in bankruptcy or insolvency or for
reorganization under the United States Bankruptcy Code, (iii) be adjudicated bankrupt or insolvent
by any court, (iv) be the subject of involuntary proceedings under the United States Bankruptcy
Code, or the appointment of a receiver or trustee for all or substantially all of its property and such
proceedings shall not be dismissed or stayed, or the receivership or trustee ship vacated, within
one hundred twenty (120) days, or (v) make a general assignment for the benefit of creditors;
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(d) Developer becomes a Prohibited Person and such breach is not cured
within thirty (30) days after notice from District; or
(e) Developer fails to perform any obligation or requirement under this
Agreement or fails to comply with any term or provision of this Agreement that is not specified
under (a) – (d) above, and such default remains uncured for thirty (30) days after n otice from
District (except as provided in Section 5.1.2, no notice shall be necessary nor shall any cure period
apply to Developer’s obligation to close on its acquisition of the Property by the Outside Closing
Date, time being of the essence), or if such a default does not involve the payment of money and
cannot reasonably be cured within thirty (30) days, Developer shall have such additional time as
is reasonably necessary, not to exceed an additional sixty (60) days, to cure such default, provided
that Developer commences the cure within the initial thirty (30) day period and diligently pursues
completion of such cure thereafter.
9.1.2 Default by District. District shall be in default under this Agreement if
District fails to perform any obligation or requirement under this Agreement or fails to comply
with any term or provision of this Agreement and such default remains uncured for thirty (30) days
after receipt of notice of such failure from Developer (any such default that remains uncured after
all notice and cure periods have expired, a “District Default”). Notwithstanding the foregoing, if
a default cannot reasonably be cured within thirty (30) days, District shall have such additional
time as is reasonably necessary, not to exceed an additional sixty (60) days, to cure such default;
provided, however, District must commence the cure within the initial thirty (30) day period and
diligently pursue completion of such cure thereafter.
9.2 District Remedies in the Event of a Developer Default. In the event of a Developer
Default under this Agreement, District may elect to:
(a) terminate this Agreement and, as liquidated damages, draw on the
Project Deposit in the full amount, whereupon the Parties shall be released from any further
liability or obligation hereunder, except those that expressly survive termination of this
Agreement. Upon such termination, the Development Work Product shall be automatically
assigned to District in accordance with Section 9.6;
(b) cure any Developer Default at Developer’s sole cost and expense,
whereupon District shall be entitled to draw on the Project Deposit for rei mbursement of such
costs, in addition to pursuing any other legal remedies;
(c) pursue specific performance; and/or
(d) pursue any other legal or equitable relief.
9.3 Developer Remedies in the Event of a District Default. In the event of a District
Default prior to Closing, Developer may elect to:
(a) extend the Closing Date for a reasonable period of time to allow
District to cure the District Default, not to exceed the Outside Closing Date;
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(b) terminate this Agreement, w hereupon District shall return the
Project Deposit to Developer and the Parties shall be released from any further liability or
obligation hereunder, except those that expressly survive termination of this Agreement; and/or
(c) pursue specific performance or other injunctive relief.
9.3 Limitation on Remedies ; Cure Periods . The remedies of Developer and District
provided herein shall be the sole and exclusive remedies of the Parties in the event of a District
Default or Developer Default hereunder. In no event shall either Party be liable for any
consequential, punitive, or special damages. Notwithstanding anything to the contrary contained
in this Agreement, any cure period provided to District or Developer under this Article IX shall
not delay Closing beyond, and shall automatically expire on, the Outside Closing Date.
9.4 No Waiver By Delay; Waiver. Notwithstanding anything to the contrary contained
herein, any delay by any Party in instituting or prosecuting any actions or proceedings with respect
to a default by the other hereunder or otherwise asserting its rights or pursuing its remedies under
this Article, shall not operate as a waiver of such rights or to deprive such Party of or limit such
rights in any way (it being the intent of this provision that neither Party shall be constrained by
waiver, laches, or otherwise in the exercise of such remedies). Any waiver by either Party hereto
must be made in writing. Any waiver in fact made with respect to any specific default under this
Section shall not be considered or treated as a waiver with respect to any other defaults or with
respect to the particular default except to the extent specifically waived in writing.
9.5 Assignment of Development Work Product. Upon termination of this Agreement
pursuant to Section 9.2(a), Developer shall assign to District all of Developer’s assignable right,
title, and interest in and to all plans, drawings, specifications, engineering studies, investigations,
reports, Governmental Approvals and Permits in connection with the Project (collectively, the
“Development Work Product”) at Developer’s sole cost and expense. Developer shall cause all
professional contracts for Development Work Pr oduct to expressly provide that Developer shall
have the right to so assign (or failing that, to license) the Development Work Product to District
and that, from and after the effective date of such assignment (or license), District shall have the
right to use such Development Work Product and rely thereon to the same extent as Developer.
Upon termination of this Agreement pursuant to Section 9.2(a), if requested by District, Developer
shall execute such assignments as District may request to perfect such assignment . Developer
hereby indemnifies, defends, and holds harmless District from and against any and all third-party
costs, claims or liabilities, caused by the failure of Developer to pay when due third parties for any
Development Work Product. Developer’s obligations pursuant to this Section 9.6 shall survive
termination of this Agreement.
9.6 Attorneys’ Fees. In the event District prevails in any legal action or proceeding to
enforce the terms of this Agreement, District shall be entitled to recover from Developer the
reasonable attorneys’ fees and costs incurred by District in such action or proceeding. In the event
District is represented by the Office of the Attorney General for the District, reasonable attorneys’
fees shall be calculated based on the then-applicable hourly rates established in the most -current
Adjusted Laffey Matrix prepared by the Civil Division of the United States Attorney’s Office for
the District of Columbia and the number of hours employees of the Office of the Attorney General
for the District of Columbia prepared for or participated in any such litigation.
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9.7 Rights and Remedies Cumulative. The rights and remedies of the Parties under this
Agreement shall be cumulative, and the exercise by a Party of any one or more of such remedies
shall not preclude the exercise of any other remedies for the same such default or breach.
ARTICLE X
CONSTRUCTION FINANCING
10.1 Limitations on Encumbrances.
10.1.1 Debt Financing; Mortgages . As further provided in the Construction and
Use Covenant and Ground Lease , beginning at Closing, Developer shall not obtain any Debt
Financing or engage in any other transaction that shall create a Mortgage or other encumbrance or
lien upon the Property or Developer’s leasehold interest in the Property , as applicable, whether by
express agreement or operation of law, or suffer any encumbrance or lien to be made on or attached
to the Property or Developer’s leasehold interest in t he Property, as applicable, without the prior
written approval of District, in its sole and absolute discretion..
10.1.2 Bona Fide Indebtedness. The Debt Financing obtained in connection with
Closing and construction of the Improvements shall (i) secure a bona fide indebtedness to an
Institutional Lender, the proceeds of which shall be applied only to the costs identified in the Final
Project Budget and (ii) be of an amount which, together with the Equity Investment and all other
funds available to Developer, shall be sufficient to complete construction of the Improvements . In
no event shall the proceeds of any Debt Financing or Mortgage be used to fund the acquisition,
development, construction, operation, or any other costs relating to a ny real property, personal
property, or business operation other than the Project.
10.2 Submissions. At least thirty (30) days prior to Closing on the applicable Parcel ,
Developer shall submit to District, for the purpose of obtaining District’s appr oval of any Debt
Financing or Equity Investment , such documents as District may reasonably request, including,
but not limited to, copies of:
(a) the Financing Commitments certified by Developer to be a true and
correct copies thereof;
(b) the signed loan agreement (which may be the most recent draft
exchanged between Developer and the lender, provided that, Developer delivers the final loan
agreement prior to Closing and the executed loan agreement as soon as available after Closing on
the Debt Financing) between Developer and the lender of such Debt Financing, certified by
Developer to be a true and correct copy thereof;
(c) the signed agreements (which may be the most recent draft
exchanged between Developer and the lender, provided that, Developer delivers the final
agreements prior to Closing and the executed agreements as soon as available after Closing on the
Equity Investment) evidencing the commitment to provide the Equity Investment for the Project;
(d) a schedule detailing the disbursement of the proceeds of the
proposed Debt Financing and Equity Investment, certified by Developer to be true and accurate ;
and
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(e) a copy of the proposed deed of trust or such other instrument to be
used to secure the Debt Financing, provided that, Developer delivers the final deed of trust prior
to Closing and the recorded deed of trust or other instrument as soon as available after Closing on
the Debt Financing.
ARTICLE XI
ASSIGNMENT AND TRANSFER
11.1 Assignment. Prior to Closing, Developer represents, warrants, covenants, and
agrees, for itself and its successors and assigns, that Developer (or any successor in interest thereof)
shall not assign its rights under this Agreement, or delegate its obligations under this Agreement,
except to an entity that is Controlled by the Managing Member (provided such transferee is not a
Prohibited Person), without District’s prior written approval, which may be granted or denied in
District’s sole and absolute discre tion. After Closing, Developer may assign or transfer the
Property (or portions thereof) and Developer’s leasehold interest in the Property in accordance
with the Construction and Use Covenant and the Deed with respect to the Townhome Component
and the Ground Lease with respect to the Malcolm Component and Martin Component.
11.2 Transfer of Membership Interests . Prior to Closing, neither Developer nor any
Member of Developer (including any successors in interest of Developer or its Members) shall
cause or suffer to be made any assignment, sale, conveyance, or other transfer, or make any
contract or agreement to do any of the same, whether directly or indirectly, of the membership
interests of Developer , except to an entity that is Controlled by Managing Member , without
District’s prior written approval, which may be granted or denied in District’s sole and absolute
discretion; provided, however, no membership interest shall be held by a Prohibited Person
(“Transfer of Membership Interests”). After Closing, Developer may conduct a Transfer of
Membership Interests in accordance with the Construction and Use Covenant with respect to the
Townhome Component and the Ground Lease with respect to the M alcolm Component and the
Martin Component.
11.3 No Unreasonable Restraint . Developer hereby acknowledges and agrees that the
restrictions on transfers set forth in this Article do not constitute an unreasonable restraint on
Developer’s right to transfer or otherwise alienate the Property or its rights under this Agreement.
Developer hereby waives any and all claims, challenges, and objections that may exist with respect
to the enforceability of such restrictions, including any claim that such restrictions constitute an
unreasonable restraint on alienation.
ARTICLE XII
INSURANCE OBLIGATIONS; INDEMNIFICATION
12.1 Insurance Obligations. In addition to any insurance requirements required under
the terms of the Construction and Use Covenant and the Ground Lease, Developer shall comply
with the insurance requirements contained in Exhibit S.
12.2 Indemnification. Developer shall indemnify, defend, and hold harmless District
and District’s agents and employees from and against any and all losses, costs, claims, damages,
liabilities, and causes of action (including reasonable attorneys’ fees and court costs) arising out
41
of death of or injury to any person or damage to any property that is directly or indirectly caused
by any acts or omissions of Developer, its Members, or Developer’s A gents; provided, however,
that the forgoing indemnity shall not apply to any losses, costs, claims, damages, liabilities, and
causes of action (including reasonable attorneys’ fees and court costs) due solely to the gross
negligence or w illful misconduct of District as determined by a court of competent jurisdiction.
The obligations of Developer under this Section shall survive Closing or the earlier termination of
this Agreement.
ARTICLE XIII
NOTICES
13.1 To District. Any notices given under this Agreement shall be in writing and
delivered (i) by U.S. Certified Mail (return receipt requested, postage pre-paid), (ii) by hand, (iii)
by reputable private overnight commercial courier service, (iv) by electronic mail, or (v) such other
means as the Parties may agree in writing, to District at the following addresses:
District of Columbia
Office of the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attn: Development Manager- St. Elizabeths East Parcel 6
Email: dmpednotice@dc.gov
With a copy to:
Office of the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attn: General Counsel
Email: dmpednotice@dc.gov
13.2 To Developer. Any notices given under this Agreement shall be in writing and
delivered (i) by U.S. Certified Mail (return receipt requested, postage pre-paid), (ii) by hand, (iii)
by reputable private overnight commercial courier service, (iv) by electronic mail, or (v) such other
means as the Parties may agree in writing, to Developer at the following addresses:
Parcel 6 Community Partners LLC
c/o Banneker Communities L.L.C
1227 Marion Barry Avenue SE, Suite 107
Washington, DC 20020
Attention: Omar Karim
Email: okarim@bannekerventures.com
with a copy to:
Reno & Cavanaugh PLLC
455 Massachusetts Avenue NW, Suite 400
42
Washington, DC 20001
Attention: Vonda Jones
Email: vjones@renocavanaugh.com
Notices served upon Developer or District in the manner aforesaid shall be deemed to have been
received for all purposes hereunder at the time such notice shall have been: (i) if hand delivered to
a Party against receipted copy, when the copy of the notice is receipted; (ii) if given by overnight
courier service, on the next Business Day after the notice is deposited with the overnight courier
service; (iii) if given by certified mail, return receipt requested, postage pre -paid, on the date of
actual delivery or refusal thereof; or (iv) if given by electronic mail, upon the recipient’s electronic
mail response confirming receipt . If notice is tendered under the terms of this Agreement and is
refused by the intended recipient of the notice, the notice shall nonetheless be considered to have
been received and shall be effective as of the date provided in this Agreement. The Parties agree
that counsel to any of them may provide notice to the other Parties under this Agreement.
ARTICLE XIV
MISCELLANEOUS
14.1 Party in Position of Surety With Respect to Obligations. Developer, for itself and
its successors and assigns and for all other persons who are or who shall become, whether by
express or implied assumption or otherwise, liable upon or subject to any obligation or burden
under the Agreement, hereby waives, to the fullest extent permitted by law and equity, any and all
claims or defenses otherwise available on the grounds of its being or having become a person in
the position of surety, whether real, personal, or otherwise or whether by agreement or operation
of law, including, without limitation any and all claims and defenses based upon extension of time,
indulgence or modification of this Agreement.
14.2 Conflict of Interests; Representatives Not Individually Liable . No official or
employee of District shall participate in any decision relating to this Agreement which affects his
or her personal interests or the interests of any District of Columbia agency, partnership, or
association in which he or she is, directly or indirectly, interested. No official or employee of
District shall be personally liable to Developer or any successor -in-interest in the event of any
default or breach by District or for any amount which may become due to Developer or such
successor-in-interest or on any obligations hereunder.
14.3 Survival; Merger. Except to the extent any provision contained herein expressly
survives the expiration or termination of this Agreement, the provisions of this Agreement are
intended to and shall merge with the Deed with respect to the Townhome Component and be
superseded by the Construction and Use Covenant and the Ground Lease with respect to the
Malcolm Component and the Martin Component.
14.4 Titles of Articles and Sections. Titles and captions of the several parts, articles, and
sections of this Agreement are inserted for convenient reference only and shall be disregarded in
construing or interpreting Agreement provisions.
14.5 Governing Law ; Forum for Disputes . This Agreement shall be governed by,
interpreted under, construed, and enforced in accordance with the laws of the District of Columbia,
43
without reference to the conflicts of laws provisions thereof. District and Developer agree that any
suit, action, or proceeding arising out of this Agreement, or any transaction contemplated hereby,
shall be brought exclusively in (a) the courts of the District of Columbia and (b) the United States
District Court for the District of Columbia. District and Developer irrevocably and unconditionally
waive any objection to the laying of venue of any action, suit, or proceeding arising out of this
Agreement or the transactions contemplated hereby in the courts named in (a) and (b) above , and
hereby further waive and agree not to plead or claim in any such court that any such action, suit,
or proceeding brought in any such court has been brought in an inconvenient forum.
14.6 Entire Agreement; Recitals; Exhibits.
14.6.1 This Agreement (including the Exhibits annexed hereto and made part
hereof), and any document delivered pursuant to this Agreement collectively contain all the
agreements and understandings between District and Developer relative to the transactions
contemplated herein and thereby and there are no agreements or understandings, oral or written,
expressed or implied, between them with respect thereto other than as herein set forth or expressly
referenced herein and made a part hereof. Upon execution of this A greement, all previous
agreements shall be deemed null and void.
14.6.2 The Recitals of this Agreement are incorporated herein by this reference
and are made a substantive part of the agreements between the Parties.
14.6.3 All Exhibits are incorporated herein by reference, whether or not so stated.
In the event of any conflict between the Exhibits and this Agreement that occurs prior to Closing,
this Agreement shall control. In the event of any conflict between the Exhibit and this Agreement
that occurs after Closing, the Exhibits shall control.
14.7 Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which shall together constitute one and the same
instrument. Execution and delivery of this Agreement by facsimile or e-mail .pdf shall be sufficient
for all purposes and shall be binding on any Person who so executes.
14.8 Time of Performance . All dates for performance (including cure) shall expire at
5:00 p.m. (Eastern time) on the performance or cure date. A performance date which falls on a
Saturday, Sunday, District of Columbia government holiday , or day in which the District of
Columbia government is officially closed for business is automatically extended to the next
Business Day.
14.9 Successors and Assigns. This Agreement shall be binding upon and shall inure to
the benefit of, the successors and assigns of District and Developer, and where the term
“Developer” or “District” is used in this Agreement, it shall mean and include their respective
successors and assigns.
14.10 Third Party Beneficiary . No Person shall be a third- party beneficiary of this
Agreement.
14.11 Waiver of Jury Trial. TO THE EXTENT PERMITTED BY LAW, ALL PARTIES
HERETO WAIVE THE RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY
44
LITIGATION ARISING IN RESPECT OF THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
14.12 Further Assurances. Each Party agrees to execute and deliver to the other Party
such additional documents and instruments as the other Party reasonably may request in order to
fully carry out the purposes and intent of this Agreement.
14.13 Modifications and Amendments . None of the terms or provisions of this
Agreement may be changed, waived, modified, or removed except by an instrument in writing
executed by the Party or Parties against which enforcement of the change, waiver, modification,
or removal is asserted. None of the terms or provisions of this Agreement shall be deemed to have
been abrogated or waived by reason of any failure or refusal to enforce the same. In addition, if
any Party seeks to amend or change any material terms set f orth in the Council Term Sheet, the
Parties must seek and receive Council approval as required under D.C. Official Code §10- 801(b-
4).
14.14 Severability. If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under present or future Applicable Law, such provision shall be fully severable, this
Agreement shall be construed and enforced as if such illegal, invalid, or unenforce able provision
had never comprised a part of this Agreement, and the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by the illegal, in valid, or
unenforceable provision or by its severance from this Agreement, unless this construction would
constitute a substantial deviation from the general intent of the Parties as reflected in this
Agreement. Furthermore, there shall be added automatically as a part of this Agreement a
provision as similar in terms to such illegal, invalid, or unenforceable provision as may be possible
that is legal, valid, and enforceable.
14.15 Anti-Deficiency Limitation; Authority.
14.15.1 Though no financial obligations on the part of District are anticipated,
Developer acknowledges that District is not authorized to make any obligation in advance or in
the absence of lawfully available appropriations and that District’s authority to make such
obligations is and shall remain subject to the provisions of (i) the federal Anti deficiency Act, 31
U.S.C. §§ 1341, 1342, 1349, 1350, 1351; (ii) D.C. Official Code § 47-105; (iii) the District of
Columbia Anti -Deficiency Act, D.C. Official Code §§ 47- 355.01 – 355.08, as the foregoing
statutes may be amended from time to time; and (iv) Section 446 of the District of Columbia Home
Rule Act.
14.15.2 Developer acknowledges and agrees that any unauthorized act by District
is void. It is Developer’s obligation to accurately ascertain the extent of District’s authority.
14.16 Time of the Essence; Standard of Performance. Time is of the essence with
respect to all matters set forth in this Agreement. For all deadlines set forth in this Agreement, the
standard of performance of the Party required to meet such deadlines shall be strict adherence and
not reasonable adherence.
14.17 No Partnership . District and Developer are independent parties under this
Agreement, and nothing in this Agreement shall be deemed or construed for any purpose to
45
establish between them, or any third party, a relationship of principal and agent, employment,
partnership, or joint venture.
14.18 Each Party To Bear Its Own Costs. Each Party shall bear its own costs and
expenses incurred in connection with the negotiation of this Agreement and the performance of
such Party’s duties and obligations hereunder.
14.19 Discretion. Unless explicitly provided to the contrary in this Agreement, where
either Party has the right to approve or consent to any matter herein, such approval or consent shall
not be unreasonably withheld, conditioned, or delayed nor any charge made therefor.
14.20 Force Majeure. Neither District nor Developer, as the case may be, shall be
considered in default of their obligations under this Agreement, in the event such Party’s
performance is materially and adversely affected by a Force Majeure event. In the event of the
occurrence of any such Force Majeure event, the time or times for performance of the obligations
of District or of Developer shall be extended day-for-day for the period of the Force Majeure;
provided however, that (a) the Party seeking the benefit of this Section 14.20 shall notify the other
Party in writing within ten (10) days after it becomes aware of the beginning of any such Force
Majeure event, of the cause or causes thereof, with supporting documentation, and such Party’s
estimate of the length of the delay that will be caused by such Force Majeure event and (b) the
Party seeking the delay must take commercially reasonable actions to minimize the delay. If either
Party requests any extension on the date of completion of any obligation hereunder due to Force
Majeure, it shall be the responsibility of such Party to reasonably demonstrate that the delay was
caused specifically by such Force Majeure event. Force Majeure delays shall not delay the Closing
beyond the Outside Closing Date and shall not apply to any obligation to pay money.
14.21 Joint Preparation. District and Developer each acknowledge that it has thoroughly
read and reviewed this Agreement, including all Exhibits and attachments thereto, and has sought
and received whatever competent advice and counsel as was necessary for it to form a full and
complete understanding of all rights and obligations herein. The language of this Agreement has
been agreed to by the Parties to express their mutual intent and no rule of strict construction shall
be applied against any Party hereto.
14.22 Estoppel Certificates. At any time and from time to time upon not less than thirty
(30) days’ prior notice, either Party shall execute, acknowledge, and deliver to the other requesting
Party, a written statement certifying the accuracy of, or any reason for the inaccuracy of, the
following statements: (a) this Agreement is in full force and effect; (b) this Agreement has not
been modified or amended (or if it has, identifying the modifications and amendments); (c) to such
Party’s knowledge, the Party requesting the certificate is not then in default under this Agreement;
(d) to such Party’s knowledge, the Party requesting the certificate has fully performed all of its
respective obligations hereunder (or, if it has not, identifying such failures to perform); and (e)
such other factual statements related to this Agreement as such requesting Party may reasonably
request.
14.23 D.C. Human Rights Act. Developer shall comply with the District of Columbia
Human Rights Act, including its prohibitions on sexual harassment, consistent with 4 D.C.M.R.
1100, et seq.
46
14.24 Project Signage. District shall be identified where Developer’s name, trade name,
or logo is used on signage for the Project consistent with the same “level of identification” as
Developer’s name and logo or such lesser level as acceptable to District. District shall have the
right to approve the general template for use of District’s name, logo, or like identifiers.
14.25 Project Press Releases, Promotional Materials, and Media Requests. Developer
shall coordinate with District all Project press releases, promotional materials, and submissions for
awards and other recognition that are prepared by Developer and requests or invitations for, and
responses to, interviews or statements by media outlets with respect to the Project . A ny press
releases, promotional materials , or submissions prepared by Developer shall be subject to
District’s approval in its sole and absolute discretion, which shall be obtained prior to publication
or submission of the press release, promotional materials , or submission for awards and other
recognition. Upon receiving a request or invitation for an interview or statement by a media outlet,
Developer shall promptly notify District. Any response or participation in an interview or
statement by Developer shall be subject to District’s approval in its sole and absolute discretion.
14.26 Project Public Events. Developer shall coordinate with, invite, and provide notice
to District of all Project public events (e .g., community meetings, stakeholder meetings,
presentations to trade association groups, presentation to out -of-town dignitaries , and similar
events). For any event involving the immediate community or key public officials (such as Council
members, international ambassadors, members of Congress and their aides, officials of the Federal
government, and executives of regional organiz ations), Developer shall use reasonable efforts to
timely notify District and schedule such meetings so that District representatives may attend.
[Signature Pages Follow]
IN WITNESS WHEREOF, District and Developer have each caused this Agreement to
be signed, acknowledged, and delivered in its name by its duly authorized representative as of the
day and year first above written.
DISTRICT:
DISTRICT OF COLUMBIA, by and through the
Office of the Deputy Mayor for Planning and
Economic Development pursuant to delegation of
authority contained in Mayor’s Order No. 2011-109
By: _____________________________
Name: __________________________
Title: Deputy Mayor for Planning and Economic
Development
Reviewed:
By:________________________
Office of the General Counsel
ODMPED
DEVELOPER:
By: PARCEL 6 COMMUNITY PARTNERS, a
District of Columbia limited liability company
________________________________
Name: Omar A. Karim
Title: Authorized Person
2
EXHIBIT A
Legal Description
Being part of Subdivision Lot 2 in Square S -5868 as shown on a Plat of Subdivision recorded
April 27, 2012 in Subdivision Book 206 at Page 95, and also shown on a Plat of Computation
dated November 30, 2012 in Survey Book 204 at Page 254, both recorded among the Records of
the Office of the Surveyor of the District of Columbia, and being known as A&T Lot 968 as shown
on A&T Plat 3895-W, on file among said Records of the Office of the Surveyor, and being more
particularly described in the meridian of the District of Columbia Surveyor’s Office (DCSO) as
follows:
Commencing at a point on the easterly line of Martin Luther King Jr. Avenue, S.E. (variable
width), said point being a southwesterly corner of said Lot 2 in Square S-5868; thence on said
easterly line and the westerly line of Lot 2 the following five (5) courses and distances, North 12°
02' 00" East, 193.93 feet; thence, North 8° 23’ 20” East, 167.43’, thence North 1° 23’ 20” East,
360.13 feet; thence North 1° 53’ 00” East, 400.15’, thence North 1° 16’ 40” East, 233.55 feet;
thence running in, through, over and across said Lot 2 the following two (2) courses and distances,
South 88° 39' 21" East, 1065.35 feet to a point; thence North 1° 46' 04" East, 68.23 feet to the
Point of Beginning ; said point also being the northwesterly corner of A&T Lot 968; thence
running in, through, over and across said Lot 2 and on the outline of A&T Lot 968 the following
nine (9) courses and distances
1. South 88°13'56" East, 250.00 feet to a point; thence
2. South 01°46'04" West, 524.90 feet to a point; thence
3. 145.92 feet along the arc of a curve to the left, having a radius of 215.00 feet, a delta
angle of 38°53'12" and a chord bearing and distance of South 17°40'32" East, 143.14
feet to a point; thence
4. South 37°14'36" West, 223.13 feet to a point; thence
5. South 52°45'24" East, 151.71 feet to a point; thence
6. South 37°14'36" West, 34.83 feet to a point; thence
7. North 52°45'24" West, 93.75 feet to a point; thence
8. 442.51 feet along the arc of a curve to the right, having a radius of 465.00 feet, a delta
angle of 54°31'29" and a chord bearing and distance of North 25°29'40" West, 426.00
feet to a point; thence
9. North 01°46'04" East, 524.90 feet to the Point of Beginning.
Containing an area of 202,758 square feet or 4.65468 acres of land, more or less.
Council Draft
EXHIBIT B-1
FORM OF AFFORDABLE HOUSING COVENANT (RENTAL)
2700 Martin Luther King, Jr. Avenue, SE
(COMMONLY KNOWN AS PARCEL 6)
ST ELIZABETHS EAST CAMPUS, WASHINGTON, D.C.
THIS AFFORDABLE HOUSING COVENANT (the “Covenant”) is made as of this ___day
of __________, 2025 (“Effective Date ”), by Parcel 6 Community Partners LLC, a District of
Columbia limited liability company , and its successors and assigns (the “Developer”) having an
address of c/o Banneker Communities LLC, 1227 Marion Barry Avenue SE, Suite 107, Washington,
DC 20020, for the benefit of the DISTRICT OF COLUMBIA, a municipal corporation, acting by
and through the Office of the Deputy Mayor for Planning and Economic Development (the
“District”).
RECITALS
R-1. District is the fee simple owner of certain real property located in the District of
Columbia as further described in Exhibit A (the “Property”).
R-2. District has determined to further its public policy of increasing the affordable housing
stock in the District of Columbia and, in particular, on the Property.
R-3. District and Developer entered into that certain Land Disposition and Development
Agreement dated ________________________________, 202_, as the same may be amended
(“Development Agreement”) whereby District and Developer agreed upon the terms under which
District agreed to ground lease the Property to Developer and for Developer to develop and construct
the Project (defined below) and to manage and lease the Affordable Units to be constructed in the
Project.
R-4. In accordance with the Development Agreement and contemporaneously with the
execution of this Covenant, District has conveyed or will convey a leasehold interest in the Property
to Developer.
R-5. District and Developer desire to set forth herein the terms, restrictions, and conditions
upon which Developer will construct, maintain, and lease the Affordable Units in the Project.
NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the District and Developer hereby declare, covenant and agree as follows:
ARTICLE I
DEFINITIONS
For the purposes of this Covenant, the capitalized terms used herein shall have the meanings
ascribed to them below and, unless the context clearly indicates otherwise, shall include the plural as
well as the singular.
Affirmative Fair Housing Marketing Plan : means Developer’s plan for marketing the
rental of the Affordable Units, as approved by the Agency pursuant to Section 2.3.
Affordability Period: is defined in Article X.
Affordability Requirement: is the requirement that thirty percent (30%) of the Residential
Units to be contained in the Project are to be Affordable Units and allocated as follows: (i) twenty-
five percent (25%) of the Affordable Units shall be reserved for Households with an Annual
Household Income at or below thirty percent (30%) MFI and (ii) seventy-five percent (75%) of the
Affordable Units shall be reserved for Households with an Annual Household Income that is more
than thirty percent (30%) MFI and less than or equal to 50% MFI.
Affordable Unit: means each Residential Unit that will be used to satisfy the Affordability
Requirement, all of which shall be identified in the Affordable Unit Index.
Affordable Unit Index : is an index of the Affordable Units contained in the Project that
identifies: (i) unit number (or similar identifier) and floor for each Affordable Unit and whether each
Affordable Unit is a Rental Affordable Unit; (ii) the Designated Affordability Level of each
Affordable Unit; (iii) the approximate square footage and number of bedrooms of each Affordable
Unit and a schematic drawing showing the layout of each Affordable Unit; (iv) a listing or schedule
of the standard and upgrade options of finishes, fixtures, equipment, and appliances for all Residential
Units; (v) a listing or schedule of the amenities, services, upgrades, parking, and other facilities that
will be offered as an option at an additional upfront or recurring cost or fee to the Residential Units;
and (vi) residential floor plans showing the location of each Residential Unit.
Affordable Unit Tenant: means a Qualified Tenant who lease(s) a Rental Affordable Unit.
Agency: means, as of the Effective Date, the D.C. Department of Housing and Community
Development, pursuant to Mayor’s Order 2009-112 (effective June 18, 2009), or such other agency
of the District of Columbia government that may subsequently be delegated the authority of the
Mayor to monitor, enforce, or otherwise administer the affordable housing requirements of the
District of Columbia government.
Annual Household Income : means the aggregate annual income of a Household as
determined by using the standards set forth in 24 CFR § 5.609, as may be amended, or as otherwise
set forth by the Agency.
Annual Report: has the meaning given in Section 4.10.
Business Day: means Monday through Friday, inclusive, other than holidays recognized by
the District of Columbia government.
Certification of Income, Affordability and Housing Size: means a certification made by a
Certifying Entity that verifies that (a) the Annual Household Income of a Household meets the
Designated Affordability Level for an applicable Affordable Unit , and (b) the Household meets the
requirements of Section 4.5 in such form as the Agency approves.
Certification of Inspection : means a certification by Developer that it has performed or
caused to be performed an inspection of a Rental Affordable Unit and that, to the best of Developer’s
knowledge, such Rental Affordable Unit is in compliance with all applicable statutory and regulatory
requirements, in such form as the Agency approves.
Certification of Residency: means a certification made by an Affordable Unit Tenant that
states that the Affordable Unit Tenant occupies the Affordable Unit as its principal residence, in such
form as the Agency approves.
Certifying Entity: means an entity or entities approved by the Agency pursuant to Section
2.4.
Conflict: is defined in Section 12.11.
Declaration of Eligibility: means a declaration executed by a Household prior to its initial
rental or subsequent rent renewal , as applicable, of an Affordable Unit, in a form approved by the
Agency, that shall be given to the Agency, Owner, and the Certifying Entity representing and
warranting the following: (a) the Household is a Qualified Tenant and has disclosed all of its Annual
Household Income to the Certifying Entity and has provided reasonably satisfactory documentation
evidencing such Annual Household Income, (b) the Household’s Annual Household Income is at or
below the Maximum Annual Household Income for the applicable Affordable Unit, (c) the
Household has been informed of its rights and obligations under this Covenant, (d) the Household
intends to occupy the Affordable Unit as its principal residence, (e) the Household size meets the
Occupancy Standard for the Affordable Unit, (f) neither the Household, nor any person within the
Household, has an ownership interest in any other residential real property or residential cooperative
or, if they do, they will divest such interest and will provide satisfactory proof of the same to the
Agency before signing a lease for the Affordable Unit and (g) any other reasonable and customary
representations requested by the Agency.
Designated Affordability Level: means the percentage of MFI assigned to each Affordable
Unit and used to determine the Maximum Annual Household Income for prospective Qualified
Tenants.
Developer: is identified in the preamble of this Covenant.
Federal Affordability Restrictions: is defined in Section 12.11.
Household(s): means all persons who will occupy the Affordable Unit, including the tenant’s
spouse or domestic partner, all children under eighteen (18) years of age, and all other persons over
eighteen (18) years of age who will be occupying the Affordable Unit. A Household may be a single
family, one (1) person living alone, two (2) or more families living together, or any other group of
related or unrelated persons who share living arrangements as allowable by this Covenant.
Household Selection Plan: means Developer’s plan for selecting Qualified Tenants for the
rental of the Affordable Units, as approved by the Agency pursuant to Section 2.3.
Housing Cost : means the total monthly payments for rent and Utilities, less any rental
subsidies paid on behalf of that Household.
Housing Locator Website : means a website established or designated by the Agency
pursuant to the Affordable Housing Clearinghouse Directory Act of 2008, effective August 15, 2008
(D.C. Law 17-215; D.C. Official Code § 42-2131, et seq.).
HUD: means the United States Department of Housing and Urban Development.
Land Records: means the real property records for the District of Columbia located in the
Recorder of Deeds.
Market-Rate Unit: is each Residential Unit that is not an Affordable Unit.
Maximum Allowable Rent: as defined in Section 4.4.2.
Maximum Annual Household Income : is the maximum Annual Household Income of a
Household occupying an Affordable Unit as indicated on the then-current Rent and Price Schedule.
Median Family Income or MFI: means the median family income for a household of four
persons in the “Washington Metropolitan Statistical Area” as periodically published by HUD, and
adjusted for Household size without regard to any adjustments made by HUD for the purposes of the
programs it administers. MFI is also known as Area Median Income or AMI.
Minimum Annual Household Income : is the minimum Annual Household Income of a
Household occupying a Rental Affordable Unit as indicated on the then-current Rent and Price
Schedule.
Mortgage: means a mortgage, deed of trust, mortgage deed, or such other classes of
instruments as are commonly given to secure a debt under the laws of the District of Columbia.
OAG: means the Office of the Attorney General for the District of Columbia.
Occupancy Standard: means the minimum number of individuals in a Household permitted
to occupy any given Affordable Unit, as identified in the following chart:
Affordable Unit Size
(Number of Bedrooms)
Minimum Number of
Individuals in a Household
Studio/Efficiency 1
1 1
2 2
3 3
4 4
5 5
6 6
Over-Income Tenant : means a tenant of a Rental Affordable Unit who, at the time of
execution of the lease qualified as an Affordable Unit Tenant, but, at the time of lease renewal, has
an Annual Household Income greater than one hundred forty percent (140%) of the applicable
Maximum Annual Household Income for the applicable Rental Affordable Unit.
Owner: means, in the context of Rental Affordable Units, Developer.
Person: means any individual, corporation, limited liability company, trust, partnership,
association, or other legal entity.
Project: means the structures, landscaping, hardscape, and site improvements to be
constructed or placed on the Property pursuant to the Development Agreement.
Property: is defined in the Recitals.
Qualified Tenant : means a Household that (i) at the time of leasing, has an Annual
Household Income, as certified by the Certifying Entity, less than or equal to the Maximum Annual
Household Income for the applicable Affordable Unit and at subsequent lease renewals, is not an
Over-Income Tenant, (ii) shall occupy the Affordable Unit as its principal residence during its lease
of such Affordable Unit, (iii) shall not permit occupancy of the Affordable Unit by any other Person,
except with the prior written consent of the Agency, (iv) shall use and occupy the Affordable Unit as
an Affordable Unit subject to the Affordability Requirement and this Covenant, and (v) shall occupy
the Affordable Unit within the Occupancy Standard.
Rent and Price Schedule: means the Rent and Price Schedule published in the D.C. Register
in accordance with the Inclusionary Zoning Implementation Amendment Act of 2006 (D.C. Law 16-
275; D.C. Official Code § 6- 1041.01 et seq.), as amended, which schedule sets forth, among other
things, the Maximum Allowable Rent for inclusionary zoning units and Affordable Units.
Rental Affordable Unit: means an Affordable Unit that shall be leased to a Qualified Tenant.
Rental Affordable Unit Lease Rider : is that certain lease rider, which is attached to this
Covenant as Exhibit B and incorporated herein, as the same may be amended from time to time with
the written approval of the Agency.
Residential Unit: means an individual residential unit constructed as part of the Project.
Utilities: means water, sewer, electricity, natural gas, trash , and any other fees required by
the Developer, property manager, or condominium or homeowners’ association in order to occupy
the Affordable Unit, including, but not limited to, mandatory amenity or administrative fees, which
amounts are included in the Rent and Price Schedule.
DMPED 4.4.25
ARTICLE II
AFFORDABILITY REQUIREMENT
2.1 Requirement of Affordability. Developer shall construct, reserve, and maintain and lease
as Rental Affordable Units that number of Affordable Units that are required by the Affordability
Requirement.
2.2 Affordable Unit Standards and Location.
2.2.1 Affordable Unit Index . As of the Effective D ate, District has approved the
Affordable Unit Index, which is attached hereto as Exhibit C . Developer shall not amend or
modify the Affordable Unit Index, except to the extent permitted under Section 4.6.6, without the
Agency’s prior written approval, which shall not be unreasonably withheld, conditioned, or
delayed. Any such approved amendment or modification as a result of re- designations of
Residential Units under Section 4.6.6 shall be recorded in the Land Records as an amendment to
this Covenant, at such time as determined by the Agency.
2.2.2 Unit Mix. The distribution of Affordable Units shall be proportional to that of the
Market-Rate Units, if any (e.g., if the Market-Rate Units have a mix of 30% studios, 40% one-
bedrooms, and 30% two-bedrooms, the Affordable Units shall have a similar mix).
2.2.3 Size. The Affordable Units shall be of a size substantially similar to the Market-
Rate Units, if any, provided that Affordable Units may be the smallest size of each market-rate
type (studio, 1-bedroom and 2-bedroom units) and have no luxury-scaled unit counterpart.
2.2.4 Exterior Finishes. Exterior finishes of Affordable Units will be substantially
similar to the appearance, finish, and durability of the exterior finishes of the Market-Rate Units,
if any.
2.2.5 Interior Finishes. Developer agrees that the interior base finishes, appliances, and
equipment in the Affordable Units shall be substantially similar to the Market-Rate Units, if any.
2.2.6 Affordable Unit Location. Affordable Units shall be disbursed throughout the
Project and shall not be concentrated on any one floor or within a tier or section of the Project.
2.3 Marketing Affordable Units.
2.3.1 Marketing Plan. Developer shall submit to Agency an Affirmative Fair Housing
Marketing Plan and Household Selection Plan that set forth its plan for marketing the Affordable
Units and for selecting Households who may be Qualified Tenants. The Affirmative Fair Housing
Marketing Plan and Household Selection Plan shall be subject to the Agency’s prior written
approval and shall be submitted to and approved by the Agency prior to marketing any Affordable
Units for rent. Developer may contract with the Certifying Entity to implement the Affirmative
Fair Housing Marketing Plan and Household Selection Plan.
2.3.2 Housing Locator. When an Affordable Unit becomes available for rent, Owner
shall register the Affordable Unit on the Housing Locator Website and indicate the availability of
such Affordable Unit and the application process for the Affordable Unit.
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2.4 Certifying Entity. Each Owner shall select a Certifying Entity, which shall be subject to
the Agency’s prior written approval, not to be unreasonably withheld, conditioned, or delayed.
Owner may contact the Agency with questions and information about the selection of a Certifying
Entity. The Certifying Entity shall review documentation and verify a Household’s Annual
Household Income and Household’s size in order to determine whether that Household is a
Qualified Tenant for the subject Affordable Unit. If a Household is determined to be a Qualified
Tenant the Certifying Entity shall issue a Certification of Income, Affordability and Housing Size
for the subject Household.
ARTICLE III
USE
3.1 Use. Except as provided herein, all Affordable Unit Tenants shall have the same and equal
use and enjoyment of all of the amenities of the Property and services provided at the Property as
the tenants of the comparable Market-Rate Units, if any. No restrictions, requirements , or rules
shall be imposed on Affordable Unit Tenants that are not imposed equally on the tenants of the
comparable Market-Rate Units, if any. If amenities, services, upgrades, or ownership or rental of
parking and other facilities are offered as an option at an additional upfront and/ or recurring cost
or fee to the comparable Market -Rate Units, if any, such amenities, services, upgrades, or
ownership or rental of parking and other facilities shall be offered to the Affordable Unit Tenants
of comparable Affordable Units at the same upfront and /or recurring cost or fee charged to the
Market-Rate Units , if any. If there is no cost or fee charged to the owners or tenants of the
comparable Market-Rate Units, if any, for such amenities, services, upgrades, or ownership or
rental of parking and other facilities, there shall not be a cost or fee charged to Affordable Unit
Tenants of comparable Affordable Units.
3.2 Demolition/Alteration. Owner shall maintain, upkeep, repair , and replace interior
components (including fixtures, appliances , flooring, and cabinetry) of the Affordable Unit with
interior components of equal or better quality than those interior components being replaced.
Owner shall not demolish or otherwise structurally alter an Affordable Unit or remove fixtures or
appliances installed in an Affordable Unit other than for maintenance and repair without the prior
written approval of the Agency, which approval shall not be unreasonably delayed or denied by
the Agency.
ARTICLE IV
RENTAL OF AFFORDABLE UNITS
4.1 Lease of Rental Affordable Units . In the event the Project contains Rental Affordable
Units, Developer shall reserve, maintain , and lease the Rental Affordable Units to Qualified
Tenants (a) in accordance with this Covenant and (b) at a rental rate at or below the Maximum
Allowable Rent.
4.2 Rental Affordable Unit Lease Requirements.
4.2.1 Form of Lease. To lease a Rental Affordable Unit to a Qualified Tenant, Developer
shall use a lease agreement to which is attached and incorporated a Rental Affordable Unit Lease
Rider. The Rental Affordable Unit Lease Rider shall be executed by Developer and each Qualified
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Tenant prior to the Qualified Tenant’s occupancy of the Rental Affordable Unit. Any occupant of
the Rental Affordable Unit who is eighteen (18) years or older shall be a party to the lease
agreement and shall execute the Rental Affordable Unit Lease Rider.
4.2.2 Effectiveness of Lease. The lease of a Rental Affordable Unit shall only be effective
if a Rental Affordable Unit Lease Rider, a Certification of Income, Affordability and Housing Size
and a Declaration of Eligibility are attached as exhibits to the lease agreement. Failure to attach
the foregoing shall be deemed a default by Developer under this Covenant.
4.2.3 Developer to Maintain Copies. Developer shall maintain or cause to be maintained
copies of all initial and renewal leases executed with Qualified Tenants for a period of no less than
five (5) years from the expiration or termination of such lease in hard copy or electronic form.
4.3 Rental Affordable Unit Admissions Process.
4.3.1 Referrals. Developer may obtain referrals of prospective tenants of Rental
Affordable Units from federal and District of Columbia agencies, or their designees provided such
referrals comply with the requirements of this Covenant. In all events, before a prospective tenant
leases a Rental Affordable Unit, a Certifying Entity shall certify the prospective tenant’s Annual
Household Income, Household size and Housing Costs for the applicable Rental Affordable Unit.
4.3.2 Consideration of Applicants . For the initial occupancy of the Rental Affordable
Units, Developer shall select Qualified Tenants through a lottery system or other system as
otherwise approved by the Agency as shall be further provided in the Affirmative Fair Housing
Marketing Plan. Following the initial occupancy of the Affordable Units, Developer shall consider
each applicant in the order in which received by Developer, whether received pursuant to the
Affirmative Fair Housing Marketing Plan or referred pursuant to Section 4.3.1.
4.3.3 Rejection of Applicants. In connection with the leasing of a Rental Affordable Unit,
Developer may reject any applicant if, after diligent review of such applicant’s application,
Developer determines in good faith that such applicant does not meet Developer’s criteria to lease
or occupy a Rental Affordable Unit, provided such criteria do not violate applicable District of
Columbia and federal laws and is the same criteria used by Developer to lease or occupy the
Market-Rate Units, if any . In the eve nt any rejected applicant raises an objection or challenges
Developer’s rejection of such applicant, Developer shall be solely responsible for ensuring that its
rejection of such applicant is not in violation of federal law and/or the D.C. Human Rights Act,
D.C. Official Code § 2- 1400 et seq . Developer shall provide the Agency with all documents
evidencing Developer’s review and rejection of an applicant, upon the request of the Agency.
4.3.4 Determination of Eligibility. Each tenant seeking to occupy a Rental Affordable
Unit shall have its Annual Household Income and Household eligibility verified by , and shall
obtain a Certification of Income, Affordability and Housing Size from, the Certifying Entity prior
to leasing such unit.
4.4 Initial Rental Affordable Unit Lease Terms.
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4.4.1 Term. The term of any Rental Affordable Unit lease agreement shall be for a period
of one (1) year.
4.4.2 Establishment of Maximum Rent . The maximum allowable monthly rent
(“Maximum Allowable Rent”) for each Rental Affordable Unit shall be determined by the then-
current Rent and Price Schedule.
4.5 Determination of Income and Hous ehold Size. The Annual Household Income for a
prospective tenant of a Rental Affordable Unit shall be determined as of the date of the lease and
any lease renewals for such Rental Affordable Unit. The Certifying Entity shall verify that (a) the
Household’s Annual Household Income is less than the Maximum Annual Household Income for
the applicable Rental Affordable Unit; (b) the Household will not expend more than fifty percent
(50%) of its monthly Annual Household Income on Housing Cost for the applicable Rental
Affordable Unit; and (c) the Hous ehold meets the Occupancy Standard for the applicable Rental
Affordable Unit.
4.6 Subsequent Lease Years
4.6.1 Establishment of Maximum Allowable Rent . The Maximum Allowable Rent for
lease years after the first lease year shall be determined by the then -current Rent and Price
Schedule.
4.6.2 Renewal by Affordable Unit Tenant. For each Affordable Unit Tenant who intends
to renew its residential lease, Developer shall obtain the following: (i) a Declaration of Eligibility
from each such Affordable Unit Tenant and (ii) a Certification of Income , Affordability and
Housing Size completed by the Certifying Entity, each dated no earlier than ninety (90) days prior
to the anniversary of the first day of the applicable residential lease. Developer shall not permit a
renewal of an Affordable Uni t Tenant’s lease unless the Affordable Unit Tenant has provided
Developer with these documents as required herein and the tenant is determined to be a Qualified
Tenant. If the Affordable Unit Tenant fails to provide such documents, Developer shall treat such
tenant as an Over -Income Tenant and charge market -rate rent , and Developer shall designate
another Residential Unit as a Rental Affordable Unit in accordance with Section 4.6.6.
4.6.3 Annual Recertification of Tenants . Within fifteen (15) days after receipt of an
Affordable Unit Tenant’s renewal documents at annual recertification, the Certifying Entity shall
determine the Affordable Unit Tenant’s eligibility pursuant to Section 4.5 for the subject Rental
Affordable Unit and notify Affordable Unit Tenant of the same. Any Affordable Unit Tenant who
is a Qualified Tenant at recertification will be eligible to remain in the Rental Affordable Unit and
to renew his/her lease at the then-current lease rate for the particular Rental Affordable Unit.
4.6.4 Annual Recertification of Under Income Tenants. Upon annual recertification, any
Affordable Unit Tenant whose Annual Household Income is less than the Minimum Annual
Household Income for the subject Rental Affordable Unit, may elect either to (i) remain in the
Rental Affordable Unit paying rent, as established by the Owner, up to the then-current Maximum
Allowable Rent for the subject Rental Affordable Unit or (ii) vacate the Rental Affordable Unit at
the end of the tenant’s lease term.
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4.6.5 Annual Recertification of Over-Income Tenants. Upon annual recertification, if an Affordable
Unit Tenant is an Over-Income Tenant, then the Over-Income Tenant may elect to remain in the Rental
Affordable Unit and pay the rent applicable to (a) a higher Designated Affordability Level, if a
higher Designated Affordability Level exists for the Property, for which the Over-Income Tenant’s
Annual Household Income qualifies, whereupon Developer shall change the Designated
Affordability Level of the Rental Affordable Unit to the higher Designated Affordability Level
pursuant to Section 4.6.6, or (b) a like -sized Market -Rate Unit, if the Over- Income Tenant’s
Annual Household Income does not qualify for a higher Designated Affordability Level or if a
higher Designated Affordability Level does not exist at the Property, but qualifies for a like-sized
Market-Rate Unit, whereupon Developer shall designate a Market -Rate Unit as a Rental
Affordable Unit pursuant to Section 4.6.6.
4.6.6 Changes to Unit Location. Developer may only change the designation of a
Rental Affordable Unit to a new Designated Affordability Level or to a Market-Rate Unit as
necessary to allow an Over -Income Tenant to remain in the unit. Following any change in
designation of a Rental Affordable Unit to a higher Designated Affordability Level or to a Market-
Rate Unit, as applicable, Developer shall designate, as expeditiously as possible, the next available
Rental Affordable Unit at that same higher Designated Affordability Level or Market -Rate Unit
of similar size and location in the Property to the lower Designated Affordability Level from which
the original Rental Affordable Unit had been changed in order to bring the Property in conformity
with the Affordability Requirement. Developer shall notify the Agency of any such redesignation
as expeditiously as possible.
4.6.7 Rent from Subsidies. Nothing herein shall be construed to prevent Developer from
collecting rental operating subsidy or rental -related payments from any federal or District of
Columbia agency paid to Developer and/or an Affordable Unit Tenant, or on behalf of an
Affordable Unit Tenant, to the extent receipt of such payment is otherwise in compliance with the
requirements of this Covenant. So long as Developer is in compliance with the requirement that a
Qualified Tenant is paying no more than fifty percent (50%) of its Annual Household Income
toward Maximum Allowable Rent, any rental operating subsidy or rental-related payments
received by Developer, together with the Qualified Tenant’s payment, may exceed the Maximum
Allowable Rent for the applicable Affordable Unit.
4.7 No Subleasing of Rental Affordable Units. An Affordable Unit Tenant may not sublease
any portion of its Rental Affordable Unit or assign its lease to any other Household and Developer
shall not knowingly allow such Rental Affordable Unit to be subleased, except with the Agency’s
prior written consent, in the Agency’s sole and absolute discretion. This prohibition includes short-
term renting to, or permitting occupancy by, Persons who are not included in an Affordable Unit
Tenant’s Household, of all or a portion of the Affordable Unit, either directly or through services
such as AirBnb or other rental agency providers.
4.8 Representations of Affordable Unit Tenant. By execution of a lease for a Rental
Affordable Unit, each Affordable Unit Tenant shall be deemed to represent and warrant to the
Agency and Developer, each of whom may rely thereon, that the Affordable Unit Tenant meets,
and will continue to meet, all eligibility requirements contained in this Covenant for the rental of
a Rental Affordable Unit.
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4.9 Representations of Developer. By execution of a lease for a Rental Affordable Unit,
Developer shall be deemed to represent and warrant to the Agency, which may rely on the
following, that: (i) the Household is determined to be a Qualified Tenant by the Certifying Entity,
and (ii) Developer is not collecting more than the Maximum Allowable Rent.
4.10 Annual Reporting Requirements. Beginning with the first occupancy of any Affordable
Unit, Developer shall provide an annual report ( “Annual Report”) to the Agency regarding the
Rental Affordable Units, which shall be submitted on each anniversary date of the Effective Date
of this Covenant. The Annual Report shall include the following:
(a) the number and identification of the Rental Affordable Units, including identifying any
Rental Affordable Units that had been redesignated during the previous year in accordance with
Section 4.6.6, by bedroom count, that are occupied;
(b) the number and identification of the Rental Affordable Units, including identifying any
Rental Affordable Units that had been redesignated during the previous year in accordance with
Section 4.6.6, by bedroom count, that are vacant;
(c) for each Rental Affordable Unit that is vacant or that was vacant for a portion of the
previous year, the manner in which the Rental Affordable Unit became vacant (e.g. eviction or
voluntary departure) and the progress in re-leasing that unit;
(d) for each occupied Rental Affordable Unit, the names and ages of all persons in the
Household, the Household size, date of initial occupancy, and total Annual Household Income as
of the date of the most recent Certification of Income, Affordability and Housing Size;
(e) a sworn statement that, to the best of Developer ’s information and knowledge, the
Household occupying each Rental Affordable Unit meets the eligibility criteria of this Covenant;
(f) a copy of each Certification of Income , Affordability and Housing Size received by
Developer during the previous year for each Household renting a Rental Affordable Unit;
(g) a copy of each Declaration of Eligibility received by Developer during the previous
year for each Household renting a Rental Affordable Unit;
(h) a copy of each inspection report and Certification of Inspection for each Rental
Affordable Unit; and
(i) a copy of all forms, policies, procedures, and other documents reasonably requested by
the Agency related to the Rental Affordable Units.
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The Annual Reports shall be retained by Developer for a minimum of five (5) years after
submission and shall be available, upon reasonable notice, for inspection by the Agency or its
designee. Notwithstanding anything contained herein to the contrary, in the event that Developer
provides a report to an agency within the District government with content substantially similar to
the content of the Annual Reports described in this section, subject to the Agency’s prior written
approval, then the reporting requirements under this section shall be satisfied upon Developer’s
delivery of such report to the Agency. The Agency may request Developer to provide additional
information in support of its Annual Report.
4.11 Confidentiality. Except as may be required by applicable law, including, without
limitation to, the District of Columbia Freedom of Information Act of 1976, D.C. Code § 2-531 et
seq., Developer, the Certifying Entity and the Agency shall not disclose to third parties the personal
information of the Households, including the identity of the Households, submitted as a part of the
Annual Report.
4.12 Inspection Rights. The Agency or its designee shall have the right to inspect the Rental
Affordable Units, upon reasonable advance notice to Developer. If Developer receives such
notice, Developer shall, in turn, give reasonable advance notice of the inspection to the tenant(s)
occupying the specific Rental Affordable Unit(s). The Agency or its designee shall have the right
to inspect a random sampling of the Rental Affordable Units to confirm that the units are in
compliance with applicable statutory and regulatory housing requirements and as otherwise
permitted under this Covenant. The Agency or its designee shall have the right to conduct audits
of a random sampling of the Rental Affordable Units and associated files and documentation to
confirm compliance with the requirements of this Covenant.
ARTICLE V
[Intentionally Omitted]
ARTICLE VI
DEFAULT; ENFORCEMENT AND REMEDIES
6.1 Default; Remedies. In the event Owner, Affordable Unit Tenant, a Person or a Household
defaults under any term of this Covenant and does not cure such default within thirty (30) days
following written notice of such default from the Agency, the District shall have the right to seek
specific performance, injunctive relief and/or other equitable remedies, including compelling the
re-leasing of an Affordable Unit and the disgorgement of rents in excess of the rental rates
permitted hereunder plus ten percent (10%) of such excess amount, for defaults under this
Covenant. Developer’s investor member shall be given notice of, and shall have the right, but not
the obligation, to cure any alleged default by Developer.
6.2 No Waiver. Any delay by the Agency in instituting or prosecuting any actions or
proceedings with respect to a default hereunder, in asserting its rights or pursuing its remedies
hereunder shall not operate as a waiver of such rights.
13
6.3 Right to Attorney’s Fees. If the District shall prevail in any such legal action to enforce
this Covenant, then Owner, Affordable Unit Tenant , Person or Household against whom the
District prevails, shall pay District all of its costs and expenses, including reasonable attorney fees,
incurred in connection with District efforts to enforce this Covenant. If OAG is counsel for the
District in such legal action, the reasonable attorney fees shall be calculated based on the then
applicable hourly rates established in the most current adjusted Laffey matrix prepared by the Civil
Division of the United States Attorney’s Office for the District of Columbia and the number of
hours employees of OAG prepared for or participated in any such action.
ARTICLE VII
COVENANTS BINDING ON SUCCESSORS AND ASSIGNS
This Covenant is and shall be binding upon the Property and each Affordable Unit and
shall run with the land as of the Effective Date through the Affordability Period. The rights and
obligations of District, Developer , and their respective successors, heirs, and assigns shall be
binding upon and inure to the benefit of the foregoing parties and their respective successors, heirs,
and assigns; provided however that all rights of District pertaining to the monitoring and/or
enforcement of the obligations of Developer hereunder shall be retained by District, or such
designee of the District as the District may so determine. No transfer, or foreclosure shall affect
the validity of this Covenant, except as provided in Article VIII.
ARTICLE VIII
MORTGAGES
8.1 Subordination of Mortgages. All Mortgages placed against the Property, or any portion
thereof, shall be subject and subordinate to this Covenant.
8.2 [Intentionally Omitted]
8.3 Default of Mortgage and Foreclosure.
8.3.1 [Intentionally Omitted]
8.3.2 [Intentionally Omitted]
8.3.3 [Intentionally Omitted]
8.3.4 [Intentionally Omitted]
8.3.5 Effect of Foreclosure on this Covenant. In the event of foreclosure or deed in lieu
thereof, this Covenant shall not be released or terminated.
8.4 [Intentionally Omitted]
ARTICLE IX
AMENDMENT OF COVENANT
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Except as otherwise provided herein, neither this Covenant, nor any part hereof, can be
amended, modified or released other than as provided herein by an instrument in writing executed
by a duly authorized official of the Agency on behalf of the District, and by a duly authorized
representative of Owner of such Affordable Unit affected by such amendment.. Any amendment
to this Covenant that alters the terms and conditions set forth herein shall be recorded among the
Land Records before it shall be deemed effective.
ARTICLE X
AFFORDABILITY PERIOD
All Affordable Units in the Project shall be leased in accordance with the terms of this
Covenant for the “Affordability Period.” The “Affordability Period” for each Affordable Unit
shall run for the lesser of (a) ninety -nine (99) years ; or (b) until the date on which the Ground
Lease expires or is terminated. Notwithstanding the foregoing, this Covenant may be released and
extinguished upon the approval of the Agency, in its sole and absolute discretion.
ARTICLE XI
NOTICES
Any notices given under this Covenant shall be in writing and delivered by certified mail
(return receipt requested, postage pre-paid), by hand, or by reputable private overnight commercial
courier service to the applicable Person at the addresses specified in this Article, or to such other
persons or locations as may be designated by the Agency or the Developer from time to time. All
notices to be sent to the Agency shall be sent to the following address:
Director
Department of Housing and Community Development
1909 Martin Luther King Jr. Avenue, SE
Washington, DC 20020
Re: Housing Regulation Administration, Affordable Dwelling Unit Monitoring
All notices to be sent to Developer shall be sent to the address given in the preamble. All
notices to be sent to any Affordable Unit Tenant shall be sent to the unit number referenced in its
lease. It shall be the responsibility of the applicable Person and any successor to the applicable
Person to provide the Agency with a current address. The failure of the applicable Person to
provide a current address shall be a default under this Covenant, subject to the notice and cure
provisions of Section 6.1.
Notices shall be deemed delivered as follows: (i) if hand delivered, then on the date of
delivery or refusal thereof; (ii) if by overnight courier service, then on the next business day after
deposit with the overnight courier service; and (iii) if by certified mail (return receipt requested,
postage pre-paid), then on the date of actual delivery or refusal thereof.
ARTICLE XII
MISCELLANEOUS
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12.1 Applicable Law: Forum for Disputes. This Covenant shall be governed by, interpreted
under, and construed and enforced in accordance with the laws of the District of Columbia, without
reference to the conflicts of laws provisions thereof. Owner, Affordable Unit Tenants and the
District irrevocably submit to the jurisdiction of the courts of the District of Columbia (including
the Superior Court of the District of Columbia) for the purposes of any suit, action, or other
proceeding arising out of this Covenant or any transaction contemplated hereby. Owner ,
Affordable Unit Tenants, and the District irrevocably and unconditionally waive any objection to
the laying of venue of any action, suit , or proceeding arising out of this Covenant or the
transactions contemplated hereby in the courts of the District of Columbia (including the Superior
Court of the District of Columbia), and hereby further waive and agree not to plead or claim in any
such court that any such action, suit or proceeding brought in any such court has been brought in
an inconvenient forum.
12.2 Counterparts. This Covenant may be executed in any number of counterparts, each of
which shall be an original but all of which shall together constitute one and the same instrument.
12.3 Time of Performance . All dates for performance (including cure) shall expire at 5:00
p.m. (Eastern Time) on the performance or cure date. A performance date which falls on a
Saturday, Sunday or District holiday is automatically extended to the next Business Day.
12.4 Waiver of Jury Trial . TO THE EXTENT PERMITTED BY LAW, ALL PARTIES
HERETO WAIVE THE RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY
LITIGATION ARISING IN RESPECT OF THIS COVENANT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
12.5 Further Assurances. Each party agrees to execute and deliver to the other party such
additional documents and instruments as the other party reasonably may request in order to fully
carry out the purposes and intent of this Covenant; provided that such additional documents and
instruments do not materially increase the obligations or burdens upon the second party.
12.6 Severability. If any provision of this Covenant is held to be unenforceable or illegal for
any reason, said provision shall be severed from all other provisions. Said other provisions shall
remain in effect without reference to the unenforceable or illegal provision, unless this construction
would constitute a substantial deviation from the general intent of the parties as reflected in this
Covenant.
12.7 Limitation on Liability. Provided that Owner has exercised reasonable due diligence in
the performance of its obligations and duties herein, no Owner shall be liable in the event a
Household submits falsified documentation, commits fraud, or breaches any representation or
warranty contained in this Covenant. Notwithstanding the foregoing, Owner shall be liable if
Owner has knowledge, or should have knowledge, that a Household submitted falsified
documentation, committed fraud, or breached any representation or warranty contained in this
Covenant.
12.8 Agency Limitation on Liability . Any review or approval by the District or the Agency
shall not be deemed to be an approval, warranty, or other certification by the District or the Agency
as to compliance of such submissions, the Project, any Affordable Unit , or the Property with any
16
building codes, regulations, standards, laws, or any requirements contained in this Covenant or
any other covenant granted in favor of the District that is filed among the Land Records; or
otherwise contractually required. The District shall incur no liability in connection with the
Agency’s review of any submissions required under this Covenant as its review is solely for the
purpose of protecting the District’s interest under this Covenant.
12.9 No Third Party Beneficiary. Except as expressly set forth in this Covenant, there are no
intended third party beneficiaries of this Covenant, and no Person other than District shall have
standing to bring an action for breach of or to enforce the provisions of this Covenant.
12.10 Representations of Developer. As of the date hereof, Developer hereby represents and
warrants to District as follows:
(a) This Covenant has been duly executed and delivered by Developer, and constitutes the
legal, valid , and binding obligation of Developer, enforceable against Developer, and its
successors and assigns, in accordance with its terms;
(b) Neither the entering into of this Covenant nor performance hereunder will constitute
or result in a violation or breach by Developer of any agreement or order which is binding on
Developer; and
(c) Developer (i) is duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization and is qualified to do business and is in good standing under the
laws of the District of Columbia; (ii) is authorized to perform under this Covenant; and (iii) has all
necessary power to execute and deliver this Covenant.
12.11 Federal Affordability Restrictions . In the event the Property is encumbered by other
affordability restrictions (“Federal Affordability Restrictions”) as a result of federal funding or
the issuance of Low-Income Housing Tax Credits for the Project, it is expressly understood and
agreed that in the event the requirements in this Covenant would cause a default of or finding of
non-compliance (“Conflict”) with the Federal Affordability Restrictions during the compliance
period for the Federal Affordability Restrictions, then the requirements of the Federal Affordability
Restrictions shall control to the extent of the Conflict. Notwithstanding anything to the contrary in
this Covenant, during the Extended Use Period (as defined in the Indenture of Restrictive Covenant
for Low-Income Housing Tax Credits dated as of _________ and recorded in the Land Records
on ___________ as Docum ent no. ___________), the M aximum Annual Household Income,
Minimum Annual Household Income, Maximum Allowable Rent, and Utilities under this
Covenant shall be determined pursuant to the Low-Income Housing Tax Credit program under
Section 42 of the Internal Revenue Code of 1986 in li eu of the Rent and Price Schedule.; and (b)
the designation of Rental Affordable Units may only be changed in a manner consistent with the
applicable Federal Affordability Restrictions. In all other instances, the requirements of this
Covenant shall control.
[Signatures on Following Pages]
17
IN TESTIMONY WHEREOF, Developer has caused these presents to be signed,
acknowledged and delivered in its name by Omar Karim, its duly authorized person, witnessed by
_________________________________, its ___________________
WITNESS DEVELOPER:
PARCEL 6 COMMUNITY PARTNERS LLC,
a District of Columbia limited liability company
By: _____
Name: ______________________________
Title: _______________________________
By: [SEAL]
Name: Omar Karim
Title: Authorized Person
CITY OF WASHINGTON
ss.
DISTRICT OF COLUMBIA
I, __________________________________, a Notary Public in and for the District of
Columbia, DO HEREBY CERTIFY THAT ___________ who is personally known to be (or
proved by oaths of credible witnesses to be) the person named as _________________ for
________________________________ in the foregoing and annexed Affordable Housing
Covenant, bearing the date of the ______________ personally appeared before me in said District
of Columbia, and as ____________, acting on behalf of _______________________________,
as aforesaid, acknowledged the same to be his/her free act and deed.
Given under my hand and seal this ____ day of_____________.
Notary Public
My Commission Expires: ___________________
18
APPROVED AND ACCEPTED THIS ______ DAY OF ______________, 20__:
DISTRICT:
DISTRICT OF COLUMBIA, by and through
the Office of the Deputy Mayor for Planning
and Economic Development
By:
Name: _______________
Title: Deputy Mayor
LEGAL REVIEW
By: ___________________________
Office of the General Counsel
District of Columbia, ss:
I, ___________________, a Notary Public in and for the District of Columbia, do here by
certify that _______________, the Deputy Mayor for Planning and Economic Development , on
behalf of the District of Columbia, personally appeared before me in said jurisdiction, and, being
personally known to me (or satisfactorily proven) to the person whose name is subscribed to the
foregoing Affordable Housing Covenant, and that he/she, in such capacity, being authorized to do
so, executed the foregoing instrument for t he purposes therein contained, and acknowledged the
same to be the act and deed of the District of Columbia.
Given under my hand and seal this _______ day of __________________, 20____.
______________________________
Notary Public, D.C.
My commission expires: _______________________
EXHIBIT A
Legal Description of Property
[See attached]
20
EXHIBIT B
Rental Affordable Unit Lease Rider
This Rental Affordable Unit Lease Rider (“Rider”) is attached to and incorporated into the lease dated
(“Lease”) between (“Resident” or “You”) and , as Management Agent (“Manager”)
for (“Owner”) for Affordable Unit number (“Premises”), located at , Washington DC
.
In consideration of the mutual covenants set forth in the Lease and below, you agree that your use and
possession of the Premises is subject to the terms and conditions set forth in the Lease and the following
terms and conditions, which are in addition to and supplement the Lease:
AFFORDABLE UNIT: Resident acknowledges that the Premises is subject to that certain Affordable
Housing Covenant between Owner and the District of Columbia dated ___________________, 20 __, as
may be subsequently amended, (the “Affordable Housing Covenant”). The Premises is currently designated
as an Affordable Unit, which requires the Resident’s household income to be less than or equal to [____]
of the median family income (MFI) or area median income (AMI).
DEFINED TERMS: Those terms not specifically defined herein shall be assigned the definition provided
in the Affordable Housing Covenant.
ELIGIBILITY: In order for you, as Resident, to be eligible to rent an Affordable Unit, you must be and
remain an “Affordable Unit Tenant” as defined in the Affordable Housing Covenant.
INCOME RECERTIFICATION: No more than ninety (90) days and no less than forty-five (45) days
before each anniversary of the first day of the lease, the Manager shall request that the Resident provide the
Certifying Entity with the following:
(i) an executed Declaration of Eligibility that states that Resident is not an Over -Income Tenant and
is and will continue to occupy the Premises as his/her/their principal residence,
(ii) all information pertaining to the Resident’s household composition and documentation of income
for all household members,
(iii) a release authorizing third party sources to provide relevant information regarding the Resident’s
eligibility for the Affordable Unit, as well as how to contact such sources, and
(iv) any other reasonable and customary representations, information or documents requested by the
Certifying Entity.
Resident shall submit the foregoing listed documentation to the Certifying Entity within fifteen (15) days
of Manager’s request. Within ten (10) days of Certifying Entity’s receipt of the foregoing documentation
and based on the results of the annual income recertification review, Certifying Entity will determine
whether the Resident remains income eligible for the Premises and notify the Resident of his or her
household’s MFI percentage, and (a) if the Resident is no longer income eligible for the Premis es, the
income category for which the Resident is income eligible to lease a unit in the apartment community, or
(b) if the Resident is income eligible for the Premises, provide a Certification of Income, Affordability and
Housing Size completed by the Certifying Entity, verifying that the income of the Resident meets income
eligibility for the Premises.
21
Upon annual recertification, if the Resident remains income eligible for the Premises, the Resident will be
eligible to remain in the Premises at the time of lease renewal and to renew his/her lease at the then-current
lease rate for the Premises. If the Resident’s A nnual Household Income is determined to exceed 140% of
the Maximum Annual Household Income applicable to the Premises, then the Resident shall be deemed an
“Over-Income Tenant” as provided in the Covenant and may either (a) remain in the Premises and pay the
rent applicable to an Affordable Unit at a higher Designated Affordability Level for which the Resident’s
Annual Household Income qualifies, if available at the Property, or (b) if an Affordable Unit at a higher
Designated Affordability Level is not available at the Property , remain in the Premises and pay the rent
applicable to a market-rate unit of like size and location.
Manager will notify Resident of all options (i.e., an Affordable Unit at a different Designated Affordability
Level or a market rate unit) for which Resident is income eligible at least __ days prior to the expiration of
the Resident’s lease term. Prior to the expiration of the Resident’s lease term, the Resident shall notify
Manager in writing of the Resident’s election to either (i) remain in the Premises and pay the rental rate
applicable to the Resident’s then current Designated Affordability Level if the Resident is not an Over -
Income Tenant, (ii) remain in the Premises paying the market rate rent for that unit if the Resident is an
Over-Income Tenant, or (iii) vacate the Premises at the end of the Resident’s Lease term. Resident’s failure
to notify Manager of Resident’s election prior to the expiration of the lease term will be deemed by Manager
as Resident’s election to vacate the Premises.
In the event that Resident fails to pay the applicable rental rate or vacate the Premises upon expiration of
the lease term, Manager may pursue an action for eviction of Resident. Resident’s agreement to pay the
applicable rental rate or vacate was a condition precedent to Manager’s initial acceptance of Resident’s
eligibility and Manager has relied on Resident’s agreement. Resident acknowledges and agrees that the
criteria to be income eligible to occupy the Premises is and serves as a District policy and objective, and
that failure to vacate the Premises or pay the applicable rental rate is both a default under the Lease and in
violation of the Affordable Housing Covenant.
PROHIBITION ON SUBLETS AND ASSIGNMENTS: Resident may not sublease all or any portion
of the Premises or assign its lease to any other person, except with the prior written consent of the D.C.
Department of Housing and Community Development, in its sole and absolute discretion. This prohibition
includes short-term renting to, or permitting occupancy by, persons who are not members of Tenant’s
household, of all or a portion of the Premises, either directly or through services such as “AirBnb” or other
rental agency providers.
LEASE EFFECTIVE: The Lease of the Premises shall only be effective if this executed Rider, a
Certification of Income, Affordability and Housing Size, a Declaration of Eligibility are attached as exhibits
to the lease agreement.
____________________________ ________________
Resident Signature Date
____________________________ ________________
Resident Signature Date
____________________________ ________________
Resident Signature Date
22
EXHIBIT C
Affordable Unit Index
Council Draft
EXHIBIT B-2
FORM OF AFFORDABLE HOUSING COVENANT (FOR SALE)
2700 Martin Luther King, Jr. Avenue, SE
(COMMONLY KNOWN AS PARCELS 6)
ST ELIZABETHS EAST CAMPUS, WASHINGTON, D.C
THIS AFFORDABLE HOUSING COVENANT (the “Covenant”) is made as of this
___day of __________, 2025 (“Effective Date”), by Parcel 6 Community Partners LLC, a District
of Columbia limited liability company and its successors and assigns (the “Developer”) having an
address of c/o Banneker Communities LLC, 1227 Marion Barry Avenue SE, Suite 107,
Washington, DC 20020, for the benefit of the District of Columbia, a municipal corporation,
acting by and through the Office of the Deputy Mayor for Planning and Economic Development
(the “District”).
RECITALS
R-1. District is the fee simple owner of certain real property located in the District of
Columbia as further described in Exhibit A (the “Property”).
R-2. District has determined to further its public policy of increasing the affordable
housing stock in the District of Columbia and, in particular, on the Property.
R-3. District and Developer entered into that certain Land Disposition and Development
Agreement dated _________________, as the same may be amended (“Development
Agreement”) whereby District and Developer agreed upon the terms under which District agreed
to convey the fee simple interest in the Property to Developer and for Developer to develop and
construct the Project (defined below) and to sell and/or manage and lease the Affordable Units to
be constructed in the Project.
R-4. In accordance with the Development Agreement and contemporaneously with the
execution of this Covenant, District has conveyed or will convey the Property to Developer.
R-5. District and Developer desire to set forth herein the terms, restrictions, and
conditions upon which Developer will construct, maintain, and sell and/or lease the Affordable
Units in the Project.
NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the District and Developer hereby declare, covenant, and agree as follows:
2
ARTICLE I
DEFINITIONS
For the purposes of this Covenant, the capitalized terms used herein shall have the
meanings ascribed to them below and, unless the context clearly indicates otherwise, shall include
the plural as well as the singular.
Acknowledgment of Covenant : is that certain Acknowledgment of Covenant executed
by a Qualified Purchaser, in such form as the Agency requires.
Affirmative Fair Housing Marketing Plan : means Developer’s plan for marketing the
rental or initial sale of the Affordable Units, as approved by the Agency pursuant to Section 2.3.
Affordability Period: is defined in Article X.
Affordability Requirement: is the requirement that all of the for-sale Affordable Units to
be contained in the Project are to be allocated as follows: (i) thirty percent (30%) of the Residential
Units to be contained in the Project are to be Affordable Units and allocated as follows: (i) fifty
percent (50%) of the Affordable Units shall be reserved for Households with an Annual Household
Income that is more than thirty percent (30%) MFI and less than or equal to 50% MFI, and (ii)
fifty percent ( 50%) of the Affordable Units shall be reserved for Households with an Annual
Household Income more than 50% and less than or equal to 80% MFI.
Affordable Unit: means each Residential Unit that will be used to satisfy the Affordability
Requirement, all of which shall be identified in the Affordable Unit Index.
Affordable Unit Index: is an index of the Affordable Units contained in the Project that
identifies: (i) unit number (or similar identifier) and floor for each Affordable Unit and whether
each Affordable Unit is a Rental Affordable Unit or For Sale Affordable Unit; (ii) the Designated
Affordability Level of each Affordable Unit; (iii) the approximate square footage and number of
bedrooms of each Affordable Unit and a schematic drawing showing the layout of each Affordable
Unit; (iv) a listing or schedule of the standard and upgrade options of finishes, fixtures, equipment,
and appliances for all Residential Units; (v) a listing or schedule of the amenities, services,
upgrades, parking, and other facilities that will be offered as an option at an additional upfront or
recurring cost or fee to the Residential Units; and (vi) residential floor plans showing the location
of each Residential Unit.
Affordable Unit Owner: means a Qualified Purchaser who own(s) a For Sale Affordable
Unit.
Affordable Unit Tenant: means a Qualified Tenant who lease(s) a Rental Affordable
Unit.
Agency: means, as of the Effective Date, the D.C. Department of Housing and Community
Development, pursuant to Mayor’s Order 2009-112 (effective June 18, 2009), or such other agency
of the District of Columbia government that may subsequently be delegated the authority of the
Mayor to monitor, enforce, or otherwise administer the affordable housing requirements of the
District of Columbia government.
3
Annual Household Income : means the aggregate annual income of a Household as
determined by using the standards set forth in 24 CFR § 5.609, as may be amended, or as otherwise
set forth by the Agency.
Annual Report: has the meaning given in Section 4.10.
Business Day: means Monday through Friday, inclusive, other than holidays recognized
by the District of Columbia government.
Certification of Income , Affordability and Housing Size : means a certification made
by a Certifying Entity that verifies that (a) the Annual Household Income of a Household meets
the Designated Affordability Level for an applicable Affordable Unit, and (b) the Household meets
the requirements of Section 4.5 or Section 5.2.1, as applicable, in such form as the Agency
approves.
Certification of Inspection: means a certification by Developer that it has performed or
caused to be performed an inspection of a Rental Affordable Unit and that, to the best of
Developer’s knowledge, such Rental Affordable Unit is in compliance with all applicable statutory
and regulatory requirements, in such form as the Agency approves.
Certification of Residency: means a certification made by an Affordable Unit Owner that
states that the Affordable Unit Owner occupies the Affordable Unit as its principal residence, in
such form as the Agency approves.
Certifying Entity: means an entity or entities approved by the Agency pursuant to Section
2.4.
Conflict: is defined in Section 12.11.
Declaration of Eligibility : means a declaration executed by a Household prior to its
purchase, initial rental or subsequent rent renewal, as applicable, of an Affordable Unit, in a form
approved by the Agency, that shall be given to the Agency, Owner, and the Certifying Entity
representing and warranting the following: (a) the Household is a Qualified Purchaser or Qualified
Tenant and has disclosed all of its Annual Household Income to the Certifying Entity and has
provided reasonably satisfactory documentation evidencing such Annual Household Income, (b)
the Household’s Annual Household Income is at or below the Maximum Annual Household
Income for the applicable Affordable Unit, (c) the Household has been informed of its rights and
obligations under this Covenant, (d) the Household intends to occupy the Affordable Unit as its
principal residence, (e) the Household size meets the Occupancy Standard for the Affordable Unit,
(f) neither the Household, nor any person within the Household, has an ownership interest in any
other residential real property or residential cooperative or, if they do, they will divest such interest
and will provide satisfactory proof of the same to the Agency before closing on the purchase of or
signing lease for the Affordable Unit and (g) any other reasonable and customary representations
requested by the Agency.
Designated Affordability Level : means the percentage of M FI assigned to each
Affordable Unit and used to determine the Maximum Annual Household Income for prospective
Qualified Purchasers or Qualified Tenants, as applicable.
4
Developer: is identified in the preamble of this Covenant.
Federal Affordability Restrictions: is defined in Section 12.11.
For Sale Affordable Unit : means an Affordable Unit that shall be sold solely to a
Qualified Purchaser.
Household(s): means all persons who will occupy the Affordable Unit, including the
purchaser’s or tenant’s, as applicable, spouse or domestic partner, all children under eighteen (18)
years of age, and all other persons over eighteen (18) years of age who will be occupying the
Affordable Unit. A Household may be a single family, one (1) person living alone, two (2) or
more families living together, or any other group of related or unrelated persons who share living
arrangements as allowable by this Covenant.
Household Selection Plan: means Developer’s plan for selecting Qualified Tenants or
Qualified Purchasers for the rental or initial sale of the Affordable Units, as approved by the
Agency pursuant to Section 2.3.
Housing Cost: means (a) for Rental Affordable Units, the total monthly payments for rent
and Utilities, less any rental subsidies paid on behalf of that Household, and (b) for For Sale
Affordable Units, the total monthly mortgage payments, property tax, hazard insurance, if
applicable, Utilities and condominium or homeowner fees required for purchase and occupancy.
Housing Locator Website : means a website established or designated by the Agency
pursuant to the Affordable Housing Clearinghouse Directory Act of 2008, effective August 15,
2008 (D.C. Law 17-215; D.C. Official Code § 42-2131, et seq.).
HUD: means the United States Department of Housing and Urban Development.
Land Records: means the real property records for the District of Columbia located in the
Recorder of Deeds.
Market-Rate Unit: is each Residential Unit that is not an Affordable Unit.
Maximum Allowable Rent: as defined in Section 4.4.2.
Maximum Annual Household Income: is the maximum Annual Household Income of a
Household occupying an Affordable Unit as indicated on the then-current Rent and Price Schedule.
Maximum Resale Price: is the maximum resale price of a For- Sale Affordable Unit as
determined pursuant to the procedures contained in Schedule 1 attached hereto.
Maximum Sales Price: as defined in Section 5.1.1.
Median Family Income or MFI: means the median family income for a household of
four persons in the “Washington Metropolitan Statistical Area” as periodically published by HUD,
5
and adjusted for Household size without regard to any adjustments made by HUD for the purposes
of the programs it administers. MFI is also known as Area Median Income or AMI.
Minimum Annual Household Income: is the minimum Annual Household Income of a
Household occupying a Rental Affordable Unit as indicated on the then-current Rent and Price
Schedule.
Mortgage: means a mortgage, deed of trust, mortgage deed, or such other classes of
instruments as are commonly given to secure a debt under the laws of the District of Columbia.
Mortgagee: means the holder of a Mortgage.
OAG: means the Office of the Attorney General for the District of Columbia.
Occupancy Standard: means the minimum number of individuals in a Household
permitted to occupy any given Affordable Unit, as identified in the following chart:
Affordable Unit Size
(Number of Bedrooms)
Minimum Number of
Individuals in a Household
Studio/Efficiency 1
1 1
2 2
3 3
4 4
5 5
6 6
Over-Income Tenant: means a tenant of a Rental Affordable Unit who, at the time of
execution of the lease qualified as an Affordable Unit Tenant, but, at the time of lease renewal, has
an Annual Household Income greater than one hundred forty percent (140%) of the applicable
Maximum Annual Household Income for the applicable Rental Affordable Unit.
Owner: means Developer for so long as Developer owns the applicable For Sale
Affordable Unit, and then thereafter, the Affordable Unit Owner that owns such For Sale
Affordable Unit.
Person: means any individual, corporation, limited liability company, trust, partnership,
association, or other legal entity.
Project: means the structures, landscaping, hardscape, and site improvements to be
constructed or placed on the Property pursuant to the Development Agreement.
Property: is defined in the Recitals.
Qualified Purchaser: means a Household that (i) at the time of purchase, has an Annual
Household Income, as certified by the Certifying Entity, less than or equal to the Maximum Annual
Household Income for the applicable Affordable Unit, (ii) shall occupy the Affordable Unit as its
6
principal residence during its ownership of such Affordable Unit, (iii) shall not permit occupancy
of the Affordable Unit by any other Person, except with the prior written consent of the Agency,
(iv) shall use, occupy, hold, and sell the Affordable Unit as an Affordable Unit subject to the
Affordability Requirement (including the requirement to sell the Affordable Unit to a Qualified
Purchaser) and this Covenant, and (v) at the time of purchase, meets the Occupancy Standard for
the applicable Affordable Unit.
Qualified Tenant : means a Household that (i) at the time of leasing, has an Annual
Household Income, as certified by the Certifying Entity, less than or equal to the Maximum Annual
Household Income for the applicable Affordable Unit and at subsequent lease renewals, is not an
Over-Income Tenant, (ii) shall occupy the Affordable Unit as its principal residence during its
lease of such Affordable Unit, (iii) shall not permit occupancy of the Affordable Unit by any other
Person, except with the prior written consent of the Agency, (iv) shall use and occupy the
Affordable Unit as an Affordable Unit subject to the Affordability Requirement and this Covenant,
and (v) shall occupy the Affordable Unit within the Occupancy Standard.
Rent and Sales Price Schedule: means the Rent and Price Schedule published in the D.C.
Register in accordance with the Inclusionary Zoning Implementation Amendment Act of 2006
(D.C. Law 16-275; D.C. Official Code § 6-1041.01 et seq.), as amended, which schedule sets forth,
among other things, the Maximum Sales Prices and Maximum Allowable Rent for inclusionary
zoning units and Affordable Units.
Rental Affordable Unit: means an Affordable Unit that shall be leased to a Qualified
Tenant.
Rental Affordable Unit Lease Rider: is that certain lease rider, which is attached to this
Covenant as Exhibit B and incorporated herein, as the same may be amended from time to time
with the written approval of the Agency.
Residential Unit: means an individual residential unit constructed as part of the Project.
Sale: is defined in Section 5.1.
Transferee: is defined in Section 5.7.
Utilities: means water, sewer, electricity, natural gas, trash, and any other fees required by
the Developer, property manager, or condominium or homeowners’ association in order to occupy
the Affordable Unit, including, but not limited to, mandatory amenity or administrative fees, which
amounts are included in the Rent and Price Schedule.
ARTICLE II
AFFORDABILITY REQUIREMENT
2.1 Requirement of Affordability . Developer shall construct, reserve, and sell as For Sale
Affordable Units that number of Affordable Units that are required by the Affordability
Requirement.
7
2.2 Affordable Unit Standards and Location.
2.2.1 Affordable Unit Index . As of the Effective D ate, District has approved the
Affordable Unit Index, which is attached hereto as Exhibit C . Developer shall not amend or
modify the Affordable Unit Index, except to the extent permitted under Section 4.6.6, without the
Agency’s prior written approval, which shall not be unreasonably withheld, conditioned, or
delayed. Any such approved amendment or modification as a result of re- designations of
Residential Units under Section 4.6.6 shall be recorded in the Land Records as an amendment to
this Covenant, at such time as determined by the Agency.
2.2.2 Unit Mix. The distribution of Affordable Units shall be proportional to that of the
Market-Rate Units, if any (e.g., if the Market-Rate Units have a mix of 30% studios, 40% one-
bedrooms, and 30% two-bedrooms, the Affordable Units shall have a similar mix).
2.2.3 Size. The Affordable Units shall be of a size substantially similar to the Market-
Rate Units, if any, provided that Affordable Units may be the smallest size of each market-rate
type (studio, 1-bedroom and 2-bedroom units) and have no luxury-scaled unit counterpart.
2.2.4 Exterior Finishes. Exterior finishes of Affordable Units will be substantially
similar to the appearance, finish, and durability of the exterior finishes of the Market-Rate Units,
if any.
2.2.5 Interior Finishes. Developer agrees that the interior base finishes, appliances, and
equipment in the Affordable Units shall be substantially similar to the Market-Rate Units, if any.
2.2.6 Affordable Unit Location. Affordable Units shall be disbursed throughout the
Project and shall not be concentrated on any one floor or within a tier or section of the Project.
2.3 Marketing Affordable Units.
2.3.1 Marketing Plan. Developer shall submit to Agency an Affirmative Fair Housing
Marketing Plan and Household Selection Plan that set forth its plan for marketing the Affordable
Units and for selecting Households who may be Qualified Tenants or Qualified Purchasers, as
applicable. The Affirmative Fair Housing Marketing Plan and Household Selection Plan shall be
subject to the Agency’s prior written approval and shall be submitted to and approved by the
Agency prior to marketing any Affordable Units for sale or rent. Developer may contract with the
Certifying Entity to implement the Affirmative Fair Housing Marketing Plan and Household
Selection Plan.
2.3.2 Housing Locator. When an Affordable Unit becomes available for rent or for sale,
Owner shall register the Affordable Unit on the Housing Locator W ebsite and indicate the
availability of such Affordable Unit and the application process for the Affordable Unit.
2.4 Certifying Entity. Each Owner shall select a Certifying Entity, which shall be subject to
the Agency’s prior written approval, not to be unreasonably withheld, conditioned, or delayed.
Owner may contact the Agency with questions and information about the selection of a Certifying
Entity. The Certifying Entity shall review documentation and verify a Household’s Annual
Household Income and Household’s size in order to determine whether that Household is a
8
Qualified Tenant or Qualified Purchaser, as applicable, for the subject Affordable Unit. If a
Household is determined to be a Qualified Tenant or Qualified Purchaser, as applicable, the
Certifying Entity shall issue a Certification of Income , Affordability, and Housing Size for the
subject Household.
ARTICLE III
USE
3.1 [Intentionally omitted]
3.2 Demolition/Alteration. Owner shall maintain, upkeep, repair , and replace interior
components (including fixtures, appliances , flooring, and cabinetry) of the Affordable Unit with
interior components of equal or better quality than those interior components being replaced.
Owner shall not demolish or otherwise structurally alter an Affordable Unit or remove fixtures or
appliances installed in an Affordable Unit other than for maintenance and repair without the prior
written approval of the Agency, which approval shall be in the sole discretion of the Agency.
ARTICLE IV
RENTAL OF AFFORDABLE UNITS
4.1 Lease of Rental Affordable Units . In the event the Project contains Rental Affordable
Units, Developer shall reserve, maintain , and lease the Rental Affordable Units to Qualified
Tenants (a) in accordance with this Covenant and (b) at a rental rate at or below the Maximum
Allowable Rent.
4.2 Rental Affordable Unit Lease Requirements.
4.2.1 Form of Lease. To lease a Rental Affordable Unit to a Qualified Tenant, Developer
shall use a lease agreement to which is attached and incorporated a Rental Affordable Unit Lease
Rider. The Rental Affordable Unit Lease Rider shall be executed by Developer and each Qualified
Tenant prior to the Qualified Tenant’s occupancy of the Rental Affordable Unit. Any occupant of
the Rental Affordable Unit who is eighteen (18) years or older shall be a party to the lease
agreement and shall execute the Rental Affordable Unit Lease Rider.
4.2.2 Effectiveness of Lease. The lease of a Rental Affordable Unit shall only be effective
if a Rental Affordable Unit Lease Rider, a Certification of Income , Affordability and Housing
Size, and a Declaration of Eligibility are attached as exhibits to the lease agreement. Failure to
attach the foregoing shall be deemed a default by Developer under this Covenant.
4.2.3 Developer to Maintain Copies. Developer shall maintain or cause to be maintained
copies of all initial and renewal leases executed with Qualified Tenants for a period of no less than
five (5) years from the expiration or termination of such lease.
4.3 Rental Affordable Unit Admissions Process.
4.3.1 Referrals. Developer may obtain referrals of prospective tenants of Rental
Affordable Units from federal and District of Columbia agencies, provided such referrals comply
with the requirements of this Covenant. In all events, before a prospective tenant leases a Rental
9
Affordable Unit, a Certifying Entity shall certify the prospective tenant’s Annual Household
Income, Household size, and Housing Costs for the applicable Rental Affordable Unit.
4.3.2 Consideration of Applicants . For the initial occupancy of the Rental Affordable
Units, Developer shall select Qualified Tenants through a lottery system or other system as
otherwise approved by the Agency as shall be further provided in the Affirmative Fair Housing
Marketing Plan. Following the initial occupancy of the Affordable Units, Developer shall consider
each applicant in the order in which received by Developer, whether received pursuant to the
Affirmative Fair Housing Marketing Plan or referred pursuant to Section 4.3.1.
4.3.3 Rejection of Applicants. In connection with the leasing of a Rental Affordable Unit,
Developer may reject any applicant if, after diligent review of such applicant’s application,
Developer determines in good faith that such applicant does not meet Developer’s criteria to lease
or occupy a Rental Affordable Unit, provided such criteria do not violate applicable District of
Columbia and federal laws and is the same criteria used by Developer to lease or occupy the
Market-Rate Units, if any. In the eve nt any rejected applicant raises an objection or challenges
Developer’s rejection of such applicant, Developer shall be solely responsible for ensuring that its
rejection of such applicant is not in violation of federal law and/or the D.C. Human Rights Act ,
D.C. Official Code § 2- 1400 et seq . Developer shall provide the Agency with all documents
evidencing Developer’s review and rejection of an applicant, upon the request of the Agency.
4.3.4 Determination of Eligibility. Each tenant seeking to occupy a Rental Affordable
Unit shall have its Annual Household Income and Household eligibility verified by , and shall
obtain a Certification of Income, Affordability, and Housing Size from, the Certifying Entity prior
to leasing such unit.
4.4 Initial Rental Affordable Unit Lease Terms.
4.4.1 Term. The term of any Rental Affordable Unit lease agreement shall be for a period
of one (1) year.
4.4.2 Establishment of Maximum Rent . The maximum allowable monthly rent
(“Maximum Allowable Rent”) for each Rental Affordable Unit shall be determined by the then-
current Rent and Price Schedule.
4.5 Determination of Income and Hous ehold Size. The Annual Household Income for a
prospective tenant of a Rental Affordable Unit shall be determined as of the date of the lease and
any lease renewals for such Rental Affordable Unit. The Certifying Entity shall verify that (a) the
Household’s Annual Household Income is less than the Maximum Annual Household Income for
the applicable Rental Affordable Unit; (b) the Household will not expend more than fifty percent
(50%) of its monthly Annual Household Income on Housing Cost for the applicable Rental
Affordable Unit; and (c) the Hous ehold meets the Occupancy Standard for the applicable Rental
Affordable Unit.
10
4.6 Subsequent Lease Years
4.6.1 Establishment of Maximum Allowable Rent . The Maximum Allowable Rent for
lease years after the first lease year shall be determined by the then -current Rent and Price
Schedule.
4.6.2 Renewal by Affordable Unit Tenant. For each Affordable Unit Tenant who intends
to renew its residential lease, Developer shall obtain the following: (i) a Declaration of Eligibility
from each such Affordable Unit Tenant and (ii) a Certification of Income , Affordability and
Housing Size completed by the Certifying Entity, each dated no earlier than ninety (90) days prior
to the anniversary of the first day of the applicable residential lease. Developer shall not permit a
renewal of an Affordable Unit Tenant’s lease unless the Affordable Unit Tenant has provided
Developer with these documents as required herein and the tenant is determined to be a Qualified
Tenant. If the Affordable Unit Tenant fails to provide such documents, Developer shall treat such
tenant as an Over -Income Tenant and charge market -rate rent , and Developer shall designate
another Residential Unit as a Rental Affordable Unit in accordance with Section 4.6.6.
4.6.3 Annual Recertification of Tenants . Within fifteen (15) days after receipt of an
Affordable Unit Tenant’s renewal documents at annual recertification, the Certifying Entity shall
determine the Affordable Unit Tenant’s eligibility pursuant to Section 4.5 for the subject Rental
Affordable Unit and notify Affordable Unit Tenant of the same. Any Affordable Unit Tenant who
meets the income and Household size requirements for the Affordable Unit at recertification will
be eligible to remain in the Rental Affordable Unit and to renew his/her lease at the then -current
lease rate for the particular Rental Affordable Unit.
4.6.4 Annual Recertification of Under Income Tenants. Upon annual recertification, any
Affordable Unit Tenant whose Annual Household Income is less than the Minimum Annual
Household Income for the subject Rental Affordable Unit, may elect either to (i) remain in the
Rental Affordable Unit paying rent, as established by the Owner, up to the then-current Maximum
Allowable Rent for the subject Rental Affordable Unit or (ii) vacate the Rental Affordable Unit at
the end of the tenant’s lease term.
4.6.5 Annual Recertification of Over-Income Tenants. Upon annual recertification, if an
Affordable Unit Tenant is an Over-Income Tenant, then the Over -Income Tenant may elect to
remain in the Rental Affordable Unit and pay the rent applicable to (a) a higher Designated
Affordability Level, if a higher Designated Affordability Level exists for the Property, for which
the Over-Income Tenant’s Annual Household Income qualifies, whereupon Developer shall
change the Designated Affordability Level of the Rental Affordable Unit to the higher Designated
Affordability Level pursuant to Section 4.6.6, or (b) a like-sized Market-Rate Unit, if the Over -
Income Tenant’s Annual Household Income does not qualify for a higher Designated Affordability
Level or if a higher Designated Affordability Level does not exist at the Property, but qualifies for
a like -sized Market -Rate Unit, whereupon Developer shall designate a Market -Rate Unit as a
Rental Affordable Unit pursuant to Section 4.6.6.
4.6.6 Changes to Unit Location. Developer may only change the designation of a
Rental Affordable Unit to a new Designated Affordability Level or to a Market-Rate Unit as
necessary to allow an Over -Income Tenant to remain in the unit. Following any change in
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designation of a Rental Affordable Unit to a higher Designated Affordability Level or to a Market-
Rate Unit, as applicable, Developer shall designate, as expeditiously as possible, the next available
Rental Affordable Unit at that same higher Designated Affordability Level or Market -Rate Unit
of similar size and location in the Property to the lower Designated Affordability Level from which
the original Rental Affordable Unit had been changed in order to bring the Property in conformity
with the Affordability Requirement. Developer shall notify the Agency of any such redesignation
as expeditiously as possible.
4.6.7 Rent from Subsidies. Nothing herein shall be construed to prevent Developer from
collecting rental operating subsidy or rental -related payments from any federal or District of
Columbia agency paid to Developer and/or an Affordable Unit Tenant, or on behalf of an
Affordable Unit Tenant, to the extent receipt of such payment is otherwise in compliance with the
requirements of this Covenant. So long as Developer is in compliance with the requirement that a
Qualified Tenant is paying no more than fifty percent (50%) of its Annual Household Income
toward Maximum Allowable Rent, any rental operating subsidy or rental -related payments
received by Developer, together with the Qualified Tenant’s payment, may exceed the Maximum
Allowable Rent for the applicable Affordable Unit.
4.7 No Subleasing of Rental Affordable Units. An Affordable Unit Tenant may not sublease
any portion of its Rental Affordable Unit or assign its lease to any other Household and Developer
shall not knowingly allow such Rental Affordable Unit to be subleased, except with the Agency’s
prior written consent, in the Agency’s sole and absolute discretion. This prohibition includes short-
term renting to, or permitting occupancy by, Persons who are not included in an Affordable Unit
Tenant’s Household, of all or a portion of the Affordable Unit, either directly or through services
such as AirBnb or other rental agency providers.
4.8 Representations of Affordable Unit Tenant. By execution of a lease for a Rental
Affordable Unit, each Affordable Unit Tenant shall be deemed to represent and warrant to the
Agency and Developer, each of whom may rely thereon, that the Affordable Unit Tenant meets,
and will continue to meet, all eligibility req uirements contained in this Covenant for the rental of
a Rental Affordable Unit.
4.9 Representations of Developer. By execution of a lease for a Rental Affordable Unit,
Developer shall be deemed to represent and warrant to the Agency, which may rely on the
following, that: (i) the Household is determined to be a Qualified Tenant by the Certifying Entity,
and (ii) Developer is not collecting more than the Maximum Allowable Rent.
4.10 Annual Reporting Requirements. Beginning with the first occupancy of any Affordable
Unit, Developer shall provide an annual report ( “Annual Report”) to the Agency regarding the
Rental Affordable Units, which shall be submitted on each anniversary date of the Effective Date
of this Covenant. The Annual Report shall include the following:
(a) the number and identification of the Rental Affordable Units, including identifying any
Rental Affordable Units that had been redesignated during the previous year in accordance with
Section 4.6.6, by bedroom count, that are occupied;
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(b) the number and identification of the Rental Affordable Units, including identifying any
Rental Affordable Units that had been redesignated during the previous year in accordance with
Section 4.6.6, by bedroom count, that are vacant;
(c) for each Rental Affordable Unit that is vacant or that was vacant for a portion of the
previous year, the manner in which the Rental Affordable Unit became vacant (e.g. eviction or
voluntary departure) and the progress in re-leasing that unit;
(d) for each occupied Rental Affordable Unit, the names and ages of all persons in the
Household, the Household size, date of initial occupancy, and total Annual Household Income as
of the date of the most recent Certification of Income, Affordability and Housing Size;
(e) a sworn statement that, to the best of Developer ’s information and knowledge, the
Household occupying each Rental Affordable Unit meets the eligibility criteria of this Covenant;
(f) a copy of each Certification of Income , Affordability and Housing Size received by
Developer during the previous year for each Household renting a Rental Affordable Unit;
(g) a copy of each Declaration of Eligibility received by Developer during the previous
year for each Household renting a Rental Affordable Unit;
(h) a copy of each inspection report and Certification of Inspection for each Rental
Affordable Unit; and
(i) a copy of all forms, policies, procedures, and other documents reasonably requested by
the Agency related to the Rental Affordable Units.
The Annual Reports shall be retained by Developer for a minimum of five (5) years after
submission and shall be available, upon reasonable notice, for inspection by the Agency or its
designee. Notwithstanding anything contained herein to the contrary, in the event that Developer
provides a report to an agency within the District government with content substantially similar to
the content of the Annual Reports described in this section, subject to the Agency’s prior written
approval, then the reporting requirements under this section shall be satisfied upon Developer’s
delivery of such report to the Agency. The Agency may request Developer to provide additional
information in support of its Annual Report.
4.11 Confidentiality. Except as may be required by applicable law, including, without
limitation to, the District of Columbia Freedom of Information Act of 1976, D.C. Code § 2-531 et
seq., Developer, the Certifying Entity and the Agency shall not disclose to third parties the personal
information of the Households, including the identity of the Households, submitted as a part of the
Annual Report.
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4.12 Inspection Rights. The Agency or its designee shall have the right to inspect the Rental
Affordable Units, upon reasonable advance notice to Developer. If Developer receives such
notice, Developer shall, in turn, give reasonable advance notice of the inspection to the tenant(s)
occupying the specific Rental Affordable Unit(s). The Agency or its designee shall have the right
to inspect a random sampling of the Rental Affordable Units to confirm that the units are in
compliance with applicable statutory and regulatory housing requirements and as otherwise
permitted under this Covenant. The Agency or its designee shall have the right to conduct audits
of a random sampling of the Rental Affordable Units and associated files and documentation to
confirm compliance with the requirements of this Covenant.
ARTICLE V
SALE OF AFFORDABLE UNITS
5.1 Sale of For Sale Affordable Units. In the event the Project contains For Sale Affordable
Units, the Owner shall comply with the provisions of this Article V for the sale of such Affordable
Units. Owner shall not convey all or any part of its fee interest (“ Sale”), whether or not for
consideration, in a For Sale Affordable Unit to any Person other than a Qualified Purchaser.
Developer and each Affordable Unit Owner of such For Sale Affordable Unit shall only sell to a
buyer who has obtained a Certific ation of Income , Affordability and Housing Size from a
Certifying Entity and who is a Qualified Purchaser.
5.1.1 Maximum Sales Price. The sale price of each For Sale Affordable Unit upon an initial
Sale shall not exceed the amount (the “Maximum Sales Price”) in the then-current Rent and Price
Schedule. The Developer shall submit to the Agency the proposed sales price for each For Sale
Affordable Unit for approval prior to the marketing and sale of such For Sale Affordable Unit.
5.1.2 Maximum Resale Price. The Maximum Resale Price for each S ale subsequent to
the initial Sale shall be calculated in accordance with Schedule 1 attached hereto and incorporated
herein. The Agency shall approve the Maximum Resale Prices for each For Sale Affordable Unit
prior to the marketing and resale of such For Sale Affordable Unit.
5.1.3 Housing Purchase Assistance Program and other subsidized funding. The
Maximum Sale s Price and Maximum Resale Price of a For Sale Affordable Unit shall be
determined as described in Sections 5.1.1 and 5.1.2, regardless of the prospective buyer’s use of
Housing Purchase Assistance Program and/or other subsidized funding for the purchase of the For
Sale Affordable Unit.
5.2 Procedures for Sales. The following procedures shall apply to (i) Developer with respect
to the initial Sale of a For Sale Affordable Unit, and (ii) an Affordable Unit Owner of a For Sale
Affordable Unit desiring to sell his or her For Sale Affordable Unit.
5.2.1 Income Eligibility. For any Qualified Purchaser, the Annual Household Income
shall be determined within thirty (30) days of the date of the sales contract for such For Sale
Affordable Unit. Each Qualified Purchaser shall have its Annual Household Income verified by
and obtain a Certification of Income, Affordability and Housing Size from the Certifying Entity
prior to entering into the contract. To the extent closing on the sale of a For Sale Affordable Unit
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will not occur within one hundred twenty (120) days after the date of the sales contract, the Annual
Household Income of the prospective Qualified Purchaser shall be determined again , so that the
Certification of Income, Affordability and Housing Size is dated no more than one hundred twenty
(120) days prior to the closing. The Certifying Entity shall determine a Household’s eligibility to
purchase a For Sale Affordable Unit by verifying that (a) the Household’s Annual Household
Income is less than the M aximum Annual Household Income for the applicable For Sale
Affordable Unit; (b) the Household will not expend more than fifty percent (50%) of its monthly
Annual Household Income on Housing Cost for the applicable For Sale Affordable Unit; and (c)
the Household meets the Occupancy Standard for the applicable For Sale Affordable Unit.
5.2.2 Sale. A Sale of a For Sale Affordable Unit shall only be effective if (a) a
Declaration of Eligibility submitted by a Household to Owner and dated no more than one hundred
twenty (120) days prior to the closing of such Sale is recorded prior to or contemporaneous with
the deed conveying the Affordable Unit and (b) a Certification of Income , Affordability and
Housing Size is completed by a Certifying Entity within one hundred twenty (120) days before
closing of such Sale. Owner, Mortgagee(s), District and any title insurer shall each be a third party
beneficiary of each such Declaration of Eligibility and Certification of Income, Affordability and
Housing Size.
5.2.3 Resale. Prior to a Sale of a For Sale Affordable Unit by an Affordable Unit Owner,
the Affordable Unit Owner intending to sell such unit shall (i) contact the Agency to obtain the
Maximum Resale Price and (ii) refer the prospective purchaser to the Agency to initiate the process
of determining their Household’s eligibility to purchase the For Sale Affordable Unit.
5.3 Closing Procedures and Form of Deed.
5.3.1 Owner to Provide Copy of Covenant. Owner shall provide the Qualified Purchaser
with a copy of this Covenant at least thirty (30) days prior to the closing on the Sale of the For
Sale Affordable Unit. Qualified Purchasers shall execute an Acknowledgment of Covenant on or
before the date of closing on such Sale.
5.3.2 Form of Deed. All deeds used to convey a For Sale Affordable Unit must have a
fully executed Declaration of Eligibility attached and shall include the following statement in
twelve (12) point or larger type, in all capital letters, on the front page of the deed:
THIS DEED IS DELIVERED AND ACCEPTED SUBJECT TO THE PROVISIONS
AND CONDITIONS SET FORTH IN THAT CERTAIN AFFORDABLE HOUSING
COVENANT, DATED AS OF ___________, 20_ RECORDED AMONG THE LAND
RECORDS OF THE DISTRICT OF COLUMBIA AS INSTRUMENT NUMBER
_________________, ON _______________ 20___, WHICH AMONG OTHER THINGS
IMPOSES RESTRICTIONS ON THE SALE AND CONVEYANCE OF THE SUBJECT
PROPERTY.
5.3.3 Deed for For Sale Affordable Unit. A deed for a For Sale Affordable Unit shall not
be combined with any other property, including parking spaces or storage facilities, unless the
price of such other property is included in the Maximum Sales Price (for initial Sales) or Maximum
Resale Price (for subsequent Sales).
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5.3.4 Post-Closing Obligations . The purchas er of a For Sale Affordable Unit shall
submit to the Agency within thirty (30) days after the closing a copy of the final executed Closing
Disclosure, a copy of the deed recorded in the Land Records, the executed Declaration of
Eligibility, the executed Certification of Income, Affordability and Housing Size, and the executed
Acknowledgment of Covenant.
5.4 Representations of Owner. By execution of a deed for a For Sale Affordable Unit,
Developer (for initial Sales) and the Affordable Unit Owner (for subsequent Sales) shall be deemed
to represent and warrant to, and agree with, the Agency and, if applicable, the title company, each
of whom may rely on the following: that (i) the Household has been determined to be a Qualified
Purchaser of the applicable For Sale Affordable Unit by the Certifying Entity , and (ii) the sale
price satisfies the terms of this Covenant.
5.5 Annual Certification of Residency. During the Affordability Period, the Affordable Unit
Owner shall submit to the Agency annually on the anniversary of the closing date for a For Sale
Affordable Unit, a Certification of Residency. The Certification of Residency shall be submitted
on or with such form as may be prescribed by Agency.
5.6 Leasing For Sale Affordable Units. An Affordable Unit Owner shall not lease, or permit
a sublease of , a For Sale Affordable Unit, or any portion thereof, without the Agency’s prior
written approval, in the Agency’s sole and absolute discretion. If the Agency approves the lease
of a For Sale Affordable Unit, then that Affordable Unit shall be leased in compliance with District
(e.g. rental unit registration) and federal laws, and any applicable corporate governing documents
(e.g. condominium, cooperative or homeowners’ association bylaws or rules) and any Mortgage
or other loan documents applicable to the Affordable Unit . This prohibition includes short-term
renting to, or permitting occupancy by, Persons who are not included in an Affordable Unit
Owner’s Household, of all or a portion of the Affordable Unit, either directly or through services
such as AirBnb or other rental agency providers.
5.7 Transfers.
5.7.1 Except as provided in Article VIII, i n the event an Affordable Unit Owner
voluntarily or involuntarily transfers all or part of the For Sale Affordable Unit pursuant to
operation of law, court order, divorce or death to a transferee, heir, devisee, or other personal
representative of such owner of a For Sale Affordable Unit (each a “Transferee”), such Transferee
shall be automatically bound by all of the terms, obligations, and provisions of this Covenant; and
shall either: (i) occupy the For Sale Affordable Unit if he or she is a Qualified Purchaser or (ii) if
the Transferee is not a Qualified Purchaser, or does not wish to , or is unable to, occupy the For
Sale Affordable Unit, he or she shall promptly sell it in accordance with this Covenant.
5.7.2 In no event shall a Transferee who is not a Qualified Purchaser reside in a For Sale
Affordable Unit for longer than ninety (90) days.
5.8 Progress Reports. Until all initial S ales of For Sale Affordable Units are completed,
Developer shall provide Agency with annual progress reports, or more frequently upon request,
on the status of its sale of Affordable Units.
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ARTICLE VI
DEFAULT; ENFORCEMENT AND REMEDIES
6.1 Default; Remedies. In the event Owner, Affordable Unit Tenant, a Person or a Household
defaults under any term of this Covenant and does not cure such default within thirty (30) days
following written notice of such default from the Agency, the District shall have the right to seek
specific performance, injunctive relief and/or other equitable remedies, including compelling the
re-sale or re-leasing of an Affordable Unit and the disgorgement of rents and sale proceeds in
excess of the rental rates and sale prices permitted hereunder plus ten percent (10%) of such excess
amount, for defaults under this Covenant.
6.2 No Waiver. Any delay by the Agency in instituting or prosecuting any actions or
proceedings with respect to a default hereunder, in asserting its rights or pursuing its remedies
hereunder shall not operate as a waiver of such rights.
6.3 Right to Attorney’s Fees. If the District shall prevail in any such legal action to enforce
this Covenant, then Owner, Affordable Unit Tenant , Person or Household against whom the
District prevails, shall pay District all of its costs and expenses, including reasonable attorney fees,
incurred in connection with District efforts to enforce this Covenant. If OAG is counsel for the
District in such legal action, the reasonable attorney fees shall be calculated based on the then
applicable hourly rates established in the most current adjusted Laffey matrix prepared by the Civil
Division of the United States Attorney’s Office for the District of Columbia and the number of
hours employees of OAG prepared for or participated in any such action.
ARTICLE VII
COVENANTS BINDING ON SUCCESSORS AND ASSIGNS
This Covenant is and shall be binding upon the Property and each Affordable Unit and
shall run with the land as of the Effective Date through the Affordability Period. The rights and
obligations of District, Developer, Affordable Unit Owner, and their respective successors, heirs,
and assigns shall be binding upon and inure to the benefit of the foregoing parties and their
respective successors, heirs, and assigns; provided however that all rights of District pertaining to
the monitoring and/or enforcement of the obligations of Developer or Affordable Unit Owner
hereunder shall be retained by District, or such designee of the District as the District may so
determine. No Sale, transfer, or foreclosure shall affect the validity of this Covenant, except as
provided in Article VIII.
ARTICLE VIII
MORTGAGES
8.1 Subordination of Mortgages. All Mortgages placed against the Property, or any portion
thereof, shall be subject and subordinate to this Covenant, except as provided in Section 8.3.3.
8.2 Amount of Mortgage . In no event shall the aggregate amount of all Mortgages placed
against a For Sale Affordable Unit exceed an amount equal to one hundred five percent (105%) of
the Maximum Resale Price for such unit. Prior to obtaining any Mortgage or refinancing thereof,
the Affordable Unit Owner shall request from the Agency the then-current Maximum Resale Price
for its For Sale Affordable Unit.
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8.3 Default of Mortgage and Foreclosure.
8.3.1 Notice of Default. The Mortgagee shall provide the Agency written notice of any
notice of default and notice of intent to foreclose under the Mortgage on the For Sale Affordable
Unit. Notwithstanding the foregoing, in no event shall failure to provide such notices preclude the
Mortgagee’s right to proceed with its remedies for default under the Mortgage.
8.3.2 Right of Purchase by the District . The Agency shall have the right to purchase a
For Sale Affordable Unit in the event a notice of default or notice of intent to foreclose for a
Mortgage in first position was recorded in the Land Records. The purchase price shall be an
amount that is the greater of (a) the amount of the debt secured by all Mortgages recorded against
the subject For Sale Affordable Unit, including commercially reasonable costs and expenses, if
any, incurred by Mortgagee as a result of a default and due and payable by the Affordable Unit
Owner under the terms of the Mortgage or (b) the Maximum Resale Price. The Agency shall have
thirty (30) days from the date a notice of default or a notice of foreclosure sale was recorded in the
Land Records to exercise its option and to purchase the For Sale Affordable Unit. The Agency’s
right to purchase shall automatically expire upon the transfer of the For Sale Affordable Unit by
foreclosure or deed in lieu thereof. The Agency may designate another District of Columbia
agency or third party to take title to the For Sale Affordable Unit.
8.3.3 Termination Upon Foreclosure and Assignment . In the event title to a For Sale
Affordable Unit is transferred following foreclosure by, or deed in lieu of foreclosure to a
Mortgagee in first position, or a Mortgage in first position is assigned to the Secretary of HUD,
the terms of this Covenant applicable to such unit shall automatically terminate subject to Sections
8.3.4 and 8.4.
8.3.4 Apportionment of Proceeds. In the event title to a For Sale Affordable Unit is
transferred according to the provisions of Section 8.3.3, the proceeds from such foreclosure or
transfer shall be apportioned and paid as follows: first, to the Mortgagee, in the amount of debt
secured under the Mortgage, including commercially reasonable costs and expenses, if any,
incurred by Mortgagee and due and payable by the Affordable Unit Owner under the terms of the
Mortgage; second, to any junior Mortgagees, in the amount of the debt secured under such
Mortgages; third, to the Affordable Unit Owner, up to the amount of the Maximum Resale Price
as of the date of such sale or transfer; and fourth, to the District.
8.3.5 Effect of Foreclosure on this Covenant. Except as provided in Section 8.3.3, in the
event of foreclosure or deed in lieu thereof, this Covenant shall not be released or terminated and
the Mortgagee or any Person who takes title to an Affordable Unit through a foreclosure sale shall
become a Transferee in accordance with Section 5.7.
8.4 Assignment of Mortgage to the Secretary of HUD. In the event a Mortgage recorded in
the first position against a For Sale Affordable Unit is assigned to the Secretary of HUD, the
following shall occur upon the date of assignment: (a) the District’s right to purchase, whether or
not such right has been triggered, shall automatically expire and (b) the terms of this Covenant
applicable to such unit shall automatically terminate pursuant to Section 8.3.3, except that upon
sale of such unit by the For Sale Affordable Owner or foreclosure or deed in lieu thereof, the
proceeds of such sale shall be apportioned as provided in Section 8.3.4.
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ARTICLE IX
AMENDMENT OF COVENANT
Except as otherwise provided herein, neither this Covenant, nor any part hereof, can be
amended, modified or released other than as provided herein by an instrument in writing executed
by a duly authorized official of the Agency on behalf of the District, and by a duly authorized
representative of Owner of such Affordable Unit affected by such amendment . Any amendment
to this Covenant that alters the terms and conditions set forth herein shall be recorded among the
Land Records before it shall be deemed effective.
ARTICLE X
AFFORDABILITY PERIOD
All Affordable Units in the Project shall be sold or leased in accordance with the terms of
this Covenant for the “Affordability Period.” The “Affordability Period” for each Affordable Unit
shall run in perpetuity . Notwithstanding the foregoing, this Covenant may be released and
extinguished upon the approval of the Agency, in its sole and absolute discretion.
ARTICLE XI
NOTICES
Any notices given under this Covenant shall be in writing and delivered by certified mail
(return receipt requested, postage pre-paid), by hand, or by reputable private overnight commercial
courier service to the applicable Person at the addresses specified in this Article, or to such other
persons or locations as may be designated by the Agency or the Developer from time to time. All
notices to be sent to the Agency shall be sent to the following address:
Director
Department of Housing and Community Development
1800 Martin Luther King Jr. Avenue, SE
Washington, DC 20020
Re: Housing Regulation Administration, Affordable Dwelling Unit Monitoring
All notices to be sent to Developer shall be sent to the address given in the preamble. All
notices to be sent to the Affordable Unit Owner shall be sent to the address on record with the
District of Columbia Office of Tax and Revenue. All notices to be sent to any Affordable Unit
Tenant shall be sent to the unit number referenced in its lease. It shall be the responsibility of the
applicable Person and any successor to the applicable Person to provide the Agency with a current
address. The failure of the applicable Person to provide a current address shall be a default under
this Covenant.
Notices shall be deemed delivered as follows: (i) if hand delivered, then on the date of
delivery or refusal thereof; (ii) if by overnight courier service, then on the next business day after
deposit with the overnight courier service; and (iii) if by certified mail (return receipt requested,
postage pre-paid), then on the date of actual delivery or refusal thereof.
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ARTICLE XII
MISCELLANEOUS
12.1 Applicable Law: Forum for Disputes. This Covenant shall be governed by, interpreted under,
and construed and enforced in accordance with the laws of the District of Columbia, without reference to
the conflicts of laws provisions thereof. Owner, Affordable Unit Tenants and the District irrevocably submit
to the jurisdiction of the courts of the District of Columbia (including the Superior Court of the District of
Columbia) for the purposes of any suit, action, or other proceeding arising out of this Covenant or any
transaction contemplated hereby. Owner , Affordable Unit Tenants, and the District irrevocably
and unconditionally waive any objection to the laying of venue of any action, suit , or proceeding
arising out of this Covenant or the transactions contemplated hereby in the courts of the District
of Columbia (including the Superior Court of the District of Columbia), and hereby further waive
and agree not to plead or claim in any such court that any such action, suit or proceeding brought
in any such court has been brought in an inconvenient forum.
12.2 Counterparts. This Covenant may be executed in any number of counterparts, each of
which shall be an original but all of which shall together constitute one and the same instrument.
12.3 Time of Performance . All dates for performance (including cure) shall expire at 5:00
p.m. (Eastern Time) on the performance or cure date. A performance date which falls on a
Saturday, Sunday or District holiday is automatically extended to the next Business Day.
12.4 Waiver of Jury Trial . TO THE EXTENT PERMITTED BY LAW, ALL PARTIES
HERETO WAIVE THE RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY
LITIGATION ARISING IN RESPECT OF THIS COVENANT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
12.5 Further Assurances. Each party agrees to execute and deliver to the other party such
additional documents and instruments as the other party reasonably may request in order to fully
carry out the purposes and intent of this Covenant; provided that such additional documents and
instruments do not materially increase the obligations or burdens upon the second party.
12.6 Severability. If any provision of this Covenant is held to be unenforceable or illegal for
any reason, said provision shall be severed from all other provisions. Said other provisions shall
remain in effect without reference to the unenforceable or illegal provision, unless this construction
would constitute a substantial deviation from the general intent of the parties as reflected in this
Covenant.
12.7 Limitation on Liability. Provided that Owner has exercised reasonable due diligence in
the performance of its obligations and duties herein, no Owner shall be liable in the event a
Household submits falsified documentation, commits fraud, or breaches any representation or
warranty contained in this Covenant. Notwithstanding the foregoing, Owner shall be liable if
Owner has knowledge, or should have knowledge, that a Household submitted falsified
documentation, committed fraud, or breached any representation or warranty contained in this
Covenant.
12.8 Agency Limitation on Liability . Any review or approval by the District or the Agency
shall not be deemed to be an approval, warranty, or other certification by the District or the Agency
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as to compliance of such submissions, the Project, any Affordable Unit , or the Property with any
building codes, regulations, standards, laws, or any requirements contained in this Covenant or
any other covenant granted in favor of the District that is filed among the Land Records; or
otherwise contractually required. The District shall incur no liability in connection with the
Agency’s review of any submissions required under this Covenant as its review is solely for the
purpose of protecting the District’s interest under this Covenant.
12.9 No Third Party Beneficiary. Except as expressly set forth in this Covenant, there are no
intended third party beneficiaries of this Covenant, and no Person other than District shall have
standing to bring an action for breach of or to enforce the provisions of this Covenant.
12.10 Representations of Developer. As of the date hereof, Developer hereby represents and
warrants to District as follows:
(a) This Covenant has been duly executed and delivered by Developer, and constitutes the
legal, valid , and binding obligation of Developer, enforceable against Developer, and its
successors and assigns, in accordance with its terms;
(b) Neither the entering into of this Covenant nor performance hereunder will constitute
or result in a violation or breach by Developer of any agreement or order which is binding on
Developer; and
(c) Developer (i) is duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization and is qualified to do business and is in good standing under the
laws of the District of Columbia; (ii) is authorized to perform under this Covenant; and (iii) has all
necessary power to execute and deliver this Covenant.
12.11 Federal Affordability Restrictions. In the event the Property is encumbered by other
affordability restrictions (“Federal Affordability Restrictions”) as a result of federal funding or
the issuance of Low -Income Housing Tax Credits for the Project, it is expressly understood and
agreed that in the event the requirements in this Covenant would cause a default of or finding of
non-compliance (“Conflict”) with the Federal Affordability Restrictions during the compliance
period for the Federal Affordability Restrictions, then the requirements of the Federal Affordability
Restrictions shall control to the extent of the Conflict. In all other instances, the requirements of
this Covenant shall control.
[Signatures on Following Pages]
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IN TESTIMONY WHEREOF, Developer has caused these presents to be signed,
acknowledged and delivered in its name by Omar Karim, its duly authorized person, witnessed by
_________________________________, its ___________________
WITNESS DEVELOPER
PARCEL 6 COMMUNITY PARTNERS LLC,
a District of Columbia limited liability company
By: _____
Name: ______________________________
Title: _______________________________
By: [SEAL]
Name:Omar Karim
Title: Authorized Person
CITY OF WASHINGTON
ss.
DISTRICT OF COLUMBIA
I, __________________________________, a Notary Public in and for the District of
Columbia, DO HEREBY CERTIFY THAT ___________ who is personally known to be (or
proved by oaths of credible witnesses to be) the person named as _________________ for
________________________________ in the foregoing and annexed Affordable Housing
Covenant, bearing the date of the ______________ personally appeared before me in said District
of Columbia, and as ____________, acting on behalf of _______________________________,
as aforesaid, acknowledged the same to be his/her free act and deed.
Given under my hand and seal this ____ day of_____________.
Notary Public
My Commission Expires: ___________________
22
APPROVED AND ACCEPTED THIS ______ DAY OF _____ 202_:
DISTRICT OF COLUMBIA, by and through
the Office of the Deputy Mayor for Planning
and Economic Development
By:
Name: ________________
Title: Deputy Mayor
LEGAL REVIEW
By: ___________________________
Office of the General Counsel
District of Columbia, ss:
I, ___________________, a Notary Public in and for the District of Columbia, do here by
certify that J _____________, the Deputy Mayor for Planning and Economic Development , on
behalf of the District of Columbia, personally appeared before me in said jurisdiction, and, being
personally known to me (or satisfactorily proven) to the person whose name is subscribed to the
foregoing Affordable Housing Covenant, and that he, in such capacity, being authorized to do so,
executed the foregoing instrument for the purposes therein contained, and acknowledged the same
to be the act and deed of the District of Columbia.
Given under my hand and seal this _______ day of ____ 202_.
______________________________
Notary Public, D.C.
My commission expires: _______________________
EXHIBIT A
Legal Description of Property
24
EXHIBIT B
Rental Affordable Unit Lease Rider
This Rental Affordable Unit Lease Rider (“Rider”) is attached to and incorporated into the lease dated
(“Lease”) between (“Resident” or “You”) and , as Management Agent (“Manager”)
for (“Owner”) for Affordable Unit number (“Premises”), located at , Washington DC
.
In consideration of the mutual covenants set forth in the Lease and below, you agree that your use and
possession of the Premises is subject to the terms and conditions set forth in the Lease and the following
terms and conditions, which are in addition to and supplement the Lease:
AFFORDABLE UNIT: Resident acknowledges that the Premises is subject to that certain Affordable
Housing Covenant between Owner and the District of Columbia dated ___________________, 20 __, as
may be subsequently amended, (the “Affordable Housing Covenant”). The Premises is currently designated
as an Affordable Unit, which requires the Resident’s household income to be less than or equal to [____]
of the median family income (MFI) or area median income (AMI).
DEFINED TERMS: Those terms not specifically defined herein shall be assigned the definition provided
in the Affordable Housing Covenant.
ELIGIBILITY: In order for you, as Resident, to be eligible to rent an Affordable Unit, you must be and
remain an “Affordable Unit Tenant” as defined in the Affordable Housing Covenant.
INCOME RECERTIFICATION: No more than ninety (90) days and no less than forty-five (45) days
before each anniversary of the first day of the lease, the Manager shall request that the Resident provide the
Certifying Entity with the following:
(i) an executed Declaration of Eligibility that states that Resident is not an Over -Income Tenant and
is and will continue to occupy the Premises as his/her/their principal residence,
(ii) all information pertaining to the Resident’s household composition and documentation of income
for all household members,
(iii) a release authorizing third party sources to provide relevant information regarding the Resident’s
eligibility for the Affordable Unit, as well as how to contact such sources, and
(iv) any other reasonable and customary representations, information or documents requested by the
Certifying Entity.
Resident shall submit the foregoing listed documentation to the Certifying Entity within fifteen (15) days
of Manager’s request. Within ten (10) days of Certifying Entity’s receipt of the foregoing documentation
and based on the results of the annual income recertification review, Certifying Entity will determine
whether the Resident remains income eligible for the Premises and notify the Resident of his or her
household’s MFI percentage, and (a) if the Resident is no longer income eligible for the Premis es, the
income category for which the Resident is income eligible to lease a unit in the apartment community, or
(b) if the Resident is income eligible for the Premises, provide a Certification of Income, Affordability and
Housing Size completed by the Certifying Entity, verifying that the income of the Resident meets income
eligibility for the Premises.
25
Upon annual recertification, if the Resident remains income eligible for the Premises, the Resident will be
eligible to remain in the Premises at the time of lease renewal and to renew his/her lease at the then-current
lease rate for the Premises. If the Resident’s A nnual Household Income is determined to exceed 140% of
the Maximum Annual Household Income applicable to the Premises, then the Resident shall be deemed an
“Over-Income Tenant” as provided in the Covenant and may either (a) remain in the Premises and pay the
rent applicable to an Affordable Unit at a higher Designated Affordability Level for which the Resident’s
Annual Household Income qualifies, if available at the Property, or (b) if an Affordable Unit at a higher
Designated Affordability Level is not available at the Property , remain in the Premises and pay the rent
applicable to a market-rate unit of like size and location.
Manager will notify Resident of all options (i.e., an Affordable Unit at a different Designated Affordability
Level or a market rate unit) for which Resident is income eligible at least __ days prior to the expiration of
the Resident’s lease term. Prior to the expiration of the Resident’s lease term, the Resident shall notify
Manager in writing of the Resident’s election to either (i) remain in the Premises and pay the rental rate
applicable to the Resident’s then current Designated Affordability Level if the Resident is not an Over -
Income Tenant, (ii) remain in the Premises paying the market rate rent for that unit if the Resident is an
Over-Income Tenant, or (iii) vacate the Premises at the end of the Resident’s Lease term. Resident’s failure
to notify Manager of Resident’s election prior to the expiration of the lease term will be deemed by Manager
as Resident’s election to vacate the Premises.
In the event that Resident fails to pay the applicable rental rate or vacate the Premises upon expiration of
the lease term, Manager may pursue an action for eviction of Resident. Resident’s agreement to pay the
applicable rental rate or vacate was a condition precedent to Manager’s initial acceptance of Resident’s
eligibility and Manager has relied on Resident’s agreement. Resident acknowledges and agrees that the
criteria to be income eligible to occupy the Premises is and serves as a District policy and objective, and
that failure to vacate the Premises or pay the applicable rental rate is both a default under the Lease and in
violation of the Affordable Housing Covenant.
PROHIBITION ON SUBLETS AND ASSIGNMENTS: Resident may not sublease all or any portion of
the Premises or assign its lease to any other person, except with the prior written consent of the D.C.
Department of Housing and Community Development, in its sole and absolute discretion. This prohibition
includes short-term renting to, or permitting occupancy by, persons who are not members of Tenant’s
household, of all or a portion of the Premises, either directly or through services such as “AirBnb” or other
rental agency providers.
LEASE EFFECTIVE: The Lease of the Premises shall only be effective if this executed Rider, a
Certification of Income, Affordability and Housing Size, a Declaration of Eligibility are attached as exhibits
to the lease agreement.
____________________________ ________________
Resident Signature Date
____________________________ ________________
Resident Signature Date
____________________________ ________________
Resident Signature Date
26
EXHIBIT C
Affordable Unit Index
27
SCHEDULE 1
Provisions Governing Calculation of Maximum Resale Price
1. The Maximum Resale Price (“MRP”) for a subsequent sale of a For Sale Affordable Unit
shall be determined through use of the formula MRP = P x ( F) + V (“Formula”), where:
(a) P = the price Owner paid for the Affordable Unit;
(b) V = the sum of the value of the Eligible Capital Improvements and Eligible
Replacement and Repair Costs, as determined by the Agency pursuant to this
section; and
(c) F = the average of the Ten Year Compound Annual Growth Rates of the Median
Family Income (“MF I”) from the first year of ownership of the For Sale
Affordable Unit to the year of the sale of the For Sale Affordable Unit by the
Affordable Unit Owner. This average may be expressed:
(1) As the result of the formula F = (1 + [((MFI Year m /MFI Year m-10) ^
(1/10) -1) +…((MFI Year k /MFI year k-10) ^ (1/10) -1) / n]) ^ n, where
m = the year after the Affordable Unit was purchased by Owner, k = the
year in which the Affordable Unit is sold by Owner, and n = the number
of years the Affordable Unit is owned by Owner; or
(2) As published by the Agency.
2. For the purposes of determining the value of “V” in the Formula, the following
improvements made to a For Sale Affordable Unit after the date of purchase may be included at
the percentage of cost indicated, to the extent they are permanent in nature and add to the market
value of the property:
(a) Eligible Capital Improvements, which will be valued at 100% of reasonable
cost, as determined by the Agency; and
(b) Eligible Replacement and Repair Costs, which shall be valued at 50% of
reasonable cost, as determined by the Agency.
3. Ineligible costs shall not be included in the determining the value of “V” in the Formula.
4. The value of improvements may be determined by the Agency based upon documentation
provided by the Affordable Unit Owner or, if not provided, upon a standard value established by
the Agency.
5. The Agency may disallow an Eligible Capital Improvement or Eligible Replacement and
Repair Cost if the Agency finds that the improvement diminished or did not increase the fair market
value of the For Sale Affordable Unit or if the improvements make the A ffordable Unit
unaffordable to all Qualified Purchasers at the Designated Affordability Level .
28
6. The Agency may reduce the value of a capital improvement if there is evidence of abnormal
physical deterioration of, or abnormal wear and tear to, the capital improvement.
7. Owner shall permit a representative of the Agency to inspect the For Sale Affordable Unit
upon request to verify the existence and value of any capital improvements that are claimed by
Owner.
8. No allowance shall be made in the Maximum Resale Price for the payment of real estate
brokerage fees associated with the sale of the For Sale Affordable Unit.
9. The value of personal property transferred to a purchaser in connection with the resale of
a For Sale Affordable Unit shall not be considered part of the sales price of the For Sale Affordable
Unit for the purposes of determining whether the sales price o f the For Sale Affordable Unit
exceeds the MRP.
10. Any capitalized terms used in this Schedule that are not defined herein shall have the
meanings set forth in the Covenant. As used in this Schedule, the following capitalized terms shall
have the meanings indicated below:
Eligible Capital Improvement: major structural system upgrades, special assessments, new
additions, and improvements related to increasing the health, safety, or energy efficiency of an
Affordable Unit. Such improvements generally include: (i) major electrical wiring system
upgrades; (ii) major plumbing system upgrades; (iii) room additions; (iv) installation of additional
closets and walls; (v) alarm systems; (vi) smoke detectors; (vii) removal of toxic substances, such
as asbestos, lead, mold, or mildew; (viii) insulation or upgrades to double-paned windows or glass
fireplace screens; and (ix) upgrade to Energy Star built -in appliances, such as furnaces, water
heaters, stoves, ranges, dishwashers, and microwave hoods. Improvements that meet these criteria
will be given 100% credit by the Agency.
Eligible Replacement and Repair Cost: in -kind replacement of existing amenities and repairs
and general maintenance that keep an Affordable Unit in good working condition. Such
improvements generally include: (i) electrical maintenance and repair, such as switches and
outlets; (ii) plumbing maintenance and repair, such as faucets, supply lines, and sinks;
(iii) replacement or repair of flooring, countertops, cabinets, bathroom tile, or bathroom vanities;
(viii) non-Energy Star replacement of built-in appliances, including furnaces, water heaters, stoves,
ranges, dishwashers, and microwave hoods; (ix) replacement of window sashes; (x) fireplace
maintenance or in -kind replacement; (xi) heating system maintenance and repairs; and (xii)
lighting system. Costs that meet these criteria will be given 50% credit for repairs as determined
by the Agency.
Ineligible Costs: means costs of cosmetic enhancements, installations with limited useful life
spans and non-permanent fixtures not eligible for capital improvement credit as determined by the
Agency. These improvements generally include: (i) cosmetic enhancements such as fireplace tile
and mantel, decorative wall coverings or hangings, window treatments (blinds, shutters, curtains,
etc.), installed mirrors, shelving, refinishing of existing surfaces; (ii) non-permanent fixtures, such
as track lighting, door knobs, handles and locks, portable appliances (refrigerator, microwave,
29
stove/ oven, etc.); and (iii) installations with limited useful life spans, such as carpet, painting of
existing surfaces, window glass and light bulbs.
EXHIBIT C
AFFORDABLE HOUSING PLAN
Building 1 (Townhome Component)
Unit Type
Approx.
Unit SF
# of
Units
Total
% of
Total
# of Units
50% MFI 80% MFI
3 Bedroom 720 7 87.5% 1 1
3 Bedroom 695 1 12.5% 0 0
Total 8
100.0% 1 1
% of Total 12.5% 12.5%
Building 2 (The Martin)
Unit Type
Approx.
Unit SF
# of
Units
Total
% of
Total
# of Units
30% MFI 50% MFI
Studio 500 46 20.8% 5 12
1 Bedroom 650 81 36.7% 4 13
2 Bedroom 800 72 32.6% 4 13
3 Bedroom 1100 22 10.0% 4 13
Total 221
100.0% 17 51
% of Total 7.7% 23.1%
Building 3 (The Malcolm)
Unit Type
Approx.
Unit SF
# of
Units
Total
% of
Total
# of Units
30% MFI 50% MFI
Studio 500 58 20.8% 6 16
1 Bedroom 650 103 36.7% 6 16
2 Bedroom 800 96 32.6% 5 17
3 Bedroom 1100 29 10.0% 5 17
Total
286
100.0% 22 66
% of Total 7.7% 23.1%
CBE AGREEMENT – St. Elizabeths East – Parcel 6
CERTIFIED BUSINESS ENTERPRISE
UTILIZATION AND PARTICIPATION AGREEMENT
THIS CERTIFIED BUSINESS ENTERPRISE UTILIZATION AND
PARTICIPATION AGREEMENT (this “Agreement”) is made by and between the DISTRICT
OF COLUMBIA (the “District”), a municipal corporation acting by and through the DISTRICT
OF COLUMBIA DEPARTMENT OF SMALL AND LOCAL BUSINESS
DEVELOPMENT (“DSLBD”) and Parcel 6 Community Partners LLC, a District of
Columbia limited liability company, or its designees, successors or assigns (the “Developer”).
RECITALS
A. Pursuant to a Land Disposition and Development Agreement to be executed between
the Developer and the District, by and through the Deputy Mayor for Planning and Economic
Development, Developer intends to provide for the development of a mixed-use property located
at 2700 Martin Luther King Jr. Avenue SE in the District of Columbia and known for taxation
and assessment purposes as Lot 968 in Square 5868S. The development shall be a mix of
residential and retail uses. Two residential buildings totaling approximately 507 mixed-income
rental units (including studios, 1, 2, and 3 bedroom units), with ground floor retail and limited
below-grade parking shall be accompanied by approximately nine (9) for-sale townhome-styled
live/work units (the “Project”).
B. Pursuant to the Land Disposition and Development Agreement, the Developer
covenants that it has executed and will comply in all respects with this Agreement.
C. Capitalized terms not defined herein shall have the meaning assigned to them in the
Land Disposition and Development Agreement.
NOW, THEREFORE, for and in consideration of the mutual covenants and agreements
contained herein, the receipt and adequacy of which is hereby acknowledged by both parties
hereto, DSLBD and the Developer agree, as follows:
ARTICLE I
UTILIZATION OF CERTIFIED BUSINESS ENTERPRISES
Section 1.1 CBE Utilization. Developer, on its behalf and/or on behalf of its successors and
assigns (if any), shall hire and contract with Small Business Enterprises (“SBE”) certified
pursuant to the Small and Certified Business Enterprise Development and Assistance Act of
2014, as amended, (D.C. Law 20-108; D.C. Official Code § 2-218.01 et seq.) (the “Act”), in
connection with the predevelopment and development phases of the Project, including but not
limited to, design, professional and technical services, construction management and trade work,
development, renovation and suppliers. Developer shall expend funds contracting and procuring
goods and services from SBEs in an amount equivalent to no less than thirty-five percent (35%)
of the adjusted development budget (“Adjusted Development Budget” or “Adjusted Budget”)
detailed in Attachment 1 (the “CBE Minimum Expenditure”). If there are insufficient qualified
SBEs to fulfill the 35% requirement, the requirement may be satisfied by subcontracting 35% to
qualified Certified Business Enterprises certified pursuant to the Act. SBE and Certified
CBE AGREEMENT – St. Elizabeths East – Parcel 6
2
Business Enterprises collectively referred to herein as “CBE.” The Adjusted Development
Budget is $157,961,114. The CBE Minimum Expenditure is therefore $55,286,390.
Section 1.2 Time Period. Developer shall achieve its CBE Minimum Expenditure no later than
thirty (30) days after the issuance of a final Certificate of Occupancy by the District
(“Expenditure Period”). If within three (3) years of the execution of this Agreement the
Developer has not achieved the CBE Minimum Expenditure and has not obtained a final
Certificate of Occupancy, the Developer shall meet with DSLBD to provide a status of the
Project as related to this Agreement.
Section 1.3 Adjustments to the Total Development Budget or CBE Minimum Expenditure. If
the Total Development Budget or the CBE Minimum Expenditure increases or decreases by an
amount greater than 5%, within ten (10) business days Developer shall submit to DSLBD to review
and determine if there is a greater than 5% adjustment to the Adjusted Development Budget or the
CBE Minimum Expenditure (”Adjustment”). The CBE Minimum Expenditure shall be
automatically increased in the case of an increase, or decreased in the case of a decrease, by an
identical percentage of the Adjustment. A modified Attachment 1, approved by DSLBD, shall
become a part of this Agreement and be provided to the Developer.
ARTICLE II
CBE OUTREACH
Section 2.1 Outreach Efforts. Developer shall utilize the resources of DSLBD, including
DSLBD’s website (http://dslbd.dc.gov). In particular, Developer shall submit all contracting
opportunities for this Project to DSLBD for publication. Developer may identify individuals or
businesses that could qualify as CBEs and is encouraged to refer any such firms to DSLBD’s
Certification unit to apply for certification. In the event that Developer develops a website for the
Project, such website shall (i) advertise upcoming bid packages, (ii) present instructions on how to
bid, and (iii) directly link to DSLBD’s website.
ARTICLE III
QUARTERLY REPORTING
Section 3.1 Quarterly Report.
(a) Throughout the Expenditure Period, regardless of whether the CBE Minimum Expenditure is
achieved before the end of the Expenditure Period, Developer will submit quarterly contracting
and subcontracting expenditure reports (“Quarterly Report”) for the Project.
(b) The Quarterly Report shall be submitted to DSLBD no later than thirty (30) days after the
end of each quarter. The Quarterly Report shall be submitted on a form provided by DSLBD (a
prototype of this form is included as Attachment 4). However, DSLBD reserves the right to
amend this form.
(c) If the Developer fails to submit a Quarterly Report by the date required in sub-section (b) of
this section, the Developer shall pay a penalty to DSLBD.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
3
(i) The penalty the Developer shall pay to DSLBD for each Quarterly Report that the
Developer fails to submit by the date required in sub-section (b) of this section shall be
$5,000 for the first offense, $15,000 for the second offense, and $25,000 for each offense
thereafter.
(d) Companies that may be eligible for certification, but are not yet certified, or whose
certification is pending before DSLBD shall not be included in the Quarterly Report unless
and until the company is certified by DSLBD as a CBE.
(i) In order to obtain credit towards the CBE Minimum Expenditure requirement, a
contractor/ subcontractor that is utilized by the Developer must have an active CBE
certification at the time the goods or services are provided (contract/ subcontract
performed) and at the time payment is made to the contractor/ subcontractor.
CREDIT WILL ONLY BE GIVEN FOR THE PORTION OF THE CONTRACT/
SUBCONTRACT PERFORMED BY A CBE USING THEIR OWN ORGANIZATION
AND RESOURCES.
(ii) The Developer will not receive credit towards the CBE Minimum Expenditure if the
Developer’s utilized contractor/ subcontractor:
(1) is not certified by DSLBD as a CBE at the time the goods or services are
provided (contract/ subcontract performed) and at the time payment is made to
the contractor/ subcontractor;
(2) has a pending application before DSLBD seeking CBE certification;
(3) has an expired CBE certification;
(4) has a CBE certification application that DSLBD denied; or
(5) has a CBE certification that has been revoked by DSLBD.
(iii) CBE certification must be valid to receive credit towards the CBE Minimum
Expenditure . If not renewed, the CBE certification will expire. To determine whether a
contractor/ subcontractor has a valid and/or current CBE certification, before goods/
services are provided and payment made, Developer must check the DSLBD website:
https://dslbd.secure.force.com/public/.
(e) Developer must require every CBE that it contracts or subcontracts with to maintain its CBE
certification through the term of and final payment of the contract/ subcontract. If Developer
pays a contractor/ subcontractor that is not certified as a CBE for goods/ services provided when
the contractor/ subcontractor was not a CBE, those payments will not be applied towards the
CBE Minimum Expenditure requirement and the expenditures shall not be included on the
Quarterly Report.
(f) Concurrently with the submission of the Quarterly Report, Developer shall also submit
vendor verification forms (each, a “Vendor Verification Form”) substantially in the form of
CBE AGREEMENT – St. Elizabeths East – Parcel 6
4
Attachment 5 for each expenditure listed in the Quarterly Report. However, DSLBD reserves
the right to amend this form. If a completed Vendor Verification Form is not submitted for each
contract/subcontract performed by a CBE, or portion thereof, the Developer will not receive
credit towards the CBE Minimum Expenditure for that contract/subcontract.
(g) Concurrently with the submission of the Quarterly Report, Developer shall also submit a
copy of each fully executed contract/subcontract with each CBE contractor/subcontractor
identified in the Quarterly Report. If a fully executed contract/subcontract is not submitted,
the Developer will not receive credit towards the CBE Minimum Expenditure for that
contract/subcontract.
(h) Once the CBE Minimum Expenditure has been achieved, the subsequent Quarterly Report
shall contain the caption “CBE MINIMUM EXPENDITURE ACHIEVED.” Additionally, the
final Quarterly Report shall contain the caption “FINAL QUARTERLY REPORT” and be
accompanied by a copy of the final Certificate of Occupancy issued by the District.
Section 3.2 Mandatory Meeting with DSLBD. Within ten (10) business days of executing this
Agreement, the Developer and CBE Equity and Development Participant(s), as described in
Article V, shall meet with DSLBD to discuss this Agreement’s reporting requirements and
participation, respectively. In the event that DSLBD is unavailable to meet within 10 business
days, Developer shall schedule the meeting on the earliest mutually agreeable date. The
individuals identified below respectively are the reporting point of contacts for the Developer,
CBE Equity and Development Participant(s), and DSLBD.
Monica Ray
Authorized Party for Developer
Parcel 6 Community Partners, LLC
c/o CHCTDC
3215 Martin Luther King Jr Ave SE
Washington, DC 20032
(202) 539-4810
monica@chctdc.org
Omar A. Karim
President
Banneker Communities LLC
1227 Marion Barry Avenue SE, Suite 107
Washington, DC 20020
(301) 408-0800
okarim@bannekerventures.com
Keith Lomax
Principal
RBK Construction & Development
4635 Minnesota Ave NE
Washington, DC 20019
(202) 735-0572
CBE AGREEMENT – St. Elizabeths East – Parcel 6
5
keith.lomax@rbkconstruction.com
ATTN: Compliance & Enforcement Division Manager
Department of Small and Local Business Development
441 4th Street NW, Suite 850N
Washington, DC 20001
(202) 727-3900
compliance.enforcement@dc.gov
ARTICLE IV
PROJECT MANAGERS AND GENERAL CONTRACTORS/CONSTRUCTION
MANAGERS
Section 4.1 Adherence to CBE Minimum Expenditure. For each component of the Project,
Developer shall require in its contractual agreements with the Project Manager (“PM”), or with
the general contractor and/or construction manager for the Project (the “General Contractor” or
“GC”), as applicable, that the PM or GC comply with the relevant obligations and
responsibilities of Developer contained in this Agreement with respect to achieving the
applicable CBE Minimum Expenditure. In the event that the Developer and PM or GC have
already entered a contractual agreement prior to the execution of this Agreement, the Developer
shall work with the PM or GC to assure that the PM or GC will assist the Developer in achieving
the applicable CBE Minimum Expenditure. Developer further agrees to inform the PM or GC
and subcontractors of the other obligations and requirements applicable to the Developer under
this Agreement. Developer shall inform the PM or GC that non-compliance with this Agreement
may negatively impact future opportunities with the District for the Developer and the PM or GC
respectively. Specifically, Developer will require in its contractual agreement with its PM or
GC, or if the Developer and PM or GC have already entered a contractual agreement prior to the
execution of this Agreement, work with its PM or GC, to achieve the following actions in
contracting efforts, in connection with the Project, undertaken after the effective date of this
Agreement:
(i) When soliciting bids for products or services for this Project, the PM or GC shall
allow a reasonable time (e.g., no less than 20 business days) for all bidders to
respond to the invitations or requests for bids.
(ii) The PM or GC will make full use of DSLBD’s website, found at
http://dslbd.dc.gov, for subcontracting opportunities and for compliance
monitoring.
(iii) The PM or GC will provide a CBE bidder, who is not the low bidder, an
opportunity to provide its final best offer before contract award, provided the
CBE bid price is among the top 3 bidders.
(iv) The PM or GC will not require that CBEs provide bonding on contracts with a
dollar value less than $100,000, provided that in lieu of bonding the PM or GC
may accept a job specific certificate of insurance.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
6
(v) The PM or GC will include in all contracts and subcontracts with CBEs, a process
for alternative dispute resolution. This process shall afford an opportunity for
CBEs to submit documentation of work performed and invoices regarding
requests for payments. Included in the subcontract/contract shall be a mutually
agreed upon provision for mediation (to be conducted by DSLBD) or arbitration
in accordance with the rules of the American Arbitration Association.
(vi) The PM or GC and subcontractors shall strictly adhere to their contractual
obligations to pay all CBE contractors and subcontractors in accordance with the
contractually agreed upon schedule for payments. In the event that there is a
delay in payment to the PM or GC, the PM or GC is to immediately notify the
CBE contractor/subcontractor and advise as to the date on which payment can be
expected.
(vii) The PM or GC commits to pay all CBEs within seven (7) days following the
PM’s or GC’s receipt of a payment, which includes funds for such
contractors/subcontractors, from the Developer. Developer also agrees to
establish a procedure for giving notice to the CBE contractors/subcontractors of
the Developer’s payment to the PM or GC.
(viii) The PM or GC commits to verify a contractor/ subcontractor’s CBE certification
status prior to entering a contract/ subcontract with, accepting goods or services
from, and making payment to a CBE contractor/ subcontractor, in accordance
with Article III of this Agreement.
ARTICLE V
EQUITY PARTICIPATION AND DEVELOPMENT PARTICIPATION
Section 5.1 CBE Equity Participation and Development Participation Requirements:
(i) Minimum CBE Equity Participation and Development Participation
Requirements. Developer acknowledges and agrees that Certified Business
Enterprises as defined in Section 2302 of the Act, D.C. Official Code § 2-218.02,
(“CBEs”) shall receive no less than twenty percent (20%) in sponsor Developer
equity participation (“Equity Participation”) and no less than twenty percent
(20%) in development participation (“Development Participation”) in the Project,
in accordance with D.C. Official Code § 2-218.49a;
(ii) Pari Passu Returns for CBE Equity Participant(s). Developer agrees that the
CBE Equity Participant(s) shall receive a return on investment in the Project that
is pari passu with all other sources of sponsor Developer equity. In addition, if
CBE Equity Participant(s) elect to contribute additional capital to the Project, they
will receive the same returns as Developer with respect to such additional capital.
However, a CBE Equity Participant’s equity interests shall not be diluted over the
course of the Project, including for failure to contribute additional capital;
CBE AGREEMENT – St. Elizabeths East – Parcel 6
7
(iii) CBE Equity Participation maintained for duration of Project. Developer
agrees that the CBE Equity Participation shall be maintained for the duration of
the Project. Culmination of the Project shall be measured by the issuance of a
certificate of occupancy in accordance with the Expenditure Period as defined in
Section 1.2 herein;
(iv) CBE Equity Participant’s Risk Commensurate with Equity Position. The
CBE Equity Participant(s) shall not bear financial or execution requirements that
are disproportionate with its equity position in the Project;
(v) Management Control and Approval Rights. Equity Participant(s) and
Development Participant(s) shall have management control and approval rights in
line with their equity positions; and
(vi) Representing the entity to the public. Equity Participant(s) and Development
Participant(s) shall be consistently included in representing the entity to the public
(e.g., through joint naming, advertising, branding, etc.).
Section 5.2 Sweat Equity Contribution. No more than 25% of the total 20% equity
participation requirement (“equal to 5%”) set forth in Section 5.1 of this Section may be met by a
CBE providing development services in lieu of a cash equity investment that will be
compensated by the Developer in the future at a date certain (“sweat equity contribution”). The
Developer and the CBE shall sign, and provide to the DSLBD, a service agreement describing
the following:
(i) A detailed description of the scope of work that the CBE will perform;
(ii) The dollar amount that the CBE will be compensated for its services and the
amount the CBE is forgoing as an investment in the Project;
(iii) The date or time period when the CBE will receive compensation;
(iv) The return, if any, the CBE will receive on its sweat equity contribution; and
(v) An explanation of when the CBE will receive its return as compared to other team
members or investors.
Section 5.3 CBE Inclusion, Recognition, Access and Involvement. Developer acknowledges
that a priority of the District is to ensure that CBE partners on development projects are granted
and encouraged to maintain active involvement in all phases of the development effort, from
initial-pre-development activities through development completion and ongoing asset
management. To assist CBE partners in gaining the skills necessary to participate in larger
development efforts, Developer agrees to provide all CBE partners full and open access to
information utilized in project execution, including, for example, market studies, financial
analyses, project plans and schedules, third-party consultant reports, etc. Developer agrees to
consistently represent and include CBE partners of Developer as team members through such
CBE AGREEMENT – St. Elizabeths East – Parcel 6
8
actions as joint naming (if applicable), advertising, and branding opportunities that incorporate
CBE partners. CBE partners of Developer shall not be precluded from selling services back to
Developer. The CBE partners shall participate in budget, schedule, and strategy meetings. CBE
partners may also participate in the negotiation of development agreements, creating a site plan,
managing design development, hiring and managing consultants, seeking and securing zoning
and entitlements, developing and monitoring budgets, apply for and securing financing,
performing due diligence, marketing and sales of all units, and any other tasks necessary to the
development and construction of the Project.
Section 5.4 No Changes in CBE Equity Participation and Development Participation.
(i) Once the selection of Equity Participant(s) and Development Participant(s) in the
Project have been approved by DSLBD, there can be no change in the Equity
Participation and Development Participation and no dilution of the participants’
Equity Participation and Development Participation without the express written
consent of DSLBD’s Director (the “Director”); and
(ii) Once DSLBD has approved the determination of returns for Equity Participant(s)
in the Project, the determination of returns for Equity Participant(s) shall not be
materially altered or adjusted from that previously presented to DSLBD without
the Director’s express written consent.
Section 5.5 Closing Requirements for CBE Equity Participation and Development
Participation.
(i) The closing documents executed in connection with the Project shall contain
provisions indicating there can be no change of the CBE Equity Participation and
Development Participation, no dilution of a participants’ Equity Participation and
Development Participation, and no material alteration of the determination of
returns for the CBE Equity Participant(s) without the Director’s express written
consent;
(ii) The closing documents shall expressly covenant and agree that DSLBD shall have
third-party beneficiary rights to enforce the provisions, for and in its own right;
(iii) The agreements and covenants in the closing documents shall run in favor of
DSLBD for the entire period during which the agreements and covenants shall be
in force and effect, without regard to whether the District was or is an owner of
any land or interest therein or in favor of which the agreements and covenants
relate; and
(iv) DSLBD shall have the right, in the event of a breach of the agreement or covenant
in the closing documents, to exercise all the rights and remedies, and to maintain
any actions or suits, at law or in equity, or other proceedings to enforce the curing
of the breach of agreement or covenant to which it may be entitled.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
9
Section 5.6 CBE Equity Participation and Development Participation Restrictive
Covenant.
(i) If there is a transfer of title to any District-owned land that will become part of
the Project, DSLBD may require a restrictive covenant be filed on the land requiring
compliance with the Equity Participation and Development Participation requirements of
the Act; and
(ii) A restrictive covenant requiring compliance with the Equity Participation and
Development Participation shall run with the land and otherwise remain in effect until
released by DSLBD following the completion of construction and of the issuance of
certificates of occupancy for the Project. A release of the restrictive covenant shall be
executed by DSLBD only after either the Developer and the Equity Participant(s) and
Development Participant(s) submit a sworn certification together with documentation
demonstrating to the satisfaction of DSLBD that, or DSLBD otherwise determines that:
(a) The CBE Development Participant(s) received at least 20% of the
development fees for the Project based on the final development
expenditures for such Project; and
(b) The CBE Equity Participant(s) maintained at least a 20% ownership
interest in the sponsor Developer equity in the Project throughout its
development.
Section 5.7 CBE Equity Participation and Development Participation Reports. Developers
must submit quarterly reports to DSLBD regarding the fulfillment of the Equity Participation and
Development Participation Program requirements on such forms that may be determined, and
amended, by DSLBD. The reports shall be submitted in accordance with Section 3.1 of this
Agreement and shall include information regarding:
(i) Changes in ownership interest of the owners/partners;
(ii) Additions or deletions of an owner/partner;
(iii) Changes in the legal status of an existing owner/partner;
(iv) Changes in the percentage of revenue distribution to an owner/partner;
(v) A description of team member activities; and
(vi) The amount of development fees paid to each team member, participant, partner,
or owner.
Section 5.8 Article V of this Agreement Controls.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
10
(i) Article V of this Agreement is incorporated by reference and made a part of the
Operating Agreement or any other similar agreement between the Developer and
the undersigned CBE Equity Participant(s) and Development Participant(s).
(ii) To the extent that Article V of this Agreement shall be deemed to be inconsistent
with any terms or conditions of the Operating Agreement or any other similar
agreement or any exhibits or attachments thereto between the Developer and the
undersigned CBE Equity Participant(s) and Development Participant(s), the terms
of Article V of this Agreement shall govern.
As it relates to or affects the CBE Equity Participant(s) and Development
Participant(s), neither the Operating Agreement or any other similar agreement
between the Developer and the undersigned CBE Equity Participant(s) and
Development Participant(s), nor this Agreement shall be amended to decreased
the participation percentage to less than 20% as mandated by D.C. Official Code
§ 2-218.49a.
Section 5.9 Equity Participation Unmet. If the Developer is unable to meet the 20% Equity
Participation requirement, including sweat equity contribution and cash equity investment, the
Developer shall pay to the District the outstanding cash equity amount as a fee in lieu of the
unmet Equity Participation requirement.
ARTICLE VI
SHORTFALL PAYMENT
Section 6.1 Failure to Meet CBE Minimum Expenditure. At the end of the Expenditure
Period as defined herein, DSLBD shall measure the difference between the CBE Minimum
Expenditure and Developer’s actual CBE expenditures. If Developer fails to meet its CBE
Minimum Expenditure as provided in Section 1.1 herein (a “Shortfall”), the Developer shall pay
a shortfall payment equal to 10% of the CBE Minimum Expenditure ($5,528,639), which shall
be paid to the District of Columbia in the time and in a manner to be determined by DSLBD.
(i) If the Developer’s Shortfall is less than 10% of the CBE Minimuum Expenditure,
and Developer has taken all actions reasonably necessary (as reasonably
determined by DSLBD based on Developer’s reports and other verifiable
evidence) to achieve the CBE Minimum Expenditure, the Developer may not be
required to pay a shortfall payment. The Developer may meet its burden to
demonstrate it has taken all actions reasonably necessary to achieve its CBE
Minimum Expenditure by (1) fulfilling all CBE outreach and recruitment efforts
identified in Article II of this Agreement; (2) complying with Article IV of this
Agreement; (3) providing evidence of the General Contractors’ compliance with
the commitments set forth in Article IV of this Agreement, and (4) by taking the
following actions, among other things1:
1 See Attachment 6 for a list of additional suggested outreach activities.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
11
a. In connection with the preparation of future bid packages, if any, develop a
list of media outlets that target CBEs and potential CBEs hereafter referred to
as “Target Audience” based on D.C. certification criteria;
b. During the initial construction of the Project, place advertisements in media
outlets that address the Target Audience on a regular basis (i.e., each time a
new bid package is sent out) and advertise the programmatic activities
established pursuant to the Agreement on an as needed basis;
c. Mail and/or email new procurement opportunity alerts to targeted CBEs
according to trade category;
d. In connection with the preparation of future bid packages, if any, develop a
list of academic institutions, business and community organizations that
represent the Target Audience so that they may provide updated information
on available opportunities to their constituents;
e. Make presentations and conduct pre-bid conferences advising of contracting
opportunities for the Target Audience either one-on-one or through targeted
business organizations;
f. Provide up to ten (10) sets, in the aggregate, of free plans and specifications
related to the particular bid for business organizations representing Target
Audiences upon request; and
g. Commit to promoting opportunities for joint ventures between non-CBE and
CBE firms to further grow CBEs and increase contract participation.
(ii) If the Developer’s Shortfall is less than 10% of the CBE Minimum Expenditure,
but Developer has not taken all actions reasonably necessary (as reasonably
determined by DSLBD based on Developer’s reports and other verifiable
evidence) to achieve the CBE Minimum Expenditure, Developer shall pay a
payment that is equal to the Shortfall.
In the event a CBE hired as part of the Project goes out of business, loses its certification during
the Project, or otherwise cannot perform in accordance with customary and acceptable standards
for the relevant industry, the Developer may identify and hire a substitute CBE capable of
performing in accordance with customary and acceptable standards for the relevant industry. If
the Developer cannot identify and hire a substitute CBE, the Developer may request in writing
that the Director identify a list of substitute CBEs capable of performing in accordance with
customary and acceptable standards for the relevant industry (“Request”). Only if, within ten
(10) business days after receiving the Request, the Director fails to send written notice to the
Developer identifying a list of substitute CBEs to perform the work (and the Developer
determines for an amount no greater than 5% above the remaining balance of the original CBE
contracted amount) may the Developer contract with a non-CBE to perform the work, provided
that the non-CBE contracted amount shall not exceed the balance of the original CBE contracted
amount by greater than 5% (“Approved Deduction”), and the Approved Deduction shall be
deducted from the CBE Minimum Expenditure.
CBE AGREEMENT – St. Elizabeths East – Parcel 6
12
Section 6.2 Failure to Meet Equity and Development Participation Requirements. Failure
to comply with the equity and development participation requirements of Article V of this
Agreement shall constitute a material breach of this Agreement and of the Land Disposition and
Development Agreement.
Section 6.3 Other Remedies. Failure to pay any required payments in the time and manner
specified by DSLBD shall be a material breach of this Agreement. In the event that the
Developer breaches any of its obligations under this Agreement, in addition to the remedies
stated herein, DSLBD does not waive its right to seek any other remedy against the Developer,
the general contractor of the Project and any manager of the Project that might otherwise be
available at law or in equity, including specific performance.
Section 6.4 Waiver. Any payments required under this Section may be rescinded or modified
by the Director upon consideration of the totality of the circumstances affecting such
noncompliance.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Primary Contact. The Director’s designee shall be the primary point of contact for
Developer for the purposes of collecting or providing information, or carrying out any of the
activities under this Agreement.
Section 7.2 Notices. Any notice, payment or instrument required or permitted by this
Agreement to be given or delivered to either party shall be deemed to have been received when
personally delivered, mailed, or emailed (with email confirmation), and addressed as follows:
To DSLBD: Department of Small and Local Business Development
441 4th Street NW, Suite 850 North
Washington, DC 20001
Attention: Director
Tel: (202) 727-3900
Fax: (202) 724-3786
and Office of the Deputy Mayor for Planning and Economic
Development Government of the District of Columbia
John A. Wilson Building
1350 Pennsylvania Avenue NW, Suite 317
Washington, DC 20004
Attention: Deputy Mayor for Planning and Economic
Development
Tel: (202) 727-6365
Fax: (202) 727-6703
CBE AGREEMENT – St. Elizabeths East – Parcel 6
13
With a copy to: Office of the Attorney General
John A. Wilson Building
1350 Pennsylvania Avenue NW, Suite 407
Washington, DC 20004
Attention: Attorney General
Tel: (202) 724-3400
Fax: (202) 347-8922
To Developer: Parcel 6 Community Partners LLC
1227 Marion Barry Ave SE, Suite 107
Washington, DC 20020
Attention: Omar Karim, Authorized Party
Tel: (301) 408-0800
Email: okarim@bannekerventures.com
With a copy to: Congress Heights Community Training and Development
Corporation
3215 Martin Luther King Jr Ave SE,
Washington, DC 20032
Attention: Monica Ray
Tel: (202) 539-4810
Fax: (202) 563-3589
Email: monica@chctdc.org
Each party may change its address for delivery of notice by delivering written notice of
such change of address to the other party.
Section 7.3 Severability. If any part of this Agreement is held to be illegal or unenforceable by
a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the
fullest extent possible.
Section 7.4 Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of any permitted successors and assigns of the parties hereto. This Agreement shall not
be assigned by the Developer without the prior written consent of the DSLBD, which consent
shall not be unreasonably withheld or delayed. In connection with any such consent of DSLBD,
DSLBD may condition its consent upon the acceptability of the financial condition of the
proposed assignee, upon the assignee’s express assumption of all obligations of the Developer
hereunder or upon any other reasonable factor which DSLBD deems relevant in the
circumstances. In any event, any such assignment shall be in writing, shall clearly identify the
scope of the rights and obligations assigned and shall not be effective until approved by the
DSLBD. DSLBD shall have no right to assign this Agreement except to another District agency.
Section 7.5 Amendment; Waiver. This Agreement may be amended from time to time by
written supplement hereto and executed by DSLBD and Developer. Any obligations hereunder
may not be waived, except by written instrument signed by the party to be bound by such waiver.
No failure or delay of either party in the exercise of any right given to such party hereunder or
the waiver by any party of any condition hereunder for its benefit (unless the time specified
CBE AGREEMENT – St. Elizabeths East – Parcel 6
14
herein for exercise of such right, or satisfaction of such condition, has expired) shall constitute a
waiver of any other or further right nor shall any single or partial exercise of any right preclude
other or further exercise thereof or any other right. The waiver of any breach hereunder shall not
be deemed to be a waiver of any other or any subsequent breach hereof.
Section 7.6 Governing Law. This Agreement shall be governed by the laws of the District of
Columbia.
Section 7.7 Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original.
Section 7.8 Entire Agreement. All previous negotiations and understandings between the
parties hereto or their respective agents and employees with respect to the transactions set forth
herein are merged into this Agreement, and this Agreement alone fully and completely expresses
the parties’ rights, duties and obligations with respect to its subject matter.
Section 7.9 Captions, Gender, Number and Language of Inclusion. The captions are
inserted in this Agreement only for convenience of reference and do not define, limit, or describe
the scope or intent of any provisions of this Agreement. Unless the context clearly requires
otherwise, the singular includes the plural, and vice versa, and the masculine, feminine and
neuter adjectives include one another. As used in this Agreement, the word “including” shall
mean “including but not limited to.”
Section 7.10 Attachments. The following exhibits shall be deemed incorporated into this
Agreement in their entirety (THERE ARE NO ATTACHMENTS 2 AND 3 FOR THIS
PROJECT):
Attachment 1: CBE Minimum Expenditure
Attachment 4: Quarterly Report
Attachment 5: Vendor Verification Forms
Attachment 6: Suggested Outreach Activities
Equity and Development Participation Overview Attachment
DSLBD reserves the right to amend the templates for all Attachments.
Section 7.11 Collected Penalty/ Fines. Any and all f ines imposed and collected by DSLBD
pursuant to this Agreement will be deposited into the fund established by D.C. Official Code § 2-
218.75.
Section 7.12 Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, assigns, heirs, and personal representatives.
Section 7.13 Recitals. The Recitals set forth on the first page are incorporated by reference and
made a part of this Agreement.
[Signatures to follow]
CBE AGREEMENT – St. Elizabeths East – Parcel 6
15
Approved as to legal sufficiency for the District of Columbia Department of Small and Local
Business Development:
B
y:
L orenzo McRae
General Counsel, DSLBD
AGR
EED TO AND EXECUTED THIS _______ DAY OF __________________ 2025
DI
STRICT OF COLUMBIA DEPARTMENT OF SMALL AND LOCAL BUSINESS
DEVELOPMENT
B
y: ____________________________
Rosemary Suggs-Evans
Director
D
EVELOPER, PARCEL 6 COMMUNITY PARTNERS LLC
B
y: ____________________________
Monica Ray
Authorized Party
15th July
CBEAGREEMENT-St.ElizabethsEast~ Parcel6
ACKNOWLEDGED AND AGREED TO,AS TO ARTICLE V,BY CBE
DEVELOPMENT PARTICIPANT(S):
Omar Karim, President
Banneker Communities
55% ofDevelopmentandEqui
(CBE# LZ11248082026)
ParticipationintheProject
ACKNOWLEDGED AND AGREED TO,AS TO ARTICLE V,BY CBE EQUITYPARTICIPANT(S):
Keith Lomax
RBK Construction and Development
7.5%of DevelopmentandEquityParticipationintheProject(CBE#LSDZRE65716102026)
16
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4934-9933-8563, v. 2
EXHIBIT F
FORM OF DEVELOPMENT AND COMPLETION GUARANTY
THIS DEVELOPMENT AND COMPLETION GUARANTY (this “Guaranty”) is made
as of ____________, 20__ (“Effective Date”), by _____________________ (the “Guarantor”),
for the benefit of the District of Columbia, a municipal corporation, acting by and through the
Office of the Deputy Mayor for Planning and Economic Development (“District”).
RECITALS:
WHEREAS, District and Parcel 6 Community Partners LLC (“Developer”) have entered
into a certain Land Disposition and Development Agreement, dated as of ____________, 20__
(the “Development Agreement”), pursuant to which, among other things, District has agreed to
lease a portion of the Property and sell a portion of the Property to Developer on or about the
Effective Date, and Developer has agreed to develop the Project on the Property.
WHEREAS, the continuing obligations of Developer to develop and construct the Project
as contemplated by the Development Agreement are set forth in that certain Construction and Use
Covenant dated as of the Effective Date between District and Developer (as may be amended from
time to time, the “Construction Covenant”) being recorded among the land records of the District
of Columbia as an encumbrance on Developer’s leasehold estate to the Property.
WHEREAS, to induce District to proceed to Closing and execute that certain Ground Lease
Agreement dated as of the Effective Date (the “Ground Lease”) and deliver the Quitclaim Deed
dated as of the Effective Date (the “Deed ”), Guarantor has agreed to deliver this Guaranty to
District to guaranty the performance of the Guaranteed Obligations (as defined below).
NOW, THEREFORE, in consideration of the premises, the mutual covenants contained
herein and other good and valuable consideration in hand paid, the receipt and sufficiency of which
are hereby acknowledged, Guarantor hereby agrees as follows:
1. Recitals; Definitions.
1.1 The foregoing recitals are true and correct and are incorporated into this Guaranty
by this reference and made a material part of this Guaranty.
1.2 Capitalized terms used and not defined in this Guaranty shall have the meaning s
attributed to them in the Construction Covenant.
2. Representations and Warranties.
2.1 Guarantor represents and warrants to District as follows:
(a) the making and performance of this Guaranty by Guarantor will not result
in any breach of any term, condition , or provision of, or constitute a default under, any contract,
agreement, or other instrument to which Guarantor is a party or by which it is bound, or result in
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4934-9933-8563, v. 2
a breach of any regulation, order, writ, injunction, or decree of any court or any commission, board,
or other administrative agency entered in any proceeding to which Guarantor is a party or by which
it is bound;
(b) Guarantor has reviewed, with the advice and benefit of its legal counsel, the
terms and provisions of the Ground Lease , and the Deed, as applicable, this Guaranty, the
Construction Covenant, the Schedule of Performance, the Approved Plans and Specifications, and
the documents referenced in each of the foregoing;
(c) Guarantor (if Guarantor is not a natural person) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization and is duly
qualified to do business, and is in good standing, in the District of Columbia;
(d) Guarantor has been duly authorized to carry on its business, to hold title to
and own the property it owns, to execute, deliver, and perform this Guaranty, and to consummate
the transactions contemplated hereby and thereby;
(e) this Guaranty has been duly authorized, executed and delivered by
Guarantor, and this Guaranty, and each term and provision hereof are the legal, valid and binding
obligation of Guarantor enforceable against Guarantor in accordance with its terms:
(f) no actions, suits, or proceedings are pending or, to Guarantor’s knowledge,
threatened in writing against or affecting Guarantor before any G overnmental Authority or in or
before any court, arbitrator, or other adjudicative body, which could, if adversely decided, result
in a material adverse change in the financial condition of Guarantor (in comparison to any state of
affairs existing before the Effective Date) or adversely affects the ability of Guarantor to perform,
or of District to enforce, any provision of this Guaranty;
(g) no consent, approval , or authorization of, or registration, declaration, or
filing with, any Governmental Authority or any other Person is required that has not been obtained
in writing by Guarantor, in connection with the execution, delivery, and performance by Guarantor
of this Guaranty and the transactions contemplated by this Guaranty;
(h) Guarantor is not insolvent (as such term is defined or determined for
purposes of the Bankruptcy Reform Act of 1978 (11 U.S.C. § 101- 1330), as amended or
recodified, or any other bankruptcy law (collectively, the “Bankruptcy Code”), and the execution
and delivery of this Guaranty will not make Guarantor insolvent;
(i) neither this Guaranty nor any financial information, certificate, or statement
furnished to District by or on behalf of Guarantor contains any untrue statement of a material fact
or intentionally, or knowingly, omits to state a material fact necessary to make the statements
herein and therein, in the light of the circumstances under which they are made, not misleading;
(j) no conditions exist which would prevent Guarantor from complying with
the provisions of this Guaranty within the time limits set forth herein and/or in the Construction
Covenant, as may be extended or deemed extended pursuant to the terms thereof;
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4934-9933-8563, v. 2
(k) Guarantor has filed all tax returns and reports required by law to have been
filed by it, and has paid all taxes, assessments, and governmental charges levied upon it or any of
its assets which are due and payable, except any such taxes or charges which are being contested
in good faith by appropriate proceedings and for which adequate reserves have been set aside;
(l) there are no conditions precedent to the effectiveness of this Guaranty;
(m) Guarantor is not a Prohibited Person;
(n) Guarantor has a business relationship with Developer and is deriving a
material financial benefit from District conveying the Property to, and entering into the Ground
Lease, Sale, and the Construction Covenant with Developer; and
(o) all financial statements delivered to District at any time by or on behalf of
Guarantor (i) are true and correct in all material respects, (ii) fairly present in a manner consistent
with prior statements submitted to District the respective financial conditions of the subjects
thereof and for the periods referenced therein, and (iii) have been prepared in accordance with
generally accepted accounting principles, or other accounting principles as District may agree ,
consistently applied, and there has be en no material adverse change in the financial position of
such Guarantor since the respective dates of (or periods covered by) such statements, and without
limiting the foregoing, all assets shown on such financial statements, unless clearly designated to
the contrary on such financial statements, (A) are free and clear of any exemption or any claim of
exemption of Guarantor or any other Person, (B) accurately reflect all debt and prior pledges or
encumbrances (direct or indirect) of or on any of Guarantor’s assets at the date of the financial
statements and at all times thereafter, and (C) are owned individually by Guarantor and not jointly
with any spouse or other Person.
2.2 Guarantor agrees that all of the representations and warranties of Guarantor in this
Guaranty are made and shall be true as of the Effective D ate and shall survive the execution and
delivery of this Guaranty. Guarantor shall inform District in writing within five (5) Business Days
upon it discovering any breach of such representations or warranties.
2.3 Guarantor acknowledges that District is consummating the Closing in reliance upon
the representations, warranties, and agreements contained in this Guaranty. District shall be
entitled to such reliance notwithstanding any investigation which has been made, has not been
made, or may be conducted by District or on District’s behalf.
3. Guaranteed Obligations . Guarantor hereby absolutely and unconditionally
guarantees to District and its successors and assigns: (i) the Commencement of Construction
and prosecution of construction through Final Completion of the Project pursuant to the terms
and conditions of the Construction Covenant and within the time period allotted therefor in the
Schedule of Performance; (ii) in accordance with Section 4, the Property, the Improvements[
and Developer’s leasehold estate in the Property shall be kept free and clear of all liens (other
than liens in favor of a mortgagee as permitted under the Ground Lease , as applicable, and
Construction Covenant ); (iii) the payment in full of all amounts due to any contractor,
subcontractor, materialman, laborer, any employee or other Person who is engaged at any time
in work or supplying materials in connection with the Project if and to the extent not paid by
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4934-9933-8563, v. 2
Developer; (iv) any obligation of the Developer under the Construction Covenant to indemnify,
defend, and hold harmless District, which obligations shall survive the release of this Guaranty;
and (v) the costs of enforcement of this Guaranty by District (including, without limitation,
reasonable attorneys’ fees) (collectively, the “Guaranteed Obligations”).
4. Liens. If any mechanic's or materialmen's liens should be filed, or should attach, against
the Property with respect to the Project and if such mechanic's or materialmen's liens have not been
removed by Developer or released or waived by the party filing same as required by the terms of
the Construction Covenant, within thirty (30) days after Guarantor is advised by District of the
filing of such liens, Guarantor shall take, or cause to be taken, action to cause the removal, release
or waiver of such liens, including, if necessary, the posting of a bond or other security against the
consequences of their possible judicial enforcement. So long as Guarantor timely complies with
the immediately preceding sentence, Guarantor shall have the right to contest in good faith any
claim, lien, or encumbrance, provided that Guarantor does so diligently and without prejudice to
District.
5. Financial Statements.
5.1 W ithin ninety (90) days after the end of each of Guarantor’s fiscal year (or each
calendar year if Guarantor is a natural person) , Guarantor shall deliver to District a copy of such
Guarantor’s balance sheet, income statement , and statement of changes in financial position for
such fiscal year (collectively, the “Guarantor Financial Statements”). The Guarantor Financial
Statements shall (a) include a schedule of all material contingent liabilities and all other notes and
schedules relating thereto, (b) be in a form reasonably satisfactory to District, (c) be prepared in
accordance with generally accepted accounting principles (or other accounting principles as
District may agree) consistently applied , (d) be audited (or unaudited and reviewed) by an
independent, certified public accountant who is a member of the American Institute of Certified
Public Accountants and otherwise acceptable to District, and (e) be accompanied by a certification
of Guarantor to District (made by the chief financial officer in the case of any corporate Guarantor)
that such Guarantor Financial Statements (i) ha ve been prepared in accordance with generally
accepted accounting principles (or other accounting principles as District may agree) consistently
applied, (ii) accurately present the financial condition of such Guarantor as of the respective dates
thereof, and (iii) show all direct and contingent material liabilities of Guarantor as of such dates.
5.2 From time to time promptly after District’s request, but no more frequently than
quarterly, Guarantor shall deliver to District such additional information, documents, reports, and
statements regarding its business operations reasonably related to the Project or the financial
condition of Guarantor as District may reasonably request.
6. Nature of Guaranty; Independent Obligation. This is a direct, absolute, and
unconditional, guaranty of completion, and is a guaranty of payment and performance, not of
collection. The obligations of Guarantor under this Guaranty are independent and primary, and
District shall not be required to take any action against Developer, any mortgagee, or any other
Person or resort to any other collateral or security given for the performance of Developer as a
precondition to the obligations of each Guarantor under this Guaranty. Guarantor hereby waives
any rights it may have to compel District to proceed against Developer, or any security, or to
participate in any security for Guarantor’s obligations hereunder, even though any rights which
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4934-9933-8563, v. 2
such Guarantor may have against Developer or others may be destroyed, diminished or otherwise
affected by such action or lack thereof. Neither the declaration of a Developer Default, nor the
exercise of any remedies against Developer, shall in any way affect Guarantor’s responsibility for
the obligations guaranteed hereunder, even though any rights which Guarantor may have against
Developer or others may be destroyed, diminished or otherwise affected by such action. To the
fullest extent permitted by law, this Guaranty shall be construed as a continuing, absolute, and
unconditional guaranty of performance without regard to: (a) the legality, validity, or
enforceability of any provisions of the Construction Covenant, or any of the obligations of
Developer evidenced thereby; (b) any defense, setoff, or counterclaim that may be available at any
time to Developer or any other Person against District or any other Person and any right of setoff
at any time held by District or any other Person (including, without limitation, any defense, setoff,
or counterclaim by Guarantor under this Guaranty); or (c) any other circumstances whatsoever
(with or without notice to or knowledge of Guarantor), whether or not similar to any of the
foregoing, that constitutes or might be construed to constitute an equitable or legal discharge of
Developer or any other Person in bankruptcy or in any other instance.
7. No Release or Waiver of Obligations; Consents.
7.1 No action which Developer or District may take, or omit to take, in connection with
the Project, nor any course of dealing with Developer or any other Person, shall release Guarantor’s
obligations hereunder or affect this Guaranty in any way, even if any such action may otherwise
be deemed a legal or equitable discharge of a guarantor or surety.
7.2 By way of example, but not in limitation of the foregoing, Guarantor hereby
expressly agrees that District may, from time to time, and without notice to Guarantor, but with
the written prior agreement of Developer, which shall not, in any case, discharge or impair
Guarantor’s obligations or any rights against Guarantor:
(a) amend, change, or modify, in whole or in part, the Construction Covenant;
(b) waive any terms, conditions, or covenants of the Construction Covenant, or
grant any extension of time or forbearance for performance of the same;
(c) compromise or settle any amount or any matter in dispute under the
Construction Covenant or other document;
(d) surrender, release, or subordinate any or all security for the Construction
Covenant, or accept additional or substituted security therefor;
(e) extend, accelerate, or otherwise change the time of payment or performance
of any obligations under the Construction Covenant or any other document;
(f) exercise its rights and remedies under the Construction Covenant or any
other document;
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4934-9933-8563, v. 2
(g) approve, disapprove, inspect, review, or fail to inspect or review, the
progress, status, or quality of construction or any costs, expenses, financing, contracts, or other
matters relating thereto;
(h) accept new or additional instruments, documents, or agreements in
exchange for, or relative to, the Construction Covenant, or any part thereof or performance
pursuant thereto; and
(i) release, substitute, or add guarantors to guaranty performance of the
obligations under the Construction Covenant or any other document.
7.3 Guarantor consents and agrees that District may, at any time and from time to time,
without notice or demand, and without affecting the enforceability or continuing effectiveness
hereof: (a) supplement, modify, amend, waive, or enter into or give any agreement, approval, or
consent with respect to the Project, or any additional security or guaranties, or any condition,
covenant, default, remedy, right, representation, or term with respect thereto; (b) accept partial
payments on, or performance of, the obligations owed to District and apply any and all payments
and/or recoveries from Developer or any other Person to such of the obligations owed to District
as District may elect in its sole discretion; (c) receive and hold additional security or guaranties for
the obligations owed to District or any part thereof; ( d) release, reconvey, terminate, waive,
abandon, fail to perfect, subordinate, exchange, substitute, transfer, or enforce any security or
guaranties, and apply any security and direct the order or manner of sale thereof, as District may
elect in its sole and absolute discretion may determine; (e ) release any Person from any personal
liability with respect to the obligations owed to District or any party thereof; (f ) settle, release on
terms satisfactory to District, as the case may be, or by operation of applicable law or otherwise,
liquidate or enforce any obligations owed to District and any security or guaranty in any manner,
consent to the transfer of any security and bid and purchase at any sal e (other than by reason of
the timely and full payment and performance of all obligations owed to District); (g ) consent to
the merger, change of any other restructuring or termination of the corporate existence of
Developer or any other Person and correspondingly restructure the obligations owed to District,
and any such merger, change, restructuring, or termination shall not affect the liability of such
Guarantor or the continuing effectiveness hereof, or the enforceability thereof with respect to all
or any part of the obligations owed to District; (h) assign the rights to this Guaranty to another
Person; or (i) otherwise deal with Developer or any other Person as District may elect in its sole
discretion.
8. Bankruptcy; Relief from Automatic Stay.
8.1 The release or discharge of Developer, Guarantor, or any other Person from any
obligation in any receivership, bankruptcy, winding-up or other creditor proceeding shall not affect
the validity of this Guarantor or of Guarantor’s obligations hereunder.
8.2 If (i) a Developer Default has occurred under the Construction Covenant and (ii) the
automatic stay imposed by the applicable provisions of the Bankruptcy Code, or under any other
applicable law, against the exercise of the rights and remedies otherwise available to creditors of
Developer is deemed by the court having jurisdiction to apply to Guarantor who is not in
bankruptcy so that Guarantor is not permitted to perform its obligations under this Guaranty and/or
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4934-9933-8563, v. 2
District may not immediately enforce the terms of this Guaranty or exercise such other rights and
remedies against Guarantor as would otherwise be provided by law, District shall immediately be
entitled, and Guarantor hereby consents, to relief from such stay, and Guarantor hereby authorizes
and directs District to present this Guaranty to the applicable court to evidence such agreement
and consent.
9. Waivers.
9.1 To the fullest extent the Guarantor may do so under a pplicable law, Guarantor
expressly waives notice of acceptance of this Guaranty or the right to enforce any of the terms of
the Construction Covenant, or any liability under this Guaranty. District shall not be required to
give any notice to Guarantor hereunder in order to preserve or enforce District’s rights hereunder
(including, without limitation, notice of any Developer Default under the Construction Covenant
or other documents evidencing and securing the obligations of Developer thereunder), any such
notice being expressly waived by Guarantor.
9.2 Guarantor agrees that District shall have no duty to disclose to Guarantor any
information it receives , or ha s reasonably available to it , regarding the financial status of
Developer, or any contractor, subcontractor or materialmen involved in the construction of the
Project, or any information relating to the Project, whether or not such information indicates that
the risk that Guarantor may be required to perform hereunder has been or may be increased.
Guarantor assumes full responsibility for being and keeping informed of all such matters.
9.3 In addition to the foregoing, Guarantor expressly waives the following defenses:
(a) lack of validity, genuineness , or enforceability of any provision of any of
the Ground Lease , as applicable, the Construction Covenant , or any other agreement between
District, Developer, Guarantor or any other Person;
(b) the incapacity, lack of authority, death, or disability of any Person or the
failure of District to file or enforce a claim against the estate of any Person in any administrative,
bankruptcy, or other proceeding;
(c) the election of remedies by District, whether or not such election may affect
in any way the recourse, subrogation, or other rights of Guarantor against Developer or any other
Person in connection with the Guaranteed Obligations;
(d) the negligence of District in administering or overseeing the Project or any
part thereof, or taking or failing to take any action in connection therewith;
(e) any change to the Approved Plans and Specifications, the Ground Lease, as
applicable the Schedule of Performance, the Construction Covenant , or any of the documents
referenced in any of the foregoing made without the consent or knowledge of Guarantor;
(f) the unenforceability or invalidity of any security or guaranty for the
Guaranteed Obligations or the lack of perfection or continuing perfection or failure of priority of
any security for the Guaranteed Obligations;
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4934-9933-8563, v. 2
(g) the failure of District to marshal assets in favor of Developer or any other
Person;
(h) the failure of District to give notice o f sale or other disposition of any
collateral (now or hereafter securing the obligations of any Person) to Developer or any other
Person, as applicable, or any defect in any notice that may be given in connection with any sale or
disposition of collateral or to comply with applicable law or other requirements in connection with
the sale or other disposition of any collateral or other security for any obligation owed to District;
(i) any act or omission of District, or others, that directly or indirectly results
in or aids the discharge or release of Developer or any other Person, or the Guaranteed Obligations
or any security or guaranty therefor by operation of law or otherwise (other than by reason of the
timely performance of all Guaranteed Obligations);
(j) any applicable law or other laws or requirements of the District of Columbia
or other jurisdictions which provides that the obligation of a surety or guarantor must neither be
larger in amount nor in other respects more burdensome than that of the principal or which reduces
a surety's or guarantor's obligation in proportion to the principal obligation, including, without
limitation, all rights and benefits under the laws of the District of Columbia purporting to reduce
Guarantor's obligation in proportion to the obligation of the principal;
(k) the avoidance of any lien in favor of District for any reason;
(l) all rights or defenses Guarantor may have by reason of protection afforded
to a principal with respect to the Guaranteed Obligations pursuant to applicable law or other laws
of the District of Columbia or other jurisdictions limiting or discharging the principal's obligations;
and
(m) any defense based on any other circumstances whatsoever (with or without
notice to or knowledge of Guarantor), whether or not similar to any of the foregoing, that
constitutes or might be construed to constitute an equitable or legal discharge of Developer or any
other Person in bankruptcy or in any other instance.
(n) no failure on the part of District to exercise, and no delay in exercising, any
right under this Guaranty shall operate as a waiver or preclude any other or further exercise thereof
or the exercise of any other right.
10. Rights Upon Default.
10.1 Upon the occurrence and during the continuance of (a) any failure by Guarantor in
the performance of the Guaranteed Obligations, (b) the dissolution or insolvency of Guarantor, (c)
the inability of Guarantor to pay its debts as they mature, (d) a general assignment by Guarantor
for the benefit of creditors, (e) the institution of any proceeding by or against Guarantor in
bankruptcy or for a reorganization or an arrangement with creditors, or for the appointment of a
receiver, trustee, or custodian for Guarantor or its properties that is not dismissed or stayed within
one hundred twenty (120) days after Guarantor's receipt of notice of filing, (f) the falsity in any
material respect of or any material omission in any representation made to District by Guarantor,
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4934-9933-8563, v. 2
or (g) any other default by Guarantor of any other obligations owed to District by Guarantor under
this Guaranty (a “Guarantor Default”), District shall have such rights and remedies available to
it as permitted by law and in equity and may enforce this Guaranty in accordance with the terms
hereof, independently of any other remedy or security District at any time may have or hold in
connection with the Guaranteed Obligations as to Developer, and it shall not be necessary for
District to marshal assets in favor of Developer, Guarantor, or any other Person or to proceed upon
or against and/or exhaust any security or remedy before proceeding to enforce this Guaranty in
accordance with the terms hereof. Additionally, Guarantor agrees that during the continuance of
any Guarantor Default, District may, without the consent of or notice to Guarantor, take or refrain
from taking such other action to enforce the provisions of this Guaranty against Guarantor as it
may from time to time determine in its sole discretion as to any obligations then unperformed.
10.2 Guarantor absolutely, irrevocably and unconditionally, and jointly and severally,
agrees to the fullest extent permitted by law, to indemnify, defend, and hold harmless District from
any and all loss, cost, liability, and expense arising out of or in connection with (a) any Guarantor
Default and (b) the enforcement of this Guaranty by District (including, without limitation,
reasonable attorneys’ fees).
10.3 Guarantor shall immediately, upon demand therefor e, reimburse District for any
and all expenditures incurred by District under this Section 10, plus interest thereon at the rate of
fifteen percent (15%) per annum until all sums are paid to District.
10.4 Guarantor agrees that District and Developer or any other Person may deal with
each other in connection with the Guaranteed Obligations , or otherwise, or alter any contracts or
agreements now or hereafter existing between them, in any manner whatsoever, all without in any
way altering or affecting the security of this Guaranty. District's rights hereunder shall be reinstated
and revived and the enforceability of this Guaranty shall continue with respect to any amount at
any time paid on account of the Guaranteed Obligations, which thereafter shall be required to be
restored or returned by District upon the bankruptcy, insolvency, or reorganization of Developer
of any other Person, or for any other reason, all as though such amount had not been paid. The
rights of District created or granted herein and the enforceability of this Guaranty at all times shall
remain effective even though the Guaranteed Obligations, including any part thereof or any other
security or guaranty therefor, may be or hereafter may become invalid or otherwise unenforceable
as against Developer.
11. Cumulative Rights. The exercise by District of any right or remedy hereunder, under the
Construction Covenant, any other documents executed by District and Developer, or at law or in
equity, shall not preclude the concurrent or subsequent exercise of any other right or remedy.
District shall have all rights, remedies, and recourses afforded to District by reason of this
Guaranty, the Construction Covenant, any other documents executed between District and
Developer, or by law or equity or otherwise, and the same (a) shall be cumulative and concurrent;
(b) may be pursued separately, successively, or concurrently against Guarantor or others obligated
for the Guaranteed Obligations, or any part thereof, or against any one or more of them, at the sole
and absolute discretion of District; (c) may be exercised as often as occasion therefor shall arise,
it being agreed by Guarantor that the exercise of, discontinuance of the exercise of, or failure to
exercise any of such rights, remedies, or recourses shall in no event be construed as a waiver or
release thereof or of any other right, remedy, or recourse; and (d) are intended to be and shall be
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4934-9933-8563, v. 2
nonexclusive. No waiver of any default on the part of Guarantor or of any breach of any of the
provisions of this Guaranty or of any other document shall be considered a waiver of any other or
subsequent default or breach, and no delay or omission in exercising or enforcing the rights and
powers granted herein or in any other document shall be construed as a waiver of such rights and
powers, and no exercise or enforcement of any rights or powers hereunder or under any other
document shall be held to exhaust such rights and powers, and every such right and power may be
exercised from time to time. The granting of any consent, approval, or waiver by District shall be
limited to the specific instance and purpose therefor and shall not constitute consent or approval
in any other instance or for any other purpose. No notice to, or demand on, Guarantor in any case
shall of itself entitle such Guarantor to any other or further notice or demand in similar or other
circumstances.
12. Statute of Limitations and Other Laws . Until the Guaranteed Obligations have been
irrevocably paid and/or performed in full, all of the rights, privileges, powers, and remedies
granted to District hereunder shall continue to exist and may be exercised by District at any time
and from time to time, irrespective of the fact that any of the Guaranteed Obligations may have
become barred by any statutes of limitations. Guarantor expressly waives the benefit of any and
all statutes of limitations, and any and all laws providing for exemption of property from execution
or for valuation and appraisal upon foreclosure, and any and all rights and benefits, if any, arising
under the laws of the District of Columbia. Furthermore, Guarantor acknowledge that any claims
brought by District that arise under, or as a result of, this Guaranty are not subject to the statute of
limitations contained in D.C. Official Code § 12-301, as amended.
13. Indemnification. Guarantor agrees to indemnify and hold harmless District for all
reasonable, direct, and out-of-pocket costs and expenses, including, without limitation, all court
costs, reasonable attorneys’ fees and expenses, and costs of collection incurred or paid by District
arising out of or in connection with (a) the Guaranteed Obligations and (b) the enforcement of this
Guaranty by District. Notwithstanding the foregoing, Guarantor shall not have any obligation to
indemnify District for any costs and expenses, including, without limitation, all court costs,
reasonable attorneys’ fees and expenses, if Guarantor should prevail in an enforcement action;
provided, further, the immediately preceding proviso clause shall not be deemed to release
Guarantor from its indemnification obligations under this Guaranty if District prevails against
Guarantor in any enforcement action notwithstanding the fact that District may not have prevailed
against Guarantor in a previous enforcement action.
14. No Limitation of Obligations. To the fullest extent Guarantor may do so under applicable
law, Guarantor agrees that it shall make no claim or setoff, defense, recoupment , or counterclaim
of any sort whatsoever against District, nor shall Guarantor seek to impair, limit, or defeat in any
way its obligations hereunder. To the fullest extent Guarantor may do so under a pplicable law,
Guarantor hereby waives any right to such a claim in limitation of its obligations hereunder.
15. No Right of Subrogation . Until all of the Guaranteed Obligations are fully paid,
performed and/or fulfilled, Guarantor agrees solely with respect to itself that it: (i) shall have no
right of subrogation against Developer by reason of any payments or acts of performance by
Guarantor in compliance with the obligations of Guarantor under this Guaranty; (ii) waives any
right to enforce any remedy which Guarantor now or hereafter shall have against Developer by
reason of any payment or act of performance in compliance with the obligations of Guarantor
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4934-9933-8563, v. 2
hereunder; and (iii) subordinates any present or future, liquidated or unliquidated, liability,
indebtedness, or obligation of Developer to Guarantor, irrespective of the respective dates of the
incurrence, accrual , or maturity thereof, to the indebtedness and obligations of Developer to
District under the Construction Covenant.
16. No Assignment or Delegation; Merger. Except in connection with an assignment of the
Construction Covenant permitted pursuant to the terms thereof or otherwise approved by District,
Guarantor shall not assign or delegate its obligations under this Guaranty. If Guarantor is not a
natural person and is merged into or with any other company, firm or corporation, the resulting
merged company, firm or corporation shall become liable as a Guarantor under this Guaranty to
the same extent as the original named Guarantor hereunder.
17. Choice of Law and Consent to Jurisdiction . This Guaranty shall , in all respects, be
governed by and construed in accordance with the laws of the District of Columbia, without
reference to its conflicts of law principles. Guarantor hereby consents to jurisdiction of the federal
or local jurisdiction courts within the District of Columbia for purposes of such litigation and waives
any right it may have to seek a change of venue of such proceedings. Guarantor further agrees not to
assert in any action, suit or proceeding arising out of or relating to the Construction Covenant that
Guarantor is not personally subject to the jurisdiction of such courts, that the action, suit, or other
proceeding is brought in an inconvenient forum, or that the venue of the action, suit , or other
proceeding is improper. Guarantor agrees that service of process may be made, and personal
jurisdiction over Guarantor obtained, by serving a copy of the summons and complaint upon
Guarantor at the notice address set forth below in accordance with the applicable laws of the District
of Columbia. Nothing herein contained, however, shall prevent District from bringing any action or
exercising any right against Guarantor within any other jurisdiction or state. Initiating such
proceeding or taking such action in any other jurisdiction or state shall not, however, constitute a
waiver of the agreement herein contained that the laws of the District of Columbia shall govern the
rights and obligations of the parties hereunder. Guarantor agrees that District may, and Guarantor
agrees not to oppose District’s attempts to, consolidate any litigation arising out of or relating to this
Guaranty with any action(s), suit(s), or proceeding(s) against Developer or any other individual or
entity and/or the property of any of the foregoing arising out of or relating to the Construction
Covenant.
18. Notices. Any notice, demand, statement, or request required under this Guaranty shall be in
writing and delivered (i) by U.S. Certified mail (return receipt requested, postage pre-paid), (ii) by
hand, (iii) by reputable private overnight commercial courier service, (iv) by electronic mail, or
(v) such other means as the Parties may agree in writing, at the following respective addresses:
IF TO DISTRICT:
Office of the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attention: Deputy Mayor for Planning and Economic Development
Email: dmpednotice@dc.gov
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4934-9933-8563, v. 2
With a copy to:
Office of the General Counsel
for the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attention: General Counsel
Email: dmpednotice@dc.gov
IF TO GUARANTOR:
__________________________________
__________________________________
__________________________________
With a copy to:
__________________________________
__________________________________
__________________________________
Notices served upon District or Guarantor in the manner aforesaid shall be deemed to have
been received for all purposes under this Guaranty as follows: (i) if hand delivered to a party
against receipted copy, when the copy of the notice is receipted; (ii) if given by nationally
recognized overnight delivery service, on the next Business Day after the notice is deposited with
the overnight delivery service; (iii) if given by certified mail, return receipt requested, postage
prepaid, on the date of actual delivery or refusal thereof , or (iv) if given by electronic mail, upon
the recipient’s electronic mail response confirming receipt. If notice is tendered under the terms of
this Guaranty and is refused by the intended recipient of the notice, the notice shall nonetheless be
considered to have been received and shall be effective as of the date provided in this Guaranty.
19. Severability. In the event that any provision of this Guaranty is held to be void or
unenforceable, all other provisions shall remain unaffected and be enforceable , unless this
construction would constitute a substantial deviation from the general intent of the Parties as
reflected in this Guaranty.
20. Waiver of Jury Trial . TO THE EXTENT PERMITTED BY LAW, EACH PARTY
HEREBY: (I) COVENANTS AND AGREES NOT TO ELECT TRIAL BY JURY OF ANY ISSUE
HEREUNDER TRIABLE OF RIGHT BY A JURY AND (II) WAIVES ANY RIGHT TO TRIAL
BY JURY OF ANY ISSUE FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW
OR HEREAFTER EXIST. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY
GIVEN, KNOWINGLY AND VOLUNTARILY, BY GUARANTOR, AND THIS WAIVER IS
INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO
WHICH THE RIGHT TO A JURY TRIAL WOULD OTHERWISE ACCRUE. EACH PARTY
ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE
OTHER PARTY TO PROVIDE OR ACCEPT THIS GUARANTY, AS APPLICABLE. FOR THE
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4934-9933-8563, v. 2
PURPOSES OF THIS SECTION 20, THE TERM “PARTY” IS DEEMED TO MEAN DISTRICT,
AS WELL AS GUARANTOR.
21. Time is of the Essence. Time is of the essence with respect to all matters set forth in this
Guaranty.
22. No Amendment . Neither this Guaranty nor any provision hereof may be modified,
amended, waived, terminated, or changed orally, but only by an agreement in writing signed by
District and Guarantor.
23. Irrevocable Release. This Guaranty shall be irrevocable by the Guarantor until this
Guaranty is automatically released upon District’s issuance of the District Certificate of Final
Completion for the Project.
[SIGNATURE PAGE FOLLOWS]
14
SIGNATURE PAGE TO
DEVELOPMENT AND COMPLETION GUARANTY
IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the Effective Date.
GUARANTOR:
___________________
GOVERNMENT OF THE DISTRICT OF COLUMBIA
Department of Employment Services
wk
a
=
MURIEL BOWSER Dr. UNIQUE MorRIS-HUGHES
Mayor DiRECTOR
August4,2025
CharlesBattleDevelopmentDirector1738EltonRoad,Suite215SilverSpring,MD 20903
Re:FirstSourceEmploymentAgreement
DearCharles,
EnclosedisyourcopyofthesignedFirstSourceEmploymentAgreementbetweentheD.C.Department
ofEmploymentServices(DOES)andParcel6CommunityPartners_{&Developer,GeneralContractor
CorSubcontractor(1.UnderthetermsoftheAgreement,youarerequiredtouseDOESasthefirstsourcetofillallnewjobscreatedasaresultofProject:StElizabethParcel6Redevelopment
‘YoumustregisterandpostyourjobvacanciestotheDepartmentofEmploymentServices’VirtualOne-Stop(VOS)atwww.denetworks.org.
Inaddition,youarerequiredtohavethefollowingpercentageofhoursworkedbyDistrictresidents:20%ofjourneyworkerhours;60%ofapprenticehours;51%ofskilledlaborerhours;and70%ofcommonlaborerhours.Further,DistrictresidentsregisteredinprogramsapprovedbytheDistrictofColumbiaApprenticeshipCouncilshallwork35%ofallapprenticeshiphoursworkedinconnectionwiththeProject‘or60%whereapplicable.
Reminder:AllGeneralContractorsmustinvitetheirsubcontractorsthataresubjecttotheFirstSourceEmploymentAgreementrequirements,tojointheprojectusingtheFirstSourceOnlineRegistration&ReportingSystem(FORRS),websitehup://firstsource.dc.gov.Additionally,contractorsarerequiredtoreporthoursworkedpercentagesthroughoutthedurationofyourcontract.ContactthemonitorlistedbelowregardingLCPTrackersubmission.
IfyouhaveanyquestionsorneedadditionalinformationpleasecontactDeCarloWashington,(202)698-5772,decarlo,washington@de.gov
DanielKingAssociateDirectorOfficeofFirstSourceCompliance
Enclosure
4058MinnesotaAve,N.E.+Suite5000*Washington,D.C.20019+Office:202.671.1900
wwe x ke
zz GOVERNMENTOFTHEDISTRICTOFCOLUMBIA— FIRSTSOURCEEMPLOYMENTAGREEMENTFOR ——CONSTRUCTIONPROJECTSONLY
GOVERNMENT-ASSISTEDPROJECT/CONTRACTINFORMATIONCONTRACT/SOLICITATIONNUMBER:"ereormotniresit8 Sens careDISTRICTCONTRACTINGAGENCY:DMPED.
CONTRACTING OFFICER: seenTELEPHONE NUMBER: 202-727-4282
TOTALCONTRACTAMOUNT: $152,110,000
THISSECTIONTO BECOMPLETEDBYTHEBENEFICIARYONLY:TOTALGOVERNMENTASSISTEDFUNDEDAMOUNT:#22 DATE[COCONTRACTCOGRANTCILOANOTAXABATEMENTOREXEMPTION(]LANDTRANSFER[LLANDDISPOSITIONANDDEVELOPMENTAGREEMENTDTAX INCREMENTFINANCING[ANY ADDITIONALLEGISLATION,IFYES_
D.C.CODE#
GENERAL CONTRACTORWILLMEETTHEHIRINGOR HOURSWORKEDPERCENTAGESREQUIREMENTSFORENTIREPROJECT[¥] OR PEREACHSUBCONTRACTOR{]
PROJECTNAME:&Ssosteccutemnnor
PROJECTADDRESS: rencecaseCITY:womwone & ZIPCODE:=PROJECTSTARTDATE:“0922 PROJECTEND DATE:tremeEMPLOYERSTARTDATE:es EMPLOYEREND DATE:"eree20
EMPLOYER INFORMATIONEMPLOYERNAME:$ecstconmnPomEMPLOYERADDRESS:127m nr56 67CITY:Manoa STATE:© ZIPCODE:2‘TELEPHONENUMBER:»'-0<00 FEDERALIDENTIFICATIONNO..32608
CONTACT PERSON:— SmAram‘TITLE:Authorized Representative
E-MAIL:senetersiereinsom TELEPHONE NUMBER: =‘CERTIFIEDBUSINESSENTERPRISESCERTIFICATIONNUMBER:21201120Goons:Geonese
D.C.APPRENTICESHIPCOUNCILREGISTRATIONNUMBER:ARE YOU A SUBCONTRACTOR [_]YES NO IFYES,NAME OF PRIMECONTRACTOR:
ThisFirstSourceEmploymentAgreement(Agreement),inaccordancewithWorkforceIntermediaryEstablishmentandReformoftheFirstSourceAmendmentActof2011(D.C.OfficialCode§§2-219.012.219.05),andrelevantprovisionsoftheApprenticeshipRequirementsAmendmentActof2004(D.C.OfficialCode§2-219.03and§32-1431)isa requiredagreementbetweentheDistrictofColumbiaDepartmentofEmploymentServices(DOES)andEMPLOYER.
EMPLOYER,whichincludestheBeneficiaryandallcontractorsandsubcontractors,isworkingonacontractorprojectthathasreceived:
1 D.C.Governmentassistancevaluedbetween$300,000and$5 milliondollars,requiredtomakea
‘goodfaithefforttoensurethat51% ofallnew hiresareDistrictresidents.(D.C.OfficialCode§ 2-
219(€)(1(A))
D.C.Governmentassistancevaluedat$5millionormore,requiredtohavethefollowingpercentageofhoursworkedineachclassificationbyDC residents;20%ofjourneyworkerhours;60%ofapprentice
hours;51%ofskilledlaborerhours;70%ofcommonlaborerhoursforalljobscreatedbytheProject.(D.C.OfficialCode§2-219.03(AXA)
Page|of11 FistSouretimploymenAgreementRevisedFebrary13,2018
DOESisthefirstsourceforrecruitment,referral,andplacementofnewhiresoremployeesforalljobscreatedbytheGovernmentAssistedProjectorContract(Project).
‘ThePartiesagreetothetermsandconditionsoftheAgreementasfollows:
1. DEFINITIONS
ThefollowingdefinitionsshallgovernthetermsusedinthisAgreement.A. Apprenticemeansaworkerwhoisemployedtolearnanapprenticeableoccupationunderthe
termsandconditionsofapprovedapprenticeshipstandards.
B.Beneficiarymeans:1.ThesignatorytoacontractexecutedbytheMayorwhichinvolvesanyDistrictofColumbiagovernmentfunds,orfundswhich,inaccordancewithafederalgrantorotherwise,theDistrictgovernmentadministersandwhichdetailsthenumberanddescriptionofalljobscreatedbya government-assistedProjectforwhichthebeneficiaryisrequiredtousetheFirstSourceRegister;
2.A recipientofa Districtgovernmenteconomicdevelopmentactionincludingcontracts,grants,loans,taxabatements,landtransfersforredevelopment,ortaxincrementfinancingthatresultsinafinancialbenefitof$300,000ormorefromanagency,commission,instrumentality,orotherentityoftheDistrictgovernment,includingafinancialorbankinginstitutionwhichservesastherepositoryfor$1millionormoreofDistrictofColumbiafunds.
C. ContractingAgencymeansanyDistrictofColumbiaagencythatawardedagovernmentassistedProjecttotaling$300,000ormore.
D. Directlaborcostsmeansallcosts,includingwagesandbenefits,associatedwiththehiring
andemploymentofpersonnelassignedtoaprocessinwhichpayrollexpensesaretracedtotheunitsofoutputandareincludedinthecostofgoodssold.
E,EMPLOYERmeansanyentityawardedagovernmentassistedProjecttotaling$300,000ormore,includingallindividualcontractorandsubcontractorentitiesatanytierwhoworkontheProject.
F. FirstSourceEmployerPortalisa websiteconsistingofa connectedgroupofstaticand
dynamicwebpageswiththe abilityforEmployerstoenterdatausingtheinternet.ThewebsiteisaccessiblebyaUniformResourceLocator(URL)andismaintainedbyDOES.‘ThewebsiteprovidesreportinginformationtoFirstSourceEMPLOYERS.
G.FirstSourceRegistermeanstheDOESAutomatedApplicantFiles,whichconsistsofthenamesofDCresidentsregisteredwithDOES,
H.GoodfaitheffortmeansanEMPLOYERhasexhaustedallreasonablemeanstocomplywithanyaffirmativeaction,hiring,orcontractualgoal(s)pursuanttotheFirstSourcelawand‘Agreement.
1.Government-assistedprojectorcontract(Project)meansanyconstructionornon-constructionProjectthatreceivesfundsorresources,valuedat$300,000ormore,fromtheDistrictofColumbia,orfundsorresourceswhich,inaccordancewithafederalgrantorotherwise,theDistrictofColumbiagovernmentadministers,includingcontracts,grants,loans,taxabatementsorexemptions,landtransfers,landdispositionanddevelopmentagreements,taxincrementfinancing,oranycombinationoftheaforementioned.
Page2 of 11 FirstSourceFmploymentAgreementRensedFebruary15,2018
J.HardtoemploymeansaDistrictofColumbiaresidentwhoisconfirmedbyDOESas:
1.Anex-offenderwhohasbeenreleasedfromprisonwithinthelast10years;2. AparticipantoftheTemporaryAssistanceforNeedyFamiliesprogram;3. AparticipantoftheSupplementalNutritionAssistanceProgram;4. LivingwithapermanentdisabilityverifiedbytheSocialSecurityAdministrationorDistrictvocationalrehabilitationprograt
5. Unemployedfor6monthsormoreinthelast12-monthperiod;
6.Homeless;7.A participantorgraduateoftheTransitionalEmploymentProgramestablishedby§3221331;or
8. An individualwhoqualifiedforinclusionintheWorkOpportunityTaxCreditProgramascertifiedbytheDepartmentofEmploymentServices.
K.Indirectlaborcostsmeansallcosts,includingwagesandbenefits,thatarepartofoperating,expensesandareassociatedwiththehiringandemploymentofpersonnelassignedtotasksotherthanproducingproducts.
L.Jobsmeansanyunionandnon-unionmanagerial,non-managerial,professional,nonprofessional,technicalornontechnicalpositionincluding:clericalandsalesoccupations,serviceoccupations,processingoccupations,machinetradeoccupations,benchwork‘occupations,structuralworkoccupations,agricultural,fishery,forestry,andrelated‘occupations,andanyotheroccupationsastheDepartmentofEmploymentServicesmayidentifyintheDictionaryofOccupationalTitles,UnitedStatesDepartmentofLabor.
M. NewHire:Individual(s)newlyhiredbytheEMPLOYERtoperformworkonagovernmentassistedProject.
N. Transfer:ExistingEMPLOYERemployeewhohasbeenmovedfromoneProjecttoanotherProject.
©.Journeymanmeansaworkerwhohasattainedalevelofskill,abilitiesandcompetenciesrecognizedwithinanindustryashavingmasteredtheskillsandcompetenciesrequiredfortheoccupation.
P. RevisedEmploymentPlanmeansadocumentpreparedandsubmittedbytheEMPLOYER,thatincludesthefollowi
1.A projectionofthetotalnumberofhourstobeworkedontheProjectbytrade;
2.A projectionofthetotalnumberofjoumeyworkerhours,bytrade,tobeworkedontheProjectandthetotalnumberofjourneyworkerhours,bytrade,tobeworkedbyDCresidents;
3. A projectionofthetotalnumberofapprenticehours,bytrade,tobeworkedontheProjectandthetotalnumberofapprenticehours,bytrade,tobeworkedbyDC
residents;
4. A projectionofthetotalnumberofskilledlaborerhours,bytrade,tobeworkedon
theProjectandthetotalnumberofskilledlaborerhours,bytrade,tobeworkedbyDC residents;
5. A projectionofthetotalnumberofcommonlaborerhourstobeworkedonthePage3 of11 ntSeurceEmploymentdgreemontRevoedFebrary18,2018,
ProjectandthetotalnumberofcommonlaborerhourstobeworkedbyDC residents;
6.AtimetableoutliningthetotalhoursworkedbytradeoverthelifeoftheProjectand
anassociatedhiringschedule;
7.Descriptionsoftheskillrequirementsbyjobtitleorposition,includingindustry-recognizedcertificationsrequiredforthedifferentpositions;
8.AstrategytofillthehoursrequiredtobeworkedbyDCresidentspursuanttothisparagraph,includinga componenton communicatingtheserequirementsto
contractorsandsubcontractorsandacomponentonpotentialcommunityoutreachpartnershipswiththeUniversityoftheDistrictofColumbia,theUniversityoftheDistrictofColumbiaCommunityCollege,theDepartmentofEmploymentServices,JointlyFundedApprenticeshipPrograms,theDistrictofColumbiaWorkforceIntermediary,orothergovernment-approved,community-basedjobtrainingproviders;
9.A remediationstrategytoameliorateanyproblemsassociatedwithmeetingthesehiringrequirements,includinganyproblemsencounteredwithcontractorsandsubcontractors;
10.Thedesignationofa seniorofficialfromtheEMPLOYER(S)orgeneralcontractorwhowillberesponsibleforimplementingthehiringandreportingrequirements,
11, Descriptions of the health and retirementbenefitsthat will be provided to DC
residentsworkingontheProject;
12.AstrategytoensurethatDistrictresidentswhoworkontheProjectreceiveongoingemploymentandtrainingopportunitiesaftertheycompleteworkonthejobforwhichtheywereinitiallyhiredandareviewofpastpracticesincontinuingtoemployDCresidentsfromoneProjecttothenext;
13.A strategytohiregraduatesofDistrictofColumbiaPublicSchools,DistrictofColumbiapubliccharterschools,andcommunity-basedjobtrainingproviders,andhard-to-employresidents;and
14,A disclosureofpastcompliancewiththeWorkforceActandtheDavis-BaconAct,whereapplicable,andthebidderorofferor’sgeneralDCresidenthiringpracticesonprojectsorcontractscompletedwithinthelast2years.
Q. TierSubcontractormeansanysubcontractorselectedbytheprimarycontractortoperformportion(s)orallworkrelatedtothetradeoroccupationarea(s)onaProjectsubjecttothisFirstSourceAgreement.
R. Washington Metropolitan StatisticalArea means the Districtof Columbia; VirginiaCities
ofAlexandria,Fairfax,FallsChurch,Fredericksburg,Manassas,andManassasPark;theVirginiaCountiesofArlington,Clarke,Fairfax,Fauquier,Loudon,PrinceWiSpotsylvania,Stafford,andWarren;theMarylandCountiesofCalvert,Charles,Frederick,MontgomeryandPrinceGeorges;andtheWestVirginiaCountyofJefferson.
S.WorkforceIntermediaryPilotProgrammeanstheintermediarybetweenemployersandtrainingproviderstoprovideemployerswithqualifiedDCresidentjobapplicants.SeeDCOfficialCode § 2-219.04b.
Page4of11 FirsSourceEmploymentAgrementRensedFebrary15.2018,
GENERAL TERMS
Subjecttothetermsandconditionssetforthherein,DOESwillreceivetheAgreementfromtheContractingAgencynolessthan7calendardaysinadvanceoftheProjectstartdate.NoworkassociatedwiththerelevantProjectcanbeginuntiltheAgreementhasbeenacceptedby
DOES.
. TheBeneficiaryand/orEMPLOYER shallrequireallProjectcontractorsandsubcontractors,
underaProjectreceivinggovernmentassistanceorbenefitsvaluedat$300,000ormore,toenterintoanAgreementwithDOES.
Agreementwilltakeaffectoncebeneficiary/EmployerawardedcontractandstartworkonthegovernmentassistedProjectandnoworkcanbeginpriortoexecutionoftheAgreementandwillbefullyeffectivethroughtheduration,anyextensionormodificationsoftheProjectanduntilsuchtimeasconstructioniscompleteandacertificateofoccupancyisissued.
. IfanEMPLOYERbeganworkpriortotheexecutionofa FirstSourceEmployment
Agreement,theEMPLOYERshallceaseworkontheProjectandsigna FirstSourceEmploymentAgreementtobeboundbytheapplicableFirstSourceEmploymentAgreementrequirements,retroactively,fromthestartofworkthroughoutthedurationofthecontract.
DOESwillproviderecruitment,referral,andplacementservicestotheEMPLOYER,subject
tothelimitationsinthisAgreement.
DOESandtheEMPLOYERagreethat,forpurposesofthisAgreement,newhiresandjobs"createdfortheProject(bothunionandnonunion)includeallofEMPLOYER'Sjobopeningsand vacancies in the Washington Metropolitan StatisticalArea createdfor the Projectas a
resultof internalpromotions, terminations,and expansions of the EMPLOYER'S workforce,
asaresultofthisProject.
|.ThisAgreementincludesapprenticesasdefinedinD.C.OfficialCode§§32-1401-1431
DOESwillmakeeveryefforttoworkwithinthetermsofallcollectivebargainingagreementstowhichtheEMPLOYERisaparty.TheEMPLOYERwillprovideDOESwithwrittendocumentationthattheEMPLOYERhasprovidedtherepresentativeofanycollectivebargainingunitinvolvedwiththisProjectacopyofthisAgreementandhasrequestedcommentsorobjections.Iftherepresentativehasanycommentsorobjections,theEMPLOYERwillpromptlyprovidethemtoDOES.
TheEMPLOYERwhocontractswiththeDistrictofColumbiagovernmenttoperformconstruction,renovationwork,orinformationtechnologyworkwitha singlecontract,orcumulativecontracts,ofatleast$500,000,withina 12-monthperiodwillberequiredtoregisteranapprenticeshipprogramwiththeDistrictofColumbiaApprenticeshipCouncilasrequiredbyDCCode32-1431.
If,duringthetermofthisAgreement,theEMPLOYERshouldtransferpossessionofalloraportionofitsbusinessconcernsaffectedbythisAgreementtoanyotherpartybylease,sale,assignment, merger, or otherwise thisFirstSource Agreement shallremain in fullforceand
effect and transfereeshall remain subject to all provisions herein. In addition, the
EMPLOYERasaconditionoftransfershall:
1,NotifythepartytakingpossessionoftheexistenceofthisEMPLOYER'SFirstSourceEmploymentAgreement.
2. NotifyDOESwithin7businessdaysofthetransfer.Thisnoticewillincludethe
PageSof11 FitSourceEmploymentAgreement,RevisedFebroary15.2018
v.
nameofthepartytakingpossessionandthenameandtelephoneofthatparty'srepresentative.
1.TheEMPLOYERandDOESmaymutuallyagreetomodifythisAgreement.Anymodificationshallbeinwriting,signedbytheEMPLOYERandDOESandattachedtotheoriginalAgreement.
J.TotheextentthatthisAgreementisinconflictwithanyfederallaborlawsorgovernmentalregulations,thefederallawsorregulationsshallprevail.
‘TRAINING
‘A.DOES andtheEMPLOYER mayagreetodevelopskillstrainingandon-the-jobtraining
programsasapprovedbyDOES;thetrainingspecificationsandcostforsuchtrainingwillbe
mutuallyagreeduponbytheEMPLOYER andDOES andwillbesetforthin a separate
TrainingAgreement,
RECRUITMENT.
‘A.TheEMPLOYER shallcompletetheattachedRevisedEmploymentPlanthatwillincludethe
informationoutlinedinSectionLP.
B. TheEMPLOYERshallregisterandpostalljobvacancieswiththeJobBankServicesofDOESatwww.denetworks.orgaminimumof10days.Shouldyouneedassistancepostingjobvacancies,pleasecontactJobBankServicesat(202)698-6001.
C. TheEMPLOYERshallnotifyDOESofallnewjobscreatedfortheProjectwithinatleast7businessdays(Monday-Friday)oftheEMPLOYERS?identification/creationofthenewjobs.TheNoticeofNewJobCreationshallincludethenumberofemployeesneededbyjobtitle,qualificationsandspecificskillsrequiredtoperformthejob,hiringdate,rateofpay,hoursofwork,durationofemployment,andadescriptionoftheworktobeperformed.Thismustbedonebeforeusinganyotherreferralsource.
D.JobopeningstobefilledbyinternalpromotionfromtheEMPLOYER'ScurrentworkforceshallbereportedtoDOESforplacementandreferral,ifthejobis newlycreated.EMPLOYERshallprovideDOESaNoticeofNewJobCreationthatdetailssuchpromotionsinaccordancewithSectionIV.C.
E.TheEMPLOYERwillsubmittoDOES,priortocommencingworkontheProject,alistofCurrentEmployeesthatincludesthename,socialsecuritynumber,andresidencystatusofallcurrentemployees,includingapprentices,trainees,and laid-offworkerswhowillbeemployedontheProject.AllEMPLOYERinformationreviewedorgathered,includingsocialsecurity‘numbers,asaresultofDOES’monitoringandenforcementactivitieswillbeheldconfidentialinaccordancewithallDistrictandfederalconfidentialityandprivacylawsandusedonlyforthepurposesthatitwasreviewedorgathered.
REFERRAL
A.DOESwillscreenapplicantsthroughcarefullyplannedrecruitmentandtrainingeventsandprovidetheEMPLOYERwitha listofqualifiedapplicantsaccordingtothenumberofemployeesneededbyjobtitle,qualificationsandspecificskillsrequiredtoperformthejob,hiringdate,rateofpay,hoursofwork,durationofemployment,andadescriptionoftheworktobeperformedassuppliedbytheEMPLOYERinitsNoticeofNewJobCreationsetforthaboveinSectionIV.C.
Page6of[1 FistSourceEmploymentAgreementRersedFebruary15,2018
vi.
B. DOESwillnotifytheEMPLOYERofthenumberofapplicantsDOESwillrefer,priortotheanticipatedhiringdates.
PLACEMENT
‘A.EMPLOYERshallingoodfaith,usereasonableeffortstoselectitsnewhiresoremployeesfromamongthequalifiedapplicantsreferredbyDOES.AllhiringdecisionsaremadebytheEMPLOYER.
B.IntheeventthatDOESisunabletoreferqualifiedapplicantsmeetingtheEMPLOYER'Sestablishedqualifications,within7 businessdays(Monday-Friday)fromthedateofnotificationfromtheEMPLOYER,theEMPLOYERwillbefreetodirectlyfillremainingpositionsforwhichnoqualifiedapplicantshavebeenreferred.However,theEMPLOYERshallstillberequiredtomeettheFirstSourcehiringrequirementsorhoursworkedpercentagesforalljobscreatedbytheProject.
C. AftertheEMPLOYERhasselecteditsemployees,DOESisnotresponsiblefortheemployees’actionsandtheEMPLOYERherebyreleasesDOES,andtheGovernmentoftheDistrictofColumbia,theDistrictofColumbiaMunicipalCorporation,andtheofficersandemployeesoftheDistrictofColumbiafromanyliabilityforemployees’actions.
REPORTING REQUIREMENTS
‘A.EMPLOYERwithasinglecontractvaluedat$300,000ormoreona Projectthatreceived‘governmentassistancetotalingbetween$300,000and$5,000,000,aprovisionthatatleast51%ofthenewemployeeshiredtoworkontheProjectshailbeDistrictresidents.
B.EMPLOYERshallregisterintheFirstSourceOnlineRegistrationandReportingSystemforelectronicsubmissionofallmonthlyContractCompliancedata,weeklycertifiedpayrollsand
anyotherdocumentsrequiredbyDOESforreportingandmonitoring.
C.EMPLOYERshallsubmittotheDepartmentofEmploymentServiceseachmonthfollowingthestartoftheProjectahiringcompliancereportfortheProjectthatincludesthe:‘Numberofnewjobopeningscreated/available;NumberofnewjobopeningslistedwithDOES,oranyotherDistrictAgency;NumberofDC residentshiredfornewjobs;
NumberofemployeestransferredtotheProject;‘NumberofDC residentstransferredtotheProject;Directorindirectlaborcostassociatedwiththeproject;Eachemployee’sname,jobtitle,socialsecuritynumber,hiredate,residence,and referralsource;and
Workforcestatisticsthroughouttheentireprojecttenure.
Nove Ne
D.EMPLOYERwithasinglecontractvaluedat$300,000ormoreona Projectthatreceivedgovernmentassistancetotaling$5millionormoreshallmeetthefollowinghoursworkedpercentagesforalljobscreatedbytheProject:1.Atleast20%ofjourneyworkerhoursbytradeshallbeperformedbyDCresidents;2. Atleast60%ofapprenticehoursbytradeshallbeperformedbyDC residents;
3.Atleast51%oftheskilledlaborerhoursbytradeshallbeperformedbyDCresidents;and4,Atleast70%ofcommonlaborerhoursshallbeperformedbyDCresidents.
Page7of11 FirSourceBmploymenAaremen,Revisedebm 15.2018
E,EMPLOYERSshallprovidethefollowingcumulativestatistics,thatwillbeusedtocreatethemonthlyreport,byuploadingcertifiedpayrollsorpayrolldataintotheLCPtrackerreportingsystem:
‘NumberofjourneyworkerhoursworkedbyDCresidentsbytrade;‘Numberofhoursworkedbyalljourneyworkersbytrade;
‘NumberofapprenticehoursworkedbyDCresidentsbytrade;
‘Numberofhoursworkedbyallapprenticesbytrade;‘Numberof skilled laborerworker hours worked by DC residentsby trade;
‘Numberof hours worked by allskilledlaborersby trade;
1.NumberofcommonlaborerhoursworkedbyDCresidentsbytrade;and..Numberofhoursworkedbyallcommonlaborersbytrade.
PAA ee Nm
F. EMPLOYER may “double count” hours for the “hard to employ” up to 15% of totalhours
workedbyDC Residents;however,acollectivebargainingagreementshallnotbeabasisforwaiverofthisrequirement.
G. ForconstructionProjectsthatarenotsubjecttoDavis-Baconlawinwhichcertifiedpayrollrecordsdonotexist,EMPLOYERshallsubmitmonthlydocumentsofworkersemployedontheProjecttoDOES,includingDC residentsandallemploymentclassificationsofhoursworked.
H.EMPLOYERmayalsoberequiredtoprovideverificationofhoursworkedorhiringpercentagesofDCresidents,suchasinternalpayrollrecordsforconstructionProjectsthatarenotsubjecttoDavis-Bacon.
1. Monthly,EMPLOYERshallsubmitweeklycertifiedpayrollsfromallsubcontractorsatanytier‘workingontheProjecttotheContractingAgency.EMPLOYERisalsorequiredtomakepayrollrecordsavailabletoDOESasapartofcompliancemonitoring,uponrequestatjobsites.
VII. FINALREPORT AND GOOD FAITHEFFORTS
A.WiththesubmissionofthefinalrequestforpaymentfromtheContractingAgency,theBeneficiaryand/orEMPLOYERshall:
1,ReporttoDOES itscompliancewiththe hiringorhoursworkedpercentagerequirementsforalljobscreatedbytheProject,andreportthehoursthatDCresidentsworkedforeachtradeclassificationsineachareaoftheProject;or
2,SubmittoDOESarequestforawaiverofthehiringorhoursworkedpercentagerequirementsforalljobscreatedbytheProjectthatwillincludethefollowingdocumentation:a. DocumentationsupportingEMPLOYER’S goodfaithefforttocomply;
b.ReferralsprovidedbyDOESandotherreferralsources;and€.AdvertisementofjobopeningslistedwithDOESandotherreferralsources.
B. DOESmaywaiveorpartiallywaivethehiringorhoursworkedpercentagerequirementsforjobscreatedbytheProject,and/ortherequiredhoursofDC residentsforeachtradeclassifications,ifDOESfindsthattheBeneficiaryorEMPLOYER,includingitscontractorsorsubcontractors:
1.DOEScertifiedthatBeneficiaryorEmployerdemonstrateda goodfaithefforttocomply,assetforthinSectionVIIILC.;or
Page8of1] FirstSourceOmploymenAgreementRevisedFebraay15,2018
2.IslocatedoutsidetheWashingtonMetropolitanStatisticalArea,andnoneofthecontractworkisperformedinsidetheWashingtonMetropolitanStatisticalArea;
3.Thebeneficiarypublishedeachjobopeningorpart-timeworkneededfor7calendardaysinaDistrictnewspaperofcity-widecirculation;and.
4.TheDOEScertifiedthatthereareinsufficienteligibleapplicantsfromtheFirstSourceRegisterthatpossesstheskillsrequiredbythepositions,ortheeligibleapplicantsarenot
availableforparttimeworkordonothaveameanstotraveltotheonsitejobs;or
5.Beneficiary/Employerenteredintoa specialworkforcedevelopmenttrainingorplacementarrangementwithDOESorwiththeDistrictofColumbiaWorkforceIntermediary.
C. DOESshallconsiderdocumentationofthefollowingwhenmakingadeterminationofag00d-faithefforttocomply:
1.DOEShascertifiedthatthereareinsufTimarketpossessingtheskillsrequiredbytheEMPLOYERforthepositionscreatedasaresultoftheProject.
2.WhethertheEMPLOYERpostedthejobsontheDOESjobwebsiteforaminimumof10calendardays;
3.WhethertheEMPLOYERadvertisedeachjobopeninginaDistrictnewspaperwithcity-widecirculationforaminimumof7 calendardays;
4.WhethertheEMPLOYERadvertisedeachjobopeninginspecialinterestpublicationsandonspecialinterestmediaforaminimumof7calendardays;
5. WhethertheEMPLOYER hostedinformational/recruitingorhiringfairs;
6. WhethertheEMPLOYERcontactedchurches,unions,and/oradditionalWorkforceDevelopmentOrganizations;
7. WhethertheEMPLOYER interviewedemployablecandidates;
8.WhethertheEMPLOYERcreatedorparticipatedina workforcedevelopmentprogramapprovedbyDOE:
9. WhethertheEMPLOYER createdorparticipatedina workforcedevelopment
programapprovedbytheDistrictofColumbiaWorkforceIntermediary;
10.WhethertheEMPLOYERsubstarrequirementssetforthinthissection;
lycompliedwiththerelevantmonthlyreporting
11,WhethertheEMPLOYERhassubmittedandsubstantiallycompliedwithitsmostrecentemploymentplanthathasbeenapprovedbyDOES;and
Page9 of 1] istSaueeEmploymentAgreementRestedFebrary18,2018
Ix,
x.
MONITORING
A.DOESistheDistrictagencyauthorizedtomonitorandenforcetherequirementsoftheWorkforceIntermediaryEstablishmentandReformoftheFirstSourceAmendmentActof2011(D.C.OfficialCode§§2 219.01— 2219.05),andrelevantprovisionsoftheApprenticeshipRequirementsAmendmentActof2004(D.C.OfficialCode§2-219.03and§ 32-1431).Asa partofmonitoringandenforcement,DOESmayrequireandEMPLOYERshallgrantaccesstoProjectsites,employees,anddocuments.
B. EMPLOYER'SnoncompliancewiththeprovisionsofthisAgreementmayresultinthe
impositionofpenalties.
C. AllEMPLOYERinformationreviewedorgathered,includingsocialsecuritynumbers,asaresultofDOES’monitoringandenforcementactivitieswillbe heldconfidentialinaccordancewithallDistrictandfederalconfidentialityandprivacylawsandusedonlyforthepurposesthatitwasreviewedorgathered.
D. DOESshallmonitorallProjectsasauthorizedbylaw.DOESwill:
1.ReviewallcontractcontrolstodetermineiftheBeneficiaryorEMPLOYER,includinganyContractorsor Subcontractors,aresubjecttotheWorkforceIntermediaryEstablishmentandReformoftheFirstSourceAmendmentActof2011.
2.NotifystakeholdersandcompanyofficialsandestablishmeetingstoprovidetechnicalassistanceinvolvingtheFirstSourceProcess.
3. MakeregularconstructionsitevisitstodetermineifthePrimeorSubcontractors’workforceisinconcurrencewiththesubmittedAgreementandMonthlyComplianceReports
4. Inspectandcopycertifiedpayroll,personnelrecordsandanyotherrecordsorinformationnecessarytoensuretherequiredworkforceutilizationisincompliancewiththeFirstSourceLaw.
5. ConductdeskreviewsofMonthlyComplianceReports.
6, EducateEMPLOYERSaboutadditionalservicesofferedbyDOES,suchasOn-the-JobtrainingprogramsandtaxincentivesforEMPLOYERSwhohirefromcertaincategories,
7.Monitorandcompletestatisticalreportsthatidentifytheoverallproject,contractor,andsubcontractors’hiringorhoursworkedpercentages.
8. Provideformalnotificationofnon-compliancewiththerequiredhiringorhoursworkedpercentages,oranyallegedbreachoftheFirstSourceLawtoallcontracting,agencies,andstakeholders.(Pleasenote:EMPLOYERSaregranted30daystocorrectanyallegeddeficienciesstatedinthenotification.)
PENALTIES
‘A.WillfulBreachoftheAgreementbytheEMPLOYER,failuretosubmitthecontract‘compliancereports,deliberatesubmissionoffalsifieddatamayresultinDOESimposingafineof5%ofthetotalamountofthedirectand indirectlaborcostsoftheProject,inadditiontootherpenaltiesprovidedbylaw.FailuretomeettherequiredhiringrequirementsorfailuretoreceivegoodfaithwaivermayresultintheDepartmentofEmploymentServices
Page10of11 FrstSourceEmploymentAgrementRevisedFebrary15,2018
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lk:*
— GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
REVISED EMPLOYMENT PLAN
Once approved,thisrevisedemployment planshallnot be amended exceptwith theapprovalof Department
ofEmploymentServices.
oa 07/02/2025EMPHAVERSesigrOfficial(Pri Date
wl 4 A Official(Signature)
Parcel 6 Community Partners
NameofCompany
1227 MarionBarryAve SE, Suite107
Washington,DC 20020
301-408-0800
Telephone
okarim@bannekerventures.com
Emil
oF -OawelIrn ¢]y[2casSignatureDepartmentofEmploymentServi Dat:
imposingapenaltyequalto1/8of1%ofthetotalamountofthedirectandindirectlaborcostsoftheProjectforeachpercentagebywhichthebeneficiaryfailstomeetthehiringrequirements.
B.EMPLOYERSwhohavebeenfoundinviolation2timesormoreovera10yearperiodmayibleforconsiderationforProjectsfora periodofSyears.
90daysofaDeterminationofaPenalty,theBeneficiaryorEmployermayappealthe
ionsorfinesby filingacomplaintwiththeContractAppealsBoardinaccordancewithD.C.Code§2-360.03and§2-360.04.
Iherebycertifythat|havetheauthoritytobindtheEMPLOYERtothisAgreementfromthestartofworkontheProject,throughoutthedurationoftheProject,andagreetoalltermsandconditionsherein.
By:
Omar A.Karim 07/28/2025
EMPLOYERSeniorOfficial(Print) Date
EMPLOYERSeniorOfficial(Signature)
Parcel6CommunityPartners
NameofCompany
1227MarionBarryAveSE,Suite107
Washington, DC 20020
Address
301-408-0800
Telephone
okarim@bannekerventures.com
Emil SSS
OOSSignatureDepartmentofEmploymehtServi Da
Page11of11 FlatSouceEmploymenAgreementRerisedFebruary13.2018
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_ GOVERNMENTOFTHEDISTRICTOFCOLUMBIAREVISEDEMPLOYMENTPLAN
L REVISED FIRST SOURCE EMPLOYMENT PLAN
GOVERNMENT-ASSISTED PROJECT/CONTRACT INFORMATION
DISTRICT CONTRACTING AGENCY: 20,
CONTRACTINGOFFICER:‘iewsene
TELEPHONENUMBER: 227722
TOTALCONTRACT AMOUNT: #2210000EMPLOYERCONTRACT AMOUNT:PROJECTNAME:160euonecpnenPactats:GasesEoicenpe)
PROJECTADDRESS:2#PecarstGecss Sas S00
CITY:voosenon STATE:_ZIPCOD}PROJECT DESCRIPTION OF WORK: feserseonerotPwcesa5te
ewigde
PROJECTSTARTDATE:== PROJECTEND DATE:"on2=
EMPLOYERSTARTDATE:Sree EMPLOYER END DATE:t=
np nentee
EMPLOYER INFORMATION
EMPLOYER NAME:PetscommPatericCOMPANY NAME: ‘se
EMPLOYERADDRESS: 7taternye5st
CITY:seamen STATE:= ZIPCODE: =
‘TELEPHONENUMBER:219-00 FEDERALIDENTIFICATIONNO.; 24008CONTACTPERSON:nwaroanTITLE:Atorestapmensne
E-MAIL:#merowstevewsnscon__TELEPHONE NUMBER: 2»'-«=0"0EMPLOYERDESCRIPTIONOFWORK:PormcynersiPweatssttzibenEucanst reteg a
AREYOUASUBCONTRACTOR YES[] NO
IFYES,NAME OF PRIMECONTRACTOR:
PRIME CONTRACTOR WILL MEET HOURS WORKED PERCENTAGES REQUIREMENTS
FOR ENTIREPROJECT [i] OR PER EACH SUBCONTRACTOR (]
a EMPLOYMENT HOURS TO BE WORKED PROJECTIONS
FirstSourcelaw requiresEMPLOYERS (winningbidders)tosubmita revisedEmployment Plan.
A.Forconstructionprojectsreceiving$5 millionor more ingovernmentassistance,Employerstoprovideprojectionofthetotalnumberofhourstobeworkedontheprojectbytrade.
JOURNEY WORKER
Provideaprojectionofthetotalnumberofjourneyworkerhours,bytrade,tobeworkedontheprojectorcontractandthetotalnumberofjourneyworkerhours,bytrade,tobeworkedbyDistrictresidents.
il:
ThispagetobecompletedbyEmployer ————EmployerInitials
xk
a
— GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
REVISED EMPLOYMENT PLAN
ProjectionofTotalNumberofJourneyWorkerHours Trade ProjectionofTotalNumberofJourneyWorkerHoursbyDCResidents(FirstSource Law requires20%)
atespiesbyGowConnc)ureyhareeteed)
[WearetheOwnerandDeveloperoftheProject.
TheGCwilladheretoallworkforcerequirements.
APPRENTICE
residents.
Provideaprojectionofthetotalnumberofapprenticehprojectorcontractand thetotalnumber ofapprenticehours,by trade,tobe worked by District
ours,by trade,tobe worked on the
ProjectionofTotalNumberofApprenticeHours Trade ProjectionofTotalNumberofApprenticeHoursbyDCResidents(FirstSource Law requires60%)
(bspronedyeGarConacrsarneyhaveDoonenon)
WearetheOwnerandDeveloperofieProject. “TheGOwilacheretoalworkforcerequirements.
SKILLED WORKER
Districtresidents.
Providea projectionofthetotalnumber ofskilledlaborerhours,by trade,tobe worked on the
projector contractand thetotalnumberofskilledlaborerhours,by trade,tobe worked by
ProjectionofTotalNumberofSkilledLaborHours Trade ProjectionofTotalNumberofSkilledLaborHoursbyDCResidents
(FirstSourceLaw requires51%)
(WoeprodbyeGaaraCones aryhaveban6nd)
[WearetheOwnerandDeveloperoftheProject. TheGCwilladheretoallworkforcerequirements.
COMMON LABORER
Provideaprojectionofthetotalnumberofcommonlaborerhourstobeworkedontheprojectorcontractand thetotalnumberofcommon laborerhourstobeworkedbyDistrictresidents.
ProjectionofTotalNumber of
Common LaborerHours
Trade ProjectionofTotalNumber ofCommon.
LaborerHoursbyDCResidents(FirstSource Law requires70%) ‘Wnpod ye GaaraGaan abyharebonoc
We aretheOwnerandDeveloperoftheProject TheGCwilladheretoallworkforcerequirements.
ThispagetobecompletedbyEmployer ‘OAK
EmployerInitials
GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
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REVISED EMPLOYMENT PLAN
B.EMPLOYMENTHIRINGPROJECTIONS.
ALLEMPLOYERS:
PleaseindicateALLnewposition(s)youwillcreateasaresultoftheproject.IfyouWILLNOTbecreatinganynewemploymentopportunities,pleasecompletetheattachedjustificationsheetwithanexplanation.Attachadditionalsheetsasneeded.
|§3
5 # OF JOBS|
F/T_P/T
UNION MEMBERSHIP.REQUIRED NAME LOCAL#
(Wepe aneCate eyheb a)
WearetheOwnerandDeveloperoftheProject.
‘TheGCwilladheretoallworkforcerequirements.
A
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D
E
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ic
HH
ThispagetobecompletedbyEmployer
EmployerInitials
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—— GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
REVISED EMPLOYMENT PLAN
C.JUSTIFICATIONSHEET:Pleaseprovidea detailedexplanationofwhytheEmployerwillnot,haveanynewhiresontheproject.
Parcel6CommunityPartnersistheDeveloperforthisproject.We donotintendtohireanyadditionalstaffforthedevelopmentofthisproject.We havenotselectedtheGeneralContractor(s)forthisproject.TheselectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponentphaseoftheproject.TheGeneralContractor(s)willadhere to allwork forcerequirements.
ThispagetobecompletedbyEmployer aEmployerinitials,
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GOVERNMENTOFTHEDISTRICTOFCOLUMBIA |REVISEDEMPLOYMENT PLAN
D. EMPLOYMENT PROJECTIONS.
Providea timetableoutliningthetotalhoursworked by tradeoverthelifeoftheprojector
contractandanassociatedhiringschedule.
Parcel6 CommunityPartnersistheDeveloperforthisproject.We do notintendtohireanyadditionalstaffforthedevelopmentof thisproject.We havenotselectedtheGeneralContractor(s) forthisproject.TheselectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseof theproject.TheGeneralContractor(s)willadheretoallworkforcerequirements.
Providedescriptionsoftheskillrequirementsbyjobtitleorposition,includingindustry-recognizedcertificationsrequiredforthedifferentpositions.
Parcel6 CommunityPartnersis theDeveloperforthisproject.We do not intendtohireanyadditionalstaffforthedevelopmentof thisproject.We havenot selectedtheGeneralContractor(s)forthisproject.The selectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseof theproject
ProvideastrategytofillthehoursrequiredtobeworkedbyDistrictresidents,includingacomponentoncommunicatingtheserequirementstocontractorsandsubcontractorsandacomponentonpotentialcommunityoutreachpartnershipswiththeUniversityoftheDistrictofColumbia,theUniversityoftheDistrictofColumbiaCommunityCollege,theDepartmentofEmploymentServices,JointlyFundedApprenticeshipPrograms,theDistrictofColumbiaWorkforceIntermediary,or othergovernment-approved,community-basedjobtrainingproviders.
Parcel6 CommunityPartnersistheDeveloperforthisproject.Wedonotintendtohireanyadditionalstaffforthedevelopmentofthisproject.wehavenotselectedtheGeneralContractor(s)forthisproject.TheselectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseoftheproject.TheGeneralContractor(s)will adhereto all work forcerequirements
ThispagetobecompletedbyEmployer EmployerInitials
ak—= GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
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REVISED EMPLOYMENT PLAN
D. EMPLOYMENT PROJECTIONS (Continued)
Ww.
vi.
vu.
A remediationstrategytoameliorateanyproblemsassociatedwithmeetingtheseworkedhourspercentagerequirements,includinganyproblemsencounteredwithcontractorsandsubcontractors.
Parcel6 CommunityPartnersistheDeveloperforthisproject.Wedonotintendtohireanyadditionalstaffforthedevelopmentofthisproject.Wehavenotselectedthe General Contractor(s) for this project. The selected General Contractor(s) will
updatetheemploymentplanforeachcomponent/phaseoftheproject.TheGeneralContractor(s)will adhereto all work forcerequirements.
‘Thedesignationofaseniorofficialfromthegeneralcontractorwhowillberesponsiblefor
simelementingthehoups,workedpereeptaessanereportingTquireeNS. Wedo notintendtohire any additional staff for the development of this project. We have not selected
the General Contractor(s) for this project. The selected General Contractor(s) will
updatetheemploymentplanforeachconponent/phaseoftheproject.TheGeneralContractor(s) will adhere to all work force requirements.
ProvidedescriptionsofthehealthandretirementbenefitsthatwillbeprovidedtoDistrictresidentsworkingontheprojectorcontract.Parcel 6 Community Partners is the Developer for this project. We do not intend to
hire any additional staff for the development of this project. We have not selected
theGeneralContractor(s)forthisproject.TheselectedGeneralcontractor(s)willupdate the employment plan for each component/phase of the project. The General
Contractor(s) will adhere to all work force requirements.
Providea strategyto ensure thatDist residentswho work on the projector contract
receiveongoingemploymentandtrainingopportunitiesaftertheycompleteworkonthejobforwhichtheywereinitiallyhiredandareviewofpastpracticesincontinuingtoemployDistrictresidentsfromoneprojectorcontracttothenext.
Parcel6 CommunityPartnersistheDeveloperforthisproject.We do notintendtohireanyadditionalstaffforthedevelopmentof thisproject.We havenotselectedtheGeneralContractor(s)forthisproject.TheselectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseof theproject.TheGeneralContractor(s)willadheretoallworkforcerequirements.
OAKThispagetobecompletedbyEmployer CsEmployer Initials
vi.
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GOVERNMENTOFTHEDISTRICTOFCOLUMBIA
REVISED EMPLOYMENT PLAN
EMPLOYMENT PROJECTIONS (continued)
Provide a strategyto hiregraduates of Districtof Columbia Public Schools, Districtof
ColumbiaPublicCharterSchools,community-basedjobtrainingproviders,andhard-to-employresidents.
Parcel6 CommunityPartnersistheDeveloperforthisproject.Wedonotintendtohire any additional staff for the development of this project. We have not selected
the General Contractor(s) for this project. The selected General Contractor(s) will
updatetheemploymentplanforeachcomponent/phaseof theproject.TheGeneralContractor(s)willadhereto allworkforcerequirements.
PleasedisclosepastcompliancewiththeFirstSourceEmploymentAgreementActof1984ortheWorkforceIntermediaryEstablishmentandReformofFirstSourceAmendmentActof2011andtheDavis-BaconAct,whereapplicable,andthebidderorofferor'sgeneralDistrict-residenthiringpracticesonprojectsorcontractscompletedwithinthelasttwo(2)years.
Parcel6 CommunityPartnersis theDeveloperforthisproject.We do not intendtohireanyadditionalstaffforthedevelopmentof thisproject.We havenot selectedtheGeneralContractor(s)forthisproject.The selectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseof theproject.TheGeneralContractor(s)willadhereto allworkforcerequirements.
PleasenotethatEMPLOYERS on constructionprojectsmust submitweeklycertifiedpayrolls
from allsubcontractorsatany tierworking on theprojector contract,as wellas make such
payrollandpersonnelrecordsavailableuponrequestatjobsitestothecontractingDistrictofColumbiaagency.
Parcel6 CommunityPartnersis theDeveloperforthisproject.We do notintendtohireanyadditionalstaffforthedevelopmentof thisproject.We havenotselectedtheGeneralContractor(s)forthisproject.TheselectedGeneralContractor(s)willupdatetheemploymentplanforeachcomponent/phaseof theproject.TheGeneralContractor(s)willadhereto allworkforcerequirements.
"OAK
EmployerInitials ThispagetobecompletedbyEmployer
EXHIBIT J
Form of Letter of Credit
ISSUER: Date of Issue: [Month, day, and year of issue]
[Name of bank]
[Bank address]
IRREVOCABLE STANDBY LETTER OF CREDIT
NO. [Letter of Credit number] Beneficiary Applicant
District of Columbia, by and through Parcel 6 Community Partners LLC
The Office of Deputy Mayor for [Address of developer]
Planning and Economic Development
1350 Pennsylvania Avenue, NW. Suite 317
Washington D.C. 20004
Attention: Deputy Mayor for Planning
and Economic Development
AMOUNT: $[Letter of Credit amount]
EXPIRY DATE: [Letter of Credit month, day, and year of expiration] subject to renewal provisions
herein
PROJECT: St. Elizabeths East – Parcel 6 [insert component name]
Ladies and Gentlemen:
We hereby establish our Irrevocable Standby Letter of Credit [Letter of Credit number] (“Letter of
Credit”) in favor of Beneficiary for the account of Applicant up to an aggregate amount of U.S.
DOLLARS (U.S. $ [Letter of Credit amount]) available for payment when accompanied by the
following three items:
1. A draft at sight drawn on [Name of bank] duly endorsed on its reverse thereof by a duly
authorized representative of the Beneficiary, specifically referencing this Letter of Credit [Letter
of Credit number];
2. The original of this Letter of Credit; and
3. A dated statement issued on the letterhead of Beneficiary, stating: “The amount of this drawing
is $________________ ,
drawn under Letter of Credit [Letter of Credit Number] and represents funds due and owing to
the District of Columbia.” Such statement shall be conclusive as to such matters and Issuer will
accept such statement as binding and correct. Issuer shall have no right, duty, obligation, or
responsibility to evaluate the performance or nonperformance of any underlying agreement
between Applicant and Beneficiary before performing under the terms of this Letter of Credit.
This Letter of Credit shall automatically renew for consecutive one (1) year terms upon the anniversary
of the expiry date (The “Anniversary Date”) until a date that is five (5) years after the Date of Issue set
forth above unless (i) earlier released by Beneficiary in writing or (ii) Issuer delivers written notice to
both Applicant and Beneficiary that this Letter of Credit will not be renewed on the Anniversary Date
upon which this Letter of Credit will no longer be renewed.
If a drawing made by Beneficiary under this Letter of Credit reaches the address provided on this Letter
of Credit via courier (FEDEX or DHL) on or prior to 1:00 PM (Eastern Time) on a Business Day (as
defined below) and, provided that such drawing and the statement presented in connection therewith
conform to the terms and conditions hereof, payments shall be made to Beneficiary in the amount specified,
in immediately available funds, on the same Business Day. If a drawing is made by Beneficiary under
this Letter of Credit after 1:00 PM (Eastern Time) on a Business Day and, provided that such drawing
and the statement presented in connection therewith conform to the terms and conditions hereof,
payments shall be made to Beneficiary in the amount specified, in immediately available funds on the
next Business Day. If requested by Beneficiary, payment under this Letter of Credit may be a deposit of
immediately available funds into an account designated by Beneficiary. As used herein, the term
“Business Day” shall mean any day ot her than a Saturday, Sunday, or a day on which banking
institutions in the District of Columbia are authorized or required by law to close.
Drafts drawn under and in compliance with the terms of this Letter of Credit will be duly honored if
presented by the Mayor, City Administrator, Deputy Mayor for Planning and Economic Development,
or one of their duly authorized representatives, on or before the Expiry Date to Issuer’s office at the
address of Issuer set forth above.
This undertaking is issued subject to the International Standby Practices 1998 (“ISP98’). As to matters
not expressly governed by ISP98, this Letter of Credit is governed by and shall be construed in
accordance with the laws of the District of Columbia.
This Letter of Credit set forth in full terms of our undertaking. This undertaking shall not in any way be
modified, amended, amplified , or incorporated by reference to any document, contract , or other
agreement, without the express written authorization of Issuer, Beneficiary, and Applicant.
Should you have occasion to communicate with us regarding the Letter of Credit, kindly direct your
communication to the attention of Letters of Credit Dept. to the address aforementioned stating as
reference our Standby Letter of Credit No. [Insert Letter of Credit Number].
Truly Yours,
_______________________________ ________________________________
Authorized Signature Name (printed)
EXHIBIT K
SCHEDULE OF PERFORMANCE
MASTER PLAN
Milestone Target Date Outside Date
Council Approval of the Act 11/30/25 01/30/26
Land Disposition Agreement Execution 12/30/25 2/28/265
Submission of Drawings for District review and approval to be submitted to
HPRB staff
2/17/26 4/17/26
Approvals from HPRB 5/17/26 7/17/26
BUILDING 1 (TOWNHOMES)
Milestone Target Date Outside Date
Submission of Schematic Drawings for District review and approval 6/17/26 8/17/26
Approval by District of Schematic Drawings 7/2/26 9/2/26
Submission of Design Development Plans for District review and approval 8/17/26 10/17/26
Approval by District of Development Drawings 9/2/26 11/2/26
Submission of Construction Drawings for District review and approval 10/17/26 12/17/26
Approval by District of Development Drawings 11/1/26 1/2/27
Submission of building permit a pplication to DOB 12/17/26 02/17/27
Building Permit Approval by DOB 2/2/27 4/2/27
Submission of Project Budget and Project Funding Plan to District for
review and approval as Final Project Budget and Final Project Funding Plan
2/2/27 4/2/27
Closing Date (Building 1) 3/6/27 5/6/27
Commencement of Construction (Building 1) 3/13/27 5/13/27
Substantial Completion (Building 1) 9/13/28 11/13/28
Issuance of Certificate of Occupancies 10/13/28 12/13/28
Completion of Construction (Building 1) 11/13/28 1/13/29
SCHEDULE OF PERFORMANCE
BUILDING 2 (THE MARTIN)
Milestone Target Date Outside Date
Building 2 (The Martin & the Park)
Submission of Schematic Drawings for District review and approval 9/17/26 11/17/26
Approval by District of Schematic Drawings 10/2/26 12/2/26
Submission of Design Development Plans for District review and approval 02/17/27 4/17/27
Approval by District of Development Drawings 3/6/27 5/6/27
Submission of Construction Drawings for District review and approval 6/17/27 8/17/27
Approval by District of Development Drawings 7/3/27 9/3/27
Submission of building permit a pplication to DOB 7/17/27 9/17/27
Building Permit Approval by DOB 10/17/27 12/17/27
Submission of Project Budget and Project Funding Plan to District for
review and approval as Final Project Budget and Final Project Funding Plan
10/17/27 12/17/27
Closing Date (Building 2 and Park) 11/17/27 01/17/28
Commencement of Construction (Building 2) 11/24/27 01/24/28
100% building dry-in (Building 2) 11/24/28 01/24/28
Substantial Completion (Building 2) 9/24/29 11/24/29
Issuance of Certificate of Occupancy (Building 2) 10/24/29 12/24/29
Final Completion of Construction (Building 2) 11/24/29 01/24/30
Lease-up Complete (Building 2) 11/30/30 01/30/31
SCHEDULE OF PERFORMANCE
BUILDING 3 (THE MALCOLM)
Milestone Target Date Outside Date
Submission of Schematic Drawings for District review and approval 7/1/28 9/1/28
Approval by District of Schematic Drawings 7/15/28 9/15/28
Submission of Design Development Plans for District review and
approval
12/1/28 02/1/29
Approval by District of Development Drawings 12/15/28 02/15/29
Submission of Construction Drawings for District review and approval 4/1/29 6/1/29
Approval by District of Development Drawings 4/15/29 6/15/29
Submission of building permit application to DOB 5/1/29 7/1/29
Building Permit Approval by DOB 7/30/29 9/30/29
Submission of Project Budget and Project Funding Plan to District for
review and approval as Final Project Budget and Final Project Funding
Plan
7/30/29 9/30/29
Closing Date (Building 3) 11/30/29 01/30/30
Commencement of Construction (Building 3) 12/8/29 2/8/30
100% building dry-in (Building 3) 4/15/31 6/15/31
Substantial Completion (Building 3) 9/30/31 11/30/31
Issuance of Certificate of Occupancy (Building 3) 10/30/31 12/30/31
Final Completion of Construction (Building 3) 11/30/31 01/30/32
Lease-up Complete (Building 3) 11/30/32 01/30/33
Date
Seller (Landlord)
Buyer (Tenant)
Property
Land Disposition
Agreement
Method of Disposition
Consideration
The Project
Affordable Housing
Conditions of Closing
Green Building
Requirements
Schedule of
Performance
TERM SHEET
Disposition of St. Elizabeths East - Parcel 6
2700 Martin Luther King Jr. Avenue, SE
September 29'12025
District of Columbia (the "District"), acting by and through the
Office of the Deputy Mayor for Planning and Economic
Development ("DMPED").
Parcel 6 Community Partners LLC, and its successors, assigns, or
affiliates (the "Developer"), as approved by DMPED or permitted
under the LODA (defined below).
The real property located at 2700 Martin Luther King Jr. A venue SE,
known for tax and assessment purposes as Lot 968 in Square 5868S
(the "Property").
All of the terms and conditions of the sale and purchase of the
Property will be governed by the terms of a Land Disposition and
Development Agreement ("LODA") by and between the District and
the Developer.
The Property will be conveyed by ground lease with a term of ninety-
nine (99) years for a portion of the Property and in fee simple for a
portion of the Property by the District to the Developer pursuant to
D.C. Official Code §10-801(b)(8)(C) and (F).
The Developer will pay a ground rent payment of $1 per year per
ground lease due at closing for the ground lease portion of the
Property and will pay a purchase price of $1 due at closing for the
fee simple portion of the Property.
The Property will be developed into mixed-use building(s),
townhomes, and additional related uses consistent with the terms of
the LODA.
At least thirty percent (30%) of the residential units in the Project
shall be affordable in accordance with D.C. Official Code 10-801(b-
3).
The District's obligation to convey or ground lease, as applicable,
the Property to the Developer shall be conditioned on the conditions
to closing set forth in the LODA.
The Developer shall construct the Project in compliance with the
Green Building Act of 2006, D.C. Official Code §§ 6-1451.01 et
seq., as amended, and the regulations promulgated therewith.
The following contains terms of the Schedule of Performance with
estimated dates, which may be amended and extended with the
approval ofDMPED in accordance with the terms of the LODA:
• Execution of the LODA - within 60 days after Council
approval of the disposition.
+ Closing—onorbeforethefourthanniversaryoftheCouncilapprovalofthedisposition.+ CommencementofConstruction~ within30daysafterclosingontheapplicableparcel.+ SubstantialCompletion~ within70 monthsaftercommencementofconstructionontheapplicableparcel.+ FinalCompletion— within72monthsaftersubstantialcompletionontheapplicableparcel.
Post-ClosingRequirements + AsrequiredundertheLDDA,theDevelopershallexecuteat
Closingfortheapplicableparcel,theConstructionandUseCovenantandAffordableHousingCovenantandshallbe
boundtocomplywiththerequirementsofthesamefortheapplicabledurationsidentifiedtherein.
+ AsrequiredundertheLDDA,theDevelopershalldelivertotheDistrictatClosingon theapplicableparcel,a
DevelopmentandCompletionGuarantyexecutedby aguarantorapprovedbyDMPED.
CertifiedBusiness
Enterprise TheDevelopershallenterintoa CertifiedBusinessEnterpriseUtilizationandParticipationAgreementwiththeDepartmentofSmallandLocalBusinessDevelopmentgoverningcertainobligationsoftheDeveloperwithrespecttotheProjectunderthe‘Small,LocalandDisadvantagedBusinessEnterpriseDevelopmentandAssistanceActof2005,asamended.
FirstSource
Requirements
TheDevelopershallenterintoaFirstSourceAgreementwiththe
DepartmentofEmploymentServicesthatshallgovernobligationsoftheDeveloperpursuanttoD.C.OfficialCode§§2-219.03,etseq.,andMayor'sOrder83-265(November9,1983)regardingjob
creationandemploymentgeneratedasaresultoftheconstructionoftheProject.
1.
INTENTION AND LIMITATIONS OF THISTERM SHEET
TheDeveloperandDMPEDacknowledgethattheyhavepreparedandsignedthisTermSheetforthesolepurposeofobtainingtheapprovaloftheCounciloftheDistrictofColumbia(the“Council”)totheproposedtransaction.TheDeveloperacknowledgesthatDMPED'snegotiationoftheLDDAandthepreparationofthisTermSheet,DMPED’ssignatureonthisTermSheet,andsubmissionofthisTermSheetandsupportingdocumentstotheCouncilshallnotbindtheDistricttoexecutetheLDDAortoconveythePropertytotheDeveloper.TheDeveloperfurtheracknowledgesthat,notwithstandingCouncilauthorizingtheconveyanceoftheProperty,theDistricthasnoobligationtodosoabsenttheDistrictandtheDeveloperdulyexecutingtheLDDA andthesatisfactionoftheconditionscontainedtherein.IntheeventDMPEDortheMayordetermine,intheirsoleandabsolutediscretion,towithholdsubmissionofthisTermSheetandsupportingdocumentstotheCouncilortootherwisedeclinetosecureCouncilauthorizationfortheconveyance,DMPEDmayterminatenegotiationswiththeDeveloperandtheDistrictshallnotberesponsiblefortheDeveloper'scostsandexpensesincurredinrelationtothePropertyortheProject.
TheDeveloperacknowledgesthatallapprovalsrequiredoftheCouncilwillbegrantedorwithheldinthesoleandabsolutediscretionoftheCouncilandthat,absentCouncilapprovaloftheproposedtransaction,DMPEDhasnoauthoritytoconveythePropertytotheDeveloper.TheDeveloperacknowledgesthatitissigningthisTermSheetpriortoobtainingallnecessaryCouncilapprovals.IntheabsenceofsuchapprovalsandexecutionoftheLDDA,theDeveloperproceedsatitssoleriskandexpensewithnorecoursewhatsoeveragainsttheDistrict.
TheDeveloperandDMPED agreethatuponreceiptofallnecessaryCouncilapprovals,
theDeveloperandDMPED intendtofinalizeandexecutetheLDDAgovemningallofthetermsandconditionsoftheconveyanceoftheProperty.
UntiltheDeveloperandtheDistrictenterintothebindingLDDA,boththeDeveloperandtheDistrictreservetherighttoproceedwiththeproposedtransactionintheirsoleandabsolutediscretion.UpontheexecutionoftheLDDA,theDeveloperandDMPEDshallproceedinaccordancewiththetermsoftheLDDA;provided,however,thattheDeveloperandDMPEDacknowledgeandagreethatanysubstantivechangeinthetermssetforthinthisTermSheetshallbesubjecttofurtherCouncilreviewandapprovalinaccordancewithD.C.OfficialCode§10-801(b-4).
TheDistrictandtheDeveloperhavecausedthisTermSheettobesignedandacknowledgedbytheirrespectivedulyauthorizedrepresentativesasofthedateidentifiedabove.
-4918-9278-0058,v.2
DISTRICT
DISTRICTOF COLUMBIA, byandthroughtheOfficeoftheDeputy
MayorforPlanniggandEconomicDevelopment
BY:Nina AtbaDeputyMayorforPlanningandEconomicDevelopment
DEVELOPER
PARCEL6COMMUNITY PARTNERS,LLC,aDistrictofColumbialimitedliabilitycompany
By:
Name:OmarKarimTitle:AuthorizedPerson
EXHIBIT N
PROJECT FUNDING PLAN
[see attached]
Parcel 6 - Townhomes
Parcel 6 - Building 2
Parcel 6 - Building 3
EXHIBIT O
PROJECT BUDGET
[see attached]
Budget and Cash Flow
1 LAND COSTS Total
Acquisition Cost 1$
TOTAL LAND COSTS 1.00$
2 HARD COSTS
Residential Space 21,060 SF 3,685,500
FFE/Unit Model Rental Costs 32,500
TOTAL HARD COSTS 3,718,000
SOFT COSTS
3 Transaction Fees
Title Insurance - Lender's Policy 25,000
Surveys (Boundary, ALTA, etc.) 20,000
Legal - Org Docs, Operating Agreements, etc. 20,000
Appraisal Fees (initial appraisal, updated appraisal) 5,000
Total Transaction/Leasing Fees 70,000
4 Architectural/Engineering
Design Fees (including interior design) 2.80% hard cost 104,104
Design Fees (CA) 1.50% hard cost 55,770
Total Architectural/Engineering 159,874
6 Financing Costs
Construction Period Interest 146,330
Construction Loan Financing Fees 1.00% loan amount 40,000
Pre-Dev Loan Fee and Closing Costs $300,000 6,000
Pre-Development Loan Interest 31,500
Total Financing Costs 223,830
7 Permit, Utility and Municipal Fees
Permits 120,000
Third Party Inspections (units) 35,000
Total Permit, Utility and Municipal Fees 155,000
8 Legal and Accounting
Legal - General 20,000
Accounting and Cost Certification 20,000
Total Legal and Accounting 40,000
9 Insurance
Insurance (G&L, property, cyber, etc.) $3.00 per $100 111,540
Total Insurance 111,540
11 Miscellaneous Expenses
Events 7,500
Misc Soft Costs & Contingencies 3.0% 22,807
Total Miscellaneous Expenses 30,307
SUBTOTAL SOFT COSTS 790,551
Developer Fee
Developer Fee 0.00% 0
TOTAL PROJECT COSTS 4,508,552
Parcel 6 - Building 2
Budget and Cash Flow
1 LAND COSTS Total
Acquisition Cost 1$
TOTAL LAND COSTS 1.00$
2 HARD COSTS
Residential Space $215 SF 55,502,250
Non-Residential Space $170 SF 2,023,000
Garage Parking - Residential $30,000 per space 2,550,000
Garage Parking - Non-Residential $30,000 per space 0
Green Building/LEED Additional Costs 1.0% 600,753
FFE/Build-Out (model, office, community room, fitness center, etc.) 500,000
Outdoor Improvements (Park) 650,000
Outdoor Improvements (Utilities, etc.) 300,000
Hard Cost Contingency 5.0% 3,106,300
TOTAL HARD COSTS 65,232,303
SOFT COSTS
3 Transaction Fees
Title Insurance - Lender's Policy $0.002 150,000
Recordation Taxes 100,000
Surveys (Boundary, ALTA, etc.) 60,000
Legal - Org Docs, Operating Agreements, etc. 30,000
Legal - LDDA, Exhibits and Lease Negotiations 30,000
Appraisal Fees (initial appraisal, updated appraisal) 30,000
Geotechnical & Environmental 45,000
Total Transaction/Leasing Fees 445,000
4 Architectural/Engineering
Design Fees (including interior design) 3.00% hard cost 1,956,969
Design Fees (CA) 0.75% hard cost 489,242
Total Architectural/Engineering 2,446,211
5 General and Administrative
Construction Management Fees $25,000 mo. 24 mos. 600,000
Total General and Administrative 600,000
6 Financing Costs
Construction Period Interest 3,580,333
Financing Fees 1.00% loan amount 558,070
Pre-Dev Loan Fee and Closing Costs $2,500,000 50,000
Pre-Development Loan Interest 262,500
Total Financing Costs 4,450,903
7 Permit, Utility and Municipal Fees
Building Permit $0.030 per cu. Ft 600,000
Public Space Permit (DDOT) 50,000
Public Space Occupancy Permit (DDOT) 15,000
Raze Permit 0
Excavation/Sheeting & Shoring Permit 35,000
Parcel 6 - Building 2
Budget and Cash Flow
SWM Review Fee 10,000
ESC Permit (DDOE) 15,000
DC Water Review Fee 40,000
DC Water Permit (Connection Fee) 30,000
DC Water Inspection Fees 50,000
Permit Expediter Costs 100,000
Third Party Inspections (units) 175,000
Utility Relocation, Dry Utility and Temporary Power Fee 100,000
Green Building Fee $0.003 per sq. Ft 50,000
Total Permit, Utility and Municipal Fees 1,270,000
8 Legal and Accounting
Legal - Zoning 15,000
Legal - GC Contract, Property Management Contract, etc. 60,000
Legal - General 150,000
Accounting and Cost Certification 100,000
Total Legal and Accounting 325,000
9 Insurance
Insurance (G&L, property, cyber, etc.) $1.25 per $100 815,404
Total Insurance 815,404
10 Carrying Costs & Reserves
Replacement Reserves $100.00 unit 331,500
Lease Up Reserve 9 months 2,676,495
Lease-Up Fee $500 unit 110,500
HUD Reserves 5% 2,790,348
Total Reservces/Escrows 5,908,843
11 Miscellaneous Expenses
Testing Expenses 250,000
Zoning Proffers - Outreach, Job Training, etc. 150,000
Printing and Reproduction 15,000
Signage 20,000
Website 10,000
Events 75,000
Tenant Improvement Allowance $50 per SF 595,000
Misc Soft Costs & Contingencies 5.0% 813,068
Total Miscellaneous Expenses 1,928,068
SUBTOTAL SOFT COSTS 18,189,430
Developer Fee
Developer Fee (Residential) 3.00% 2,502,652
TOTAL PROJECT COSTS 85,924,385
Parcel 6 - Building 3
Budget and Cash Flow
1 LAND COSTS Total
Acquisition Cost 1$
TOTAL LAND COSTS 1.00$
2 HARD COSTS
Residential Space $215 SF 73,637,500
Non-Residential Space $170 SF 986,000
Garage Parking - Residential $30,000 per space 3,000,000
Garage Parking - Non-Residential $30,000 per space 0
Green Building/LEED Additional Costs 1.0% 776,235
FFE/Build-Out (model, office, community room, fitness center, etc.) 500,000
Outdoor Improvements (Utilities, etc.) 300,000
Hard Cost Contingency 5.0% 3,959,987
TOTAL HARD COSTS 83,159,722
SOFT COSTS
3 Transaction Fees
Title Insurance - Lender's Policy $0.002 150,000
Recordation Taxes 100,000
Surveys (Boundary, ALTA, etc.) 60,000
Legal - Org Docs, Operating Agreements, etc. 30,000
Legal - LDDA, Exhibits and Lease Negotiations 30,000
Appraisal Fees (initial appraisal, updated appraisal) 30,000
Geotechnical & Environmental 45,000
Total Transaction/Leasing Fees 445,000
4 Architectural/Engineering
Design Fees (including interior design) 2.60% hard cost 2,162,153
Design Fees (CA) 0.75% hard cost 623,698
Total Architectural/Engineering 2,785,851
5 General and Administrative
Construction Management Fees $40,000 mo. 24 mos. 960,000
Total General and Administrative 960,000
6 Financing Costs
Construction Period Interest 4,538,667
Financing Fees 1.00% loan amount 860,591
Pre-Dev Loan Fee and Closing Costs $2,500,000 50,000
Pre-Development Loan Interest 262,500
Total Financing Costs 5,711,757
7 Permit, Utility and Municipal Fees
Building Permit $0.030 per cu. Ft 600,000
Parcel 6 - Building 3
Budget and Cash Flow
Public Space Permit (DDOT) 50,000
Public Space Occupancy Permit (DDOT) 15,000
Raze Permit 0
Excavation/Sheeting & Shoring Permit 35,000
SWM Review Fee 10,000
ESC Permit (DDOE) 15,000
DC Water Review Fee 40,000
DC Water Permit (Connection Fee) 30,000
DC Water Inspection Fees 50,000
Permit Expediter Costs 100,000
Third Party Inspections (units) 175,000
Utility Relocation, Dry Utility and Temporary Power Fee 100,000
Green Building Fee $0.003 per sq. Ft 50,000
Total Permit, Utility and Municipal Fees 1,270,000
8 Legal and Accounting
Legal - Zoning 15,000
Legal - GC Contract, Property Management Contract, etc. 60,000
Legal - General 150,000
Accounting and Cost Certification 100,000
Total Legal and Accounting 325,000
9 Insurance
Insurance (G&L, property, cyber, etc.) $1.25 per $100 1,039,497
Total Insurance 1,039,497
10 Carrying Costs & Reserves
Replacement Reserves $100.00 unit 429,000
Lease Up Reserve 9 months 4,127,383
Lease-Up Fee $500 unit 143,000
HUD Reserves 5% 4,302,953
Total Reservces/Escrows 9,002,336
11 Miscellaneous Expenses
Testing Expenses 250,000
Zoning Proffers - Outreach, Job Training, etc. 150,000
Printing and Reproduction 15,000
Signage 20,000
Website 10,000
Events 75,000
Tenant Improvement Allowance $50 per SF 290,000
Misc Soft Costs & Contingencies 5.0% 1,076,972
Total Miscellaneous Expenses 1,886,972
SUBTOTAL SOFT COSTS 23,426,413
Developer Fee
Developer Fee (Residential) 3.00% 3,197,584
TOTAL PROJECT COSTS 109,783,719
NEWMARK VALUATION & ADVISORY
St. Elizabeth's East
Site - Parcel 6
Pecan Street Southeast
Washington, DC 20032
Newmark Job No.: 25-0223132-1
Client Reference: Task Order No.: DCEB-2021-
D-0003-A03 (T002) IDIQ Contract No.: DCEB-
2021-D-0003-A03
Appraisal Report Prepared For:
Jacque McDonald
Director of Contracts
Office of the Deputy Mayor Planning &
Economic Development
1015 Half Street SE
Washington, DC 20003
Prepared By:
Newmark Valuation & Advisory
1899 Pennsylvania Ave. NW, Suite 300
Washington, DC 20006
NEWMARK VALUATION & ADVISORY
Newmark Valuation & Advisory
1899 Pennsylvania Ave. NW, Suite 300
Washington, DC 20006
www.nmrk.com/valuation
May 21, 2025
Jacque McDonald
Director of Contracts
Office of the Deputy Mayor Planning & Economic Development
1015 Half Street Southeast
Washington, DC 20003
RE: Appraisal Of A Property Known As St. Elizabeth's East Site - Parcel 6 Located At Pecan
Street Southeast, Washington, DC 20032, Prepared By Newmark Valuation & Advisory,
LLC (herein “Firm” or “Newmark”)
Newmark Job No.: 25-0223132-1
Client Reference: Task Order No.: DCEB -2021-D-0003-A03 (T002) IDIQ Contract No.: DCEB -
2021-D-0003-A03
Dear Ms. McDonald:
The “Subject Property” is an irregular -shaped parcel of land containing an area 4.65 acres or
202,758 square feet (SF), located in the Saint Elizabeth East Campus in the southeast quadrant
of Washington, DC, east of the Anacostia River. The underlying land is owned by the District of
Columbia and is currently vacant and partially cleared. The site is zoned under a special-purpose
designation, Saint Elizabeths, which allows for a mixture of uses with specific requirements that
conform to the DC Comprehensive Plan, the St. Elizabeth’s Redevelopment Framework Plan,
and the Saint Elizabeth’s East Master Plan and Design guidelines.
The purpose of this appraisal is to develop an opinion of the value of the property under two major
scenarios: first, assuming the property is unencumbered and may be put to its highest and best
use (effective the “unrestricted market value” which is hypothetical); and second, assuming that
the Subject Property is developed to its highest potential under a provided Development Plan.
The guidelines for the Development Plan are as follows:
1. The Property is subject to the requirements of D.C. Code §10-801, D.C. Code §2-218.01
(Certified Business Enterprise), D.C. Code §2 - 219.01 (First Source), D.C. §6 -1451.01
(Green Building Act), D.C. Code §2 - 1226.02 (AWi Act), and any other legally binding
requirements that are, or maybe, applicable.
2. The Property is conveyed through a 99-year ground lease.
3. Determine the highest value of the property.
May 21, 2025
JACQUE MCDONALD
St. Elizabeth's East Site - Parcel 6
4. The scenario should assume mixed-use residential and retail development.
5. The Live/Work Townhomes on Parcel 6 that will wrap the garage will be conveyed in a fee
simple sale.
6. The Property will remain zoned by the Saint Elizabeths East Campus (StE) zones (StE-1
through StE-19) - Zone - StE- 6.
7. §10-801 Affordable Housing Requirements: Under §10 -801, developments that include
multi-family residential units are required to reserve 30% of the units as affordable in
perpetuity in the case of a fee simple proposal or for the term of the ground lease in the
case of a ground lease.
8. Parcel 6 will comprise of the following:
a. 17,700 SF of retail in total
b. 185 parking spaces in total
c. 507 units and 8 townhomes set at 30% - 100% of Median Family Income (MFI)
i. 36 units will be set at 30% of MFI
ii. 120 units will be set at 50% of MFI
iii. 2 units (townhomes) will be set at 80% of MFI
iv. 6 units (townhomes) will be set at 100% of MFI
v. 358 units set at 100% of MFI
d. Building 1 will include eight live/work townhomes
e. Building 2 will include 221 residential apartment units, 11,900 SF of retail, and a
community park
f. Building 3 will include 286 residential apartment units and 5,800 SF of retail
May 21, 2025
JACQUE MCDONALD
St. Elizabeth's East Site - Parcel 6
Strengths
1. The Subject Property has good access to public transportation (within wallking distance of the
Congress Heights Metrorail Station) and nearby major employers such as Department of Homeland
Security, The U.S. Coast Guard, and the Enternaiment and Sports Arena.
2. There are some market fundamentals that should help support demand for multifmaily use in the
subject's surrounding area including: 1) large amount of proposed multifamily projects in the
Subject's submarket cluster; 2) improving vacancy rates for the market and submarket; and, 3)
improving rental rates for the submarket and market.
3. There is a high demand for affordable housing within the District of Columbia which should support
the lease-up of proposed multifamily properties at the Subject Property.
4. The proposed Development Plan includes a small residential subdivision. There has been limited
development of new townhomes within the District. There should be ample demand for these units
in the submarket, especially with some of these units reduced in pricing for households making less
than 80% of MFI.
Key Value Considerations
Risk Factors
1. The limited projected population and household growth for the Subject Property's immediate area
will likely limited extended demand for additional multifamily properties in the subject's surrounding
market over the near term.
National Trends and Uncertainties
1. Newmark Capital Markets assesses that there was a momentum shift in the 4th quarter, leading to
both transaction volume and lending volume increasing year-over-year. However, they also note that
the notable increase in interest rates since early December complicates matters.
2. Real Capital Analytics reported in their end of 2024 Capital Trends publication that “the commercial
property markets turned a corner in 2024.” Deal volume climbed in 2024 and price declines are
coming to an end overall.
3. The uncertainty surrounding the new U.S. administration’s economic policies will be an overhang
and the Federal Reserve is expected to pause any additional rate reductions until the effects of
these policies are better understood.
May 21, 2025
JACQUE MCDONALD
St. Elizabeth's East Site - Parcel 6
Based on the analysis contained in the following report, the opinions of value for the subject are:
Extraordinary Assumptions
An extraordinary assumption is defined in USPAP as an assignment -specific assumption as of
the effective date regarding uncertain information used in an analysis which, if found to be false,
could alter the appraiser’s opinions or conclusions. The value conclusions are subject to the
following extraordinary assumptions that may affect the assignment results.
Hypothetical Conditions
A hypothetical condition is defined in USPAP as a condition, directly related to a specific
assignment, which is contrary to what is known by the appraiser to exist on the effective date of
the assignment results, but is used for the purpose of analysis. The value conclusions are based
on the following hypothetical conditions that may affect the assignment results.
Value Conclusions
Appraisal Premise Interest Appraised Date of Value Value Conclusion
Hypothetical Market Value Unencumbered Fee Simple 3/21/2025 $15,500,000
Market Value Under Development Plan Fee Simple 3/21/2025 $1
Compiled by Newmark
1. Our opinion of the market value subject to the Development Plan assumes that: 1) the Parcel will be conveyed
subject to a 99-year ground lease (leasehold conveyance), with zero or nominal ($1/annually) ongoing rent
payments; and, 2) the Developer will obtain the required approvals needed (parking), if any, to complete
construction of the proposed properties in accordance with the proposed plans and details provided by the
Sponsor.
2. The Subject Property, per the Sponsor's documentation, contains a WMATA Green Line tunnel easement and DC
Water utility easement for sanitary and storm sewer piping. Development of the Subject Property to the density
envisioned by zoning and consistent with maximally productive use of the property will require sub-grade
development (e.g. parking) which may necessitate relocation of existing water and sewer lines and a
configuration that avoids underground tunnels for WMATA. Accordingly, this appraisal assumes that the costs of
infrastructure reconfiguration of this type will be separately funded, with the purchaser of the Subject Property
held responsible for the abnormal development costs only.
The use of these extraordinary assumptions might have affected assignment results.
May 21, 2025
JACQUE MCDONALD
St. Elizabeth's East Site - Parcel 6
The appraisal was developed based on, and this report has been prepared in conformance with
the Client’s appraisal requirements, the guidelines and recommendations set forth in the Uniform
Standards of Professional Appraisal Practice (USPAP), and the requirements of the Code of
Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.
1. Affordable Housing Requirements (10-801): Dispositions of properties owned by the District of Columbia are
subject to various development requirements, including that any multifamily use set aside a significant number of
units (30%, in the case of the subject's location) for low and very low income households. These restrictions are
embodied in Section 10-801 of the D.C. Code. This appraisal assumes that the Subject Property is not
encumbered by said restrictions.
2. The market value as if unencumbered is hypothetical as the property is currently encumbered with a number of
restrictions.
The use of these hypothetical conditions might have affected assignment results.
CERTIFICATION 7
St. Elizabeth's East Site - Parcel 6
Certification
We certify that, to the best of our knowledge and belief:
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting
conditions and are our personal, impartial and unbiased professional analyses, opinions, and conclusions.
3. We have no present or prospective interest in the property that is the subject of this report and no personal
interest with respect to the parties involved.
4. We have no bias with respect to the property that is the subject of this report or to the parties involved with this
assignment.
5. Our engagement in this assignment was not contingent upon developing or reporting predetermined results.
6. Our compensation for completing this assignment is not contingent upon the development or reporting of a
predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the
attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of
this appraisal.
7. This appraisal assignment was not based upon a requested minimum valuation, a specific valuation, or the
approval of a loan.
8. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with
the Uniform Standards of Professional Appraisal Practice, as well as the requirements of the District of
Columbia.9. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in
conformity with the Code of Professional Ethics and Standards of Professional Appraisal Practice of the
Appraisal Institute.
10. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly
authorized representatives.
11. As of the date of this report, Douglas L. Nickel, MAI, FRICS has completed the continuing education program for
Designated Members of the Appraisal Institute.
12. Chizoma Ohanyerenwa made a personal inspection of the property that is the subject of this report. Douglas L.
Nickel, MAI, FRICS has not personally inspected the subject.
13. No one provided significant real property appraisal assistance to the person(s) signing this certification.
14. The Firm operates as an independent economic entity. Although employees of other service lines or affiliates of
the Firm may be contacted as a part of our routine market research investigations, absolute client confidentiality
and privacy were maintained at all times with regard to this assignment without conflict of interest.
15. Within this report, "Newmark", "Newmark Valuation & Advisory", "Newmark, Inc.", and similar forms of reference
refer only to the appraiser(s) who have signed this certification and any persons noted above as having provided
significant real property appraisal assistance to the persons signing this report.
CERTIFICATION 8
St. Elizabeth's East Site - Parcel 6
Douglas L. Nickel, MAI, FRICS
Senior Managing Director - Market Leader
Appraiser Certified General
District of Columbia # GA40000058
Telephone: 202.774.9040
Email: Douglas.Nickel@nmrk.com
Chizoma Ohanyerenwa
Senior Appraiser
Certified General Real Estate Appraiser
District of Columbia # GA2002168
Telephone: 202.774.9047
Email: Chizzy.Ohanyerenwa@nmrk.com
16. Douglas L. Nickel, MAI, FRICS has not performed any services, as an appraiser or in any other capacity, regarding
the property that is the subject of this report within the three-year period immediately preceding the agreement to
perform this assignment. Chizoma Ohanyerenwa has not performed any services, as an appraiser or in any other
capacity, regarding the property that is the subject of this report within the three-year period immediately
preceding the agreement to perform this assignment.
TABLE OF CONTENTS
St. Elizabeth's East Site - Parcel 6
Table of Contents
Appraisal Transmittal and Certification
Certification
Table of Contents
Subject Maps
Subject Photographs
Executive Summary ................................. 11
Introduction............................................... 13
Economic Analysis .................................. 16
National Trends and Uncertainties....... 16
Area Analysis ................................ ...... 17
Market Area Analysis........................... 24
Multifamily Market Analysis ................. 35
Retail Market Analysis ......................... 43
For-Sale Residential Market Analysis .. 49
Land and Site Analysis ............................ 57
Improvements Analysis ........................... 64
Highest and Best Use .............................. 67
Appraisal Methodology ............................ 70
Land Valuation – Value as if
Unencumbered (Sales Comparison
Approach) ................................................. 72
Development Analysis Approach (Value
As If Unencumbered) ............................... 76
Project Design and Valuation Detail for
Proposed Property .............................. 76
Multifamily Rent Analysis ..................... 78
Operating Expense Analysis – Multifamily
Section ................................ ................ 83
Market Rent Analysis – Retail .............. 88
Net Operating Income – Retail ............ 92
Direct Capitalization – Retail Section ... 93
Residual Analysis ................................ 95
Development Analysis Approach (Value
Subject to Development Plan) ............... 104
Project Design and Valuation of
Residential Subdivision ...................... 106
Reconciliation of Value .......................... 143
Assumptions and Limiting Conditions 146
Addenda
A. Glossary of Terms
B. Financials and Property Information
C. Comparable Data
Land Sales
Rental Surveys
D. Appraiser Qualifications and Licenses
SUBJECT MAPS 10
St. Elizabeth's East Site - Parcel 6
Aerial Photo
Location Map
EXECUTIVE SUMMARY 11
St. Elizabeth's East Site - Parcel 6
Executive Summary
Property Type: Land
Street Address: Pecan Street Southeast
City, State & Zip: Washington, DC 20032
Number of Units: 507
Current Occupancy: 0.0%
Land Area: 4.655 acres; 202,758 SF
Zoning: StE-6
Highest and Best Use - As Vacant: A Multifamily Use
St. Elizabeth's East Site - Parcel 6
Analysis Details
Valuation Dates:
Hypothetical Market Value Unencumbered March 21, 2025
Market Value Under Development Plan March 21, 2025
Inspection Date and Date of Photos:
Report Date:
Report Type:
Client:
Intended Use:
Intended User:
Appraisal Premise:
Intended Use and User:
Interest Appraised:
Exposure Time (Marketing Period) Estimate:
March 21, 2025
Hypothetical Market Value Unencumbered, Market Value Under Development Plan
May 21, 2025
The intended use and user of our report are specifically identified in our report as agreed upon in our
contract for services and/or reliance language found in the report. No other use or user of the report is
permitted by any other party for any other purpose. Dissemination of this report by any party to non-client,
non-intended users does not extend reliance to any other party and Newmark will not be responsible for
unauthorized use of the report, its conclusions or contents used partially or in its entirety.
Appraisal Report
Portfolio management and no other use is permitted and no other use is permitted.
Office of the Deputy Mayor Planning & Economic Development and no other user is permitted by any other
party for any other purpose.
Fee Simple
3 to 9 Months (3 to 9 Months)
Office of the Deputy Mayor Planning & Economic Development
Compiled by Newmark
Value Conclusions
Appraisal Premise Interest Appraised Date of Value Value Conclusion
Hypothetical Market Value Unencumbered Fee Simple 3/21/2025 $15,500,000
Market Value Under Development Plan Fee Simple 3/21/2025 $1
Compiled by Newmark
EXECUTIVE SUMMARY 12
St. Elizabeth's East Site - Parcel 6
1. Our opinion of the market value subject to the Development Plan assumes that: 1) the Parcel will be conveyed
subject to a 99-year ground lease (leasehold conveyance), with zero or nominal ($1/annually) ongoing rent
payments; and, 2) the Developer will obtain the required approvals needed (parking), if any, to complete
construction of the proposed properties in accordance with the proposed plans and details provided by the
Sponsor.
2. The Subject Property, per the Sponsor's documentation, contains a WMATA Green Line tunnel easement and DC
Water utility easement for sanitary and storm sewer piping. Development of the Subject Property to the density
envisioned by zoning and consistent with maximally productive use of the property will require sub-grade
development (e.g. parking) which may necessitate relocation of existing water and sewer lines and a
configuration that avoids underground tunnels for WMATA. Accordingly, this appraisal assumes that the costs of
infrastructure reconfiguration of this type will be separately funded, with the purchaser of the Subject Property
held responsible for the abnormal development costs only.
1. Affordable Housing Requirements (10-801): Dispositions of properties owned by the District of Columbia are
subject to various development requirements, including that any multifamily use set aside a significant number of
units (30%, in the case of the subject's location) for low and very low income households. These restrictions are
embodied in Section 10-801 of the D.C. Code. This appraisal assumes that the Subject Property is not
encumbered by said restrictions.
2. The market value as if unencumbered is hypothetical as the property is currently encumbered with a number of
restrictions.
Compiled by Newmark
Extraordinary Assumptions and Hypothetical Conditions
An extraordinary assumption is defined in USPAP as an assignment-specific assumption as of the effective date regarding
uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.
The value conclusions are subject to the following extraordinary assumptions that may affect the assignment results.
A hypothetical condition is defined in USPAP as a condition, directly related to a specific assignment, which is contrary to
what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of
analysis. The value conclusions are based on the following hypothetical conditions that may affect the assignment
results.
The use of these extraordinary assumptions might have affected assignment results.
The use of these hypothetical conditions might have affected assignment results.
INTRODUCTION 13
St. Elizabeth's East Site - Parcel 6
Introduction
OWNERSHIP HISTORY
According to public records, t he current owner is District of Columbia . To the best of our
knowledge, no sale or transfer of ownership has taken place within a three -year period prior to
the effective date of the appraisal.
DEFINITION OF VALUE
Market value is defined as:
“The most probable price which a property should bring in a competitive and open market under
all conditions requisite to a fair sale, the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition
is the consummation of a sale as of a specified date and the passing of title from seller to buyer
under conditions whereby:
– Buyer and seller are typically motivated;
– Both parties are well informed or well advised, and acting in what they consider their
own best interests;
– A reasonable time is allowed for exposure in the open market;
– Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements
comparable thereto; and
– The price represents the normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted by anyone associated with
the sale.”
(Source: Code of Federal Regulations, Title 12, Chapter I, § 34.42[h]; also Interagency
Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10,
2010, page 77472)
APPRAISAL REPORT
This appraisal is presented in the form of an appraisal report, which is intended to comply with
the reporting requirements set forth under Standards Rule 2 -2(a) of USPAP. This report
incorporates sufficient information regarding the data, reasoning and analysis that were used to
develop the opinion of value in accordance with the intended use and user.
PURPOSE OF THE APPRAISAL & INTEREST APPRAISED
The purpose of this appraisal is to develop an opinion of the value of the property under two major
scenarios: first, assuming the property is unencumbered and may be put to its highest and best
INTRODUCTION 14
St. Elizabeth's East Site - Parcel 6
use (effective the “unrestricted market value” which is hypothetical) ; and second, assuming that
the Subject Property is developed to its highest potential under a provided Development Plan.
The value opinions are subject to several Extraordinary Assumptions and Hypothetical
Conditions. For all values, we follow the Extraordinary Conditions that:
1. Our opinion of the market value subject to the Development Plan assumes that: 1) the
Parcel will be conveyed subject to a 99 -year ground lease (leasehold conveyance), with
zero or nominal ($1/annually) ongoing rent payments; and, 2) the Developer will obta in
the required approvals needed (parking), if any, to complete construction of the proposed
properties in accordance with the proposed plans and details provided by the Sponsor.
2. The Subject Property, per the Sponsor's documentation, contains a WMATA Green Line
tunnel easement and DC Water utility easement for sanitary and storm sewer piping.
Development of the Subject Property to the density envisioned by zoning and consistent
with maximally productive use of the property will require sub -grade development (e.g.
parking) which may necessitate relocation of existing water and sewer lines and a
configuration that avoids underground tunnels for WMATA. Accordingly, this appraisal
assumes that the costs of infrastructure reconfiguration of this type will be separately
funded, with the purchaser of the Subject Property held responsible for the abnormal
development costs only.
SCOPE OF WORK
Extent to Which the Property is Identified
– Physical characteristics
– Legal characteristics
– Economic characteristics
Extent to Which the Property is Inspected
Newmark inspected the subject property on March 21, 2025 as per the defined scope of work.
Chizoma Ohanyerenwa made a personal inspection of the property that is the subject of this
report. Douglas L. Nickel, MAI, FRICS has not personally inspected the subject.
Purpose of the Appraisal
Appraisal Premise Interest Appraised Date of Value
Hypothetical Market Value Unencumbered Fee Simple 3/21/2025
Market Value Under Development Plan Fee Simple 3/21/2025
Compiled by Newmark
INTRODUCTION 15
St. Elizabeth's East Site - Parcel 6
Type and Extent of the Data Researched
– Exposure and marketing time;
– Neighborhood and land use trends;
– Demographic trends;
– Market trends relative to the
subject property type;
– Physical characteristics of the site
and applicable improvements;
– Flood zone status;
– Zoning requirements and
compliance;
– Real estate tax data;
– Relevant applicable comparable
data; and
– Investment rates
Type and Extent of Analysis Applied
We analyzed the property and market data gathered through the use of appropriate, relevant, and
accepted market-derived methods and procedures. Further, we employed the appropriate and
relevant approaches to value, and correlated and reconciled the results into an estimate of market
value, as demonstrated within the appraisal report. The applied scope of work is appropriate and
sufficient to produce credible assignment results for the intended use of this report.
ECONOMIC ANALYSIS 16
St. Elizabeth's East Site - Parcel 6
Economic Analysis
NATIONAL TRENDS AND UNCERTAINTIES
Newmark Capital Markets assesses that there was a momentum shift in the 4th quarter, leading
to both transaction volume and lending volume increasing year -over-year. However, they also
note that the notable increase in interest rates since early December complicates matters. Real
Capital Analytics (RCA) concurred as they reported in their end of 2024 Capital Trends publication
that “the commercial property markets turned a corner in 2024.” Deal volume climbed in 2024
and price declines are coming to an en d overall. Along with higher interest rates, capitalization
rates rose quickly starting in 2022, and bid -ask spreads widened. While these trends have
moderated and cap rates are beginning to reverse direction, the impacts are still present and
remain major drivers of current CRE market conditions.
Investors are adjusting to the new reality by modifying their investment strategies, leading to a
narrowing of the bid-ask spread. Transaction volume for 2024 ended 9% above 2023 levels at
$420.4 billion according to RCA. RCA and Green Street have both o bserved that CRE property
prices have started to inch higher again, despite the impacts of high borrower rates. The January
15, 2025 Federal Reserve Beige Book noted “cautious optimism continues to prevail among
survey respondents given modestly positive trends in loan demand, wage growth, and consumer
spending.” At the same time, RCA notes that distress continues to rise, with office properties
accounting for 40-45% of the total value of distressed assets but multifamily dominating the most
recent additions to the distress totals.
The Federal Reserve’s prior actions engineered the fastest increase in interest rates in their
history - rising to a high of 5.25-5.50% for the Federal Funds rate in July 2023. Three reductions
at the end of 2024 has brought this range to 4.25-4.50%. However, the 10 year Treasury rate did
not follow suit. Moody’s Analytics Chief Economist Mark Zandi expects the Federal Reserve to
pause interest rate reductions until late in the year. Zandi points to tariffs being likely to increase
inflation and also that the Federal Reserve will be closely watching the new U.S. administration’s
actions before moving. Other commentators expect faster reductions but the uncertainty of
economic policies are part of the reason that long-term rates remain at elevated levels. Interest
rates have been unusually low for upwards of 15 years but have now reversed to higher levels for
the past two. As interest rates return to an equilibrium level, they will still likely be higher than
those observed in the periods prior to 2022.
It will take time for the effects of higher interest rates to reverse. Interest rates have declined from
their peak in October 2023, and debt market conditions have improved – at least marginally. The
majority of investors surveyed by PwC expect capitalization rates to hold steady over the next six
months. The RCA Commercial Property Pricing Index reflected only a -0.7% loss for the year.
ECONOMIC ANALYSIS 17
St. Elizabeth's East Site - Parcel 6
While investors are taking a more optimistic view and metrics such as sales volume have
improved, the uncertainty of economic policies remains an overhang. We have considered and
will address these issues throughout this appraisal and report, including in our determinations of
overall capitalization rates, discount rates, market rent assumptions, market conditions
adjustments, and growth of rents and expenses where applicable.
AREA ANALYSIS
Area Map
The subject is located within the southeast quadrant of the District of Columbia. It is part of the
Washington-Arlington-Alexandria metro area (Washington, DC MSA).
Moody’s Analytics’ Economy.com provides the following economic summary for the Washington,
DC MSA as of February, 2025.
ECONOMIC ANALYSIS 18
St. Elizabeth's East Site - Parcel 6
Moody’s summarizes the area’s economic performance in recent months as follows:
Recent Performance
The Washington, DC MSA's economy is underwhelming. Payroll employment growth still lags that
of the nation but closed the gap slightly in the final months of 2024. Federal government payrolls
were little changed over the year. Professional/business service s gains also plateaued, but
healthcare continues to power ahead. The unemployment rate is creeping higher, as household
employment is edging lower. Meanwhile, house prices are appreciating faster in the Washington,
DC MSA than in its national peers. Residential construction is subdued.
Market Comparison
The following table illustrates key economic indicators and a comparison of the Washington, DC
MSA to the regional grouping as a whole. As indicated, Washington, DC MSA is projected to
outperform the National Region Metros in three of eight performance categories shown over the
next five years.
Employment Sectors and Trends
Employment data by occupation and business/industry sectors provides an indication of the
amount of diversification and stability in the local economy. Job sector composition also gives an
2018 2019 2020 2021 2022 2023 INDICATORS 2024 2025 2026 2027 2028 2029
409.2 418.1 412.2 436.8 447.4 458.3 Gross metro product (C17$ bil) 468.3 476.5 482.0 491.5 502.2 513.5
2.4 2.2 -1.4 6.0 2.4 2.4 % change 2.2 1.8 1.1 2.0 2.2 2.3
2,709.9 2,746.1 2,586.7 2,636.1 2,716.2 2,768.0 Total employment (ths) 2,793.8 2,771.4 2,736.7 2,740.9 2,747.0 2,755.1
1.3 1.3 -5.8 1.9 3.0 1.9 % change 0.9 -0.8 -1.3 0.2 0.2 0.3
3.3 3.1 6.6 4.6 2.9 2.8 Unemployment rate (%) 3.1 3.6 3.8 3.7 3.6 3.5
4.7 4.0 5.1 8.2 4.4 6.3 Personal income growth (%) 5.4 2.9 3.1 3.9 3.6 3.9
101.6 105.8 109.9 113.1 119.9 126.0 Median household income ($ ths) 129.7 132.2 134.9 139.0 142.4 146.0
4,961.4 5,000.5 5,019.5 5,024.2 5,041.6 5,095.6 Population (ths) 5,173.0 5,226.7 5,251.5 5,263.3 5,274.2 5,285.6
0.9 0.8 0.4 0.1 0.3 1.1 % change 1.5 1.0 0.5 0.2 0.2 0.2
6.0 6.5 -5.2 -19.5 -8.0 27.2 Net migration (ths) 50.6 26.9 -2.0 -14.9 -15.4 -14.6
11,015 10,518 10,800 10,716 9,530 8,716 Single-family permits (#) 9,269 15,760 16,866 17,321 17,066 16,722
10,795 10,593 10,261 11,962 19,512 10,218 Multifamily permits (#) 7,711 12,703 13,139 13,502 13,690 13,654
4 4 5 10 10 3 FHFA house price index (% change) 6 3 1 2 2 2
Source: Moody's Analytics Précis® US Metro
Moody's Analytics Précis® Metro Indicators: Washington, DC MSA
Indicator 2019 2024 2029 2019 - 2024 2024 - 2029 2019 2024 2029 2019 - 2024 2024 - 2029
Gross metro product (C17$ bil) 418.1 468.3 513.5 2.3% 1.9% 20,692 22,896 25,388 2.0% 2.1%
Total employment (ths) 2,746.1 2,793.8 2,755.1 0.3% -0.3% 150,906 158,612 161,729 1.0% 0.4%
Unemployment rate (%) 3.1% 3.1% 3.5% 3.7% 4.0% 4.0%
Personal income growth (%) 4.0% 5.4% 3.9% 4.7% 4.7% 4.6%
Population (ths) 5,000.5 5,173.0 5,285.6 0.7% 0.4% 330,487 336,438 342,546 0.4% 0.4%
Single-family permits (#) 10,518 9,269 16,722 -2.5% 12.5% 888,667 1,035,880 1,124,838 3.1% 1.7%
Multifamily permits (#) 10,593 7,711 13,654 -6.2% 12.1% 402,833 345,083 370,405 -3.0% 1.4%
FHFA house price index (% change) 4.1 5.7 2.3 6.9% -16.7% N/A N/A N/A N/A N/A
Washington, DC MSA outperforming National Region Metros
Washington, DC MSA underperforming National Region Metros
Source: Moody's Analytics Précis® US Metro; Compiled by Newmark
Washington, DC MSA Annual Growth National
Comparison of Key Economic Indicators - Washington, DC MSA Metro to National Region
Annual Growth
ECONOMIC ANALYSIS 19
St. Elizabeth's East Site - Parcel 6
indication of the predominant drivers of current and future demand for supporting commercial real
estate sectors. The following tables display employment data by occupation sector and by
business/industry sector for the area and region.
Comparing the industry sectors for the local market area ( District of Columbia) to Washington,
DC MSA indicates the local market area is somewhat more heavily weighted toward the Public
Administration, Services, and Information sectors. By contrast, the industry employment totals
for Washington, DC MSA indicate somewhat higher proportions within the Construction, Retail
Trade, Manufacturing, Transportation/Utilities, Finance/Insurance/Real Estate, Wholesale Trade,
and Agriculture/Mining sectors. The following graphic further illustrates this comparison.
Occupation Sector
Administrative Support 29,025 7.2% 290,570 8.1%
Management/Business/Financial 132,402 32.6% 921,323 25.5%
Professional 166,987 41.1% 1,242,556 34.4%
Sales and Sales Related 19,347 4.8% 224,410 6.2%
Construction/Extraction 2,754 0.7% 140,905 3.9%
Installation/Maintenance/Repair 1,156 0.3% 63,369 1.8%
Production 2,278 0.6% 59,847 1.7%
Transportation/Material Moving 11,458 2.8% 162,010 4.5%
Total Employees (16+ Occupation Base) 405,927 100.0% 3,606,845 100.0%
Source: ESRI; Compiled by Newmark
Current Employment by Occupation Sector
Washington, DC MSADistrict of Columbia
Industry Sector
Agriculture/Mining 59 0.0% 10,208 0.3%
Construction 7,196 1.8% 221,259 6.1%
Manufacturing 6,631 1.6% 108,299 3.0%
Wholesale Trade 1,559 0.4% 31,843 0.9%
Retail Trade 17,570 4.3% 257,913 7.2%
Transportation/Utilities 12,192 3.0% 153,553 4.3%
Information 16,432 4.0% 91,713 2.5%
Finance/Insurance/Real Estate 20,363 5.0% 205,800 5.7%
Services 244,920 60.3% 2,016,683 55.9%
Public Administration 79,005 19.5% 509,574 14.1%
Total Employees (16+ Occupation Base) 405,927 100.0% 3,606,845 100.0%
Source: ESRI; Compiled by Newmark
Current Employment by Industry Sector
District of Columbia Washington, DC MSA
ECONOMIC ANALYSIS 20
St. Elizabeth's East Site - Parcel 6
Unemployment
The following table displays the historical unemployment data for the area derived from the US
Department of Commerce, Bureau of Labor Statistics. The reported unemployment rate for the
Washington, DC MSA is 3.1% (January 2025).
Source: ESRI; Compiled by Newmark
Employment Comparison
55.9%
14.1%
5.7%
7.2%
2.5%
4.3%
6.1%
3.0%
0.9%
0.3%
60.3%
19.5%
5.0%
4.3%
4.0%
3.0%
1.8%
1.6%
0.4%
0.0%
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%
Services
Public Administration
Finance/Insurance/Real Estate
Retail Trade
Information
Transportation/Utilities
Construction
Manufacturing
Wholesale Trade
Agriculture/Mining
District of Columbia Washington, DC MSA
ECONOMIC ANALYSIS 21
St. Elizabeth's East Site - Parcel 6
Major Employers
The following table lists a number of major employers within the Washington, DC MSA as reported
by Moody’s. While not all -encompassing, this list provides further indication of the types of
economic sectors that are drivers for the area.
Bars represent beginning to end range of unemployment rates in each year
Orange bars denote increasing unemployment from beginning to end of year
Blue bars are declining unemployment from beginning to end of year
Arrows are extent of unemployment rates over the year
Compiled by Newmark
Unemployment Rate: Washington-Arlington-Alexandria, DC-VA-MD-WV Metropolitan Statistical Area
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
ECONOMIC ANALYSIS 22
St. Elizabeth's East Site - Parcel 6
Analysis
Further economic analysis from Moody’s is detailed as follows:
DOGE Days
The outlook for the Federal government has darkened as the Trump administration works quickly
to shrink its footprint. Federal worker buyouts, layoffs, and a hiring freeze at executive agencies
will cause federal payrolls to fall by about 400,000 nationall y through the fourth quarter of 2027.
Nearly one-fourth of the cuts will occur in the Washington, DC MSA, more than any other regional
economy, given the outsize concentration of agencies in the administration's crosshairs. About
77,000 federal workers hav e already accepted a buyout. The Office of Personnel Management
has instructed agency heads to fire probationary workers, those with less than two years in their
positions, totaling around 200,000. Agency restructurings, led by the Department of Government
Efficiency, are underway, with USAID and the Consumer Financial Protection Bureau gutted.
There is also potential for several agencies to be relocated from the metro division to other parts
of the country, mirroring what happened with the USDA and Bureau of Land Management during
Trump's first administration.
Rank Employer Employees
1 Federal Government 300,000>
2 Inova Health System 19,000
3 MedStar Health 17,000
4 Marriott International Inc. 16,500
5 Booz Allen Hamilton 15,000
6 The University of Maryland 15,000
7 Northrop Grumman 14,000
8 Lockheed Martin 11,000
9 Giant Food 10,000
10 Deloitte 9,500
11 CSRA Inc. 9,000
12 Leidos Holding Inc. 9,000
13 Amazon 8,000
14 Verizon Communications 8,000
15 Capital One Financial Corp. 7,000
16 AstraZeneca PLC 3,500
17 The Bozzuto Group 1,958
18 The Henry M. Jackson Foundation for the Advancement of Military Medicine 1,936
19 Great American Restaurants 1,700
20 AARP 1,424
Source: Moody's Analytics Précis® US Metro
Selected Major Employers: Washington, DC MSA
ECONOMIC ANALYSIS 23
St. Elizabeth's East Site - Parcel 6
Absorption
Some dismissed Federal workers will find refuge in the private sector, but this will not be enough
to offset the hit dealt to the Washington, DC MSA's economy. As a result, total employment will
decline more than in any other metro area over the next year, and the unemployment rate will rise
to a peak of 3.8% -its highest since 2017, excluding the pandemic. Office -using industries stand
to benefit from the influx of talented labor. Specifically, professional/business services, much of
which are dedicated to government contracting, consulting, and policy research and advocacy,
will attract former Federal employees. Finance and tech will also be positioned to attract some
highly educated ex -federal workers. However, the metro division's labor market has loosene d
considerably, and total job postings have dipped below pre -pandemic levels, according to data
from Indeed. Consequently, absorption of ex-Federal workers into the private sector will be limited
by its capacity. Moreover, government budget constraints will weigh on contracting and thus limit
hiring.
Downstream Effects
Consumer industries will take it on the chin as the Federal workforce shrinks. Government jobs
are among the highest paying in the Washington, DC MSA and fewer high -paid federal workers
will stunt disposable income growth. Retail, leisure/hospitality and personal services will all suffer
as spending declines. Net migration will also turn negative as some ex-Federal workers struggle
to find new jobs and look elsewhere, further reducing demand-but losses will be limited.
Conclusion
Strengths Negative Attributes
– High per capita income and educated
workforce.
– Major center for computer systems
design and tech -related professional
services.
– Popular tourist destination.
– Exposure to downturn tourism.
– Above-average living costs.
– High exposure to Federal government.
– High business and regulatory costs.
The Washington, DC MSA will grind to a halt. Federal layoffs will cause the most severe payroll
decline in the nation. The high-wage segment of the private sector will absorb some workers, but
the resulting reduction in income and spending will harm consumer industries. Long term, heavy
reliance on the public sector will limit the Washington, DC MSA's growth potential, ensuring it is
an average performer nationally, at best.
ECONOMIC ANALYSIS 24
St. Elizabeth's East Site - Parcel 6
MARKET AREA ANALYSIS
Neighborhood Map
Boundaries
The Subject Property is located in the southeast quadrant of Washington, DC in a neighborhood
known as Congress Heights. This area is part of the Congress Height multifamily submarket and
Southeast retail submarket defined by CoStar, Inc. The Congress Heights submarket is generally
delineated as follows:
North Interstate – 295, Suitland Parkway
South Interstate – 295, Potomac River, District of Columbia and Maryland Border
East District of Columbia and Maryland Border
West Interstate – 295
Surrounding Area of Influence Trends
Description
The Congress Heights neighborhood is dominated by the Saint Elizabeths Campus, a former
psychiatric hospital in southeast DC that was operated by the District of Columbia Department of
Behavioral Health. After several decades of decline, the property was split into two sections. The
eastern portion of the campus was transferred to th e DC Government in 1987 while the federal
government retained the western portion of the campus. Saint Elizabeths Hospital was added to
the National Register of Historic Places in 1979. The property was designated a national historic
landmark in 1990. The eastern portion of the campus is currently undergoing a major
ECONOMIC ANALYSIS 25
St. Elizabeth's East Site - Parcel 6
revitalization/redevelopment effort spearheaded by the DC government which will be discussed
in detail later in this section.
The surrounding area is viewed as urban with 90%+ of land developed. Land uses immediately
surrounding the Subject Property are predominantly complementary and harmonious residential,
office, multifamily, and institutional use s, along with a small commercial concentration
(neighborhood shopping center) located several blocks to the southeast.
Fundamental Real Estate Cycle and New Development
The surrounding area is considered to be within the recovery stage of its real estate cycle. This
is due to the following:
– Vacancy rates in the subject’s immediate area (east of the Anacostia River) have
remained relatively stable and low;
– Rents have grown over the past three years in the subject’s submarket including rents
in Class B/C apartments located east of the Anacostia River; and,
– There is an increase in proposed new construction within the subject’s submarket
particularly of multifamily projects with an affordable housing component.
Still, economic growth and development of the Anacostia/NE DC submarket in general, lags the
other regions in the DC market. Furthermore, much of the new development in the area is driven
by financing from government entities, rather than purely from private investors and debt sources.
As a result, growth for this section of DC is tenuous and heavily dependent on DC government
involvement.
The following is a list of recently built properties east of the Anacostia River.
ECONOMIC ANALYSIS 26
St. Elizabeth's East Site - Parcel 6
The majority of these properties are multifamily buildings with a large affordable housing
component. Over the past three years, approximately 1, 788 units have been added to the area
east of the Anacostia River.
The following is a list of proposed or under construction properties east of the Anacostia River.
Property Address Property Name
Building
Class Property Type Submarket Name
Year
Built
Number
of Units
Rentable
Building Area
Percent
Leased (%)
3451 Benning Rd NE B Office Northeast 2022 13,200 100.00
2442 Martin Luther King Ave SE The Bridge A Multi-Family Anacostia 2023 112 148,530
1909 Martin Luther King Jr. Ave SE A Office Southeast 2023 80,000 88.34
3924 Minnesota Ave NE DC Department of General Services HQ A Office Northeast 2023 258,500 99.36
611 Division Ave NE B Office Northeast 2024 12,606 95.17
2201 Shannon Pl SE Reunion Square A Office Southeast 2024 288,000 99.10
1916 15th St SE C Multi-Family Anacostia 2024 27 47,771
1913 17th St SE B Multi-Family Anacostia 2023 18 14,825
1603 18th St SE C Multi-Family Anacostia 2024 6 6,000
3341-3353 23rd St SE Terrace Manor Redevelopment B Multi-Family Congress Heights 2024 130 128,000
1735 28th St SE The Robinson Apartments Hillcrest B Multi-Family Anacostia 2022 9 9,000
5 47th St SE Carver Terraces Row Houses A Multi-Family Marshall Heights 2023 28 33,600
599 50th St NE Providence Place B Multi-Family Lincoln Heights 2022 93 83,650
2483-2491 Alabama Ave SE Aspire Apartments A Multi-Family Anacostia 2025 86 85,622
2495 Alabama Ave SE B Multi-Family Anacostia 2024 31 22,700
3443 Benning Rd NE B Retail Northeast 2022 10,787 100.00
4234 Benning Rd NE B Multi-Family Minnesota Ave 2024 8 6,800
2501 Burns BOAZ Flats B Multi-Family Anacostia 2022 16 19,120
Cypress St East Parking Garage A Specialty Southeast 2022 500,000 100.00
5701 Dix St NE The Turner Flats at Beulah Crossing B Multi-Family Grant Park 2023 38 45,000
3450 Eads St NE 34Fifty B Multi-Family Minnesota Ave 2024 49 70,000
1100 Eastern Ave NE 11Hundred Apartments A Multi-Family Deanwood 2022 65 63,000
5900 Foote St NE B Multi-Family Grant Park 2023 16 16,000
1600 Good Hope Rd SE Good Hope Park Apartments B Multi-Family Anacostia 2024 35 30,000
630 Kenilworth Ter NE Jayde Parkside B Multi-Family Parkside 2024 112 100,000
750 Kenilworth Ter NE Vesta Parkside A Multi-Family Parkside 2022 191 187,169
2418 Lenfant Sq B Multi-Family Anacostia 2022 16 21,112
2323 Martin Luther King Jr Ave SE The Clara on MLK B Multi-Family Anacostia 2024 81 93,863
2715 Martin Luther King Jr Ave SE Friendship Public Charter School SE Campus Specialty Southeast 2024 35,000 100.00
2521 Minnesota Ave SE Park27 B Multi-Family Anacostia 2022 26 30,000
17 Mississippi Ave SE 17 Mississippi B Multi-Family Congress Heights 2023 41 25,000
5119-5127 Nannie Helen Burroughs Ave NE The Strand B Multi-Family Lincoln Heights 2022 86 90,000
5127-5131 Nannie Helen Burroughs Ave NE Historic Strand Theatre C Retail Northeast 2023 8,602 100.00
1949 Naylor Rd SE B Multi-Family Anacostia 2022 29 19,585
4501 Quarles St NE Kenilworth Courts B Multi-Family Kenilworth 2024 166 166,000
1200 Sumner Rd SE The Asberry at Barry Farm A Multi-Family Anacostia 2024 108 80,670
1007 Sycamore Dr SE District Towns B Multi-Family Congress Heights 2022 88 146,344
1201 Sycamore Dr SE St. Elizabeth's East - Parcel 17 A Office Southeast 2023 123,952 100.00
Sycamore Dr and Oak St SE Sycamore & Oak B Retail Southeast 2023 23,000 100.00
2224 Town Center Dr SE Lidl A Retail (Neighborhood Center) Southeast 2022 30,000 100.00
2230-2238 Town Center Dr SE Block 3B B Retail (Neighborhood Center) Southeast 2022 9,038 100.00
1517 Young St SE B Multi-Family Anacostia 2024 20 20,000
5717 Dix St NE Dix Street Residences B Multi-Family Grant Park 2025 47 54,162
4732 Sheriff Rd NE C Multi-Family Deanwood 2023 10 6,976
Source: CoStar, Inc.; compiled by Newmark
ECONOMIC ANALYSIS 27
St. Elizabeth's East Site - Parcel 6
Several large projects are on the horizon that could change the submarket in the future if all were
to be funded and developed. There are 9,600 units currently planned or under construction in this
area.
St. Elizabeths Campus
The ongoing redevelopment of the 359-acre St. Elizabeths Campus is the largest, and potentially
the most significant, development effort undertaken in Ward 8 in many years. The Subject
Property is part of this project.
Saint Elizabeths Hospital was founded in 1855 and was the nation’s first large-scale, federally run
psychiatric hospital; it eventually grew into a complex of over 100 buildings on a 300+ acre
campus. The hospital fell into disrepair during the second half of the 20th century and was turned
Property Address Property Name
Building
Class PropertyType Submarket Name Building Status
Year
Built
Number
Of Units
Rentable
Building Area
Percent
Leased (%)
3915 Dix St NE A Office Northeast Proposed 2025 60,000 0.00
632 Howard Rd SE The Douglass A Multi-Family Anacostia Under Construction 2025 757 400,000
671 Parkside Pl NE One Parkside Place A Office Northeast Proposed 2026 117,816 0.00
4201 7th St SE Barnaby & 7th B Multi-Family Congress Heights Under Construction 2025 169 90,000
12th Pl SE Hyacinth’s Way B Multi-Family Congress Heights Proposed 2026 71 70,000
13th St Cedar Hill Regional Medical Center, GW Health A Health Care Southeast Under Construction 2025 150,000 100.00
1920 17th St SE B Multi-Family Anacostia Deferred 13 8,483
322 40th St NE Phase I Retail A Office (Community Center) Northeast Proposed 2025 73,906 79.62
322 40th St NE Phase II A Multi-Family (Community Center) Minnesota Ave Proposed 2028 495 475,000
307 40th st NE B Retail Northeast Proposed 16,000 14.25
5 47th St SE Carver Terraces Apartments A Multi-Family Marshall Heights Deferred 2026 178 143,000
1331 Alabama Ave SE Congress Heights A Office Southeast Deferred 2026 240,000 100.00
2405 Alabama Ave SE B Multi-Family Anacostia Proposed 2026 16 15,000
3903 Benning Rd Phase III A Multi-Family (Community Center) Minnesota Ave Proposed 2033 855 800,000
3905 Benning Rd Phase I Retail A Retail (Community Center) Northeast Proposed 2027 110,000 53.11
3911 Benning Rd Phase I A Retail (Community Center) Northeast Proposed 2026 21,000 33.58
3340 Benning Rd NE Prologis DC Capital Logistics Center A Industrial NE Proposed 2026 146,000 0.00
4401-4435 Benning Rd NE B Multi-Family Minnesota Ave Proposed 2025 109 100,000
4650 Benning Rd SE Fletcher Johnson At Park A Multi-Family Marshall Heights Proposed 2029 500 450,000
E Capitol St NE Capitol Gateway Marketplace B Retail Northeast Deferred 8,800 100.00
E Capitol St NE Capitol Gateway Marketplace Wal-Mart B Retail Northeast Deferred 135,000 100.00
Dogwood Rd A Health Care Southeast Under Construction 2025 150,000 100.00
640 Howard Rd SE Bridge District Phase II A Multi-Family Anacostia Under Construction 2026 825 291,150
650 Howard Rd SE Alula at Bridge District A Multi-Family Anacostia Under Construction 2025 294 295,009
1004-1018 Howard Rd SE Workforce Townhomes B Multi-Family Anacostia Under Construction 2026 18 20,000
Kenilworth Ter NE Building 12 A Multi-Family Parkside Proposed 2028 871,611
700 Kenilworth Ter NE Parkside Parcel 10 B Multi-Family Parkside Under Construction 2025 118 100,000
1337 Marion Barry Ave SE Hope View Apartments B Multi-Family Anacostia Under Construction 2025 48 40,000
2001-2027 Martin Luther King Jr Ave SE Reunion Square A Multi-Family Anacostia Proposed 143 105,400
2420-2422 Martin Luther King Jr Ave SE B Multi-Family Anacostia Proposed 2025 34,213
2628 Martin Luther King Jr Ave SE B Multi-Family Anacostia Deferred 10 25,000
2910 1/2 Martin Luther King Jr Ave SE B Multi-Family Congress Heights Deferred 2022 2 2,100
5110-5140 Nannie Helen Burroughs Ave NE Town Center A Multi-Family Deanwood Deferred 183 183,000
2636 Naylor Rd SE B Multi-Family (Neighborhood Center)Anacostia Proposed 2027 75 50,000
670 Parkside Pl NE A Multi-Family Parkside Proposed 2026 82,938
2617 Pennsylvania Ave SE B Multi-Family Anacostia Proposed 2026 69,490
3220 Pennsylvania Ave SE B Multi-Family Anacostia Proposed 189 100,000
4726 Sheriff Rd NE B Multi-Family Deanwood Deferred 2024 13 20,000
4750 Sheriff Rd NE B Multi-Family Deanwood Proposed 2026 17,000
1221 Sycamore Dr A Office Southeast Proposed 2026 163,279 0.00
1802 Woodmont Pl SE Community College Preparatory Academy A Specialty Southeast Under Construction 2025 50,000 100.00
4217 7th St SE Barnaby & 7th Phase 2 B Multi-Family Congress Heights Proposed 2027 229 90,000
125 45th St NE The Residences at Benning Road A Multi-Family Minnesota Ave Under Construction 2025 156 78,000
737 50th St NE H.R. Crawford Gardens B Multi-Family Deanwood Under Construction 2025 76 60,000
Alabama Ave SE B Multi-Family Congress Heights Proposed 2027 120 120,000
1100 Alabama Ave SE St. Elizabeth’s – Parcel 13 B Multi-Family Congress Heights Proposed 2027 421 400,000
1222 Eaton Rd SE Barry Farm Redevelopment B Multi-Family Anacostia Proposed 2026 480 200,000
1605-1607 Good Hope Rd SE B Multi-Family Anacostia Deferred 86 86,000
4337 Martin Luther King Jr Ave SW A Multi-Family Congress Heights Proposed 2028 821 821,000
3932 Minnesota Ave NE Northeast Heights Phase 2 Office/Retail B Retail Northeast Proposed 162,000 100.00
3960 Minnesota Ave NE Northeast Heights Multi-Family B Multi-Family Minnesota Ave Proposed 2026 1500 600,000
2318-2322 Nicholson St SE B Multi-Family Anacostia Proposed 50 50,000
1101 Oak Dr SE Sycamore & Oak Multi-Family Congress Heights Proposed 650,000
2600 SE Pecan St The Martin and The Malcolm B Multi-Family Congress Heights Proposed 507 507,000
2510 Pennsylvania Ave SE B Health Care Southeast Deferred 6,000 100.00
2000 Ridgecrest Ct SE Ridgecrest Apartments Phase II B Multi-Family Congress Heights Proposed 128 128,000
3801 South Capitol St SW B Multi-Family Congress Heights Deferred 93,600
Sycamore St St Elizabeth's East A Office Southeast Proposed 2028 63,422 100.00
Source: CoStar, Inc.; compiled by Newmark
ECONOMIC ANALYSIS 28
St. Elizabeth's East Site - Parcel 6
over to the District of Columbia in 1987. By the early 2000s, the property was essentially
abandoned. Only a small portion of the East Campus is still operating as a mental health facility.
West Campus
The 176-acre West Campus is controlled by the Federal government and was planned for the
largest Federal building project in the Washington area since the construction of the Pentagon.
Construction was scheduled to take place in three phases and w ould eventually include 3.75
million SF occupied by the Department of Homeland Security, a 1.175 million SF headquarters
for the Coast Guard, and numerous storage and warehouse facilities. The Coast Guard
headquarters broke ground in late 2009 and was completed in 2013, adding about 3,700 new
workers to the neighborhood’s daytime population. The DHS headquarters (originally planned to
be completed by 2014-2016), had been delayed repeatedly due to funding, logistics, and process
issues. The Center Building, home to the Department of Homeland Security, opened in 2019. In
August 2024, it was announced that the Cybersecurity and Infrastructure Security Agency, part
of the DHS, will build a new headquarters on the campus as part of the new ma ster plan for the
site. The project will consist of a new 630,000 SF that we be completed by Clark Construction.
East Campus
The 183-acre East Campus, which contains the subject, is controlled by the District of Columbia.
While plans for a large-scale redevelopment of the campus were announced over a decade ago,
developer interest had been limited due to the costs associated with remediating and renovating
the existing historically designated improvements on the site. To date, the significant projects
completed on the East Campus have been:
– The April 2010 opening of a new St. Elizabeths hospital facility (located northeast of
the Congress Heights Metro station),
– The October 2013 completion of the East Gateway Pavilion (located along MLK Jr.
Ave.), which features an open-air market and other public space,
– The August 2014 opening of the $8.3 million R.I.S.E. Demonstration Center, a meeting
and educational facility featuring lecture halls, classrooms, and computing facilities.
– Fall 2018 completion of street and utility infrastructure.
– Fall 2018 opening of the CareFirst Arena – an entertainment and sports arena,
developed by the District (in concert with Events DC and Monumental Sports &
Entertainment), a $65 million, 4,200-seat sports and entertainment complex for use by
the Washington Wizards and Washington Mystics (as well as other cultural and
musical events).
In addition to the completion of infrastructure and the opening of the arena, plans for the
development situated near the Congress Heights Metro station was established . This plan
ECONOMIC ANALYSIS 29
St. Elizabeth's East Site - Parcel 6
originally included 88 townhomes, 252 apartment units (30% affordable), and a 171,000 SF office
building with 38,000 SF of integrated retail (frontage on Alabama Avenue across from the
Congress Heights Metro). This plan is depicted below.
The project was broken into several phases. Phase 1 included the development of Parcels 9, 10,
11 , 12, 14, 15, and 17 in the diagram above. Parcel 12 and a portion of Parcel 9 included the
sports arena. The multifamily use on Parcel 11 was completed in September 2020, The
Residences at St. Elizabeths East. The property contains 2 52 units. The affordable units are
comprised of 19 units available to rent at 30% of the area's median family income (MFI), inclusive
of 13 permanent supportive units, and 183 units available at 31% to 50% of the area's MFI. Parcel
ECONOMIC ANALYSIS 30
St. Elizabeth's East Site - Parcel 6
10 and 14 includes an 88-townhome subdivision, DistrictTowns at St. Elizabeths East. It opened
in April 2022 and is currently sold out. Parcel 15 is home to The Sycamore & Oak, a mixed -use
development that contains 23,000 SF of interim retail space with several local vendors, including
shops and restaurants. Parcel 17 include the Whitman -Walker Health, Max Robinson Center
which opened in 2023.
Construction of Phase 1 has proceeded concurrently with the deployment of infrastructure to the
site, including an entirely new roadway and utility system. The District allocated over $100 million
in capital dollars to fund this work. All infrastructure fo r Phase 1 and the surrounding sites was
completed circa September 2018.
Phase II began in 2020 and was originally scheduled for completion in 2024. Phase II included
the development of Parcels 2, 6, and 18. Parcel 2 included the development of 801 East, a men’s
shelter. It was completed in September 2021. It also included the renovation and preservation of
some historic buildings on that site (St. Elizabeths Hospital and Horse Stable Stabilization). Phase
II included the construction of a new Hospital and accompanying parking garage with an
ambulatory pavilion on this parcel. The New Cedar Hill Regional Medical Center GW Health broke
ground in February 2024 and will open April 15, 2025. Part of Parcel 6 was used to design and
build a 750-space multilevel parking structure. It was completed in 2022. This section of Parcel 6
has been subdivided from the structure. In addition, Phase II included infrastructure to support
the larger site including roadways and utility support.
Conformity
The immediate area around the subject includes a complementary and harmonious mixture of
several uses – office (medical and traditional office buildings ), institutional (including the
aforementioned men’s shelter near the subject ), retail, multifamily, and residential subdivision
development within the larger Saint Elizabeths East Campus.
Nuisances or Hazards
Our observation of the area revealed no evidence of significant nuisances or hazards.
Access
Primary Access and Major Thoroughfares
Primary access to the area is provided by Interstate 295, a major arterial that crosses the
Washington, DC metro area in a north/south direction. Other major thoroughfares in the area are
the Suitland Parkway, Malcolm X Avenue SE, Alabama Avenue SE, and Mississippi Avenue SE.
Direct access to the Subject Property from I -295 is via Malcolm X Avenue SE which intersect I -
295 less than 1 mile southwest of the Subject Property. This road provides access to the larger
Saint Elizabeths East Campus. Overall, vehicular access is above average.
ECONOMIC ANALYSIS 31
St. Elizabeth's East Site - Parcel 6
Transportation
Public transportation is provided by the Washington Metropolitan Area Transit Authority
(WMATA), which operates Metrorail (subway) and Metrobus service throughout the region. The
nearest Metrorail station, Congress Heights, is a few block southwest of the Subject Property at
the intersection of 13th Street SE and Alabama Avenue SE. The Congress Heights Metro station
is on the Green Line. Metrobus also operates along major thoroughfares including Alabama
Avenue SE. Overall, the neighborhood’s level of public transportation service is considered good.
Distance from Key Locations
Ronald Reagan Washington National Airport (DCA) is located about a 15- to 20-minute drive from
the Subject Property. The commute to the Washington, DC Central Business District (CBD) is
about a 20- to 25-minute drive from the Subject Property, with similar travel time by Metro.
Land Use
The following was developed from Costar data for the major property types in the surrounding
1.0-mile radius around the Subject.
ECONOMIC ANALYSIS 32
St. Elizabeth's East Site - Parcel 6
Demographics
A demographic summary for the defined area is illustrated as follows:
Souce: Costar; Compiled by Newmark
Surrounding Area Commercial Property Characteristics
Multi-
Family
Office
Health
Care
Specialty
Retail
By # of Properties
Multi-
Family
Office
Health
Care
Specialty
Retail
By Size (SF)
ECONOMIC ANALYSIS 33
St. Elizabeth's East Site - Parcel 6
– The population of the local area (1-mile radius) grew at a slower rate compared to the
District and the MSA between 2020 and 2024. However, over the next five years, the
population is projected to grow at a rate faster than the District and the MSA.
– Similarly, the number of households is projected to grow at a rate faster than the
projected growth for the MSA over the next five years.
– Household income levels in the subject’s immediate area are below the median
household income level for DC as a whole, and considerably lower than at the MSA
level.
– The average household size in a mile radius of the Subject Property (2.54) is larger
than the average for the District (2.05).
Demand Generators
Primary employers for the DC metro area population are federal and local government agencies,
as well as related business located within the core of the CBD. The local area benefits from its
proximity to the Congress Heights Metro station, which provides s ervice on the Green Line,
providing access to neighboring Prince George’s County, MD and Downtown DC (East End). The
1-Mile Radius 3-Miles Radius 5-Miles Radius
District of
Columbia
Washington, DC
MSA
Population
2020 Total Population 31,768 199,099 581,586 689,545 6,278,542
2024 Total Population 30,808 203,346 590,241 691,893 6,429,395
2029 Total Population 31,845 211,870 616,788 712,445 6,609,906
Projected Annual Growth % 0.7% 0.8% 0.9% 0.6% 0.6%
Households
2020 Total Households 11,904 87,335 267,260 312,448 2,322,700
2024 Total Households 11,682 91,999 276,546 318,913 2,388,663
2029 Total Households 12,299 98,263 295,020 335,494 2,474,063
Projected Annual Growth % 1.0% 1.3% 1.3% 1.0% 0.7%
Income
2024 Median Household Income $44,586 $79,630 $98,284 $105,897 $122,325
2024 Average Household Income $73,716 $120,951 $143,639 $160,285 $171,041
2024 Per Capita Income $28,406 $55,100 $67,501 $74,317 $63,635
Housing
2024 Owner Occupied Housing Units 23.7% 28.7% 31.2% 33.5% 59.1%
2024 Renter Occupied Housing Units 64.9% 58.8% 56.7% 53.8% 34.9%
2024 Median Home Value $374,167 $468,404 $579,771 $732,886 $618,875
Median Year Structure Built 1966 1965 1967 1956 1982
Miscellaneous Data Items
2024 Average Household Size 2.54 2.14 2.06 2.05 2.65
2024 Median Age 32.9 35.2 34.9 34.5 37.9
Source: ESRI; Compiled by Newmark
Demographic Analysis
ECONOMIC ANALYSIS 34
St. Elizabeth's East Site - Parcel 6
Subject Property is also located within 4 miles of the Suitland Federal Center, which is a 226-acre
campus located at the Suitland Metrorail Station, along the Green Line, that supports 7,000 to
8,000 employees. Joint Base Anacostia -Bolling, a 1,018 -acre military installation located along
the banks of the Potomac and Anacostia Rivers, is less than 2 miles west of the Subject Property.
It houses 14,000 military and civilian personnel and is the base center for Air Force and Navy
ceremonial support, among ot her missions performed by the nearly 50 military and federal
agencies.
Finally, the ongoing redevelopment of the 359 -acre St. Elizabeths Campus is the largest, and
potentially the most significant development effort undertaken in th e surrounding area in many
years. As previously detailed, there are several uses within the West and East campus of the
development which should be a source of employment for area including the headquarters for the
DHS and Coast Guard.
Conclusion
– The proximity to major employment should support interest in the subject’s location in
the near term.
– Most development over roughly the past five years east of the Anacostia River has
been of multifamily properties (with an affordable housing component).
– The subject’s area is in the recovery phase where there is an increase in
redevelopment/development for the immediate area; however, investment in the
neighborhood is fostered by governmental forces partnered with private investors.
– While there is a demand for housing in the subject’s immediate area, it is mostly for
affordable housing for low- to moderate-income households.
ECONOMIC ANALYSIS 35
St. Elizabeth's East Site - Parcel 6
MULTIFAMILY MARKET ANALYSIS
Classification
The subject is in the Anacostia/Southeast submarket cluster and the Congress Heights submarket
of the District of Columbia market. We have included this information for market reconnaissance
for potential multifamily development in the area.
Multifamily Market Overview
The following discussion outlines overall market performance in the surrounding Multifamily
market using Costar market metric data. Presented are market statistics of the District of
Columbia area and the subject Anacostia/Southeast submarket cluster overall along with more
closely focused statistics related specifically to the Congress Heights submarket.
Period
District of
Columbia Anacostia/Southeast
Congress
Heights
Q3 2021 91.6% 94.4% 94.2%
Q4 2021 92.0% 94.4% 94.1%
Q1 2022 92.4% 93.9% 93.0%
Q2 2022 93.0% 93.9% 92.6%
Q3 2022 92.6% 93.5% 91.7%
Q4 2022 92.0% 92.5% 90.9%
Q1 2023 91.7% 93.2% 92.2%
Q2 2023 92.2% 93.1% 92.3%
Q3 2023 91.8% 92.5% 91.7%
Q4 2023 91.7% 91.9% 90.8%
Q1 2024 91.9% 91.6% 90.3%
Q2 2024 92.2% 91.2% 90.1%
Q3 2024 92.0% 91.1% 90.1%
Q4 2024 91.6% 90.8% 90.3%
Source: Costar; Compiled by Newmark Valuation & Advisory
Occupancy Rate
85.0%
87.0%
89.0%
91.0%
93.0%
95.0%
97.0%
99.0%
Q3 2021 Q2 2022 Q1 2023 Q4 2023 Q3 2024
District of Columbia Anacostia/Southeast
Congress Heights
ECONOMIC ANALYSIS 36
St. Elizabeth's East Site - Parcel 6
– The average vacancy rate for the subject submarket and submarket cluster is higher
than that of the overall market area.
– The average rental rate for the submarket and submarket cluster is lower than the
overall District of Columbia market. The subject Anacostia/Southeast submarket
cluster and Congress Heights submarket is considered a lower tier or more affordable
submarket as compared to the other submarkets in the overall District of Columbia
area. This is largely due to the age of its inventory. Most of the units within the
submarket are Class B/C units in older/vintage apartment buildings.
– Approximately 1.4% of the submarket cluster inventory, 0.9% of the submarket
inventory, and 3.2% of the market inventory, represents newer construction.
– Absorption for the last 12 months was positive for all three sectors; however,
absorption trailed completions.
Period
District of
Columbia Anacostia/Southeast
Congress
Heights
Q3 2021 $2,133 $1,279 $1,232
Q4 2021 $2,138 $1,288 $1,240
Q1 2022 $2,157 $1,298 $1,246
Q2 2022 $2,188 $1,310 $1,254
Q3 2022 $2,199 $1,318 $1,260
Q4 2022 $2,188 $1,330 $1,274
Q1 2023 $2,198 $1,341 $1,289
Q2 2023 $2,226 $1,350 $1,297
Q3 2023 $2,232 $1,362 $1,310
Q4 2023 $2,215 $1,367 $1,315
Q1 2024 $2,235 $1,376 $1,325
Q2 2024 $2,265 $1,384 $1,333
Q3 2024 $2,269 $1,393 $1,339
Q4 2024 $2,265 $1,409 $1,349
Source: Costar; Compiled by Newmark Valuation & Advisory
Asking Rent Per Unit
$1,100.00
$1,300.00
$1,500.00
$1,700.00
$1,900.00
$2,100.00
$2,300.00
Q3 2021 Q2 2022 Q1 2023 Q4 2023 Q3 2024
District of Columbia Anacostia/Southeast
Congress Heights
Trailing Four Quarters Ended Q4 2024
Market / Submarket Inventory (Unit)
Completions
(Unit) Vacancy (%)
Net Absorption
(Unit)
Asking Rent Per
Unit
Effective Rent
Per Unit
District of Columbia 187,080 6,078 8.40% 5,313 $2,265 $2,241
Anacostia/Southeast 31,790 438 9.20% 60 $1,409 $1,401
Congress Heights 14,156 130 9.70% 49 $1,349 $1,341
Source: Costar; Compiled by Newmark Valuation & Advisory
Multifamily Market Statistics
ECONOMIC ANALYSIS 37
St. Elizabeth's East Site - Parcel 6
Market and Submarket Trends
– The overall market area has been stable with respect to occupancy over the past two
years. The vacancy rate has fluctuated between 7. 8% and 8. 3% between Q4 2022
and Q3 2024, with it reaching a peak recently at 8.4%. In contrast, the vacancy rate
has steadily increased for the submarket over the past two years. Since Q4 2022,
vacancy rates increased to a peak of 9.9% in Q2 202 4, but have recently decreased
20 basis point to 9.7% in Q4 2024.
– Generally, effective rental rates have been following an increasing trend; however,
these rents have greatly fluctuated over the past two years. Effective rental rates
increased 3.5% and 5.9% for the market and submarket, respectively.
– As shown above, the submarket is underperforming against the market overall.
Long Term Congress Heights Submarket Metrics
The following provides a longer term view of the focused submarket.
Inventory
(Unit)
Completions
(Unit) Vacancy %
Asking Rent
Per Unit
Inventory
(Unit)
Completions
(Unit) Vacancy %
Asking Rent
Per Unit
Q4 2022 174,729 1,766 8.0% $2,188 13,985 0 9.1% $1,274
Q1 2023 176,801 2,072 8.3% $2,198 14,026 41 7.8% $1,289
Q2 2023 177,618 817 7.8% $2,226 14,026 0 7.7% $1,297
Q3 2023 179,660 2,042 8.2% $2,232 14,026 0 8.3% $1,310
Q4 2023 181,002 1,342 8.3% $2,215 14,026 0 9.2% $1,315
Q1 2024 181,978 976 8.1% $2,235 14,026 0 9.7% $1,325
Q2 2024 182,716 738 7.8% $2,265 14,026 0 9.9% $1,333
Q3 2024 185,325 2,609 8.0% $2,269 14,156 130 9.9% $1,339
Q4 2024 187,080 1,755 8.4% $2,265 14,156 0 9.7% $1,349
* Forecast
Source: Costar; Compiled by Newmark Valuation & Advisory
District of Columbia Congress Heights
Multifamily Market Trends
ECONOMIC ANALYSIS 38
St. Elizabeth's East Site - Parcel 6
Congress Heights Submarket Metrics
Period
Inventory
(Units) Vacancy %
Net
Absorption
(Units)
Completions
(Units)
Asking Rent
Per Unit
Effective
Rent Per
Unit
Q2 2022 13,985 7.4% -54 0 $1,254 $1,248
Q3 2022 13,985 8.3% -123 0 $1,260 $1,255
Q4 2022 13,985 9.1% -111 0 $1,274 $1,268
Q1 2023 14,026 7.8% 208 41 $1,289 $1,283
Q2 2023 14,026 7.7% 12 0 $1,297 $1,291
Q3 2023 14,026 8.3% -77 0 $1,310 $1,303
Q4 2023 14,026 9.2% -130 0 $1,315 $1,306
Q1 2024 14,026 9.7% -72 0 $1,325 $1,314
Q2 2024 14,026 9.9% -30 0 $1,333 $1,323
Q3 2024 14,156 9.9% 117 130 $1,339 $1,329
Q4 2024 14,156 9.7% 34 0 $1,349 $1,341
Y 2005 13,143 7.4% 340 182 $812 $806
Y 2006 13,243 7.0% 138 100 $854 $849
Y 2007 13,243 6.7% 41 0 $892 $887
Y 2008 13,243 6.9% -31 0 $916 $910
Y 2009 13,243 6.6% 51 0 $935 $929
Y 2010 13,243 6.0% 75 0 $992 $987
Y 2011 13,243 6.2% -23 0 $1,006 $1,001
Y 2012 13,243 5.7% 63 0 $1,021 $1,013
Y 2013 13,243 5.6% 15 0 $1,047 $1,040
Y 2014 13,243 6.5% -122 0 $1,063 $1,053
Y 2015 13,292 6.5% 48 49 $1,081 $1,070
Y 2016 13,292 5.8% 94 0 $1,103 $1,096
Y 2017 13,506 6.5% 108 214 $1,133 $1,124
Y 2018 13,506 5.7% 102 0 $1,165 $1,157
Y 2019 13,758 5.8% 235 252 $1,191 $1,185
Y 2020 13,953 6.6% 67 195 $1,219 $1,212
Y 2021 13,985 5.9% 120 32 $1,240 $1,235
Y 2022 13,985 9.1% -434 0 $1,274 $1,268
Y 2023 14,026 9.2% 13 41 $1,315 $1,306
Y 2024 14,156 9.7% 49 130 $1,349 $1,341
5 Year Average 14,021 8.1% -37 80 $1,279 $1,272
10 Year Average 13,746 7.1% 40 91 $1,207 $1,199
15 Year Average 13,578 6.7% 27 61 $1,147 $1,139
Source: Costar; Compiled by Newmark Valuation & Advisory
ECONOMIC ANALYSIS 39
St. Elizabeth's East Site - Parcel 6
Supply & Demand
Supply Additions
The following is a list of proposed and under construction multifamily properties east of the
Anacostia River.
Currently, according to CoStar, there are over 9,600 units proposed, planned, or under
construction east of the Anacostia River. These proposed supply additions are most impactful
and relevant to the subject. The units planned/proposed for the submarket are mostly Class A
and B apartments (with several of th ese communities including rent -restricted/mixed-income
housing properties). The addition of new supply that caters to affordable housing tenants in the
submarket should place pressures on rents keeping potential rent growth in check. However, the
timing of delivery of the proposed units remains speculative as securing funding is challenging at
present. Consequently, we conclude that the volume of planned/proposed units in the market
area would present a risk to substantial rental growth potential and likely balance between supply
and demand.
Property Address Property Name
Building
Class Submarket Name Building Status
Year
Built
Number
Of Units
Rentable
Building Area
Percent
Leased (%)
632 Howard Rd SE The Douglass A Anacostia Under Construction 2025 757 400,000
4201 7th St SE Barnaby & 7th B Congress Heights Under Construction 2025 169 90,000
12th Pl SE Hyacinth’s Way B Congress Heights Proposed 2026 71 70,000
13th St Cedar Hill Regional Medical Center, GW Health A Southeast Under Construction 2025 150,000 100.00
1920 17th St SE B Anacostia Deferred 13 8,483
322 40th St NE Phase II A Minnesota Ave Proposed 2028 495 475,000
5 47th St SE Carver Terraces Apartments A Marshall Heights Deferred 2026 178 143,000
2405 Alabama Ave SE B Anacostia Proposed 2026 16 15,000
3903 Benning Rd Phase III A Minnesota Ave Proposed 2033 855 800,000
4401-4435 Benning Rd NE B Minnesota Ave Proposed 2025 109 100,000
4650 Benning Rd SE Fletcher Johnson At Park A Marshall Heights Proposed 2029 500 450,000
640 Howard Rd SE Bridge District Phase II A Anacostia Under Construction 2026 825 291,150
650 Howard Rd SE Alula at Bridge District A Anacostia Under Construction 2025 294 295,009
1004-1018 Howard Rd SE Workforce Townhomes B Anacostia Under Construction 2026 18 20,000
Kenilworth Ter NE Building 12 A Parkside Proposed 2028 871,611
700 Kenilworth Ter NE Parkside Parcel 10 B Parkside Under Construction 2025 118 100,000
1337 Marion Barry Ave SE Hope View Apartments B Anacostia Under Construction 2025 48 40,000
2001-2027 Martin Luther King Jr Ave SE Reunion Square A Anacostia Proposed 143 105,400
2420-2422 Martin Luther King Jr Ave SE B Anacostia Proposed 2025 34,213
2628 Martin Luther King Jr Ave SE B Anacostia Deferred 10 25,000
2910 1/2 Martin Luther King Jr Ave SE B Congress Heights Deferred 2022 2 2,100
5110-5140 Nannie Helen Burroughs Ave NE Town Center A Deanwood Deferred 183 183,000
2636 Naylor Rd SE B Anacostia Proposed 2027 75 50,000
670 Parkside Pl NE A Parkside Proposed 2026 82,938
2617 Pennsylvania Ave SE B Anacostia Proposed 2026 69,490
3220 Pennsylvania Ave SE B Anacostia Proposed 189 100,000
4726 Sheriff Rd NE B Deanwood Deferred 2024 13 20,000
4750 Sheriff Rd NE B Deanwood Proposed 2026 17,000
4217 7th St SE Barnaby & 7th Phase 2 B Congress Heights Proposed 2027 229 90,000
125 45th St NE The Residences at Benning Road A Minnesota Ave Under Construction 2025 156 78,000
737 50th St NE H.R. Crawford Gardens B Deanwood Under Construction 2025 76 60,000
Alabama Ave SE B Congress Heights Proposed 2027 120 120,000
1100 Alabama Ave SE St. Elizabeth’s – Parcel 13 B Congress Heights Proposed 2027 421 400,000
1222 Eaton Rd SE Barry Farm Redevelopment B Anacostia Proposed 2026 480 200,000
1605-1607 Good Hope Rd SE B Anacostia Deferred 86 86,000
4337 Martin Luther King Jr Ave SW A Congress Heights Proposed 2028 821 821,000
3960 Minnesota Ave NE Northeast Heights Multi-Family B Minnesota Ave Proposed 2026 1500 600,000
2318-2322 Nicholson St SE B Anacostia Proposed 50 50,000
1101 Oak Dr SE Sycamore & Oak Congress Heights Proposed 650,000
2600 SE Pecan St The Martin and The Malcolm B Congress Heights Proposed 507 507,000
2000 Ridgecrest Ct SE Ridgecrest Apartments Phase II B Congress Heights Proposed 128 128,000
3801 South Capitol St SW B Congress Heights Deferred 93,600
Source: CoStar, Inc.; compiled by Newmark
ECONOMIC ANALYSIS 40
St. Elizabeth's East Site - Parcel 6
Demand Generators
– The subject Anacostia/Southeast submarket cluster and the Congress Heights
submarket is within one of the expanding segments of the District of Columbia area,
particularly due to the development of the Saint Elizabeth’s East Campus . However,
this development is heavily contingent upon local and Federal government support.
– There are several planned developments for the subject’s immediate area.
Construction Versus Absorption
– Absorption in the Congress Heights submarket and the market has trailed construction
over the past five years.
– The construction to absorption ratio in all sectors suggests deliveries have exceeded
demand (absorption) as the ratio is above 1.0 in all sectors.
Supply & Demand Conclusion
Absorption of new multifamily construction for the submarket cluster has trailed behind
construction. Current trending demographics for the immediate area (household growth over the
next five years compared to the District and MSA overall) will likely result in an increase in demand
for multifamily properties in the immediate area over the near term and reduces some of the
multifamily supply overhangs evident through rising vacancy. Most of the proposed projects in the
submarket area include a large afforda ble housing component, which directly targets low - and
moderate-income households. This would be the target demographic for segment of the Subject
Property’s tenant base for the Development Plan . The level of proposed construction in the
market area, especially affordable housing properties east of the Anacostia River, would
represent a significant competitive challenge to a multifamily development for the submarket that
targets low- to mid-income households.
Market / Submarket
Units Built Units
Absorbed
Const. /
Abs. Ratio Units Built Units
Absorbed
Const. /
Abs. Ratio Units Built Units
Absorbed
Const. /
Abs. Ratio
District of Columbia 6,078 5,313 1.1 18,829 16,525 1.1 31,788 26,806 1.2
Anacostia/Southeast 438 60 7.3 663 -492 -1.3 1,314 168 7.8
Congress Heights 130 49 2.7 171 -372 -0.5 398 -185 -2.2
Source: Costar; Compiled by Newmark Valuation & Advisory
Prior Calendar Year History Prior Three Year History Prior Five Year History
Prior Calendar Years History
Construction/Absorption Change
ECONOMIC ANALYSIS 41
St. Elizabeth's East Site - Parcel 6
Trends and Projections
Subject and Market Historical and Forecast Trends
The direct competition vacancy rate will be subsequently presented in this appraisal report.
Considering historic trends and the vacancy rate of the peer group of multifamily properties for
the subject, we project a vacancy rate of 6.50% for the new multifamily in the Congress Height
submarket as a market-rate property. As a property with significantly higher affordable units than
typical, we project a vacancy rate of 5.00%.
Market Conclusion
Positive Attributes Negative Attributes
– Rents have grown for the market and
submarket over the past two years.
– The number of households is projected to
grow at a faster rate than the MSA over the
next five years which should help demand for
affordable housing within the Subject’s
surrounding area.
– All market sectors are in danger of
experiencing oversupply as the vacancy rate
for the market increases due to continued
new construction.
– Supply additions in the submarket will likely
keep rent growth in check, especially for
smaller B/C properties like the subject.
– Increasing vacancy for all market sectors
over the past 3+ years.
Current Most Recent
Full Year
Trailing 3-
Year
Trailing 5-
Year
Trailing 10-
Year
Costar
District of Columbia 8.40% 8.40% 8.00% 11.90% 6.50%
Anacostia/Southeast 9.20% 9.20% 7.50% 5.70% 5.60%
Congress Heights 9.70% 9.70% 9.10% 6.60% 6.50%
Direct Competition 6.60%
Concluded Subject Vacancy Rate - Market 6.50%
Concluded Subject Vacancy Rate - Affordable 5.00%
Source: Costar, Newmark Valuation & Advisory
Market Vacancy Rate Indicators
ECONOMIC ANALYSIS 42
St. Elizabeth's East Site - Parcel 6
Conclusion
The Congress Heights submarket, and the greater Anacostia/Southeast submarket cluster has
experienced significant growth over the past ten years. Delivery of new supply in the submarket
may result in continued pressure on vacancy rates over the near term for the submarket as well
as temper rent growth. However, we note th at absorption trends will support the continued
absorption of units for the submarket, especially units priced as affordable for the market.
Costar
District of Columbia 91.60%
Anacostia/Southeast 90.80%
Congress Heights 90.30%
Direct Competition 93.40%
Subject Property’s Stabilized Occupancy - Market 93.50%
Subject Property’s Stabilized Occupancy - Affordable 95.00%
Source: Costar, Newmark Valuation & Advisory
Occupancy Conclusions
ECONOMIC ANALYSIS 43
St. Elizabeth's East Site - Parcel 6
RETAIL MARKET ANALYSIS
Classification
The subject is in the Northeast/Southeast submarket cluster of the Washington, DC MSA market.
We have included this section for market information for the proposed Development Plan which
includes ground floor retail.
Retail Market Overview
The following discussion outlines overall market performance in the surrounding Retail market
using Costar market metric data. Presented are market statistics of the Washington, DC MSA
area and the subject Northeast/Southeast submarket overall along with more closely focused
statistics related specifically to the Subject Property’ Southeast submarket.
Period
Washington, DC
MSA Northeast/Southeast Southeast
Q3 2021 95.2% 95.1% 98.1%
Q4 2021 95.1% 95.0% 98.1%
Q1 2022 95.3% 95.1% 97.9%
Q2 2022 95.3% 95.5% 97.7%
Q3 2022 95.3% 95.6% 96.3%
Q4 2022 95.6% 95.3% 96.7%
Q1 2023 95.5% 95.3% 96.0%
Q2 2023 95.6% 95.6% 97.9%
Q3 2023 95.7% 95.6% 97.5%
Q4 2023 95.8% 95.4% 97.6%
Q1 2024 95.7% 95.5% 98.1%
Q2 2024 95.7% 95.5% 98.3%
Q3 2024 95.7% 96.1% 98.7%
Q4 2024 95.7% 95.7% 98.7%
Source: Costar; Compiled by Newmark Valuation & Advisory
Occupancy Rate
90.0%
91.0%
92.0%
93.0%
94.0%
95.0%
96.0%
97.0%
98.0%
99.0%
100.0%
Q3 2021 Q2 2022 Q1 2023 Q4 2023 Q3 2024
Washington, DC MSA Northeast/Southeast
Southeast
ECONOMIC ANALYSIS 44
St. Elizabeth's East Site - Parcel 6
– The average vacancy rate for the subject submarket and submarket cluster is lower
than that of the overall market area. This is largely due to the limited amount of retail
in the submarket and its older stock.
– The average rental rate for the submarket is similar to the overall Washington, DC
MSA market.
– Approximately 0.1% of the submarket cluster inventory, and 0.3% of the market
inventory, represents newer construction . Note, the Northeast/Southeast submarket
cluster only makes up 2.1% of the total inventory of retail space in the market.
– Absorption for the last 12 months was flat for the overall market area and at the
submarket level.
Period
Washington, DC
MSA Northeast/Southeast Southeast
Q3 2021 $27.22 $21.89 $28.23
Q4 2021 $27.52 $26.93 $28.90
Q1 2022 $28.11 $27.15 $27.82
Q2 2022 $28.66 $27.83 $28.97
Q3 2022 $29.48 $29.13 $28.97
Q4 2022 $29.22 $25.26 $28.08
Q1 2023 $29.78 $31.84 $28.08
Q2 2023 $30.41 $34.48 $37.25
Q3 2023 $30.70 $33.17 $32.13
Q4 2023 $30.44 $33.06 $32.29
Q1 2024 $30.11 $31.79 $32.34
Q2 2024 $29.62 $32.03 $32.62
Q3 2024 $29.93 $32.26 $31.40
Q4 2024 $30.00 $31.93 $30.15
Source: Costar; Compiled by Newmark Valuation & Advisory
Asking Rent Per SF
$23.00
$25.00
$27.00
$29.00
$31.00
$33.00
$35.00
$37.00
Q3 2021 Q2 2022 Q1 2023 Q4 2023 Q3 2024
Washington, DC MSA Northeast/Southeast
Southeast
Trailing Four Quarters Ended Q4 2024
Market / Submarket Inventory (SF)
Completions
(SF) Vacancy (%)
Net Absorption
(SF)
NNN Rent
Overall / SF
Washington, DC MSA 274,043,181 762,636 4.30% 505,071 $30.00
Northeast/Southeast 5,721,936 4,394 4.30% 20,985 $31.93
Southeast 1,611,571 0 1.30% 18,366 $30.15
Source: Costar; Compiled by Newmark Valuation & Advisory
Retail Market Statistics
ECONOMIC ANALYSIS 45
St. Elizabeth's East Site - Parcel 6
Market and Submarket Trends
– The vacancy rate for the submarket has decreased over the past two years from a
peak of 4.0%. For the market, the vacancy rate has been stable over the past two
years.
– The overall market has been somewhat flat when it comes to rent growth. The
submarket exhibits erratic trends, but is skewed by the limited size of the inventory.
The introduction of 23,000 SF to the submarket resulted in a steep increase in asking
rents followed by a gradual decline over the past six quarters.
Long Term Southeast Submarket Metrics
The following provides a longer term view of the focused submarket.
Inventory (SF)
Completions
(SF) Vacancy %
NNN Rent
Overall / SF Inventory (SF)
Completions
(SF) Vacancy %
NNN Rent
Overall / SF
Q4 2022 272,614,200 222,924 4.4% $29.22 1,588,571 0 3.3% $28.08
Q1 2023 272,765,413 151,213 4.5% $29.78 1,588,571 0 4.0% $28.08
Q2 2023 272,955,343 189,930 4.4% $30.41 1,611,571 23,000 2.1% $37.25
Q3 2023 273,100,906 145,563 4.3% $30.70 1,611,571 0 2.5% $32.13
Q4 2023 273,280,545 179,639 4.2% $30.44 1,611,571 0 2.4% $32.29
Q1 2024 273,530,847 250,302 4.3% $30.11 1,611,571 0 1.9% $32.34
Q2 2024 273,641,141 110,294 4.3% $29.62 1,611,571 0 1.7% $32.62
Q3 2024 273,728,795 87,654 4.3% $29.93 1,611,571 0 1.3% $31.40
Q4 2024 274,043,181 314,386 4.3% $30.00 1,611,571 0 1.3% $30.15
* Forecast
Source: Costar; Compiled by Newmark Valuation & Advisory
Washington, DC MSA Southeast
Retail Market Trends
ECONOMIC ANALYSIS 46
St. Elizabeth's East Site - Parcel 6
Southeast Submarket Metrics
Period Inventory (SF) Vacancy %
Net
Absorption
(SF)
Completions
(SF)
Nnn Rent
Overall
All Service
Type Rent
Overall
Q2 2022 1,549,533 2.3% -3,466 0 $28.97 $28.97
Q3 2022 1,588,571 3.7% 15,408 39,038 $28.97 $28.97
Q4 2022 1,588,571 3.3% 6,673 0 $28.08 $28.08
Q1 2023 1,588,571 4.0% -11,440 0 $28.08 $28.90
Q2 2023 1,611,571 2.1% 52,469 23,000 $37.25 $34.79
Q3 2023 1,611,571 2.5% -6,368 0 $32.13 $31.65
Q4 2023 1,611,571 2.4% 2,093 0 $32.29 $31.79
Q1 2024 1,611,571 1.9% 7,965 0 $32.34 $31.84
Q2 2024 1,611,571 1.7% 3,595 0 $32.62 $32.07
Q3 2024 1,611,571 1.3% 5,549 0 $31.40 $30.97
Q4 2024 1,611,571 1.3% 1,257 0 $30.15 $29.80
Y 2006 1,440,261 3.6% 13,398 0 $27.68 $27.35
Y 2007 1,529,238 5.1% 62,253 88,977 $27.78 $26.54
Y 2008 1,534,238 5.3% 1,518 5,000 $23.36 $23.00
Y 2009 1,534,238 5.4% -1,414 0 $25.60 $25.67
Y 2010 1,538,238 5.8% -2,262 4,000 $26.78 $24.12
Y 2011 1,538,238 3.9% 30,180 0 $22.91 $21.68
Y 2012 1,538,238 4.1% -3,933 0 $23.33 $22.09
Y 2013 1,544,658 4.4% 1,929 6,420 $24.42 $23.37
Y 2014 1,544,658 4.5% -1,970 0 $22.68 $22.40
Y 2015 1,544,658 3.8% 10,490 0 $23.24 $22.72
Y 2016 1,544,658 2.0% 28,165 0 $24.77 $23.36
Y 2017 1,544,658 2.8% -11,836 0 $23.91 $24.12
Y 2018 1,544,658 1.9% 13,281 0 $16.06 $16.27
Y 2019 1,547,312 1.9% 2,959 2,654 $15.04 $15.04
Y 2020 1,547,312 1.8% 985 0 $16.57 $17.45
Y 2021 1,549,533 1.9% 1,445 2,221 $28.90 $28.90
Y 2022 1,588,571 3.3% 15,925 39,038 $28.08 $28.08
Y 2023 1,611,571 2.4% 36,754 23,000 $32.29 $31.79
Y 2024 1,611,571 1.3% 18,366 0 $30.15 $29.80
5 Year Average 1,581,712 2.1% 14,695 12,852 $27.20 $27.20
10 Year Average 1,563,450 2.3% 11,653 6,691 $23.90 $23.75
15 Year Average 1,555,902 3.1% 9,365 5,156 $23.94 $23.41
Source: Costar; Compiled by Newmark Valuation & Advisory
ECONOMIC ANALYSIS 47
St. Elizabeth's East Site - Parcel 6
Supply & Demand
Supply Additions
The following is a list of proposed and under construction multifamily properties east of the
Anacostia River.
Considering the overall size of this area in the District, the overall proposed retail supply is
somewhat limited. Note, two of the six properties have been deferred and will likely not begin
construction without significant back -filling of the lost anchor -tenant, Wal Mart. The list above
does not include the ground floor retail that may be included in proposed multifamily and office
buildings in this submarket.
Construction Versus Absorption
– Absorption in the Northeast/Southeast submarket is outpacing construction. This is
largely due to its limited supply in such a large region of the city.
Supply & Demand Conclusion
Increasing demographic trends for the area, limited amount of new and proposed supply
additions, and the traditionally underserved DC retail market has helped to maintain demand for
retail space in the submarket, despite changing conditions for the market and submarket over the
past few years. We expect the market and submarket to generally improve over time.
Property Address Property Name
Building
Class PropertyType Submarket Name Building Status
Year
Built
Number
Of Units
Rentable
Building Area
Percent
Leased (%)
307 40th st NE B Retail Northeast Proposed 16,000 14.25
3905 Benning Rd Phase I Retail A Retail (Community Center) Northeast Proposed 2027 110,000 53.11
3911 Benning Rd Phase I A Retail (Community Center) Northeast Proposed 2026 21,000 33.58
E Capitol St NE Capitol Gateway Marketplace B Retail Northeast Deferred 8,800 100.00
E Capitol St NE Capitol Gateway Marketplace Wal-Mart B Retail Northeast Deferred 135,000 100.00
3932 Minnesota Ave NE Northeast Heights Phase 2 Office/Retail B Retail Northeast Proposed 162,000 100.00
Source: CoStar, Inc.; compiled by Newmark
Market / Submarket
SF Built SF Absorbed Const. /
Abs. Ratio SF Built SF Absorbed Const. /
Abs. Ratio SF Built SF Absorbed Const. /
Abs. Ratio
Washington, DC MSA 762,636 505,071 1.5 2,644,484 4,122,640 0.6 5,790,506 4,474,458 1.3
Northeast/Southeast 4,394 20,985 0.2 85,821 123,324 0.7 140,822 210,247 0.7
Southeast 0 18,366 0.0 62,038 71,045 0.9 64,259 73,475 0.9
Source: Costar; Compiled by Newmark Valuation & Advisory
Prior Calendar Year History Prior Three Year History Prior Five Year History
Prior Calendar Years History
Construction/Absorption Change
ECONOMIC ANALYSIS 48
St. Elizabeth's East Site - Parcel 6
Trends and Projections
Subject and Market Historical and Forecast Trends
Market Conclusion
Positive Attributes Negative Attributes
– The area retail market and the subject
submarket are at stabilized levels with
vacancy rates sub-5.0%.
– The long term projection is for stabilized
trends as economic trends continue to
improve.
– The District has been a traditionally
underserved retail market, so there is built in
demand for retail space. Furthermore, the
limited amount of available land for
development in the subject’s surrounding
area creates a barrier to entry.
– The older supply of retail space in the
submarket tends to attract lower tier retail
tenants that are only able to support rents
near the average for the market compared to
other retail locations in the city such as the
M Street/Wisconsin Avenue Corridor a nd
14th Street Corridor.
The Southeast submarket, and the greater Northeast/Southeast submarket cluster has
experienced limited growth over the past ten years. Delivery of new supply in the submarket may
result may put upward pressure vacancy rates over the near term for the submarket due to its
limited size; however, we consider this region of DC to be underserved. We note that absorption
trends will support the continued absorption of retail for the submarket.
Current Most Recent
Full Year
Trailing 3-
Year
Trailing 5-
Year
Trailing 10-
Year
Costar
Washington, DC MSA 4.30% 4.30% 4.40% 4.70% 4.10%
Northeast/Southeast 4.30% 4.30% 4.70% 4.40% 6.20%
Southeast 1.30% 1.30% 3.30% 1.80% 3.80%
Concluded Subject Vacancy Rate 4.00%
Source: Costar, Newmark Valuation & Advisory
Market Vacancy Rate Indicators
ECONOMIC ANALYSIS 49
St. Elizabeth's East Site - Parcel 6
FOR-SALE RESIDENTIAL MARKET ANALYSIS
The Development Plan for the Subject Property will include a small residential subdivision . The
strength of any market depends on supply and demand. The following analysis first addresses
regional residential trends and statistical data for townhome units specifically. Lastly, we focus on
competitive residential communities in the market.
Regional Housing Market
The subject is located within the District of Columbia, and the overall demand for housing in the
District has recently been less vibrant with inconsistent price trends.
Market Fundamentals
A summary of house pricing and sales volume trends (resales only) is presented in the following
graphic.
ECONOMIC ANALYSIS 50
St. Elizabeth's East Site - Parcel 6
The following tables present statistical data for re -sales in the District of Columbia through
January 2025.
Source: 2025 Real Estate Business Intelligence, LLC and MRIS
According to statistics from the Metropolitan Regional Information Systems (MRIS), a regional
listing service used by brokers and agents, sales volume (total dollars) in the District of Columbia
ECONOMIC ANALYSIS 51
St. Elizabeth's East Site - Parcel 6
has increased by 32% compared to the previous year. Despite that the median home prices have
decreased by 8.3% over the past year. This suggests that there was a dramatic increase in the
number of sales; however, pricing has not dramatically increased.
As of January 2025, the average days on market for a property in the District of Columbia was 57
days, higher than the level experienced in January 2024 (52 days). There has been a slight
decrease in the average sold-to-list price ratio between January 2024 and January 2025 (96.0%
to 95.5%).
Over the past year, condominium units have had a decrease in pricing (5.5%) compared to the
other residential property types, particularly detached 4 BR or more homes which increased
27.9%.
Source: 2025 Real Estate Business Intelligence, LLC and MRIS
Building Permits
One of the closely watched economic indicators is the issuance of building permits. The following
table illustrates building permit activity as reported by the U.S. Census Bureau for Washington
DC since 2004, with multifamily (2+ units) and single-family units tracked separately.
ECONOMIC ANALYSIS 52
St. Elizabeth's East Site - Parcel 6
As shown above, the number of residential building permits for the District began to rebound from
the Great Recession in 2011. However, there was a large dip in building permits for multifamily
buildings in 2021 likely due to the outbreak of COVID -19. The number of permits recovered in
2022. However, since that time, increased interest rates and economic uncertainty has resulted
in a drop in permits, reflected in the 2023 figures.
Residential Building Permit History - District of Columbia
Year
Single-
Family 2-Family 3/4 Family 5+ Family MF Total Total
% Change in
Total
% Change in
SF
% Change in
MF
2004 226 0 0 1,710 1,710 1,936
2005 125 76 35 2,624 2,735 2,860 47.7% -44.7% 59.9%
2006 126 14 6 1,959 1,979 2,105 -26.4% 0.8% -27.6%
2007 576 14 23 1,297 1,334 1,910 -9.3% 357.1% -32.6%
2008 248 4 4 280 288 536 -71.9% -56.9% -78.4%
2009 151 82 4 889 975 1,126 110.1% -39.1% 238.5%
2010 177 16 51 495 562 739 -34.4% 17.2% -42.4%
2011 227 100 0 4,285 4,385 4,612 524.1% 28.2% 680.2%
2012 271 68 0 3,484 3,552 3,823 -17.1% 19.4% -19.0%
2013 333 76 36 2,810 2,922 3,255 -14.9% 22.9% -17.7%
2014 288 30 26 3,845 3,901 4,189 28.7% -13.5% 33.5%
2015 255 106 7 4,588 4,701 4,956 18.3% -11.5% 20.5%
2016 336 26 8 4,320 4,354 4,690 -5.4% 31.8% -7.4%
2017 352 50 12 5,623 5,685 6,037 28.7% 4.8% 30.6%
2018 112 34 6 4,463 4,503 4,615 -23.6% -68.2% -20.8%
2019 168 90 4 5,683 5,777 5,945 28.8% 50.0% 28.3%
2020 139 94 4 7,133 7,231 7,370 24.0% -17.3% 25.2%
2021 376 24 7 4,333 4,364 4,740 -35.7% 170.5% -39.6%
2022 409 64 4 7,228 7,296 7,705 62.6% 8.8% 67.2%
2023 166 64 11 2,779 2,854 3,020 -60.8% -59.4% -60.9%
Source: United Stated Census Bureau; compiled by Newmark
ECONOMIC ANALYSIS 53
St. Elizabeth's East Site - Parcel 6
We note the single -family market (and the for -sale market generally, as very few large
condominium developments have been started since the recession) remains highly supply -
constrained, primarily due to a lack of available land.
Demand Analysis
Demand for housing is a function of demographic, social, and economic characteristics. In
changing markets, forecasting population, employment, and ultimately, housing demand, is
problematic, and generalizations of market forces may have little relevance i n the subject’s
market. However, they are indicative of the overall supply and demand relationship. According to
ESRI the population within the market area (District of Columbia) is projected to increase from
691,893 in 2024 to 712,445 in 2029 (or 0.6% ann ual growth rate). Meanwhile, the number of
households is projected to increase from 318,913 in 2024 to 335,494 in 2029, or 1.0% annually.
Long-term trends in owner versus renter decisions help establish an appropriate and marketable
split between owner and renter housing unit additions over the forecast period.
The households organized by owner- and renter-occupied units are illustrated as follows.
ECONOMIC ANALYSIS 54
St. Elizabeth's East Site - Parcel 6
The projections in the following chart forecast housing demand for both owner and rental units
based on the current owner/renter ratio.
Based on this data, it appears that the total number of housing units being developed (per permit
data) is in line with the forecasted level of demand for housing (permits for 3,000+ units issued
while demand suggest a growth of only 3,316 households per year).
However, the split of for -rent versus for-sale new housing is tilted much more heavily toward
rentals than the owner/renter ratio, suggesting that while the rental sector of the market is
experiencing some level of oversupply, there is likely continued demand for for-sale housing. The
average number of building permits issued for single -family units over the past three years was
317, with the highest annual amount of 409 permits occurring in 2022. This is lower than the
forecast demand for owner-occupied housing over the next five years (1,112 per year).
Regional Housing Market Conclusion
The regional housing market has been generally stable over the past several years; however, it
is not immune to national trends. In line with national trends, the District experienced a slow down
in sales and a decrease in average pricing. COVID-19 and the subsequent economic challenges
(elevated interest rates and inflation) , decreased demand for housing in the region in the short
term. The number of permits issued in 2023 decreased by over 60% compared to the number of
Residential Occupancy - Market Area (District of Columbia)
Number of Households Percentage
Owner-Occupied Housing Units 106,963 33.5%
Renter-Occupied Hosuing Units 211,950 66.5%
318,913 100.0%
Source: ESRI; Compiled by Newmark
Housing Demand Projections - District of Columbia
Group 2024 % 2029
Total Housing Units 318,913 100.0% 335,494
Owner-Occupied Units 106,963 33.5% 112,525
Renter-Occupied Units 211,950 66.5% 222,969
Owner/Tenant Allocated Demand Total Year
2029 Housing Demand (Projected) 335,494
Less: 2024 Demand 318,913
Five-Year Demand 16,581 3,316
Five-Year Demand - Owner Occupied 5,561 1,112
Five-Year Demand - Renter Occupied 11,020 2,204
Source: ESRI; Compiled by Newmark
ECONOMIC ANALYSIS 55
St. Elizabeth's East Site - Parcel 6
building permits issued in 2022. The change in interest rates ushered in slower growth in sales
and pricing for housing in the region as the housing purchasing power of consumers is reduced
compared to the initial post-pandemic period.
Residential Housing Submarket
Competition and Absorption Pace
The most notable residential subdivision east of the Anacostia River is District Towns at St.
Elizabeths East. The project was part of the larger redevelopment of Saints Elizabeth East
Campus by the District of Columbia. The community include 4-story townhomes that range in size
from 1,200 SF to 1,600 SF with lots being 16 feet to 20 feet wide. The community included 27
affordable dwelling units to satisfy a land covenant agreement for the site between owner,
developer, and the District of Columbia. The builder is Knutsons Homes. The community includes
a total of 88 townhome units. Pricing is currently set in the l ow $600,000s. The residential
subdivision began selling units in 2021. In 2024, the property sold 24 units, a sales pace of 2 units
per month. The property is, as of the effective date of this appraisal, sold out.
Brookland Grove is a 60-townhome development located in the Edgewood neighborhood of DC,
northwest of the Anacostia River. The Tri Pointe Homes community offers three and four bedroom
designs with 2,027 - 2,448 SF of living space on three or four levels. The remaining inventory has
starting prices in the mid $800 ,000s. During 2024, 28 homes were sold, a sales pace 2.3 units
per month.
Considering these residential subdivision communities located within SE and NE DC and the
Subject Property’s unique building floor plan that includes 660 SF of retail/commercial space, we
conclude to a sales pace of 1 unit per month for the Subject’s live/work townhome units.
Price Considerations
The following table, based on data provided by BrightMLS, summarizes historical three-bedroom
townhome sales in the month of February for the District for the past 10 years (primarily existing
units).
ECONOMIC ANALYSIS 56
St. Elizabeth's East Site - Parcel 6
The average price for three-bedroom townhomes in the District has been gradually increasing
year-over-year since 2011, despite periodic variation.
The average price for the District increased by 12.50% following the outbreak of COVID -19 in
2020. The following year, the price increased by 2.52%. After the onset of increased interest rates
and some economic uncertainty due to inflation, pricing decreased by 0.69% in 2023 and 10.95%
in 2024. However, over the past 12 months, ending in February 2025, prices have increased by
15.98%. Over the past five years, townhome prices have increased by 3.87% annually. We have
considered this trending data for increased prices in our analysis in this appraisal.
Residential Market Outlook and Projections
Considering the size of the subject , its location, and its atypical configuration, we apply a sales
pace 1.0 unit per month for the sellout of the townhouse units . Also, considering historic price
trends, we conclude to an inflation factor of 3.00% for the residential subdivision analysis later in
this appraisal.
Year Units Sold
Average Sale
Price Price Change (%)
Average Days on
the Market
2014 75 $508,327 40
2015 87 $546,736 7.56% 40
2016 88 $585,910 7.17% 39
2017 94 $596,572 1.82% 35
2018 115 $598,886 0.39% 37
2019 86 $687,246 14.75% 39
2020 107 $669,407 -2.60% 36
2021 102 $753,111 12.50% 35
2022 93 $772,090 2.52% 34
2023 83 $766,773 -0.69% 45
2024 85 $682,838 -10.95% 48
2025 85 $791,985 15.98% 50
Average Price Increase - 10 Years 4.09%
Average Price Increase - 5 Years 3.87%
Average Price Increase - 3 Years 1.45%
Compiled by Newmark
Price Considerations - 3 Bedroom Townhomes (February)
LAND AND SITE ANALYSIS 57
St. Elizabeth's East Site - Parcel 6
Land and Site Analysis
Land Survey (Square 5868S, Lot 0968)
LAND AND SITE ANALYSIS 58
St. Elizabeth's East Site - Parcel 6
Zoning Map
LAND AND SITE ANALYSIS 59
St. Elizabeth's East Site - Parcel 6
EASEMENTS/ENCROACHMENTS
Per the Sponsor’s documents, there are current use restrictions on the Subject Property. There
are two major easements. First, there is an easement associated with WMATA . There is a
Land Parcels
Parcel Summary Associated APN(s) Classification Land Area (SF) Land Area (Acres)
Site 1 Square 5868S Lot 0968 Primary Site 1 202,758 4.6547
202,758 4.6547
202,758 4.6547
0 0.0000
0 0.0000
Compiled by Newmark
Total Gross Land Area
Total Usable Land Area
Total Surplus Land Area
Total Excess Land Area
Total Land Area 4.6547 Acres; 202,758 SF
Usable Land Area 4.6547 Acres; 202,758 SF
Excess Land Area None
Surplus Land Area None
Source of Land Area Public records
Site Characteristics
Primary Street Frontage Pecan Street Southeast (990 FF)
Traffic Control at Entry None
Traffic Flow Moderate
Accessibility Rating Average
Visibility Rating Good
Shape Irregular
Corner Yes
Rail Access No
Topography Level at street grade
Site Vegetation Partially cleared and partially wooded.
Easement/Encroachments WMATA Green Line Tunnel and DC Water Utility Easements
Environmental Issue None Noted
Flood Zone Analysis
Flood Area Panel Number 1100010017C
Date 9/27/2010
Zone Zone X
Description Area of minimal flood hazard, usually depicted on Flood Insurance
Rate Maps as above the 500-year flood level.
Insurance Required? No
Utilities
Utility Services None noted
Compiled by Newmark
Land Description
LAND AND SITE ANALYSIS 60
St. Elizabeth's East Site - Parcel 6
WMATA Green Line tunnel easement through the Property. In addition, DC Water has a utility
easement for sanitary and storm sewer piping.
Our analysis assumes that Subject Property will be developed to the density envisioned by zoning
and consistent with maximally productive use of the property will require sub-grade development
(e.g. parking) which may necessitate relocation of existing water and sewer lines and a
configuration that avoids underground tunnels for WMATA. Accordingly, this appraisal assumes
that the costs of infrastructure reconfigu ration of this type will be separately funded, with the
purchaser of the Subject Property held responsible for the abnormal development costs only.
ENVIRONMENTAL ISSUES
No environmental issues were observed or reported. Newmark is not qualified to detect the
existence of potentially hazardous issues such as soil contaminants, the presence of abandoned
underground tanks, or other below-ground sources of potential site contamination. The existence
of such substances may affect the value of the property. For this assignment, we have specifically
assumed that any hazardous materials that would cause a loss in value do not affect the subject.
ZONING AND LEGAL RESTRICTIONS
The Subject Property is located in the Saint Elizabeth (StE), a special zoning category adopted
to guide development of the former Saint Elizabeth campus area. There are several StE sub -
zones (StE- 1 through StE-19). The StE zoning regulations contain general guidelines applicable
to all zones, as well as specific height and density controls that vary by sub -zone, summarized
below.
LAND AND SITE ANALYSIS 61
St. Elizabeth's East Site - Parcel 6
Note, the maximum allowable building area is 648,826 SF, which will be considered in the
forthcoming valuation analysis.
Inclusionary Zoning
Inclusionary Zoning (IZ) compliance is required when 10 or more units are constructed, which,
given land use patterns in the area and the size of the site, is expected to be the case under any
reasonably probable development scenario of multifamily use. Therefore, Inclusionary Zo ning
compliance requirements are expected to apply to a proposed development of the site. For
construction located in a zone with a by -right height limit of 50 feet or more, a residential
development can be constructed on the site that would be required to set aside the greater of 8%
of the residential floor area, or 75% of the bonus density utilized for units for inclusionary zoning.
Category Description
Zoning Jurisdiction District of Columbia
Zoning Designation StE-6
Description Saint Elizabeths East Campus Zones
Legally Conforming? Yes
Zoning Change Likely? Unlikely
Permitted Uses A broad mix of uses, including residential, commercial, hospitality, educational, and
civic uses consistent with the Comprehensive Plan, St. Elizabeths Redevelopment
Framework Plan, as approved by the Council of the District of Columbia, and the Saint
Elizabeths East Master Plan and Design Guidelines.
Minimum Lot Area None noted.
Maximum Floor Area Ratio 3.2 with a required minimum of 1.60 for residential
Allowable Building Area 648,826
Setback Requirements
Front None noted.
Side None noted.
Rear None noted.
Building Height Restrictions 90 feet, not including penthouse or rooftop structure. The maximum permitted height
of a penthouse or rooftop structure is 20 feet/1 story with a second story permited for
penthose mechanical space.
Parking Requirement Multifamily: 1 space per 3 apartment units in excess of 4 units. Retail: 1.33 spaces per
1,000 SF of gross floor area over 3,000 SF. Note, all properties within a half mile of a
Metrorail station or within a quarter mile of a Priority Corridor Network Metrobus
Route, the parking requirement can be reduced by 50%. Per the development plan, the
property is required to have 96 parking space, excluding the townhouses (we assume
that townhomes will include a garage).
Maximum Site Coverage 75%
Inclusionary Zoning All residential development within the zone are subject to Inclusionary Zoning;
however, the density, height, and lot occupancy maximums previously mentioned can
not be expanded. An inclusionary development in the zone shall devote no less than
10% of the gross floor area devoted to residential use.
Compiled by Newmark
Zoning Summary
LAND AND SITE ANALYSIS 62
St. Elizabeth's East Site - Parcel 6
For construction located in a zone with a by -right height limit below 50 feet, a residential
development can be constructed on the site that required to set aside 10% of the residential floor
area. These units will be set aside at prices affordable to households earning no more than 60%
of Median Family Income (MFI), assuming operation as rental apartments. If the units were sold
as condominiums, the maximum pricing for the IZ units would be based on affordability at the
80% MFI standard.
Note, due to the site’s location within the StE -6 zone, a development program for the site is
required to have inclusionary zoning set at 10% of the residential floor area.
Sale of Public Lands (D.C. Code §10-801)
Pursuant to D.C. Code §10-801, regarding the dispositions of real property owned by the District
of Columbia for purposes of developing 10 or more multifamily housing units, a residential
development program is required to designate either 20% or 30% of the new units as Affordable
Dwelling Units (ADUs) based on its proximity to a Metrorail Station or Priority Corridor Network
Metrobus Route.
Based on the Subject Property’s location, the 30% requirement would apply. If the Subject
Property were developed as a “for rent” multifamily propert y, 25% of the required ADUs would
have to be made available to households earning not more than 30% of area median income
(AMI), with the remaining 75% of the ADUs affordable to households earning not more than 50%
of AMI. As “for sale” multifamily developments, 50% of the ADUs would have to be affordable at
the 50% AMI level, with the other 50% of ADUs affordable at the 80% AMI level.
In either case, these restrictions must remain in place through the life of the building. Because
the Subject is owned by the District, a disposition of the property would necessitate that the
purchaser and/or leaseholder comply with these regulations in d eveloping the site for any
multifamily residential use comprising 10 or more units. This requirement would have a substantial
negative impact on the value of the Subject Property in a multifamily residential use context.
Note, our valuation of the Subject Property’s market value as if unencumbered assumes that this
restriction is not applicable.
Anacostia Waterfront Development Zone and the AWI Act (D.C. Code §2-1226.01 –
1226.41)
Per the Sponsor’s documentation, the Anacostia Waterfront Development Zone (AWDZ) and the
AWI Act was considered; however, the Subject is outside of this zone. As a result, this stipulation
has not been considered. The AWI Act (D.C. Code §2 -1226.01-1226.41) requires that at least
30% of the total housing units developed in any project in the AWDZ must be affordable, with
15% reserved for households earning not more than 30% of MFI and 15% reserved for
LAND AND SITE ANALYSIS 63
St. Elizabeth's East Site - Parcel 6
households earning not more than 60% of MFI. The requirements adhere for a term of 50 years
for rental properties, or 20 years for for-sale properties (e.g. condominiums).
Development Plan Compliance with Regulations
We have been provided a detailed Development Plan for the Subject which will include 516 units
further described this report . For our valuation, we will apply the Development Plan described
while making alterations to ensure that conforms to the regulations and requirements mentioned
in this section.
IMPROVEMENTS ANALYSIS 64
St. Elizabeth's East Site - Parcel 6
Improvements Analysis
Aerial Image of Subject Property
PROPERTY CONDITION
The site is an irregular-shaped vacant parcel that is partially cleared as of the effective date of
this appraisal.
PROPOSED DEVELOPMENT (DEVELOPMENT PLAN)
As part of this appraisal, we have been asked to develop an opinion of the market value for the
Subject Property in accordance with the Development Plan under the following assumptions:
1. The Property is subject to the requirements of D.C. Code §10-801, D.C. Code §2-218.01
(Certified Business Enterprise), D.C. Code §2 -219.01 (First Source), D.C.§6 -1451.01
(Green Building Act), D.C. Code §2 -1226.02 (AWI Act), and any other legally binding
requirements that are, or may be, applicable.
2. The Property is conveyed through a 99-year ground lease.
3. The Property will remain zoned under the Saint Elizabeths Zone – 6 and follow its
requirements.
4. Our Development Plan will include the following:
IMPROVEMENTS ANALYSIS 65
St. Elizabeth's East Site - Parcel 6
a. Nine Live/Work Townhomes that will wrap around the garage that will be conveyed
in a fee simple sale.
b. A second building will include 221 residential units, 11,900 SF of retail, and a
community park.
c. A third building will include 286 residential units and 5,800 SF of retail.
d. 185 parking spaces in total
e. All 507 apartment units will have the following affordable designations:
i. 36 units set at 30% MFI
ii. 120 units set at 50% MFI
iii. 351 units set at 100% MFI
f. The Live/Work Townhomes will have the following affordable housing
designations:
i. 2 units set at 80% of MFI
ii. 6 units set at 100% of MFI
As previously stated, the Subject Property is outside of the AWI Act zone. As a result, the property
is only required to follow the affordable housing restrictions of D.C. Code §10 -801. Per the
guidance, 30% of all dwelling units developed must be set aside as affordable housing. Of these
units, under a rental scenario, 25% of these units must be set aside for households making 30%
or less of AMI. The remaining 75% of these units must be set aside for households making 50%
or less of AMI. Under a for -sale scenario, 15% of the units must be set aside for households
making 50% or less of AMI and the remaining 15% of the units must be set aside for households
making 80% or less of AMI.
Unfortunately, the Development Plan does not meet the requirements of D.C. Code §10 -801. In
total, there are 515 units: 507 apartments and 8 townhomes. Approximately 155 units have to be
set aside as affordable housing. From our calculation, 39 of the units would have to be set at the
lowest designation, 30% AMI for the rental units and 50% AMI for the townhomes. Currently, there
are 36 apartment units set at 30% AMI and no townhomes set at 50% AMI. At a minimum, there
would need to be 39 apartment units set at 30% AMI or 37 apartment units set at 30% AMI and 2
townhomes set at 50% AMI. That does not appear to be the case. In order for the property meet
the D.C. Code §10-801 requirements, we have adjusted the unit mix for the entire project to meet
this requirement. We will detail changes to the unit mix later in this appraisal.
IMPROVEMENTS ANALYSIS 66
St. Elizabeth's East Site - Parcel 6
REAL ESTATE TAXES
Real estate in the District of Columbia is assessed at 100% of the local assessor’s estimated
market value. Assessments are levied on a fiscal year basis beginning each October. As of the
effective date of this appraisal, the real property tax rates and sp ecial real property tax rates for
taxable Class 2 properties (commercial real estate excluding multifamily properties) are:
– $1.65 for each $100 of assessed value if the real property’s assessed value is not
greater than $5 million;
– $1.77 for each $100 of assessed value if the real property’s assessed value is greater
than $5,000,000 but not greater than $10 million;
– $1.89 for each $100 of assessed value if the real property’s assessed value is greater
than $10 million.
Properties classified as residential (including multifamily) are taxed at a lower rate of $0.85 per
$100.
The following table summarizes the Subject Property’s assessed value and tax burden as of
January 1, 2025 for the Tax Year 2025 (October 1, 2024 through September 30, 2025).
Due to public ownership of the Subject Property, it is currently exempt from real property taxation;
however, the Subject Property is currently classified as Class 2 (commercial property). In the table
above, we have applied the tax expense if it were not owned by the District. Upon conveyance of
the Subject Property to a non -exempt owner, it would become subject to real estate taxation at
the applicable rates via the District’s possessory interest tax.
Tax Year 2025
Tax ID Land Improvements Total
Assessment
Ratio Land
Ad Valorem
Taxes
Direct
Assessments Total
Square 5868S Lot 0968 $3,309,010 $0 $3,309,010 100.0% 1.6500% $54,599 $54,599
$3,309,010 $0 $3,309,010 100.0% 1.6500% $54,599 $0 $54,599
Compiled by Newmark
Tax Rates Taxes and Assessments
Taxes and Assessments
Assessor's Market Value
HIGHEST AND BEST USE 67
St. Elizabeth's East Site - Parcel 6
Highest and Best Use
AS VACANT – UNRESTRICTED
Legally Permissible
The site is zoned StE-6 which allows for a broad mix of uses, including residential, commercial,
hospitality, educational, and civic uses consistent with the Comprehensive Plan, St. Elizabeths
Redevelopment Framework Plan, as approved by the Council of the District of Columbia, and the
Saint Eliz abeths East Master Plan and Design Guidelines. For purposes of the unrestricted
market value analysis, we assume that the property is not subject to any of major use restrictions
mentioned in this appraisal thus far (i.e. DC Code §10-801). Given that surrounding properties
have similar zoning and the future land use plan is focused on similar uses as well, it is unlikely
that there would be a change of zoning classification.
Physically Possible
The Subject Property’s s ite contains 202758 square feet ( 4.6546832 acres), has favorable
topography, adequate access, and all necessary utilities to support the range of legally
permissible uses. No significant physical limitations were noted. Note, there are several uses in
the Subject Property’s surrounding area including multifamily, residential (single-family attached
homes), and institutional uses.
Of the legally permissible and physically possible uses, only multifamily use, mixed-use (likely
including a retail component) , and residential use appears probable based on observation of
surrounding properties as well as the location.
Financially Feasible
As detailed in the Multifamily Market Analysis, multifamily use appears to be financially feasible
under current market conditions, provided an appropriate land basis and the ability to utilize stick-
above-podium construction (as opposed to concrete/steel framing).
Regarding construction typology: stick-above-podium construction typically allows for a maximum
of 6 stories. Zoning allows for lot coverage of up to 75%, and similarly zoned sites are typically
able to achieve the full zoned FAR density, provided that the entire 75% of lot coverage is used
after accounting for setbacks, courtyards, etc.
Reaching the maximum FAR of 648,826 SF with a building height of 5 stories yields a site
coverage of only 64% [64% = (648,826 SF of GFA/5 stories)/202,728 SF of land area) ]. As a
result, we assume that the property under multifamily/mixed -property usage with residential
component would be able to reach its maximum FAR for the site.
HIGHEST AND BEST USE 68
St. Elizabeth's East Site - Parcel 6
We have also considered alternative uses for the large site. First, we considered mixed-use with
an office component since residential/multifamily use is required on the site to a minimum FAR of
1.6. Given the current climate for the office market, post COVID-19 and observed market activity,
office space constructed in the market in recent years outside of core submarket (e.g. Downtown
and Capitol Hill) was developed on a built-to-suit basis, requiring an above-market “feasibility rent”
committed prior to construction. Accordingly, we conclude that office use is not financially feasible
without extensive pre-leasing of the property.
We also considered development of the site into a residential subdivision, in particular,
townhomes. From our analysis later on in this appraisal , finished townhomes in the subject’s
surrounding have a price that ranges from $500,000 to $580,000 per home. Given the size of the
Subject Propert y (202,788 SF of land area), we assume 25% of the site will be used for
infrastructure (sidewalks, curbs, etc.). This leaves a remaining land area of 152,069 SF. Assuming
lots would be 2,500 SF, which is typical of the submarket for residential townhomes shown in this
appraisal report, the site has the maximized potential of about 61 lots. Considering the cost
associated with finishing the lots and townhomes and subdividing the property, although the
underlying land value for this scenario is positive, it is slightly lower than our concluded value of
the site under an alternative scenario.
Maximally Productive
Both residential subdivision use and multifamily use/mixed -use with a retail and multifamily
component is financially feasible. However, considering the cost of construction, multifamily use
allows for the developer to maximum FAR usage on the site. From our research and analysis
shown in this appraisal report, we conclude the maximally productive use of the Subject Property
is development of mixed-use buildings; i.e. multifamily units with ground floor retail.
Conclusion: Highest and Best Use As Is
The financially feasible analysis has yielded the conclusion that development of mixed-use
property is feasible and reasonably probable. The associated risk is typical, and market
conditions appear to be supportive. Therefore, the highest and best use of the subject as though
vacant ‘unencumbered” is the development of a mixed-use project with a multifamily component
to the maximum density permitted by zoning including supporting ground floor retail/commercial
use. As noted, market and economic conditions are supportive of the near-term development of
this use on the site. The most likely buyer would be an investor or developer.
AS VACANT – RESTRICTED
Our analysis of the Subject Property subject to the noted restrictions presumes that the only
permissible uses are multifamily/residential use on the site. Per zoning, the Subject Property
would have to include residential/multifamily use to a minimum FAR of 1.6. However, the inclusion
of residential/multifamily use would trigger the extensive affordable housing requirements for DC
HIGHEST AND BEST USE 69
St. Elizabeth's East Site - Parcel 6
land under DC Code §10-801. This restriction would ultimately hamper the net operating
income/revenue that can be generated at the Subject resulting in negative residual land value
based on current figures. The only use allowed on the site would be residential/multifamily use;
however, it would require a significant amount of government subsidies to allow for development.
APPRAISAL METHODOLOGY 70
St. Elizabeth's East Site - Parcel 6
Appraisal Methodology
COST APPROACH
The cost approach is based on the proposition that the informed purchaser would pay no more
for the subject than the cost to produce a substitute property with equivalent utility. This approach
is particularly applicable when the property being appraised involves relatively new improvements
that represent the highest and best use of the land, or when it is improved with relatively unique
or specialized improvements for which there exist few sales or leases of comparable properties.
SALES COMPARISON APPROACH
The sales comparison approach utilizes sales of comparable properties, adjusted for differences,
to indicate a value for the subject. Valuation is typically accomplished using physical units of
comparison such as price per square foot, price per unit, pri ce per floor, etc., or economic units
of comparison such as gross rent multiplier. Adjustments are applied to the property units of
comparison derived from the comparable sale. The unit of comparison chosen for the subject is
then used to yield a total value.
INCOME CAPITALIZATION APPROACH
The income capitalization approach reflects the subject’s income -producing capabilities. This
approach is based on the assumption that value is created by the expectation of benefits to be
derived in the future. Specifically estimated is the amount an in vestor would be willing to pay to
receive an income stream plus reversion value from a property over a period of time. The two
common valuation techniques associated with the income capitalization approach are direct
capitalization and the discounted cash flow (DCF) analysis.
DEVELOPMENT ANALYSIS APPROACH (RESIDUAL ANALYSIS)
The development analysis approach incorporates elements of all three approaches.
For the market value un encumbered, the cost approach is not applicable because the site is
currently a vacant, partially cleared lot . Similarly, the income capitalization approach is not
applicable because the property is unlikely to generate significant real estate investment income
in its current state. We utilize development analysis approach, also known as residual analysis,
Application of Approaches to Value
Approach Comments
Cost Approach
Sales Comparison Approach
Income Capitalization Approach
Development Analysis Approach
Compiled by Newmark
The Income Capitalization Approach is applicable and is utilized in this appraisal.
The Sales Comparison Approach is applicable and is utilized in this appraisal.
The Cost Approach is not applicable and is not utilized in this appraisal.
The Development Analysis Approach is applicable and is utilized in the appraisal.
APPRAISAL METHODOLOGY 71
St. Elizabeth's East Site - Parcel 6
to conclude to a market value which considers elements of the cost approach, sales comparison
approach, and income capitalization approach. This valuation considers the cost that will be
associated with building a property on site into its highest and best use and the potential revenue
that would be generated at the property to estimate the residual value of the underlying land. We
also utilize land valuation/sales comparison approach by considering reasonably comparable
multifamily land sales in the market.
For the valuation under the Development Plan provided by the Sponsor, the valuation is also
based on the development analysis approach which incorporates elements of all three
approaches. The sales comparison approach is not applicable, because the development
program would include atypical affordability requirements that will greatly negatively impact the
overall land value of the site. There are insufficient sales of similarly encumbered sites available
for analysis to develop this approach. The cost approach is not applicable in the residual analysis
because the income/rent restrictions will cause significant obsolescence to accrue to the
improvements.
LAND VALUATION – VALUE AS IF UNENCUMBERED (SALES COMPARISON APPROACH) 72
St. Elizabeth's East Site - Parcel 6
Land Valuation – Value as if
Unencumbered (Sales Comparison
Approach)
Land value can be developed from a number of different methodologies. In this case, we have
employed the sales comparison approach as sufficient comparable data exists from which to
derive a reliable indication of value. Based on a review of market activity, the appropriate unit of
comparison is Price per FAR.
We have researched recent sales activity in the market in order to identify sales of
multifamily/mixed-use development sites that are similar to the subject . The most comparable
sales were selected for analysis, and are mapped and summarized below. Detailed sale profiles
are located in the addenda.
Land Comparables Map
LAND VALUATION – VALUE AS IF UNENCUMBERED (SALES COMPARISON APPROACH) 73
St. Elizabeth's East Site - Parcel 6
ANALYSIS OF LAND COMPARABLES
The following analyzes the comparable data against the subject property.
– Newmark Multifamily Capital Markets Research indicates multifamily sales volume in
the Mid-Atlantic region had decelerated after record volume in 2021 and 2022 due, in
part, to the high-interest rate environment. Elevated construction and financing costs
have caused most projects to continue to remain on hold unless the developer has
already broken ground. On the other hand, all markets in the Mid -Atlantic region
demonstrated positive year -over-year rent growth in the range of 0.8% to 3.1% in
2024. Neverthe less, for properties that transferred before the start of the Fed’s
aggressive interest rate hikes in mid-2022 (i.e. Comparables 4 through 6), downward
adjustments of 1.0% per year are made.
– We apply varied location – income and rents and location – accessibility adjustments
to each of the comparables based on the data regarding median household income
levels, submarket rents, Walk Score, and proximity to Metrorail shown the grid below.
– Comparables 1 and 6 are corner locations with Comparable 1 having prominent
frontage on a major roadway within the District (New York Avenue ). As a result, we
apply downward corner/frontage adjustments to these comparables.
– We apply varied size adjustments to each of the comparables due to the inverse
relationship between unit value and project size.
Subject Sale 1 Sale 2 Sale 3 Sale 4 Sale 5 Sale 6
Address Pecan Street
Southeast
1901 New York Avenue
Northeast
801 17th Street
Northeast
307 40th Street
Northeast
4th Street Northeast 123 45th Street
Northeast
Kenilworth Avenue
Northeast
City, State Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC
Proposed Use Multifamily MF Residential MF Residential MF Residential SF Residential MF Residential MF Residential
Gross Land SF 202,758 SF 429,803 SF 50,601 SF 26,789 SF 206,474 SF 32,217 SF 122,866 SF
Useable Acres 4.65 Acres 9.87 Acres 1.16 Acres 0.61 Acres 4.74 Acres 0.74 Acres 2.82 Acres
Useable Land SF 202,758 SF 429,803 SF 50,601 SF 26,789 SF 206,474 SF 32,217 SF 122,866 SF
Allowable Bldg Area 648,826 SF 1,805,173 SF 242,885 SF 128,587 SF 222,992 SF 154,642 SF 119,180 SF
Shape/Topography Irregular/Level at
street grade
Irregular/Level Irregular/Level Irregular/Level Irregular/Level Rectangular/Level Irregular/Level
Utilities Available None noted Electricity, Gas, Sewer,
Water
Electricity, Gas, Sewer,
Water
Electricity, Gas, Sewer,
Water
Electricity, Gas, Sewer,
Water
Electricity, Gas,
Sewer, Water
Electricity, Gas, Sewer,
Water
Zoning StE-6 MU-5B MU-7B MU-7 RA-1 MU-7B RA-1
Transaction Type Closed Closed Closed Closed Closed Closed
Buyer AP DC Schaeffer LLC,
AAFMAA Property
BOZ 17th Owner, LLC National Housing
Trust
DRP DC 1, LLC; Tri
Pointe Group
The Residences at
Benning Road LLC
The Residences at
Kenilworth Park LLC
Seller Jemal's Schaeffer LLC;
Douglas Development
Corp.
DC Developing
Families
DRA Advisors; KPR
Centers
The Missionary
Society of Saint Paul
The Apostle
Industrial Bank Lewis C. Booker, Henok
A. Mengesha
Interest Conveyed Fee Simple Leased Fee Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple
Transaction Date Oct-24 Dec-22 Oct-22 Mar-21 Oct-20 Jul-20
Price $30,243,768 $20,000,000 $7,500,000 $12,000,000 $8,350,000 $5,069,397
Adj. Sale Price $55,843,473 $20,160,000 $7,500,000 $12,000,000 $8,428,200 $5,069,397
Price per Gross Land Acre $5,659,678 $17,355,372 $12,195,122 $2,531,646 $11,395,619 $1,797,266
Price Per Gross Land SF $129.93 $398.41 $279.97 $58.12 $261.61 $41.26
Price per Usable Land Acre $5,659,678 $17,355,372 $12,195,122 $2,531,646 $11,395,619 $1,797,266
Price Per Usable Land SF $129.93 $398.41 $279.97 $58.12 $261.61 $41.26
Price per FAR $30.94 $83.00 $58.33 $53.81 $54.50 $42.71
Compiled by Newmark
Comparable Land Sales Summary
LAND VALUATION – VALUE AS IF UNENCUMBERED (SALES COMPARISON APPROACH) 74
St. Elizabeth's East Site - Parcel 6
– We conclude a development program at the subject will include ground floor retail.
Retail space typically commands a higher NOI per square foot compared to traditional
multifamily space. As a result, we apply an upward retail adjustment to Comparables
2 through 6 which do not include ground floor retail.
– Comparable 6 sold with some entitlements in place (completed site plan and drawings)
which would have been viewed as desirable by a developer. Consequently, we apply
a downward entitlement adjustment.
Summary of Adjustments / Adjustment Grid
Based on our comparative analysis, the following table summarizes the adjustments warranted
to each land sale.
LAND VALUE CONCLUSION
– Prior to adjustments, the sales reflect a range of $30.94 to $83.00 per FAR.
– After adjustment, the range is narrowed to $20.66 to $33.20 per FAR, with an average
of $28.38 per FAR.
Subject Sale 1 Sale 2 Sale 3 Sale 4 Sale 5 Sale 6
Address Pecan Street
Southeast
1901 New York Avenue
Northeast
801 17th Street
Northeast
307 40th Street
Northeast
4th Street Northeast 123 45th Street
Northeast
Kenilworth Avenue
Northeast
City, State Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC
Gross Land SF 202,758 SF 429,803 SF 50,601 SF 26,789 SF 206,474 SF 32,217 SF 122,866 SF
Usable Land Area (Acres) 4.65 Acres 9.87 Acres 1.16 Acres 0.61 Acres 4.74 Acres 0.74 Acres 2.82 Acres
Usable Land Area (SF) 202,758 SF 429,803 SF 50,601 SF 26,789 SF 206,474 SF 32,217 SF 122,866 SF
Allowable Bldg Area 648,826 1,805,173 242,885 128,587 222,992 154,642 119,180
Median Household Income (1-Mile
Radius)
$35,359 $63,973 $91,192 $41,525 $86,519 $47,908 $49,159
Submarket Average Asking Rent
($/unit)
Congress Heights
($1,456)
Trinidad ($1,624) Langston ($1,715) Minnesota Ave
($1,715)
Edgewood ($2,101) Minnesota Ave
($1,715)
Kenilworth ($1,714)
Walk Score 62% 74% 90% 83% 84% 73% 32%
Proximity to Metrorail 0.5 miles away More than a mile 1.0 miles away 0.6 miles away 0.4 miles away 0.1 miles away 0.5 miles away
Transaction Type -- Closed Closed Closed Closed Closed Closed
Transaction Date -- Oct-24 Dec-22 Oct-22 Mar-21 Oct-20 Jul-20
Price per FAR $30.94 $83.00 $58.33 $53.81 $54.50 $42.71
Property Rights 0% 0% 0% 0% 0% 0%
Financing 0% 0% 0% 0% 0% 0%
Conditions of Sale 0% 0% 0% 0% 0% 0%
Market Conditions (Time) 0% 0% 0% -4% -4% -5%
Subtotal (adjustments are multiplied) 0% 0% 0% -4.0% -4.0% -5.0%
Transaction Adjusted Price per FAR $30.94 $83.00 $58.33 $51.66 $52.32 $40.57
Location - Income and Rents -10% -20% -5% -20% -5% -5%
Location - Accessibility -2.5% -10% -10% -10% -5% 10%
Corner/Frontage -10% 0% 0% 0% 0% -5%
Size 15% -35% -35% -35% -35% -35%
Construction Type/Requirements 0% 0% 0% 0% 0% 0%
Retail 0% 5% 5% 5% 5% 5%
Entitlements 0% 0% 0% 0% 0% -10%
Inclusionary Zoning Units 0% 0% 0% 0% 0% 0%
Subtotal (adjustments are summed) -8% -60% -45% -60% -40% -40%
Gross Adjustment 38% 70% 55% 74% 54% 75%
Overall Adjustment -7.5% -60.0% -45.0% -61.6% -42.4% -43.0%
Indicated Price per FAR $28.62 $33.20 $32.08 $20.66 $31.39 $24.34
Compiled by Newmark
Comparable Land Sales Adjustment Grid
Physical Adjustments
Transaction Adjustments
LAND VALUATION – VALUE AS IF UNENCUMBERED (SALES COMPARISON APPROACH) 75
St. Elizabeth's East Site - Parcel 6
– We place emphasis on Comparable 1 due to its recency and its larger size (over
400,000 SF of land). Although Comparable 4 is an older sale, it is of a land site that is
a similar size compared to the subject. That being said, each of the comparables had
to be adjusted significantly for the allowable building area size. Taking these factors
into account, the reconciled value per FAR is between the indicators from Comparable
1 and Comparable 4.
Based on this analysis, we conclude to the following:
Allowable Bldg Area 648,826
Comparable Sales Indications Range Average
Unadjusted Price per FAR $30.94 - $83.00 $53.88
Adjusted Price per FAR $20.66 - $33.20 $28.38
Reconciled Value per FAR $25.00
Total Indicated Value $16,220,640
Rounded $16,200,000
Compiled by Newmark
Land Value Conclusion
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 76
St. Elizabeth's East Site - Parcel 6
Development Analysis Approach (Value
As If Unencumbered)
To estimate the residual land value through a development analysis without consideration of
encumbrances, we have concluded to an underlying residual land value for the multifamily rental
component and the retail component. The component contributions are consolidated to a single
value on a per FAR basis.
For the residual analysis section, we considered our valuation as if 2 multifamily properties/sister
buildings would be built on the site. As a multiphase development, the project would be split into
two sections. We will then apply a discounted cash flow analysis to account for the holding time
between each phase and its impact on the overall value.
PROJECT DESIGN AND VALUATION DETAIL FOR PROPOSED PROPERTY
As previously stated, we estimated the likely total buildable area for the site. As previously
discussed in the Highest and Best Use section of this appraisal report, we conclude to the follow
gross building area for the site.
We also apply the following assumptions for our analysis:
1. Typically, building cores for apartment buildings which include common area, lobby area,
project amenities, elevators, etc., range from 10% to 25% of the gross building area. This
Projection
Site Area 202,758
Total Site Area (SF) 202,758
Maximum Allowable FAR 3.2
Total Project Square Footage (SF) 648,826
Number of Buildings 2
Size of Each Proposed Building (SF) 324,413
Total Remaining Site Area (SF) 202,758
Maximum Allowable Coverage 75%
Total Project Site Area Coverage 152,069
Number of Buildings 2
Site Coverage/Ground Floor Size for Each Building (SF) 76,034
Compiled by Newmark
Maximum Gross Building Area for Subject Site
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 77
St. Elizabeth's East Site - Parcel 6
is dependent on the complexity of the property. We conclude to a building core of 20% for
the sister Class A apartment buildings which is in line with market standards.
2. Most Class A apartment buildings offer garage parking for tenants. Although the Subject
Property, due to its proximity to Metrorail, is only require d to have 50% of the parking
spaces specified by zoning, we have applied a parking ratio that is typical of or market
standard for other multifamily properties, 0.44/unit. We assume that the Subject Property
will have one level of underground parking in each of the sister buildings. From our review
of parking garages in the market and our review of MVS, parking garages usually require
350 SF to 375 SF per parking space. With one level of below grade parking, we have
allotted up to 375 SF per parking space. This means that the parking garage for each of
the sister buildings will be 55,500 SF (148 spaces x 375 SF).
3. The projected multifamily building has an average unit size of 716 SF. This is in line with
the rent comparables shown later in this section.
4. The zoning designation requires the inclusion of any affordable units via inclusionary
zoning; however, this inclusion does not include a bonus to the density due to the St
Elizabeths designation. Despite the projected height parameters for the si te via zoning
(greater than 85 ft.) , approximately 10.0% of the floor area must be aside as affordable
housing. We have taken this into consideration.
5. We have allotted roughly 20,000 SF of the ground floor level in each building to retail
space which is in line with our apartment rent comparables shown later in this report
(roughly 30.8% of the ground floor).
From our review of the parameters and the assumptions listed above, we conclude to the following
parameters regarding a mixed-use property that could be built on the site.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 78
St. Elizabeth's East Site - Parcel 6
We assume that two apartment buildings built to these parameters will be completed on the site,
delivering roughly 680 units to the submarket.
MULTIFAMILY RENT ANALYSIS
In estimating market rent, we considered data and opinions based on leasing activity with
competing properties and market area leasing trends.
% SF of GBA SF of RBA
Total Density 324,412 262,435
Multifamily Density (FAR - Multifamily) 304,412 243,435
Implied Core Factor for Multifamily Section (Amenities, Lobby, etc.) 20.0% 60,977
Retail Density (FAR - Retail) 20,000 19,000
Implied Core Factor for Retail Section (Loading Area, Common Area, etc.) 5.0% 1,000
Implied Core Factor for Entire Property 19.1% 61,977
Market Rate Density 90.0% 273,831 218,980
Affordable Dwelling Unit (ADU Density) 10.0% 30,581 24,455
Estimated Average Unit Size (SF of RBA) 716
Total # of Units 340
Number of Market Rate Units 90.0% 306
Number of Affordable Units 10.0% 34
Parking Ratio # of Spaces
Estimated Required Parking for Multifamily Section 0.16/unit 56
Estimated Required Parking for Retail Section 0.6/1,000 SF 12
Provided Parking Spaces - Multifamily 0.40/unit 136
Provided Parking Spaces - Retail 0.6/1,000 SF 12
Total Parking 0.44/unit 148
Compiled by Newmark
Sister Buildings (76,034 SF of Land Area)
Mixed Use Project Details - Multifamily Rental and Ground Floor Retail
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 79
St. Elizabeth's East Site - Parcel 6
Comparable Map
We reviewed recent construction of apartments located east of the Anacostia River as well as
other new apartments in NE and SE DC.
No. Name Address
Subject St. Elizabeth's East Site - Parcel 6 Pecan Street Southeast, Washington, DC 20032
1 Crest at Skyland Town Center 2219 Town Center Drive Southeast, Washington, DC
2 31-Unit Apartment Building 2495 Alabama Avenue Southeast, Washington, DC
3 Stratos at Bridge District 600 Howard Road Southeast, Washington, DC
4 Alula at Bridge District 660 Howard Road Southeast, Washington, DC
5 Jayde Parkside 630 Kenilworth Terrace Northeast, Washington, DC
6 Vesta Parkside 750 Kenilworth Terrace Northeast, Washington, DC
7 Link Apartments H Street 1701 H Street Northeast, Washington, DC
8 Park Kennedy 1901 C Street Southeast, Washington, DC
9 Blackbird Apartments 1401 Pennsylvania Avenue Southeast, Washington, DC
10 1600 Penn 1600 Pennsylvania Avenue Southeast, Washington, DC
11 Beckert's Park 1350 E Street Southeast, Washington, DC
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 80
St. Elizabeth's East Site - Parcel 6
No.
Property Name;
Street Address;
City, State
Year Built;
% Occupancy;
Parking Ratio Unit Mix No. of Units % of Unit Mix Avg. Unit SF
Avg. Eff.
Rent/Month
Avg. Eff.
Rent/Month/SF
1 Crest at Skyland Town Center 2021 Studio 0 0.0% 0 $0 $0.00
2219 Town Center Drive SE 98.8% 1 BR 194 73.5% 630 $1,964 $3.12
Washington, DC 0.59/unit 2 BR 70 26.5% 1,048 $2,798 $2.67
3 BR 0 0.0% 0 $0 $0.00
Total 264 100.0% 741 $2,185 $2.95
2 31-Unit Apartment Building 2024 Studio 0 0.0% 0 $0 $0.00
2495 Alabama Avenue SE 87.1% 1 BR 7 22.6% 550 $1,605 $2.92
Washington, DC 0.0/unit 2 BR 8 25.8% 650 $1,933 $2.97
3 BR 16 51.6% 850 $2,147 $2.53
Total 31 100.0% 731 $1,969 $2.70
3 Stratos at Bridge District 2025 Studio 32 11.3% 521 $2,665 $5.12
600 Howard Road SE 25.8% 1 BR 168 59.4% 733 $3,223 $4.40
Washington, DC 2 BR 83 29.3% 1,027 $4,559 $4.44
3 BR 0 0.0% 0 $0 $0.00
Total 283 100.0% 795 $3,552 $4.47
4 Alula at Bridge District 2025 Studio 44 15.0% 396 $2,003 $5.06
650 Howard Road SE 17.0% 1 BR 228 77.6% 655 $2,553 $3.90
Washington, DC 2 BR 22 7.5% 912 $3,778 $4.14
3 BR 0 0.0% 0 $0 $0.00
Total 294 100.0% 635 $2,562 $4.03
Comment: Property includes garage parking and bicycle parking spaces.
5 Jayde Parkside 2024 Studio 46 41.1% 531 $1,657 $0.00
630 Kenilworth Terrace NE 77.7% 1 BR 40 35.7% 676 $1,909 $2.82
Washington, DC 2 BR 26 23.2% 966 $2,661 $2.75
3 BR 0 0.0% 0 $0 $0.00
Total 112 100.0% 684 $1,980 $2.90
Comment: Subject includes unassigned parking.
6 Vesta Parkside 2022 Studio 19 9.9% 568 $1,791 $3.15
750 Kenilworth Terrace NE 97.4% 1 BR 133 69.6% 734 $1,975 $2.69
Washington, DC 2 BR 39 20.4% 963 $2,435 $2.53
3 BR 0 0.0% 0 $0 $0.00
Total 191 100.0% 764 $2,051 $2.68
Comment: Subject includes unassigned parking.
7 Link Apartments H Street 2023 Studio 76 39.8% 437 $2,082 $4.76
1701 H Street NE 87.3% 1 BR 60 31.4% 642 $2,299 $3.58
Washington, DC 2 BR 55 28.8% 1,069 $3,569 $3.34
3 BR 0 0.0% 0 $0 $0.00
Total 191 100.0% 683 $2,578 $3.77
Comment: The property includes 14,342 SF of ground floor retail and garage parking.
8 Park Kennedy 2021 Studio 21 8.0% 524 $1,685 $3.22
1901 C Street SE 89.6% 1 BR 191 72.9% 741 $2,210 $2.98
Washington, DC 0.79/unit 2 BR 50 19.1% 1,058 $3,337 $3.15
3 BR 0 0.0% 0 $0 $0.00
Total 262 100.0% 784 $2,383 $3.04
Comment: The property includes 35,517 SF of ground floor retail and garage parking.
9 Blackbird Apartments 2020 Studio 36 21.6% 429 $1,953 $4.55
1401 Pennsylvania Avenue SE 95.1% 1 BR 76 45.5% 601 $2,252 $3.75
Washington, DC 0.36/unit 2 BR 48 28.7% 928 $2,958 $3.19
3 BR 7 4.2% 1,086 $4,634 $4.27
Total 167 100.0% 678 $2,490 $3.67
10 1600 Penn 2015 Studio 3 3.9% 366 $1,659 $4.53
1600 Pennsylvania Avenue SE 91.8% 1 BR 48 62.3% 588 $2,106 $3.58
Washington, DC 0.39/unit 2 BR 26 33.8% 904 $2,720 $3.01
3 BR 0 0.0% 0 $0 $0.00
Total 77 100.0% 686 $2,296 $3.35
11 Beckert's Park 2020 Studio 33 10.2% 571 $2,195 $3.84
1350 E Street SE 87.6% 1 BR 189 58.2% 721 $2,690 $3.73
Washington, DC 0.54/unit 2 BR 88 27.1% 994 $3,606 $3.63
3 BR 15 4.6% 1,365 $5,307 $3.89
Total 325 100.0% 809 $3,009 $3.72
Compiled by Newmark
Summary of Comparable Rentals - Apartments
Comment: The property includes 84,000 SF of retail space and parking is available for $145/month. Electric car spaces, which allows unlimited charging, is
$200/month. Storage is available for $40 per month. Water and sewer are included in the rent.
Comment: Property includes a parking garage and bicycle parking spaces.
Comment: The property includes garage parking for $250/month. The property includes 22,500 SF of ground floor retail space.
Comment: The property includes garage parking for tenants. Storage is available for $50/month.
Comment: The property includes 69,107 SF of ground floor retail. The property includes garage parking for $195/month.
Comment: The property is a small apartment building with three inclusionary zoning units.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 81
St. Elizabeth's East Site - Parcel 6
We surveyed several Class A apartments in the environs of the subject. We place particular
emphasis on Comparables 1, 3 and 4 due to their proximity to the Subject. Comparables 3 and 4
are currently in lease -up. We also conclude that Comparables 7 , 9 and 11 are superior to the
subject due to their strong locations in a superior submarket with locational amenities compared
to the subject.
Placing emphasis on these comparables, we conclude to a market rent of $3.45/SF per month.
We conclude to an average affordable rent as follows based on the Inclusionary Zoning
requirements.
EFFECTIVE INCOME ESTIMATE – MULTIFAMILY SECTION
Concessions
– Most properties are utilizing a leasing optimizer such as LRO or Yieldstar and quote
effective rates net of concessions. As a result, the concluded market rents have
already “baked in” the concessions that may be offered in the market.
– Very few of the stabilized competitive projects in the immediate area offer free rent
concessions.
– As a result, we have not applied any concessions to the property.
– However, it is standard market practice to offer concessions during the lease-up phase
in order to sustain absorption. In addition, due to the expected delivery of units to the
designated market area in the next few years, we have included concessions duri ng
lease up. We estimated concession at 8.3% of the effective rental income during lease-
Studio 1 BR 2 BR 3 BR Average
Maximum Rental Rate - 60% MFI $1,430 $1,520 $1,830 $2,140
Utility Allowance $160 $241 $322 $404
Maximum Net Rent - 60% MFI $1,270 $1,279 $1,508 $1,736
Average Affordable Rent by Unit Type $1,270 $1,279 $1,508 $1,736
Typical Unit Size (SF) 480 660 955 1100 719
Rent/SF $2.65 $1.94 $1.58 $1.58
Projected Unit Mix 18% 53% 26% 3%
Weighted Rent/SF $0.47 $1.03 $0.42 $0.05 $1.96
Source: CoStar, Inc.; compiled by Newmark
Affordable Restrictions (Inclusionary Zoning)
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 82
St. Elizabeth's East Site - Parcel 6
up (1 month of free rent/12 -month lease term). This is within the range indicated by
the actively marketing projects reported, particularly projects near the Subject
Property.
Vacancy & Collection Loss Allowance
Per our analysis and review of comparables, and taking into account the statistics presented in
the multifamily market analysis section of this appraisal report, total stabilized vacancy allowance
is 6.00%. In addition, we project collection lost at 0.50%. Based on this we conclude to a vacancy
and collection loss allowance of 6.50%.
Net Expense Recoveries (RUBS)
We project expenses on a “net” basis, with the landlord presumed to be responsible only for
common area utilities. Accordingly, no reimbursement income is projected.
Net Parking Income
– The Subject Property is modeled with 148 parking spaces in a subterranean parking
garage. Approximately 136 of the spaces will be available to rent for the tenants.
– From our review of the rent comparables, there are parking fees that range from $145
to $250 per space in neighboring properties as shown in the table above.
– We conclude to a parking income of $150/month/space.
– We project a parking income of $ 0.95/SF assuming a vacancy rate of 6.50% (($150
per month x 12 months x 136 spaces x 93.5% occupancy)/716 SF per unit).
– We have included an additional 1 2 parking spaces in the subject that would be
dedicated to the retail use. These spaces have been allocated to the retail tenants in
the building as an amenity.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 83
St. Elizabeth's East Site - Parcel 6
Net Other Income
– Other income typically includes amenity rentals, pet fees, and other income like
storage rental.
– Per our review of comparables in the market, net other income typically ranges from
2.0% to 5.0% of the effective gross income of the property. We have included a table
of comparables above.
– In the case of the Subject Property, due to the complexity of the property, we apply a
net other income projection equal to 3. 00% of the effective gross income for the
multifamily section of the Property.
OPERATING EXPENSE ANALYSIS – MULTIFAMILY SECTION
Expense data for the subject and comparable properties are summarized in the following table.
Property Location Type Project Size Year Built
Net Other Income
Per Unit
Income Per
Unit (% of EGI)
Washington, DC Class A - Market 305 2016 $604 3.22%
Washington, DC Class A - Market 32 2016 $668 3.37%
Washington, DC Class A - Market 145 2008 $1,016 4.52%
Washington, DC Class A - Market 214 2014 $1,028 5.43%
Washington, DC Class B/C - Market 27 1909 $336 0.06%
Washington, DC Class B/C - Market 11 1952 $247 0.26%
Washington, DC Class B/C - Market 78 1927(2015) $1,253 4.85%
Washington, DC Class B/C - Market 92 1929(2013) $650 2.95%
Washington, DC Class B/C - Market 63 1922 (2014) $548 2.73%
Average $706 3.04%
Compiled by Newmark
Net Other Income Comparables
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 84
St. Elizabeth's East Site - Parcel 6
Being new construction, it is highly likely the Subject Property will be more efficient from an energy
usage and operational standpoint. W e conclude to a n operating expense of $ 9,000 per unit,
which is $12.57/SF ($9,000 in operating expenses/716 SF), excluding a real estate tax expense.
Note, we included a real estate tax expenses based on a loaded capitalization rate analysis.
DIRECT CAPITALIZATION – MULTIFAMILY SECTION
The following subsections represent different techniques for deriving an overall capitalization rate.
Comp 1 Comp 2 Comp 3 Comp 4 Comp 5
Year Built 2021 2018 2019 2016 2020 AVERAGE
SF 300,478 194,453 121,557 172,908 270,123
Number of Units 387 198 173 227 308
Average Unit Size (SF) 776 982 703 762 877
Operating Data Type Trailing-12 Trailing-12 Actual Actual Actual
Year 2024 2023 2021 2021 2023
Effective Gross Multifamily Income Per Unit $27,372 $37,630 $36,343 $32,321 $32,499 $33,233
Effective Gross Commercial Income Per Unit $0.00 $2,945 $2,906 $1,534 $0.00
Effective Gross Income Per Unit $27,372 $40,575 $39,249 $33,855 $32,499 $33,233
Operating Expenses Per Unit
Real Estate Taxes $2,752 $3,659 $2,916 $3,651 $4,162 $3,428
Insurance $820 $316 $386 $397 $604 $505
Utilities $1,922 $2,075 $2,227 $1,213 $1,550 $1,797
Repairs and Maintenance $1,969 $1,521 $2,016 $1,591 $1,829 $1,785
Payroll and Benefits $2,461 $3,289 $4,255 $2,830 $2,177 $3,002
General and Administrative $1,176 $1,006 $680 $583 $691 $827
Advertising and Marketing $376 $214 $809 $313 $270 $428
Management $590 $543 $772 $749 $1,130 $757
Replacement Reserves
Total Operating Expenses Per Unit $12,066 $12,623 $14,061 $11,327 $12,413 $12,530
Total Operating Expense Per Unit Excluding RET $9,314 $8,964 $11,145 $7,676 $8,251 $9,102
Net Operating Income Per Unit $15,306 $27,952 $25,188 $22,528 $20,086 $20,703
Operating Expense KPIs (% of EGI)
Management 2.16% 1.34% 1.97% 2.21% 3.48% 2.28%
Operating Expense Ratio (% of EGI) 44.08% 31.11% 35.83% 33.46% 38.20% 37.70%
Net Operating Income (% of EGI) 55.92% 68.89% 64.17% 66.54% 61.80% 62.30%
Compiled by Newmark
Expense Analysis Per Unit
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 85
St. Elizabeth's East Site - Parcel 6
Comparable Sales – Multifamily Buildings
Recent sales in the District form a capitalization rate range of 2.93% to 6.02%. The subject will
be a Class A apartment project. The recent sale of the District, a Class A building, in the U Street
Corridor/Logan Circle area is considered superior to the subject due to its location. On the other
hand, Comparable 4 included ground floor retail which negatively impacted the capitalization rate.
We also considered Comparable 2, an older Class A apartment building in a slightly superior
submarket compared to the subject. Secondly, this property includes a large retail portion (33.9%
of the gross building area) which negatively impacted the capitalization rate. Considering the most
similar comparables to the Subject Property and the trending data, we conclude a capitalization
rate for the Subject Property would range from 4.75% to 5.25%, with the likely capitalization rate
falling in the middle of the range.
Capitalization Rate Conclusion
Based on this analysis, we conclude to a capitalization rate of 5.00% for the Subject Property.
Direct Capitalization Summary
Valuation of the multifamily component of the proposed improvements by direct capitalization is
shown in the following table.
No. Property Name Location Yr. Built Sale Date
Number
of Units Occ. %
Price per
Unit OAR
1 City Ridge 20 Ridge Square Northwest 2022 Nov-24 350 96% $797,143 4.27%
2 Fort Totten Square 5661 3rd Street Northeast 2015 Sep-24 344 95% $252,326 4.90%
3 Apartments at Westlight 1110 23rd Street Northwest 2018 Sep-24 93 94.0% $819,355 5.62%
4 District 1401 S Street Northwest 2013 Jun-24 125 98.0% $540,000 4.73%
5 The Glover House 2101 Wisconsin Avenue Northwest 2020 Apr-24 226 98.0% $529,867 5.67%
5 The Shay 1924 8th Street Northwest 2015 Jun-23 245 88.0% $332,653 2.93%
6 The Lydian 400 K Street Northwest 2018 Feb-23 324 99.0% $560,185 4.38%
7 The Lyric 440 K Street Northwest 2014 Feb-23 233 98.0% $478,540 4.30%
8 The Valo 222 M Street Southwest 2018 Feb-23 221 97.0% $371,041 4.20%
9 The Lurgan 915 L Street Northwest 2018 Nov-22 214 94.0% $486,916 4.52%
10 The Jennifer at Georgia Ave 4014 Georgia Avenue Northwest 2022 Aug-22 10 0.0% $402,500 5.94%
11 Jamison at Dakota Crossing 3750 Jamison Street Northeast 2019 Apr-22 236 96.0% $330,508 3.94%
12 The Batley 1270 4th Street Northeast 2019 Nov-21 432 91.0% $475,124 4.00%
13 The Shaw 618 T Street Northwest 2019 Jul-21 69 0.0% $710,145 4.50%
14 The Vale at Parks 6800 Georgia Avenue Northwest 2021 Jul-21 301 0.0% $419,435 3.95%
15 Griffin Apartments at Petwoth Metro 3801 Georgia Avenue Northwest 2012 Jul-20 49 98.0% $390,306 4.68%
16 The Woodley 2700 Woodley Road Northwest 2014 Jan-20 212 94.0% $850,236 4.00%
17 F1RST Residences 1263 1st Street Southeast 2017 Dec-19 325 95.0% $493,846 4.50%
18 3825 Georgia at Petworth Metro 3825 Georgia Avenue Northwest 2016 Nov-19 32 98.0% $291,406 4.54%
19 1301 Thomas Circle 1301 M Street Northwest 2006 Sep-19 292 98.0% $630,136 4.00%
20 Highline Union Market 320 Florida Avenue Northeast 2019 Aug-19 318 0.0% $415,094 6.02%
21 Madison House 1772 Church Street Northwest 2019 Jul-19 51 100.0% $627,451 4.50%
22 RESA 22 M Street Northeast 2019 Jun-19 326 0.0% $434,202 4.50%
Average (Mean) Cap Rate: 4.55%
Compiled by Newmark
Comparable Multifamily Sales Summary
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 86
St. Elizabeth's East Site - Parcel 6
Lease Up Costs for Multifamily
We project lease-up of the proposed multifamily units based on the following data.
Multifamily Section of the Property
Monthly Market Rent/SF $3.45
Monthly Affordable Rent/SF $1.96
Weighted Rent/SF (92%/8%) $3.30
Vacancy & Collection Loss 6.00% (5.50% vacancy & 0.50% collection loss) -$0.20
Effective Rental Income/SF $3.10
Conversion to Annual Income $37.22
Net Other Income 3.00% of EGI $1.17
Net Parking Income $150/space for 136 spaces @ 93.5% occupancy $0.95
Effective Gross Income/SF $39.34
Non-Tax Operating Expense/SF $9,000/unit -$12.57
Pre-Tax Net Operating Income/SF $26.77
Tax-Loaded Capitalization Rate (5.00% capitalization rate + 0.85%) 5.85%
Stabilized Value/Rentable SF $457.60
Rentable/Gross SF Ratio 79.97%
Stabilized Value/Gross SF $365.94
Less: Lease-Up Costs for Multifamily
Rent Loss 18 months for lease-up with 93.5% occupancy -$27.92
Free Rent 1 month of free rent with 93.5% occupancy -$2.92
Entreprenuerial Profit 15% of Lease-up Costs -$4.63
Value at Completion/Gross SF - Multifamily Section $330.48
Compiled by Newmark
Mixed Use Property with Inclusionary Zoning and Ground Floor Retail
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 87
St. Elizabeth's East Site - Parcel 6
The average lease-up pace is 15.0 units per month. For the apartments that delivered in 2024,
the average lease-up pace is 15.6 units per month. For the communities with more than 300 units,
the absorption pace is 20.0 units per month.
Absorption Pace for Actively Leasing Projects - District of Columbia
# Name Submarket
Property
Type Rent Type
Total
Units
Date
Delivery
Units
Absorbed
Absorption
Pace
1 Link Apartments H Street Langston High-rise Market 191 8/1/2023 174 10.2
2 Upton Place Cathedral Heights Mid-rise Market 689 11/1/2023 646 46.1
3 OZMA NoMA High-rise Market 478 7/1/2023 114 6.3
4 Cielo Near Northeast High-rise Market 457 11/1/2022 425 16.3
5 The Westerly Waterfront High-rise Market 449 10/1/2023 301 20.1
6 Theory Union Market Mid-rise Market 159 8/1/2023 144 8.5
7 The 202 Union Market High-rise Market 254 3/1/2024 207 20.7
8 Revel at NoMaCNTR NoMa High-rise Market 500 7/1/2022 463 15.4
9 MDXL Flats Waterfront High-rise Affordable 101 5/1/2024 94 11.8
10 Cantata Mount Vernon Triangle High-rise Market 275 8/1/2023 223 13.1
11 Gables Union Market Union Market High-rise Market 300 7/1/2023 238 13.2
12 The Hartley Takoma DC Mid-rise Market 323 1/1/2023 285 11.9
13 Annex on 12th Southwest DC High-rise Market 562 12/1/2024 44 44.0
14 Capitol Rose Dupont Circle Mid-rise Market 158 9/1/2023 124 7.8
15 Drake East Dupont Circle High-rise Market 78 9/1/2024 41 10.3
16 Elle Apartments National Mall High-rise Market 163 7/1/2024 114 19.0
17 Banner Lane NoMa High-rise Market 561 1/1/2023 522 21.8
18 The Paxton Kingman Park Mid-rise Market 148 7/1/2024 83 13.8
19 Roberts Residences NoMa High-rise Affordable 139 11/1/2023 127 9.1
20 The Reynard Takoma DC High-rise Market 344 7/1/2024 102 17.0
21 The Florian NoMA High-rise Market 388 9/1/2024 76 19.0
22 The Burton Union Market High-rise Market 387 1/1/2022 359 10.0
23 Beech Tree Place Shepherd Park Mid-rise Affordable 66 11/1/2024 13 15.3
24 Gallery 64 Southwest DC High-rise Market 492 2/1/2023 399 17.3
25 Verge Waterfront High-rise Market 344 9/1/2022 321 11.5
26 Venture on I Southwest DC Mid-rise Market 197 3/1/2024 134 13.4
27 Crosby Mount Vernon Triangle High-rise Market 302 7/1/2024 108 18.0
28 Jayda Parkside Parkside High-rise Market 112 8/1/2024 13 2.6
29 Vesta Parkside Parkside Mid-rise Market 191 3/1/2022 180 5.3
30 Balsa National Mall High-rise Market 222 7/1/2024 66 11.0
31 The Grade on Laurel Takoma DC Mid-rise Market 353 10/1/2024 50 16.7
32 The Iris NoMA High-rise Market 430 5/1/2024 187 23.4
33 Pinnacle NoMa High-rise Market 116 4/1/2024 93 10.3
34 The Tides The Wharf High-rise Market 255 7/1/2022 224 7.5
35 Weavers Row Georgetown High-rise Market 115 8/1/2024 60 12.0
36 Kenilworth Courts Kenilworth Mid-rise Affordable 166 8/1/2024 58 11.6
37 City Ridge Cathedral Heights Mid-rise Market 690 5/1/2022 650 22.4
38 J Coopers Row Waterfront High-rise Market 312 1/1/2024 212 17.7
39 The Asberry at Barry Farm Anacostia Mid-rise Affordable 108 11/1/2024 9 4.5
40 Margarite Union Market High-rise Market 260 6/1/2023 208 10.9
41 Vela Navy Yard High-rise Market 379 8/1/2023 331 19.5
Total/Average 15.0
Source: Data obtained from CoStar, Inc. as of Q4 2024; compiled by Newmark.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 88
St. Elizabeth's East Site - Parcel 6
Based on this, we conclude to an absorption pace of 16 units per month. This results in a lease-
up period of 21 months. We assume the Subject Property will have 3 months of pre-leasing prior
to construction completion. As a result, we apply a lease-up period of 18 months as a market-rate
property. We apply a deduction in our analysis based on the rent loss during the 1 8 months
required for lease-up at the Subject. We also apply a concession amount of 1 month of free rent
previously mentioned and an entrepreneurial profit of 15% during lease-up.
Note, as property with a higher number of affordable units, we assume that the lease-up pace will
be higher due to the demand for affordable housing within the District.
MARKET RENT ANALYSIS – RETAIL
For our analysis, we assume that the Subject Property’s retail space will be subdivided into 6
spaces with an average unit size of 3,167 SF.
In estimating market rent for the Subject Property, we considered data and opinions based on
leasing activity with competing properties and market area leasing trends.
Rentable Rem.
Tenant Area (SF) Start End Mos. MLA Category $ Total $ PSF
Vacant 3,167 0 Ground Floor Retail $110,833 $35.00
Vacant 3,167 0 Ground Floor Retail $110,845 $35.00
Vacant 3,167 0 Ground Floor Retail $110,845 $35.00
Vacant 3,167 0 Ground Floor Retail $110,845 $35.00
Vacant 3,166 0 Ground Floor Retail $110,810 $35.00
Vacant 3,166 0 Ground Floor Retail $110,810 $35.00
Vacant 19,000 $664,988 $35.00
Total (Average) 19,000 0 $664,988 $35.00
Compiled by Newmark
Rent Roll
Lease Term Year 1 Market Rent
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 89
St. Elizabeth's East Site - Parcel 6
Comparable Map
No. Name Address
Subject St. Elizabeth's East Site - Parcel 6 Pecan Street Southeast, Washington, DC 20032
1 Good Hope Rd Mixed Use Building 1516 Good Hope Road SE, Washington, DC
2 Good Hope Marketplace 2845 Alabama Avenue, SE, Washington, DC
3 Fort Davis Shopping Center 3863 Alabama Avenue Southeast, Washington, DC
4 Skyland Town Center - Ground Floor
Commercial/Retail
2700 Good Hope Road Southeast and 2219 Town Center
Drive Southeast, Washington, DC5 Shops at Penn Branch 3200 Pennsylvania Avenue, Southeast, Washington, DC
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 90
St. Elizabeth's East Site - Parcel 6
Ground Floor Retail Space Subject Lease 1 Lease 2 Lease 3 Lease 4 Lease 5
Property Name St. Elizabeth's East Site -
Parcel 6
Good Hope Rd Mixed
Use Building
Good Hope
Marketplace
Fort Davis Shopping
Center
Skyland Town Center -
Ground Floor
Commercial/Retail
Shops at Penn Branch
Address Pecan Street Southeast 1516 Good Hope Road
SE
2845 Alabama Avenue,
SE
3863 Alabama Avenue
Southeast
2700 Good Hope Road
Southeast and 2219
Town Center Drive
Southeast
3200 Pennsylvania
Avenue, Southeast
City, State Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC Washington, DC
Submarket District of Columbia District of Columbia Valuation Retail District of Columbia District of Columbia District of Columbia
Rentable Area (SF) 19,000 SF 2,800 SF 97,213 SF 44,147 SF 84,264 SF 88,254 SF
Year Built (Renovated) 2025 2019 1997 1941 (2013) 2021 1964 (2017)
Number of Stories 1 4 1 2 1 1
Condition Excellent Excellent Good Average Excellent Average
Lease Details
Lease Status Signed Lease Signed Lease Signed Lease Signed Lease Signed Lease
Lease Date May-24 Jun-23 Aug-22 Apr-22 Jun-21
Term (Mos.) 132 120 126 120 120
Lease Size (SF) 2,654 3,500 2,875 2,225 2,613
Tenant Name DC Wildflower Public
Charter School
Quickway Hihachi Fort Davis Orthodontic
and Pediatric Dentistry
Roaming Roster Chipotle Mexican Grill
Full Building Lease No No No No No
Rates and Measures
Base Rental Rate $27.13 $45.00 $35.00 $45.00 $36.00
Effective Rental Rate $27.13 $45.00 $35.00 $45.00 $36.00
Base Rent Escalation Type Fixed Percentage Fixed Steps Fixed Percentage Fixed Percentage Fixed Steps
Escalation Description 3.0% annually 10% / 5YRS 3.0%, Annually 2.5%, Annually 10%/5 YRS
Lease Reimbursement Method Triple Net Triple Net Triple Net Triple Net Triple Net
Free Rent (Months) 5.00 0.00 6.00 0.00 0.00
TI Allowance / SF $0.00 $0.00 $15.00 $37.00 $25.00
Compiled by Newmark
Comparable Leases Summary
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 91
St. Elizabeth's East Site - Parcel 6
Adjustments are applied for the Subject Property’s location (regarding retail rents and median
household income levels in the surrounding area as well as Walk Scores and proximity of
locational amenities). We considered the size of the space, the age/condi tion of the property,
amenities and features such as on-site parking and storage space, and the quality of the space.
The adjusted rental rate range is $27.13 – $42.75 per square foot, with an average of $34.76 per
square foot. Based on this, we conclude to a market rent of $35.00/SF.
Based on the preceding analysis and our review of the details included in the addendum for these
leases, the following is the concluded market lease terms for the subject.
Ground Floor Retail Space Subject Comparable 1 Comparable 2 Comparable 3 Comparable 4 Comparable 5
Property Name St. Elizabeth's East Site -
Parcel 6
Good Hope Rd Mixed
Use Building
Good Hope
Marketplace
Fort Davis Shopping
Center
Skyland Town Center -
Ground Floor
Commercial/Retail
Shops at Penn Branch
Address Pecan Street Southeast 1516 Good Hope Road
SE
2845 Alabama Avenue,
SE
3863 Alabama Avenue
Southeast
2700 Good Hope Road
Southeast and 2219
Town Center Drive
Southeast
3200 Pennsylvania
Avenue, Southeast
Lease Date May-24 Jun-23 Aug-22 Apr-22 Jun-21
Term (Mos.) 132 120 126 120 120
Size (SF) 2,654 3,500 2,875 2,225 2,613
Tenant Name DC Wildflower Public
Charter School
Quickway Hihachi Fort Davis Orthodontic
and Pediatric Dentistry
Roaming Roster Chipotle Mexican Grill
Base Rental Rate $27.13 $45.00 $35.00 $45.00 $36.00
Effective Rental Rate $27.13 $45.00 $35.00 $45.00 $36.00
Base Rent Escalation Type Fixed Percentage Fixed Steps Fixed Percentage Fixed Percentage Fixed Steps
Lease Reimbursement Method Triple Net Triple Net Triple Net Triple Net Triple Net
Financial Adjustments
Expense Structure ($ PSF Adjustment) $0.00 $0.00 $0.00 $0.00 $0.00
Expense Structure 0% 0% 0% 0% 0%
Conditions of Lease 0% 0% 0% 0% 0%
Market Conditions (Time) 3/21/2025 0% 0% 0% 0% 0%
Subtotal 0% 0% 0% 0% 0%
Financial Adjusted Rent Per SF $27.13 $45.00 $35.00 $45.00 $36.00
Physical Adjustments
Location/Access/Exposure 5% -10% -10% -10% -10%
Size -5% 0% 0% -5% 0%
Age/Condition 0% 5% 5.0% 0% 5.0%
Parking 0% 0% 0% 0% 0%
Features/Amenities (Storage, Outdoor Seating, etc.) 0% 0% 0% 0% 0%
Quality (2nd Floor and Basement Space) 0% 0% 0% 0% 0%
Economic Characteristics (Irregular Lease Terms) 0% 0% 0% 0% -5%
Subtotal 0% -5% -5% -15% -10%
Overall Adjustment 0% -5% -5% -15% -10%
Adjusted Rent Per SF $27.13 $42.75 $33.25 $38.25 $32.40
Range of Adjusted Rents $27.13 - $42.75
Average $34.76
Indicated Rent $35.00
Compiled by Newmark
Comparable Leases Adjustment Grid
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 92
St. Elizabeth's East Site - Parcel 6
NET OPERATING INCOME – RETAIL
Potential Gross Rent
Figures presented below reflect the 12-month period following the effective date of the appraisal.
For our analysis, potential gross rent is based on market rents.
Expense Recoveries
A triple net lease structure where tenants cover all operating expenses is typical of retail tenants
in the market. Therefore, we do not project expense recoveries for the Subject Property as our
expense analysis effectively nets out expenses paid by the tenants.
Vacancy & Collection Loss Allowance
Based on review of the statistical information presented in the retail market analysis section of
this appraisal report, the total stabilized vacancy and collection loss allowance for the retail
component of the property is 5.00% (4.00% for vacancy and 1.00% for collection loss).
Non-Reimbursable Operating Expenses
As is common for properties where tenants occupy the improvements per a triple net lease, it is
assumed that operating expenses are directly paid by the tenant or occupant. The only expense
deductions that are appropriate are general/administrative, proper ty management, and
miscellaneous unreimbursed expenses, discussed further below.
– The general/administrative expenses are estimated to be $0.05 to $0.10 per square
foot for various accounting, administrative, and professional fees. This expense takes
MLA Category Rentable SF Market Rent Measure
Term
(Mos.) Mos. Free
Ground Floor Retail Space: 19,000 $35.00 $/SF/Year 3.00%/year 120 3
MLA Category Renewal %
Rollover Vacant
Mos.
Weighted
Down-time TI/SF (New)
TI/SF
(Renewal)
Weighted
TI/SF LC (New)
LC
(Renewal)
Weighted
LC
Ground Floor Retail Space: 60% 2 1 $25.00 $15.00 $19.00 5.00% 3.00% 3.80%
Compiled by Newmark
Triple Net
Concluded Market Lease Terms
Rent Escalations Reimbursement Method
Leased Potential Rent At Market
MLA Category SF Annual $/SF/Yr
Vacant Space (at market rents)
Ground Floor Retail Space: 19,000 $665,000 $35.00
Vacant Space Total 19,000 $665,000 $35.00
Overall Total 19,000 $665,000 $35.00
Compiled by Newmark
Potential Gross Rent
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 93
St. Elizabeth's East Site - Parcel 6
into account known and reported costs for general and administrative costs incurred
at retail properties throughout the region.
– Management fees are considered an expense of operation, whether the services are
contracted or provided by the property owner. We estimate this expense at 3.0% of
effective gross income considering the limited managerial responsibilities with these
property types.
– Miscellaneous unreimbursed expenses represent period expenses incurred such as
unreimbursed repairs to common areas and sporadic repairs to the structural
components such as the roof that fall outside of replacements. We estimate this
expense at $0.25 per square foot based on known and reported costs incurred at retail
properties throughout the region.
This is roughly equal to about $1.35/SF for this expense.
DIRECT CAPITALIZATION – RETAIL SECTION
The following subsections represent different techniques for deriving an overall capitalization rate.
Comparable Sales – Retail Buildings
No. Property Description Property Location Yr. Built Sale Date
Rentable
Area (SF) Occ. %
Price per
SF OAR
1 2-Story Office/Retail Building 4473-4477 Connecticut Avenue Northwest 1949 Oct-24 18,900 100% $421 6.48%
2 4-Story Retail/Office Building 519 H Street Northwest 1890 May-24 2,805 100% $578 5.96%
3 Retail Condominium Unit 1921 8th Street Northwest 2015 Jan-24 27,380 100% $520 6.03%
4 2-story Retail Building 1633 Wisconsin Avenue Northwest 1900 Jul-23 1,778 100% $843 4.86%
5 Shopping Center 4820 Massachusetts Avenue Northwest 1939 (2018) Jul-23 94,527 97% $503 6.60%
6 3-story Retail Building 1508 14th Street Northwest 1890 (2013) Jan-23 7,700 100% $857 6.37%
7 2-Story Restaurant Building 517 H Street Northeast 1900 (2014) Jan-23 2,472 100% $675 6.54%
8 2-story Bar/Restaurant 1378 H Street Northeast 1923 (2012) Dec-22 1,800 100% $880 6.55%
9 2-story Office & Retail Building 2600 Connecticut Avenue Northwest 1935 Nov-22 3,746 100% $1,121 6.40%
10 2-story Office & Retail Building 5800 Connecticut Avenue Northwest 1925 Nov-22 3,842 100% $606 5.75%
11 2-story Office & Retail Building 1519 Wisconsin Avenue Northwest 1900 (2010) May-22 5,736 100% $1,049 6.53%
12 3-story Restaurant 2321 18th Street Northwest 1910 Apr-22 4,500 100% $778 6.52%
13 2-story Retail Building 1344 - 1348 H Street Northeast 1923 (2017) Apr-22 10,460 100% $571 5.70%
14 2-story Restaurant 1544 9th Street Northwest 1900 (2016) Apr-22 3,800 100% $1,158 5.67%
15 Shopping Center 2410 Market Street Northeast 2017 Mar-22 139,243 100% $489 6.30%
16 2-story Office & Retail Building 2922 M Street Northwest 1900 (1999) Jan-22 2,137 95% $936 5.70%
17 2-story Bar/Restaurant 1610 U Street Northwest 1911 (2018) Nov-21 4,255 100% $799 6.40%
18 3-story Retail Building 1947 14th Street Northwest 1865 (2018) Aug-21 9,524 100% $1,312 5.70%
19 Single-story Retail Building 3131 M Street Northwest 1900 (2020) Apr-21 3,504 100% $2,354 5.15%
20 CVS - Single-story Building 3601 12th Street Northeast 1935 (1988) May-20 11,585 100% $687 5.00%
21 CVS - Single-story Building 1755 Columbia Road Northwest 1988 (2009) Apr-20 12,592 100% $1,376 5.01%
22 Retail Condominium Unit 1700 Columbia Road Northwest 2015 Mar-20 9,150 100% $858 5.40%
23 2-story Office & Retail Building 775 - 799 H Street Northeast 2003 Feb-20 6,001 100% $750 5.55%
24 2-story Retail Building 4473 Connecticut Avenue Northwest 1949 Listing 18,900 100% $444 6.14%
Average 5.93%
Compiled by Newmark
Comparable Retail Sales Summary
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 94
St. Elizabeth's East Site - Parcel 6
Recent sales in the District form a tight capitalization rate range of 4. 82% to 6. 60% with an
average of 5.93%.
We placed emphasis on Comparable 1, a 2 -story retail/office building, in a superior submarket
than the subject. However, the larger size and 2-level configuration is inferior to the subject. We
conclude that the subject will have a capitalization rate similar to this property. The Subject
Property will be ground floor retail (single floor) within walking distance of a Metrorail station. Due
to the location, we conclude the Subject Property will have a capitalization rate inferior to
Comparable 3 which is located in the strong retail submarket (U Street/Shaw area). We conclude
that the Subject Property will have capitalization rate superior to this comparable.
Considering the size, layout of the retail portion of the Subject Property, location, and recent
trending data, the comparable sales suggest an adjusted capitalization rate of 6.00% to 6.50%
for the retail component Subject Property.
Capitalization Rate Conclusion
Based on this analysis, we conclude to a capitalization rate of 6.25%.
Direct Capitalization Summary
Valuation of the retail component of the proposed improvements by direct capitalization is shown
in the following table.
Retail Section of the Property
Retail Market Rent/SF $35.00
Vacancy & Collection Loss 5.00% (4.00% vacancy & 1.00% collection loss) ($1.75)
Effective Rental Income/SF $33.25
Non-Reimbursable Operating Expense/SF -$1.35
Net Operating Income/Rentable SF $31.90
Capitalization Rate 6.25%
Stabilized Value/Rentable SF $510.40
Rentable/Gross SF Ratio 95.00%
Stabilized Value/Gross SF $484.88
Less: Lease-Up Cost for Retail
Tenant Improvement Allowance/SF Tenant improvements @ $25/SF -$25.00
Free Rent/SF 3 months of free rent per 10-year term -$8.75
Commissions/SF 5% of base rent over 10-year term -$17.50
Rent Loss/SF 9 months to lease retail space w/ 5.00% V&C -$24.94
Entreprenuerial Profit 15% of Lease-Up Costs -$11.43
Value at Completion/Gross SF - Retail Section $397.26
Compiled by Newmark
Direct Capitalization Value for Retail Section
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 95
St. Elizabeth's East Site - Parcel 6
Lease Up Costs for Retail
We make our assumptions regarding the lease-up of the Subject Property’s proposed retail space
based on the following data.
Note, restaurants tend to have tenant improvement allowances near $100/SF or higher. On the
other hand, other tenant including gyms, boutiques, etc. tend to have improvement allowances
that are on the lower end of the range for retail properties in the Subject’s surrounding area. We
apply a blended tenant improvement allowance of $25/SF.
We assume that it will take 9 months for the retail space to be fully leased after the Subject
Property is delivered. This assumes that at least 50% of the space will be pre-leased. The Subject
will have several months to market the retail space.
RESIDUAL ANALYSIS
To arrive at a pre-development land value indication for the Subject Property, we make deductions
from the “at completion” value indicated in the preceding analysis for construction costs (hard and
soft costs) and a required entrepreneurial incentive.
Building and Site Improvements
We utilize Marshall Valuation Service cost data to develop an estimate of the cost of completing
the proposed improvements. We have not been provided with any construction cost estimates or
development/construction budget for the Subject Property.
Based on this, we conclude to a following estimation of construction costs:
MLA Category
Mos. To
Absorb
Market Rent
($/SF/Yr)
Lease Term
(Mos.)
Est. Op.
Exp. ($/SF) TI/SF
Free Rent
(Mos.)
Leasing
Commission
Discount
Rate
Ground Floor Retail Space: 9 $35.00 120 $0.00 $25.00 3 5.00% 0.00%
Compiled by Newmark
Stabilization Discount - Assumptions
Site Improvements - Cost New
Item Unit Measure Cost/Unit Cost New Current Mult. Local Mult. Adj. Cost New
Site Preparation SF 76,034 $0.66 $50,182 1.040 1.050 $54,799
Excavation Cubic Feet 555,000 $0.87 $482,850 1.040 1.050 $527,272
Totals $533,032 $582,071
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 96
St. Elizabeth's East Site - Parcel 6
Note, our analysis includes one level of below grade parking underneath the Subject Property.
We estimate the garage will have an efficiency of 375 SF per parking space. We have considered
this in our analysis and attributed 76,034 SF of site area and 55,500 SF of garage space.
We include an indirect or soft cost that is roughly 20.0% of the hard costs for the Subject Property.
To check the reasonableness of our projection, we considered recent cost comparable for midrise
multifamily properties with ground floor retail within the Washington, DC MSA.
Improvements (Structures) Retail Store
Above Grade
Apartments Parking Appliances Subtotal
MVS Improvement Type Retail Stores (353)
Apartments (High-
Rise) (300)
Basements - High-
Rise Apartments
Residences and
Motels Built-Ins
Construction Class A C A-B
Quality Good Good Parking Good
MVS Section 13 11 11 12
MVS Page 26 18 19 41
Source Date 5/1/2024 11/1/2024 11/1/2024 8/1/2024
Base Cost PSF $205.00 $176.00 $81.50 $3,750.00
Has Sprinklers? Yes Yes Yes
+ Sprinklers $4.44 $2.96 $3.89 $0.00
+HVAC (var. from base) $0.00 $0.00 $0.00 $0.00
Other $0.00 $0.00 $0.00 $0.00
Adjusted Base Cost PSF $209.44 $178.96 $85.39 $3,750.00
Height & Size Refinements
# of Stories Multiplier 1.000 1.010 1.010 1.010
Ceiling Height Multiplier 1.000 1.000 1.000 1.000
Perimeter Multiplier 1.000 1.000 1.000 1.000
Adjusted Base Cost $209.44 $180.75 $86.25 $3,787.50
Final Calculations
Current Cost Multiplier 1.040 1.040 1.040 1.040
Local Area Multiplier 1.050 1.050 1.050 1.050
Other Multiplier (Site Congestion, etc.) 1.000 1.000 1.000 1.000
Adjusted Base Cost $228.71 $197.38 $94.18 $4,135.95
x Structure Size (SF GBA per building) 20,000 304,412 55,500 340 379,912
Adjusted Cost per Building $4,574,170 $60,084,403 $5,227,081 $1,406,223 $69,885,654
x Number of Buildings 1 1 1 1 3
Total Adjusted Cost $4,574,170 $60,084,403 $5,227,081 $1,406,223 $71,291,877
Site Improvements $582,071 $582,071
+ Indirect Costs @ 20.00% $1,031,248 $12,016,881 $1,045,416 $281,245 $14,374,790
MVS Indicated Cost New Before Profit $6,187,489 $72,101,284 $6,272,498 $1,687,468 $86,248,738
Compiled by Newmark
Building and Site Improvements - Cost Summary (Sister Buildings)
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 97
St. Elizabeth's East Site - Parcel 6
We place weight on Comparable 1 due to their similar configuration (mid -rise buildings with
ground floor retail. Placing emphasis on this and the mean of all the comparables, we conclude
to a construction cost of $270/SF GBA.
Based on this analysis, we apply rely on the MVS projection for construction costs.
Entrepreneurial Profit
Based on our analysis and research, we conclude that an appropriate entrepreneurial profit for
the Subject Property is 15% for the construction costs.
Cost Comparable
Building Size (SF GBA)
Year Built/Year of Estimate
Type
Cost $ $/SF $ $/SF $ $/SF $ $/SF $ $/SF $ $/SF
Hard Costs $114,109,123 $200.47 $90,778,645 $159.80 $73,684,779 $178.38 $204,194,302 $314.63 $123,136,217 $304.76 $121,180,613 $231.61
Soft Costs $24,504,046 $43.05 $30,458,675 $53.62 $22,771,682 $55.13 $44,684,226 $68.85 $37,115,147 $91.86 $31,906,755 $62.50
Total Base Cost $138,613,169 $243.52 $121,237,320 $213.42 $96,456,461 $233.50 $248,878,528 $383.49 $160,251,364 $396.62 $153,087,368 $294.11
Add
Tenant Improvements $0.00 $0.00 $0.00 $0.00 $0.00 $0 $0.00
Leasing Costs $723,136 $1.27 $3,906,548 $6.88 $0.00 $0.00 $0.00 $925,937 $1.63
Adjustments $0.00 $0.00 $0.00 $0.00 $0.00 $0 $0.00
Subtotal $723,136 $1.27 $3,906,548 $6.88 $0 $0.00 $0 $0.00 $0 $0.00 $925,937 $1.63
Total Cost $139,336,305 $244.79 $125,143,868 $220.29 $96,456,461 $233.50 $248,878,528 $383.49 $160,251,364 $396.62 $154,013,305 $295.74
Percentage of Total
Hard Costs
Soft Costs
Other
Conclusion
Subject Building Area (GBA)
Concluded Cost Per Square Foot X
Replacement Cost New Indication
Notes: Replacement cost new indication is exclusive of entrepreneurial profit.
Compiled by Newmark
18%
0%
2021
Mid-rise Multifamily with
Ground Floor Retail and
Above Grade Parking
569,211
2024
Mid-rise Multifamily with
Ground Floor Retail and
Below Grade Parking
568,075 413,087
2024
Mid-rise with Ground Floor
Retail and Above Grade
Parking
648,989
2019
High-Rise (12 Stories) with
Ground Floor Retail and
Below Grade Parking
1
78%
Average
1%
21%
520,682
2022
404,046
2020
High-Rise (15 Stories) with
Ground Floor Retail and
Below Grade Parking
$87,591,240
77%
23%
0%
82%
18%
1%
73%
24%
3%
76%
24%
0%
324,412
$270
82%
2 3 4
Cost Comparables - Multifamily Development
5
Reconciliation of Replacement Cost New Before Profit (Sister Buildings)
Source Total $/SF
Marshall Valuation Service ("MVS") $86,248,738 $265.86
Cost Comparables $87,591,240 $270.00
Reconciled Replacement Cost New (Before Profit) $86,248,738 $265.86
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 98
St. Elizabeth's East Site - Parcel 6
We conclude to a replacement cost new value, with profit, shown in the table above.
We convert the projected costs based on the FAR of the Subject Property (324,412 SF).
Residual Land Value Summary
By subtracting all costs necessary to complete the project, we arrive at a current indication for the
Subject Property’s underlying land value as follows:
Building and Site Improvements Retail Store
Above Grade
Apartments Parking Appliances Subtotal
Reconciled Cost New Before Profit $6,187,489 $72,101,284 $6,272,498 $1,687,468 $86,248,738
Entrepreneurial Profit @ 15.00% $928,123 $10,815,193 $940,875 $253,120 $12,937,311
Replacement Cost New (RCN) $7,115,613 $82,916,476 $7,213,372 $1,940,588 $99,186,049
$ PSF/Unit $355.78 $272.38 $129.97 $5,707.61 $261.08
Total Replacement Cost New (RCN) $99,186,049
$/SF-FAR (324,412 SF) $305.74
Compiled by Newmark
Entrepreneurial Profit (Sister Buildings)
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 99
St. Elizabeth's East Site - Parcel 6
Based on this analysis, we conclude to a residual land value of $ 26.00/SF-FAR for a proposed
mixed-use building.
Multifamily Section of the Property
Monthly Market Rent/SF $3.45
Monthly Affordable Rent/SF $1.96
Weighted Rent/SF (90%/10%) $3.30
Vacancy & Collection Loss 6.00% (5.50% vacancy & 0.50% collection loss) -$0.20
Effective Rental Income/SF $3.10
Conversion to Annual Income $37.22
Net Other Income 3.00% of EGI $1.17
Net Parking Income $150/space for 136 spaces @ 93.5% occupancy $0.95
Effective Gross Income/SF $39.34
Non-Tax Operating Expense/SF $9,000/unit -$12.57
Pre-Tax Net Operating Income/SF $26.77
Tax-Loaded Capitalization Rate (5.00% capitalization rate + 0.85%) 5.85%
Stabilized Value/Rentable SF $457.60
Rentable/Gross SF Ratio 79.97%
Stabilized Value/Gross SF $365.94
Less: Lease-Up Costs for Multifamily
Rent Loss 18 months for lease-up with 93.5% occupancy -$27.92
Free Rent 1 month of free rent with 93.5% occupancy -$2.92
Entreprenuerial Profit 15% of Lease-up Costs -$4.63
Value at Completion/Gross SF - Multifamily Section $330.48
Retail Section of the Property
Retail Market Rent/SF $35.00
Vacancy & Collection Loss 5.00% (4.00% vacancy & 1.00% collection loss) ($1.75)
Effective Rental Income/SF $33.25
Non-Reimbursable Operating Expense/SF -$1.35
Net Operating Income/Rentable SF $31.90
Capitalization Rate 6.25%
Stabilized Value/Rentable SF $510.40
Rentable/Gross SF Ratio 95.00%
Stabilized Value/Gross SF $484.88
Less: Lease-Up Cost for Retail
Tenant Improvement Allowance/SF Tenant improvements @ $25/SF -$25.00
Free Rent/SF 3 months of free rent per 10-year term -$8.75
Commissions/SF 5% of base rent over 10-year term -$17.50
Rent Loss/SF 9 months to lease retail space w/ 5.00% V&C -$24.94
Entreprenuerial Profit 15% of Lease-Up Costs -$11.43
Value at Completion/Gross SF - Retail Section $397.26
Market Value As is of Subject Property
Blended Value at Completion/Gross SF (93.8% Multifamily/6.2% Retail) $334.60
Construction Costs with 15.0% Profit -$305.74
Residual Land Value/FAR $28.86
Rounded $29.00
Compiled by Newmark
Mixed Use Property with Inclusionary Zoning and Ground Floor Retail
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 100
St. Elizabeth's East Site - Parcel 6
DISCOUNTED CASH FLOW ANALYSIS
Absorption Pace
We have subdivided the FAR in two phases based on the sizes of our sale comparables. In order
to project the timing of the second phase, we have reviewed absorption data for a recently
completed apartment building the market area.
Our valuation assumes that each of the sections would be developed with complementary
development programs so that demand synergies are realized rather than erosion of demand
from competing developments. As such, the timing of the potential sale of the com ponents is
effectively unaffected by the development programs. We assume Building 1 would be sold first
with Building 2 being sold 36 months later.
Selling Expenses
Typically, marketing and sales expenses include commissions, advertising, and all other items
required to attract buyers.
We have projected a selling expense of 2.0% of gross sales proceeds.
Project Expenses
We assume that the owner will have some property expenses while holding on to the remaining
multifamily site including real estate taxes. We project expenses to be roughly 2.0% of the
underlying value of the land.
Rate of Growth
Our valuation is based on current figures; however, we must determine if unit prices will escalate
in the future. In order to inflate our pricing, we have considered income and expense growth over
the past five years for multifamily section within the regi on. Based on the survey information
below, we apply an inflation factor of 2.75% annually.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 101
St. Elizabeth's East Site - Parcel 6
Source: 1st Quarter 2025 PwC Real Estate Investor Survey
Land Discount Rates
To estimate an appropriate discount rate for our analysis, we considered investment survey data
for land leases, developing land, and multifamily properties in general.
Survey data indicated discount rates for development land ranges from 1 2.00% to 30.00% with
an average of 17.00%. Rates have dramatically decreased over the past year following a steep
increase between 2021 and 2023 as shown in the table below.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 102
St. Elizabeth's East Site - Parcel 6
Note, this is for all development land, not necessarily multifamily development land in particular.
Due to the Subject Property’s location, we assume that the Subject Property will have a discount
rate on the lower end of the range. We apply a discount rate of 15.00%.
Discounted Cash Flow Analysis
To value the property as a whole, we have used discounted cash flow analysis to calculate the
present value of the two phases of development. Our analysis assumes the following:
– Land value increases at 2.75% annually.
– Expenses growth at 2.75% annually.
– We use an annual discount rate of 15.00% per our previous analysis for discount rates
for development land.
– We apply a selling expense of 2.00% of cash receipts.
– We apply expenses, roughly 2.00% of the underlying land value, for holding expenses
such as real estate taxes.
DEVELOPMENT ANALYSIS APPROACH (VALUE AS IF UNENCUMBERED) 103
St. Elizabeth's East Site - Parcel 6
12 months 24 months 36 months Total
Total FAR 648,824
Value per FAR For Each Building $29.00
Appreciation Factor Annually 2.75%
Expense Growth Rate Annually 2.75%
Discount Rate 15.00%
Price Escalator 1.0275 1.0558 1.0848
Expense Escalator 1.0275 1.0558 1.0848
Prevailing Value per Phase $29.80 $30.62 $31.46
Absorption
Development Land (SF of FAR Sold) 324,412 0 324,412
Remaining Development Land 324,412 324,412 0
Land Sale Revenue $9,666,667 $0 $10,205,644 $19,872,310
Net Revenues
Total Cash Receipts $9,666,667 $0 $10,205,644 $19,872,310
Selling Expense (2% of Cash Receipts) -$193,333 $0 -$204,113 -$397,446
Project Expenses (2% of Projected Value) -$6,667 -$6,850 $0 -$13,517
Total Revenue $9,466,667 -$6,850 $10,001,531 $19,461,347
Discount Factor (15%) 0.869565 0.756144 0.657516
Net Present Value $8,231,884 -$5,180 $6,576,169 $14,802,873
Net Present Value $14,802,873 $22.81 /SF - FAR
Rounded $14,800,000 $22.81 /SF - FAR
Compiled by Newmark
Discounted Cash Flow for Residual Analysis
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 104
St. Elizabeth's East Site - Parcel 6
Development Analysis Approach (Value
Subject to Development Plan)
Per the client’s requirements, we develop an opinion of the market value of the Property in
accordance with the Development Plan under the following assumptions:
1. The Property is subject to the requirements of D.C. Code §10-801, D.C. Code §2-218.01
(Certified Business Enterprise), D.C. Code §2 -219.01 (First Source), D.C.§6 -1451.01
(Green Building Act), D.C. Code §2 -1226.02 (AWI Act), and any other legally binding
requirements that are, or may be, applicable.
2. The Property is conveyed through a 99-year ground lease.
3. The Property will remain zoned under the Saint Elizabeths Zone – 6 and follow its
requirements.
4. Our Development Plan will include the following:
a. Eight Live/Work Townhomes that will wrap around the garage that will be conveyed
in a fee simple sale.
b. A second building will include 221 residential units, 11,900 SF of retail, and a
community park.
c. A third building will include 286 residential units and 5,800 SF of retail.
d. 185 parking spaces in total
e. All 507 apartment units will have the following affordable designations:
i. 36 units set at 30% MFI
ii. 120 units set at 50% MFI
iii. 351 units set at 100% MFI
f. The Live/Work Townhomes will have the following affordable housing
designations:
i. 2 units set at 80% of MFI
ii. 6 units set at 100% of MFI
As previously stated, the Subject Property is outside of the AWI Act zone. As a result, the property
is only required to follow the affordable housing restrictions of D.C. Code §10 -801. Per the
guidance, 30% of all dwelling units developed must be set aside as affordable housing. Of these
units, under a rental scenario, 25% of these units must be set aside for households making 30%
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 105
St. Elizabeth's East Site - Parcel 6
or less of AMI. The remaining 75% of these units must be set aside for households making 50%
or less of AMI. Under a for -sale scenario, 15% of the units must be set aside for households
making 50% or less of AMI and the remaining 15% of the units must be set aside for households
making 80% or less of AMI.
Unfortunately, the Development Plan does not meet the requirements of D.C. Code §10 -801. In
total, there are 515 units, 507 apartments and 8 townhomes. Approximately 155 units have to be
set aside as affordable housing. From our calculation, 38 of the units would have to be set at the
lowest designation, 30% AMI for the rental units and 50% AMI for the townhomes. Currently, there
are 36 apartment units set at 30% AMI and no townhomes set at 50% AMI. At a minimum, there
would need to be 38 apartment units set at 30% AMI or 36 apartment units set at 30% AMI and 2
townhomes set at 50% AMI. That does not appear to be the case. In order to have the p roperty
meet the D.C. Code §10-801 requirements, we have adjusted the unit mix for the entire project to
the following breakdown:
No. Units Unit Description
Unit Size
(SF)
Rentable
Area (SF)
Occupied
Units
Unit
Occupancy
61 0 BR/1 BA - 480 SF 480 29,280 0 0.0%
6 0 BR/1 BA 30% AMI - 480 SF 480 2,880 0 0.0%
19 0 BR/1 BA 50% AMI - 480 SF 480 9,120 0 0.0%
86 0 BR Total 480 41,280 0 0.0%
195 1 BR/1 BA - 660 SF 660 128,700 0 0.0%
21 1 BR/1 BA 30% AMI - 660 SF 660 13,860 0 0.0%
63 1 BR/1 BA 50% AMI - 660 SF 660 41,580 0 0.0%
279 1 BR Total 660 184,140 0 0.0%
88 2 BR/2 BA - 955 SF 955 84,040 0 0.0%
10 2 BR/2 BA 30% AMI - 955 SF 955 9,550 0 0.0%
29 2 BR/2 BA 50% AMI - 955 SF 955 27,695 0 0.0%
127 2 BR Total 955 121,285 0 0.0%
11 3 BR/2 BA - 1,100 SF 1,100 12,100 0 0.0%
1 3 BR/2 BA 30% AMI - 1,100 SF 1,100 1,100 0 0.0%
3 3 BR/2 BA 50% AMI - 1,100 SF 1,100 3,300 0 0.0%
15 3 BR Total 1,100 16,500 0 0.0%
507 Totals 363,205 0
Averages 716 0.0%
Compiled by Newmark
Unit Mix - Mixed-Use Buildings
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 106
St. Elizabeth's East Site - Parcel 6
In total, 155 units are set aside for affordable housing. Within the rental units, 7.5% of the 507
units are set aside for households making 30% or less of AMI and 22.6% of the 507 units are set
aside for households making 50% or less of AMI. For the for-sale units, 25% of the 8 units are set
aside for households making 50% or less of AMI and 1 2.5% of the 8 units are set aside for
households making 80% or less of AMI.
To estimate the residual land value of the Development Plan, we will have to estimate the residual
land value of the major sections on the Plan, the residential subdivision and the mixed-use
apartment buildings.
PROJECT DESIGN AND VALUATION OF RESIDENTIAL SUBDIVISION
The Subject will contain a total of nine townhome units. We were provided the following
information regarding the proposed townhomes:
Unit Description No. Units Unit Size (SF) Saleable Area (SF)
3 BR/3.5 BA Townhome 50% AMI - 2,300 SF 2 2,300 4,600
3 BR/3.5 BA Townhome 80% AMI - 2,300 SF 1 2,300 2,300
3 BR/3.5 BA Townhome - 2,300 SF 5 2,300 11,500
Total 8 2,300 18,400
Compiled by Newmark
Unit Mix - Live/Work Townhomes
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 107
St. Elizabeth's East Site - Parcel 6
These units will be live/work units w here the ground floor will include an average of 660 SF of
retail/business space. The units will be roughly 2,300 SF on average. For the valuation analysis,
we assume the following:
1. Each of the townhomes will have a designated surface parking space on the street. Each
space will be roughly 820 SF.
2. We assume each of the buildings will be at least 4 stories.
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 108
St. Elizabeth's East Site - Parcel 6
3. The ground floor will include 660 SF of area dedicated to retail/business use that includes
a restroom. The upper three levels will include three bedrooms with three bathrooms and
a half bath/powder room on the 2nd floor of the building.
From our review of the development plan, the Subject Property will have a unit mix as follows:
Residential Subdivision Section Pricing
Retail Pricing – Market Townhome Units
In developing the sales comparison approach for townhome units, we surveyed the market for
recent single -family dwelling sales, particularly townhomes and semi -detached units. The
following is a list of residential townhomes/semi-detached home sales in the District east of the
Anacostia River over the past two years.
Unit Description No. Units Unit Size (SF) Saleable Area (SF)
3 BR/3.5 BA Townhome 50% AMI - 2,300 SF 2 2,300 4,600
3 BR/3.5 BA Townhome 80% AMI - 2,300 SF 1 2,300 2,300
3 BR/3.5 BA Townhome - 2,300 SF 5 2,300 11,500
Total 8 2,300 18,400
Compiled by Newmark
Unit Mix - Live/Work Townhomes
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 109
St. Elizabeth's East Site - Parcel 6
Note, the subject will include a ground floor level dedicated to retail use /office use. We consider
this to be similar to a finished basement level. We searched within DC to find similar unit types,
but were not able to find many of this unit type. We searched outside of the District and concluded
Comparable Townhome/Semi-Detached Home Sales in SE DC
# Full Address Status Listing Date Close Date List Price
Close
Price Year Built Beds Baths Size (SF)
Lot Size
(SF)
ADU?
(Y/N) $/SF
1 3812 1St Street SE Active 3/5/2025 $595,000 2021 4 3.5 2,420 4,550 N $245.87
2 1507 Erie Street SE Active 8/31/2024 $559,000 2024 4 4 2,679 2,445 N $208.66
3 2518 Elvans Road SE Closed 1/20/2025 1/28/2025 $649,000 $620,000 2024 5 3.5 2,760 3,521 Y $224.64
4 2516 Elvans Road SE Closed 1/2/2025 1/28/2025 $649,000 $620,000 2024 5 3.5 2,760 3,561 Y $224.64
5 2523 Elvans Rd Closed 9/1/2024 12/13/2024 $581,000 $581,000 2023 3 3.5 2,500 0 N $232.40
6 4941 Call Place SE Closed 11/5/2024 11/29/2024 $665,000 $649,990 2024 5 3.5 2,760 2,000 Y $235.50
7 2520 Elvans Road SE Closed 11/4/2024 11/29/2024 $680,999 $677,000 2024 5 3.5 2,760 10,309 Y $245.29
8 2514 Elvans Road SE Closed 10/18/2024 1/28/2025 $649,000 $620,000 2024 5 3.5 2,800 3,601 Y $221.43
9 4943 Call Place SE Closed 10/8/2024 12/3/2024 $665,000 $640,000 2024 5 3.5 2,760 2,000 Y $231.88
10 2529 1/2 Elvans Road SE Closed 8/22/2024 10/15/2024 $599,000 $575,000 2023 3 3.5 2,592 2,178 N $221.84
11 4945 Call Place SE Closed 7/31/2024 12/20/2024 $649,000 $620,000 2024 5 3.5 2,794 2,000 Y $221.90
12 2525 1/2 Elvans Road SE Closed 7/8/2024 7/26/2024 $575,000 $600,000 2023 3 3.5 2,592 2,200 N $231.48
13 2644 Stanton Road SE Closed 7/8/2024 8/30/2024 $542,700 $546,000 2023 4 3.5 2,400 2,000 N $227.50
14 231 Valley Avenue SE Closed 6/20/2024 8/23/2024 $689,000 $689,000 2023 6 4 3,450 2,500 Y $199.71
15 2512 Elvans Road SE Closed 5/7/2024 7/31/2024 $695,000 $680,000 2024 6 4 3,312 6,812 Y $205.31
16 2646 Stanton Road SE Closed 3/7/2024 4/26/2024 $549,000 $549,000 2024 4 3.5 2,400 2,000 N $228.75
17 233 Valley Avenue SE Closed 3/7/2024 11/14/2024 $670,000 $670,000 2024 6 4 3,450 2,500 Y $194.20
18 1435 Howard Road SE Closed 2/8/2024 4/23/2024 $549,000 $549,000 2023 5 3.5 2,500 2,338 N $219.60
19 4002 D Street SE Closed 1/30/2024 5/27/2024 $649,000 $640,000 2024 5 3.5 2,679 4,500 Y $238.90
20 2642 Stanton Road SE Closed 1/22/2024 5/24/2024 $549,000 $545,000 2023 4 3.5 2,400 2,000 N $227.08
21 2529 Elvans Road SE Closed 1/11/2024 3/22/2024 $599,999 $599,999 2023 3 3.5 2,592 2,178 N $231.48
22 235 Valley Avenue SE Closed 1/9/2024 1/30/2024 $699,000 $689,000 2023 6 4 3,450 2,500 Y $199.71
23 2527 1/2 Elvans Road SE Closed 1/2/2024 2/21/2024 $599,999 $599,999 2023 3 3.5 2,592 2,200 N $231.48
24 2531 1/2 Elvans Road SE Closed 12/1/2023 2/1/2024 $610,000 $610,000 2023 3 3.5 2,592 2,200 N $235.34
25 1619 V Street SE Closed 11/9/2023 12/8/2023 $649,950 $649,950 2023 6 4.5 2,740 3,120 N $237.21
26 2214 Chester Street SE Closed 11/7/2023 12/29/2023 $599,000 $585,000 2023 3 3.5 2,260 2,379 N $258.85
27 1437 Howard Road SE Closed 10/30/2023 12/1/2023 $565,000 $565,000 2023 5 3.5 2,500 2,338 N $226.00
28 2527 Elvans Road SE Closed 10/1/2023 10/25/2023 $599,000 $599,000 2023 3 3.5 2,678 2,200 N $223.67
29 1621 V Street SE Closed 10/12/2023 12/11/2023 $649,950 $620,000 2023 6 4.5 2,740 3,120 N $226.28
30 3826 1St Street SE Closed 9/14/2023 1/19/2024 $565,000 $540,000 2023 3 3.5 2,005 2,995 N $269.33
31 1433 Howard Road SE Closed 8/16/2023 12/1/2023 $565,000 $550,000 2023 5 3.5 2,500 2,338 N $220.00
32 2216 Chester Street SE Closed 8/7/2023 9/5/2023 $609,000 $609,000 2023 3 3.5 2,260 2,379 N $269.47
33 2525 Elvans Road SE Closed 8/1/2023 12/14/2023 $599,999 $599,999 2023 3 3.5 2,592 2,200 N $231.48
34 5114 Bass Place SE Closed 6/20/2023 7/28/2023 $625,999 $600,000 2023 5 3.5 2,760 2,000 Y $217.39
35 3872 Halley Terrace SE Closed 6/7/2023 6/16/2023 $522,000 $522,000 2022 3 3.5 2,176 0 N $239.89
36 2521 1/2 Elvans Rd Closed 5/19/2023 1/23/2024 $600,000 $600,000 2023 3 3.5 2,500 0 N $240.00
37 5112 Bass Place SE Closed 4/26/2023 8/14/2023 $625,000 $600,000 2023 5 3.5 2,760 2,000 Y $217.39
38 714 Malcolm X Avenue SE Closed 4/28/2023 6/16/2023 $599,000 $599,000 2022 3 2.5 1,914 2,500 N $312.96
39 2419 Elvans Rd Closed 4/13/2023 6/9/2023 $529,900 $529,900 2022 4 3.5 2,428 2,000 N $218.25
40 2427 Elvans Rd Closed 4/10/2023 7/19/2023 $529,900 $519,000 2022 4 3.5 2,428 2,000 N $213.76
41 2421 Elvans Rd Closed 3/24/2023 7/31/2023 $529,999 $527,000 2022 4 3.5 2,428 2,000 N $217.05
42 2429 Elvans Rd Closed 3/21/2023 5/15/2023 $529,999 $529,999 2022 4 3.5 2,428 2,000 N $218.29
43 4008 9Th St Closed 3/10/2023 5/26/2023 $539,999 $539,999 2023 4 3.5 2,600 4,287 N $207.69
44 2423 Elvans Rd Closed 2/28/2023 4/20/2023 $529,999 $515,000 2022 4 3.5 2,428 2,000 N $212.11
45 2425 Elvans Rd Closed 2/23/2023 4/7/2023 $529,999 $529,999 2022 4 3.5 2,428 2,000 N $218.29
46 5011 Astor Place SE Closed 2/16/2023 5/24/2023 $599,000 $575,000 2022 4 3.5 2,793 2,000 N $205.87
47 716 Malcolm X Avenue SE Closed 2/15/2023 4/27/2023 $620,000 $620,000 2022 3 2.5 1,914 2,500 N $323.93
48 2431 Elvans Rd Closed 2/13/2023 10/16/2023 $529,999 $530,000 2022 4 3.5 2,428 2,000 N $218.29
49 1515 Erie Street SE Closed 1/20/2023 3/24/2023 $575,000 $550,000 2022 4 3.5 2,428 2,000 N $226.52
MINIMUM $522,000 $515,000 1,914 0 $194.20
MAXIMUM $699,000 $689,000 3,450 10,309 $323.93
AVERAGE $598,681 $590,954 2,594 2,581 $229.68
MEDIAN $599,000 $599,999 2,592 2,200 $226.00
SUBJECT - MARKET $540,500 3 3.5 2,300 $225.00
Source: BrightMLS.com; compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 110
St. Elizabeth's East Site - Parcel 6
that the value for these homes is not significantly different than typical residential townhomes on
a per SF basis.
Based on this analysis, we conclude to a market-oriented townhome price of $540,500.
Retail Pricing – Affordable Townhome Units
As previously shown, three of the townhome units will be set aside as affordable housing. The
following are tables which show the maximum purchase price for single -family homes based on
the median family income for the Washington Metropolitan Statistical Area, as published by the
U.S. Department of Housing and Urban Development (HUD) on April 1, 2024. These prices were
effective for the D.C. area as of August 30, 2024.
Source: D.C. Department of Housing and Community Development, 2024
Residential Pricing Conclusion
Our concluded final value indication for the residential portion for each development scenario is
as follows:
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 111
St. Elizabeth's East Site - Parcel 6
Development Analysis – Residential Sell Off
In the preceding analysis, we have developed projections of the Subject’s sale revenue potential.
These projections, along with the assumptions described below, are used to project net revenues
during the sell-out period.
Absorption
We project a general sales pace of 1.0 units per month for the completed townhomes due to the
location and pricing of the units.
Timing
Considering the time needed to obtain approvals (estimated at 12 months) and the required site
work needed and construction time, we project that sales will begin. April 1, 2027 with marketing
and pre-sales beginning in January 2027. The residential subdivision is relatively small (only 9
units), with the potential lots already served by an existing street (Pecan Street SE) . However,
some infrastructure (utilities, curb cuts, etc.) would likely need to be installed or improved to
support the entire site development program. We assume 30 months will be enough to obtain the
required approvals and construct nine townhome units.
Rate of Escalation
Our valuation, in particular, our unit prices are based on current figures; however, we assume that
unit prices will escalate in the future. In order to inflate our pricing, we have considered sale price
inflation in the market. Approximately 30% of the unit mix have pricing restrictions based on
median household income levels for the District . we have reviewed the annual changes to the
median household income levels for the MSA over the past twenty years as shown in the following
table.
Unit Type
Number of
Units
Average Unit
Size (SF)
Concluded
Price/SF
Concluded
Price/Unit
Total
Concluded
Revenue
3 BR/3.5 BA Townhome 50% AMI - 2,300 SF 2 2300 $94 $216,900 $433,800
3 BR/3.5 BA Townhome 80% AMI - 2,300 SF 1 2300 $158 $364,100 $364,100
3 BR/3.5 BA Townhome - 2,300 SF 5 2300 $235 $540,500 $2,702,500
Total 8 2,300 $190 $437,550 $3,500,400
Compiled by Newmark
Concluded Prices for Proposed Units
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 112
St. Elizabeth's East Site - Parcel 6
Household income levels have increased more than 5.00% annually over the past five years. In
contrast, as shown below, prices for three-bedroom townhomes have increased at a rate of 3.87%
annually over the past five years.
Year Median Household IncomeAnnual Increase
2003 $84,800 7.32%
2004 $85,400 0.71%
2005 $89,300 4.57%
2006 $90,300 1.12%
2007 $94,500 4.65%
2008 $99,000 4.76%
2009 $102,700 3.74%
2010 $103,500 0.78%
2011 $106,100 2.51%
2012 $107,500 1.32%
2013 $107,300 -0.19%
2014 $107,000 -0.28%
2015 $109,200 2.06%
2016 $108,600 -0.55%
2017 $110,300 1.57%
2018 $117,200 6.26%
2019 $121,300 3.50%
2020 $126,000 3.87%
2021 $129,000 2.38%
2022 $142,300 10.31%
2023 $152,100 6.89%
2024 $154,700 1.71%
Average - Past 20 Years 3.05%
Average - Past 10 Years 3.80%
Average - Past 5 Years 5.03%
Average - Past 3 Years 6.30%
Concluded Escalation Rate
Compiled by Newmark
Annual Changes to Median Family Income
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 113
St. Elizabeth's East Site - Parcel 6
Considering the location of the subject in the Congress Heights submarket, the limited amount of
new townhome units within the District and the desire for affordable housing, we apply an
escalation rate of 3.00% annually for the residential townhomes.
Rate of Expense Growth
We project expenses to grow at a rate of 3.00% annually.
Vertical and Horizontal Constructions Costs
We reviewed the horizontal constructions costs, which include all development cost associated
with preparing finished townhome lots. This cost includes creating curbs and sidewalks when
necessary as well as delivering utilities to the site. The following is a table of cost comparables
for site development in other residential subdivisions in the Washington, DC MSA.
Year Units Sold
Average Sale
Price Price Change (%)
Average Days on
the Market
2014 75 $508,327 40
2015 87 $546,736 7.56% 40
2016 88 $585,910 7.17% 39
2017 94 $596,572 1.82% 35
2018 115 $598,886 0.39% 37
2019 86 $687,246 14.75% 39
2020 107 $669,407 -2.60% 36
2021 102 $753,111 12.50% 35
2022 93 $772,090 2.52% 34
2023 83 $766,773 -0.69% 45
2024 85 $682,838 -10.95% 48
2025 85 $791,985 15.98% 50
Average Price Increase - 10 Years 4.09%
Average Price Increase - 5 Years 3.87%
Average Price Increase - 3 Years 1.45%
Compiled by Newmark
Price Considerations - 3 Bedroom Townhomes (February)
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 114
St. Elizabeth's East Site - Parcel 6
The Subject Property site is relatively small and the development will only be 8 units. Furthermore,
the site is already serviced by a road (Pecan Street SE). Based on this, we assume the Subject’s
horizontal cost will be significantly lower than our comparables which are larger subdivisions that
would need internal roads. Based on this, we conclude to a horizontal cost of $45,000 per
lot/townhome unit.
Vertical construction costs are the cost associated with building the actual townhomes . This
includes hard and soft costs. Hard costs include labor, materials, supervision, contractor’s profit
and overhead, architect’s plans and specifications, sales taxes, and insurance.
Our projection for the vertical costs are as follows:
Development Cost Comparables
Comparable Property Location Development Description Unit Count Total Cost Budget $/Unit
Washington, DC 74 TH and 150+ Apartment Building 74 $6,614,071 $89,379
Arlington, VA 25 TH 25 $2,596,000 $103,840
Washington, DC 80 TH 80 $6,847,715 $85,596
Washington, DC 80 TH 88 $6,491,372 $73,766
Washington, DC 80 TH and Project Amenities 80 $8,137,372 $101,717
Bethesda, MD 309 SF and TH (Highly amenitized, offsite costs) 309 $40,681,529 $131,655
Average $97,659
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 115
St. Elizabeth's East Site - Parcel 6
As previously stated, we assume that the parking for the townhomes will be reserved space on
the road. We assume that the cost to develop those onsite parking spaces is included in the
horizontal costs for the subject.
We have not included indirect costs/soft costs for this projection since we will discuss overhead,
maintenance costs, etc. later on in this section.
Improvements (Structures) Retail Store
Live-Work
Townhomes Appliances Subtotal
MVS Improvement Type
Retail Stores
(353)
Town Houses
(401)
Residences and
Motels Built-Ins
Construction Class A D
Quality Excellent to Good Good Good
MVS Section 13 12 12
MVS Page 26 31 41
Source Date 5/1/2022 8/1/2024 8/1/2022
Base Cost PSF $219.50 $160.00 $3,750.00
Has Sprinklers? Yes Yes Yes
+ Sprinklers $5.43 $4.14 $0.00
+HVAC (var. from base) $0.00 $0.00 $0.00
Other $0.00 $0.00 $0.00
Adjusted Base Cost PSF $224.93 $164.14 $3,750.00
Height & Size Refinements
# of Stories Multiplier 1.000 0.990 1.000
End/Interior Unit Multiplier 1.000 0.997 1.000
Area Multiplier 0.945 0.945 1.000
Adjusted Base Cost $212.56 $153.05 $3,750.00
Final Calculations
Current Cost Multiplier 1.040 1.020 1.020
Local Area Multiplier 1.050 1.020 1.000
Other Multiplier (Site Congestion, etc.) 1.000 1.000 1.000
Adjusted Base Cost $232.12 $159.24 $3,825.00
x Structure Size (SF GBA per building) 5,280 13,120 8 547,294
Adjusted Cost per Building $1,225,569 $2,089,169 $30,600 $175,612,694
x Number of Buildings 1 1 1 7
Total Adjusted Cost $1,225,569 $2,089,169 $30,600 $3,345,337
Site Improvements $0 $0
+ Indirect Costs @ 0.00% $0 $0 $0 $0
MVS Indicated Cost New Before Profit $1,225,569 $2,089,169 $30,600 $3,345,337
Compiled by Newmark
Building and Site Improvements - Cost Summary (Live-Work Townhomes)
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 116
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Contingency
Our discussions with speculative land purchasers, builders, and brokers indicate that prospective
purchasers would likely include a contingency allowance to address any unexpected factors.
Thus, we have modeled a 5% contingency.
Overhead or General and Administrative
General and administrative charges can cover project overhead and costs, including developer’s
office expenses, accountants, the management staff along with supporting clerical and secretarial
field supervision personnel, insurance premiums, travel and veh icle expenses, and
miscellaneous. We assume that general and administrative expense will also cover the carrying
costs associated with the real estate taxes for the site prior to being subdivided.
The Sponsor’s budget does not include a line item associated with project overhead/general and
administrative. For our analysis, we have allocated $ 10,000 per year ($ 5,000 per period) to
account for overhead of the project. This includes the carrying costs associated with the real
estate taxes for the subdivided lots prior to them being sold. This is due to the smaller size of the
project and the limited overall responsibilities that will be associated with the property.
Commissions and Marketing Costs
Marketing and sales expenses include commissions, advertising, and all other items required in
attracting buyers, including carrying costs associated with model units. Marketing overhead and
sales management is typically projected at 1.5% to 3.0% of gross sales. Other selling expenses
are typically budgeted at 4.0% to 6.0% of gross sales, and include commissions to outside
brokers, salaries and commissions for on-site sales personnel, and closing costs that are borne
by the seller. Considering the characteristics of the Subject project, including its size and projected
price points, we project residential marketing and sales expenses at 8.00% of gross sales
proceeds.
Settlement Costs
Settlement expenses include closing costs borne by the seller and all other items required in
making the transfer of finished lots. Our discussions with developers indicated that settlement
fees and legal and miscellaneous fees for closings would be 2.0% of sale receipts, which includes
the District of Columbia’s 1.45% transfer tax (typically paid by the seller).
Property Owners Association (POA/HOA)
During the sell-out period, the developer is responsible for the operation of the property owner’s
association, including roadway maintenance, landscaping, and security, as well as maintenance
of the open space. The most typical obligation is to make up the HOA shortfall. We have reviewed
the POA/HOA fees for the townhomes we reviewed in our survey earlier in this appraisal. Most of
these properties did not have a HOA fee associated with the sale.
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We assume that the HOA would have to take care of basic needs for the residential homes during
the sell-off including lawn maintenance. This expense should be relatively low.
Considering all factors, we project HOA charges to the developer of $ 25 annually per unsold
townhome per month.
Developer Profit and Discounting
As an incentive for an investor to purchase the lots and market the lots over a lengthy period, a
developer profit is required. The preceding analysis includes all remaining direct and indirect costs
of development. The developer typically creates, coordinates, and oversees the investment and
is entitled to the entrepreneurial profit the venture creates. Accordingly, this expertise must be
rewarded.
There are two general methods for applying appropriate rates of return, and both recognize that
engaging in a future sales program over time provides a riskier income stream than conventional
stabilized real estate investment properties. One method is to apply a single higher rate to the
projected cash flows. A second method is to bifurcate the risk elements by ap plying a typical
discount rate associated with the characteristics of real estate investment, and to deduct a
separate profit amount to compensate for the return necessary for incurring the risk of selling
each individual unit on a speculative basis.
We have selected one of the more commonly used formats in implementing our development
analysis, incorporating all entrepreneurial profit and project management in the discount rate
(weighted average cost of capital). We have considered the subject project with regard to its risk
in relation to other investments, liquidity, projected absorption period, and our ability to obtain
information on return expectations from market participants.
In our analysis, we have considered profit in relation to several major components, the risk and
management services to obtain the approvals; develop the project; market the units; and manage
the project during sell-out. In contrast to typical investment-grade real estate, land developments
require higher rates of return because of higher market risk exposure, less certain or quantifiable
demand, high initial capital outlays, and the property is a diminishing asset (no property reversion
is available at the end of the holding period) with minimal tax shelter advantage.
The greatest risk associated with subdivision development or investment is associated with the
ability of the development to sustain sales volume over time. Due to the relatively small size of
the subject, this factor will not be as much of a risk as typically associated within larger
subdivisions.
The primary national sources for land development rates are RealtyRates.com and PwC Real
Estate Investor Survey although this data is focused on retail, office, and other investment
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 118
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property developments rather than residential. This data is given below but it should be noted it
is an equity discount rate.
Testing locally yields a range of rates. These are best extracted in situations where the buyer of
a property has clear cost estimates and we can apply their projections for the pricing and pace,
or our best estimates at the time. These rates are typically in the range of 15% to 20%. We note,
however, that the rates are lower for small batches of finished lots. Oftentimes, the builder is not
looking for significant profit on these acquisitions but views the cost as part of the overall
construction expense.
According to the 4th Quarter 2024 PwC Real Estate Investor Survey, reported discount rates on
an unleveraged basis, including developers' profit for the national development land market,
averaged 17.00%, down from 19.13% in the 4th Quarter of 2024.
Free-and-clear discount rates including developer’s profit range from 1 2.00% to 30.00% and
average 17.00% this quarter (see exhibit below). This average is 213 basis points lower than six
months ago, and assumes entitlements are in place. Without entitlements in place, certain
investors will increase the discount rate an average of 125 basis points. The reported average
IRR assumes that entitlements are in place.
In the case of the RealtyRates.com data, these are indications of returns to equity only meaning
that they must be converted to the overall discount rate required for this analysis. Typically, an
overall rate would be lower than an equity rate. The PwC data is indicative of overall rates, but it
is derived from both commercial and residential development. The RealtyRates.com, PwC, and
market participant rates are pro forma rates in that they are expectations rather than actual
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 119
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performance. However, pro forma rates are considered to be better indicators of buyer behavior
because the decision to purchase is based on expectations.
The rates for subdivisions reflect anticipated returns for land that has entitlements in place, but
which is not improved. For subdivisions, site -built residential less than 100 units, discount rates
range from 19.08% to 35.82%, with an average of 2 6.90%. Pro forma rates range from 18.31%
to 34.38% with an average of 25.82%. This is compared to the pro forma rates reported in 3rd
Quarter 2024, 18.49% to 34.56%% with an average of 26.00%. It appears that discount rates are
trending downward.
We have also considered the rates associated with residential condominium development in the
Mid-Atlantic region as well, shown below.
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It is the general perception of the market that the results of this survey tend to lag the marketplace
so that if trends are improving, it may be on the conservative side. Or conversely, if the market is
weakening, it could be overly optimistic.
In the case of RealtyRates.com, the rates reflect anticipated returns for land that has entitlements
in place, but which is not improved. The Condominium category also typically includes a profit
factor over and above the IRR. Due to the subject’s urban lo cation, we consider the appropriate
discount rate to be slightly lower than traditional subdivision rates but higher than the rates
typically applied for urban homes/condominium units.
In our selection of an appropriate discount rate, we have considered the following factors which
impact developer/investor risk and are reflected in higher or lower discount rates and ultimately
residual land value:
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 121
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Positive Attributes (Lower Rate) Potential Issues & Risks (Higher Rate)
– Small subdivision with a shorter holding time.
– Some infrastructure/site improvements are
already in place (frontage on a street).
– High demand for affordable housing within the
District but a limited supply of new residential
single-family homes for purchase.
– Increasing home sale prices over the past
three years for the District as well as observed
decreases in discount rates for land
development over the past six months.
– Construction risk is a factor since the site
work and construction of the units has not
been completed.
– Lack of entitlements as of the effective date
increases risk of development.
– Slightly elevated interest rates for residential
home purchases.
– Limited new product has been brought to
market east of the Anacostia River over the
past few years. Most of the recent projects
have been very small and include a large
affordable housing component like the
Subject.
Considering all factors, the subject project is low to moderate risk primarily due to its relatively
small size and the strength of the overall market, with most of the non-construction risk related to
uncertainty as to achievable end-unit pricing due to the lack of directly comparable new for -sale
product in the immediate area.
For the market value as is, we utilize a projected development schedule where vertical
development will be completed by October 1, 2026 and all the units will have been built over a
period of 18 months.
Based on this analysis, we conclude to a discount rate of 18.00%.
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 122
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Concluded Market Value Under Development Plan – Residential Subdivision
By subtracting all costs necessary to complete the proposed development from the prospective
at-completion value, we arrive at the following residual land value for section that will be develop
into a residential subdivision under Development Plan, as of the effective date of this appraisal.
Development Analysis - Market Value As Is
Development Assumptions Development Cost Assumptions
Inflation - Costs 1 Escalator-Sale Price 1.50%
Units 8 TH Lots RE Taxes 0.85% Settlement Costs 2.00%
Analysis Period 2 per year Development Costs - Horizontal $3,345,337 HOA Fees per Home $25
Development Costs - Vertical $360,000 Option Revenue 0.00%
# of Phase 1 Townhomes 8 $437,550 Marketing/Sale Commissions 8% Contingency Cost 5.00%
Maintenance/Overhead/G&A $5,000
Period 1 2 3 4 5 6 Totals
Beginning 4/1/2025 9/29/2025 4/1/2026 9/29/2026 4/1/2027 9/29/2027
Absorption
Phase 1 TH Sales 0 0 0 0 0 6 2 8
Remaining Inventory 8 8 8 8 8 2 0
Phase 2 TH Retail Price $437,550 $444,113 $450,775 $457,537 $464,400 $471,366 $478,436
Inflation Factor - Prices 1.000 1.015 1.030 1.046 1.061 1.077 1.093
Inflation Factor - Costs 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Cash Receipts
Phase 1 TH Sales Receipts $0 $0 $0 $0 $2,828,194 $956,872 $3,785,066
Options Revenue 0.00% $0 $0 $0 $0 $0 $0 $0
Total Cash Receipts $0 $0 $0 $0 $2,828,194 $956,872 $3,785,066
Cash Disbursements
Maintenance/Overhead/G&A $5,000 $5,000 $5,000 $5,000 $5,000 $2,500 $27,500
Development Costs - Horizontal $0 $0 $360,000 $0 $0 $0 $360,000
Development Costs - Vertical $0 $0 $1,115,112 $1,115,112 $1,115,112 $0 $3,345,337
Contigency on Costs 5.0% $0 $0 $55,756 $55,756 $55,756 $0 $167,267
Subtotal Development Costs $5,000 $5,000 $1,535,868 $1,175,868 $1,175,868 $2,500 $3,900,104
Marketing/Sale Commissions $0 $0 $0 $0 $226,255 $76,550 $302,805
Settlement Costs 2.00% $0 $0 $0 $0 $56,564 $19,137 $75,701
HOA Fees per Lot $1,200 $1,200 $1,200 $1,200 $750 $600 $6,150
Property Taxes $15,100 $15,326 $15,556 $15,790 $40,066 $8,133 $109,972
Total Cash Disbursements $21,300 $21,526 $1,552,624 $1,192,858 $1,499,504 $106,921 $4,394,732
Residual Value of Land
Cash Receipts - Bulk $0 $0 $0 $0 $2,828,194 $956,872 $3,785,066
Less: Cash Disbursments $21,300 $21,526 $1,552,624 $1,192,858 $1,499,504 $106,921 $4,394,732
Net Residual Value - Land -$21,300 -$21,526 -$1,552,624 -$1,192,858 $1,328,690 $849,952 -$609,666
Discount Factor - Lots 18.00% 0.92057 0.84746 0.78015 0.71818 0.66114 0.60863
Net Present Value -$19,608 -$18,243 -$1,211,277 -$856,692 $878,453 $517,307 -$710,059
Value Rounded -$700,000
Compiled by NKF
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 123
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As shown, our analysis indicates a substantially negative residual value. Accordingly, we
conclude that the Development Plan is not feasible absent some type of outside subsidy.
Newmark notes that our negative residual value is generally consistent with the level of projected
affordability in this scenario.
We conclude the Market Value of this part of the subject (mixed-use buildings) , under the
Development Plan requirements is negative, as the project is not feasible absent significant
subsidies.
PROJECT DESIGN AND VALUATION OF MIXED-USE BUILDINGS
For this section, we have focused on the two mixed -use buildings. It will be developed into a
midrise multifamily building with 507 units, 17,700 SF of retail space, and 185 parking spaces in
total. From our review of the information provided by the Sponsor, the proposed Development
Plan for this section is as follows:
Total Revenue for Entire Project $3,785,066
Expenses $4,394,732
Total Cash Revenue for Entire Project -$609,666
Discount Factor 18%
Net Present Value -$710,059
Rounded -$700,000
Compiled by Newmark
Residual Analysis - Residential Subdivision
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 124
St. Elizabeth's East Site - Parcel 6
For our assumptions above, we assume that it will take 12 months to complete the pre -
development period for the property. This typically includes obtaining building plans, permits, and
approvals required to begin construction. We project a construction period of 24 months which is
typical of the market.
Multifamily Unit Mix
The proposed unit mix, per the provided information, is as follows:
Date No. of Months
Inspection Date/Current Figures Date 3/21/2025
Analysis Begins 3/21/2025
Pre-Development Period Ends 3/23/2026 12
Construction Completion 3/23/2028 24
Stabilization Date 2/1/2030 22
% SF of GBA SF of RBA
Total Density 472,639 380,905
Commercial Density (FAR - Retail) 18,632 17,700
Residential Density (FAR - Multifamily) 454,007 363,205
Market Rent Density 70.0% 63,531 254,120
Affordable Dwelling Unit (ADU) Density 30.0% 27,271 109,085
Implied Core Factor for Residential 20.0% 90,802
Estimated Average Unit Size (SF of RBA) 716
Total # of Units 507
Approximate # of Market Units 355
Approximate # of Affordable Units 152
Parking Ratio # of Spaces
Estimated Required Parking Spaces for Multifamily Section 0.17/unit 84
Estimated Required Parking Spaces for Retail Section 0.59/1,000 SF 11
Provided Parking Spaces 0.37/unit 185
Compiled by Newmark
Mixed-Use Buildings Project Details (Multifamily and Retail)
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 125
St. Elizabeth's East Site - Parcel 6
Multifamily Market Rent Analysis
In estimating the market rent for the Subject Property, we utilize the previously discussed
multifamily rent comparables. Based on this analysis we conclude to the following market rent
terms for the Subject’s proposed units.
No. Units Unit Description
Unit Size
(SF)
Rentable
Area (SF)
Occupied
Units
Unit
Occupancy
61 0 BR/1 BA - 480 SF 480 29,280 0 0.0%
6 0 BR/1 BA 30% AMI - 480 SF 480 2,880 0 0.0%
19 0 BR/1 BA 50% AMI - 480 SF 480 9,120 0 0.0%
86 0 BR Total 480 41,280 0 0.0%
195 1 BR/1 BA - 660 SF 660 128,700 0 0.0%
21 1 BR/1 BA 30% AMI - 660 SF 660 13,860 0 0.0%
63 1 BR/1 BA 50% AMI - 660 SF 660 41,580 0 0.0%
279 1 BR Total 660 184,140 0 0.0%
88 2 BR/2 BA - 955 SF 955 84,040 0 0.0%
10 2 BR/2 BA 30% AMI - 955 SF 955 9,550 0 0.0%
29 2 BR/2 BA 50% AMI - 955 SF 955 27,695 0 0.0%
127 2 BR Total 955 121,285 0 0.0%
11 3 BR/2 BA - 1,100 SF 1,100 12,100 0 0.0%
1 3 BR/2 BA 30% AMI - 1,100 SF 1,100 1,100 0 0.0%
3 3 BR/2 BA 50% AMI - 1,100 SF 1,100 3,300 0 0.0%
15 3 BR Total 1,100 16,500 0 0.0%
507 Totals 363,205 0
Averages 716 0.0%
Compiled by Newmark
Unit Mix - Mixed-Use Buildings
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 126
St. Elizabeth's East Site - Parcel 6
Property Name Unit Type Size (SF)
Average Rent
($/month) Average Rent/SF
Studio Units
Stratos at Bridge District 0 BR/1 BA 521 $2,665 $5.12
Alula at Bridge District 0 BR/1 BA 396 $2,003 $5.06
Jayde Parkside 0 BR/1 BA 531 $1,657 $3.12
Vesta Parkside 0 BR/1 BA 568 $1,791 $3.15
Link Apartments H Street 0 BR/1 BA 437 $2,082 $4.76
Park Kennedy 0 BR/1 BA 524 $1,685 $3.22
Blackbird Apartments 0 BR/1 BA 429 $1,953 $4.55
1600 Penn 0 BR/1 BA 366 $1,659 $4.53
Beckert's Park 0 BR/1 BA 571 $2,195 $3.84
Average 483 $1,966 $4.15
SUBJECT CONCLUSION 480 $1,970 $4.10
1 BR/1 BA Units
Crest at Skyland Town Center 1 BR/1 BA 630 $1,964 $3.12
31-Unit Apartment Building 1 BR/1 BA 550 $1,605 $2.92
Stratos at Bridge District 1 BR/1 BA 733 $3,223 $4.40
Alula at Bridge District 1 BR/1 BA 655 $2,553 $3.90
Jayde Parkside 1 BR/1 BA 676 $1,909 $2.82
Vesta Parkside 1 BR/1 BA 734 $1,975 $2.69
Link Apartments H Street 1 BR/1 BA 642 $2,299 $3.58
Park Kennedy 1 BR/1 BA 741 $2,210 $2.98
Blackbird Apartments 1 BR/1 BA 601 $2,252 $3.75
1600 Penn 1 BR/1 BA 588 $2,106 $3.58
Beckert's Park 1 BR/1 BA 721 $2,690 $3.73
Average 661 $2,253 $3.41
SUBJECT CONCLUSION 660 $2,260 $3.42
2 BR/2 BA Units
Crest at Skyland Town Center 2 BR/2 BA 1,048 $2,798 $2.67
31-Unit Apartment Building 2 BR/1 BA 650 $1,933 $2.97
Stratos at Bridge District 2 BR/2 BA 1,027 $4,559 $4.44
Alula at Bridge District 2 BR/2 BA 912 $3,778 $4.14
Jayde Parkside 2 BR/2 BA 966 $2,661 $2.75
Vesta Parkside 2 BR/2 BA 963 $2,435 $2.53
Link Apartments H Street 2 BR/2 BA 1,081 $3,611 $3.34
Blackbird Apartments 2 BR/2 BA 956 $3,046 $3.19
1600 Penn 2 BR/2 BA 904 $2,720 $3.01
Beckert's Park 2 BR/2 BA 994 $3,606 $3.63
Average 950 $3,115 $3.28
SUBJECT CONCLUSION 955 $3,120 $3.27
3 BR/2 BA Units
31-Unit Apartment Building 3 BR/1 BA 850 $2,147 $2.53
Blackbird Apartments 3 BR/2 BA 1,086 $4,634 $4.27
Beckert's Park 3 BR/2 BA 1,365 $5,307 $3.89
Average 1,100 $4,029 $3.66
SUBJECT CONCLUSION 1,100 $3,750 $3.41
Compiled by Newmark
Market Rent Conclusion
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 127
St. Elizabeth's East Site - Parcel 6
Affordable Unit Rent Analysis
The following are tables which show the maximum affordable rent limits based on the median
family income for the Washington Metropolitan Statistical Area, as published by the U.S.
Department of Housing and Urban Development (HUD) on April 1, 202 4. These rents were
effective for the D.C. area as of August 30, 2024.
Source: D.C. Department of Housing and Community Development, 2024
Typically, new multifamily properties require tenants to cover all utilities. As a result, these
maximum rents must be adjusted downward to include a utility allowance. Utility allowances are
based on the following data provided by the D.C. Department of H ousing and Community
Development where we assume electric service.
Source: D.C. Department of Housing and Community Development, 2024
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 128
St. Elizabeth's East Site - Parcel 6
Multifamily Market Rent Conclusions
The following is a summary of the subject’s unit mix and our rent conclusions based on our
analysis of comparable market data and inclusionary zoning schedule detailed in the preceding.
Commercial Rent Roll
As noted, the subject includes two segments – a multifamily component and a retail component.
The commercial segment will now be addressed. The Subject will include 17,700 SF of retail
space.
No. Units Unit Description
Unit Size
(SF)
Rentable
Area (SF)
Occupied
Units
Unit
Occupancy Market Rent
Market Rent
PSF
61 0 BR/1 BA - 480 SF 480 29,280 0 0.0% $1,965 $4.09
6 0 BR/1 BA 30% AMI - 480 SF 480 2,880 0 0.0% $560 $1.17
19 0 BR/1 BA 50% AMI - 480 SF 480 9,120 0 0.0% $1,010 $2.10
86 0 BR Total 480 41,280 0 0.0% $1,656 $3.45
195 1 BR/1 BA - 660 SF 660 128,700 0 0.0% $2,250 $3.41
21 1 BR/1 BA 30% AMI - 660 SF 660 13,860 0 0.0% $519 $0.79
63 1 BR/1 BA 50% AMI - 660 SF 660 41,580 0 0.0% $1,029 $1.56
279 1 BR Total 660 184,140 0 0.0% $1,844 $2.79
88 2 BR/2 BA - 955 SF 955 84,040 0 0.0% $2,850 $2.98
10 2 BR/2 BA 30% AMI - 955 SF 955 9,550 0 0.0% $588 $0.62
29 2 BR/2 BA 50% AMI - 955 SF 955 27,695 0 0.0% $1,198 $1.25
127 2 BR Total 955 121,285 0 0.0% $2,295 $2.40
11 3 BR/2 BA - 1,100 SF 1,100 12,100 0 0.0% $3,390 $3.08
1 3 BR/2 BA 30% AMI - 1,100 SF 1,100 1,100 0 0.0% $666 $0.61
3 3 BR/2 BA 50% AMI - 1,100 SF 1,100 3,300 0 0.0% $1,376 $1.25
15 3 BR Total 1,100 16,500 0 0.0% $2,806 $2.55
507 Totals 363,205 0
Averages 716 0.0% $1,953 $2.73
Compiled by Newmark
Unit Mix - Mixed-Use Buildings
Rentable Rem.
Tenant Area (SF) Start End Mos. MLA Category $ Total $ PSF
Vacant - Building 2 2,900 0 Ground Floor Retail $101,500 $35.00
Vacant - Building 2 2,900 0 Ground Floor Retail $101,500 $35.00
Vacant - Building 1 2,975 0 Ground Floor Retail $104,125 $35.00
Vacant - Building 1 2,975 0 Ground Floor Retail $104,125 $35.00
Vacant - Building 1 2,975 0 Ground Floor Retail $104,125 $35.00
Vacant - Building 1 2,975 0 Ground Floor Retail $104,125 $35.00
Vacant 17,700 $619,500 $35.00
Total (Average) 17,700 0 $619,500 $35.00
Compiled by Newmark
Rent Roll
Lease Term Year 1 Market Rent
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 129
St. Elizabeth's East Site - Parcel 6
We subdivide the ground floor retail space into six suites with a typical unit size that ranges from
2,900 SF to 2,975 SF, which is typical of the submarket. For our analysis, we will conclude to a
general market rent for this space.
Market Rent Conclusions
Per our previous analysis, we conclude to the market rent terms shown below.
We conclude to these blended market lease terms for the retail space. We assume that suites
leased towards the be ginging of the marketing phase may receive a higher amount of
concessions (more free rent, higher tenant improvement allowance, etc.) in order to quickly lease
up part of the retail space. Towards the end of the marketing phase, tenants would require a
reduced amount of concessions.
MLA Category Rentable SF Market Rent Measure
Term
(Mos.) Mos. Free
Ground Floor Retail Space: 17,700 $35.00 $/SF/Year 3.00%/year 120 3
MLA Category Renewal %
Rollover Vacant
Mos.
Weighted
Down-time TI/SF (New)
TI/SF
(Renewal)
Weighted
TI/SF LC (New)
LC
(Renewal)
Weighted
LC
Ground Floor Retail Space: 60% 2 1 $25.00 $15.00 $19.00 5.00% 3.00% 3.80%
Compiled by Newmark
Triple Net
Concluded Market Lease Terms
Rent Escalations Reimbursement Method
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 130
St. Elizabeth's East Site - Parcel 6
Gross Income Estimate
Potential Gross Rent - Multifamily
For this analysis, potential gross rent is based on market/restricted rents for each of the units.
Concessions - Multifamily
As previously discussed, we did not include any concessions in our analysis; however, we have
offered concessions (1 month of free rent per 12 -month lease) during initial lease -up of the
property.
Potential Rental Income - Multifamily
Unit Description No. Units
Market Rent /
Unit
Potential
Gross Rent-
Market
Vacant Units (at market rents)
0 BR/1 BA - 480 SF 61 $1,965 $1,438,380
0 BR/1 BA 30% AMI - 480 SF 6 $560 $40,320
0 BR/1 BA 50% AMI - 480 SF 19 $1,010 $230,280
1 BR/1 BA - 660 SF 195 $2,250 $5,265,000
1 BR/1 BA 30% AMI - 660 SF 21 $519 $130,788
1 BR/1 BA 50% AMI - 660 SF 63 $1,029 $777,924
2 BR/2 BA - 955 SF 88 $2,850 $3,009,600
2 BR/2 BA 30% AMI - 955 SF 10 $588 $70,560
2 BR/2 BA 50% AMI - 955 SF 29 $1,198 $416,904
3 BR/2 BA - 1,100 SF 11 $3,390 $447,480
3 BR/2 BA 30% AMI - 1,100 SF 1 $666 $7,992
3 BR/2 BA 50% AMI - 1,100 SF 3 $1,376 $49,536
Total Vacant 507 $1,953 $11,884,764
Grand Total 507 $1,953 $11,884,764
Compiled by Newmark
Potential Gross Rent
Concessions
Subject % of RI $/Unit Total
Newmark Projection 0.00% $0 $0
Compiled by Newmark
Potential Rental Income
Subject $/Unit Total
Newmark Projection $23,441 $11,884,764
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 131
St. Elizabeth's East Site - Parcel 6
Vacancy & Collection Loss Allowance - Multifamily
Per our analysis and review of comparables and market analysis earlier in this appraisal , total
stabilized vacancy allowance is 4.00%. We set collection loss at 0. 50%. Based on this, we
conclude to a vacancy and collection loss allowance of 4.50%.
Effective Rental Income - Multifamily
Net Expense Recoveries - Multifamily
We project expenses on a “net” basis, with the landlord presumed to be responsible only for
common area utilities. Accordingly, no reimbursement income is projected.
Net Parking Income
– The subject includes 185 parking space.
– Per our previous analysis, we conclude to a parking fee of $150/month/space
Vacancy
Subject % of PGI $/Unit Total
Newmark Projection 5.50% $1,289 $653,662
Compiled by Newmark
Collection Loss
Subject % of PGI $/Unit Total
Newmark Projection 0.50% $117 $59,424
Compiled by Newmark
Vacancy and Collection Loss - Units
Subject % of PGI $/Unit Total
Newmark Projection 6.00% $1,406 $713,086
Compiled by Newmark
Effective Rental Income
Subject % of PGI $/Unit Total
Newmark Projection 94.00% $22,035 $11,171,678
Compiled by Newmark
Net Parking Income
Subject $/Unit Total
Newmark Projection $621 $314,712
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 132
St. Elizabeth's East Site - Parcel 6
– We project a parking income of $ 319,734, or $631 per unit assuming a vacancy rate
of 4.50% ($150 per month x 12 months x 186 spaces x 95.50% occupancy).
Net Other Income
– Other income typically includes amenity rentals, pet rent, cable, and other income like
storage rental.
– Per our previous analysis, we apply a net other income amount of 3.00% of the EGI
for the multifamily section of the property.
Effective Gross Income - Multifamily
The following depicts the total effective gross income for the property.
Potential Gross Rent - Commercial
Figures presented below reflect the 12-month period following the effective date of the appraisal.
For this analysis, potential gross rent is based on market rent.
Expense Recoveries - Commercial
The subject’s contract tenants will have a triple net lease structure where the tenants cover all
operating expenses, excluding management fees, per the Sponsor’s pro forma. Furthermore,
triple net lease structures are typical of retail tenants in the market. Therefore, we don not project
expense recoveries for the subject property.
Net Other Income
Subject $/Unit Total
Newmark Projection $701 $355,245
Compiled by Newmark
Effective Gross Multifamily Income
Subject $/Unit Total
Newmark Projection $23,356 $11,841,635
Compiled by Newmark
Leased Potential Rent At Market
MLA Category SF Annual $/SF/Yr
Vacant Space (at market rents)
Ground Floor Retail Space: 17,700 $619,500 $35.00
Vacant Space Total 17,700 $619,500 $35.00
Overall Total 17,700 $619,500 $35.00
Compiled by Newmark
Potential Gross Rent
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 133
St. Elizabeth's East Site - Parcel 6
Vacancy & Collection Loss Allowance – Commercial
We conclude to a stabilized vacancy and collection loss allowance for the subject of 4.00% (5.0%
vacancy and 1.0% collection loss).
Effective Gross Income – Commercial
Effective Gross Income - Overall
The following depicts the total effective gross income for the property.
Operating Expense Analysis
Expense data for comparable properties are summarized in the following table.
Effective Gross Commercial Income
Subject $/Unit Total
Newmark Projection $1,173 $594,720
Compiled by Newmark
Effective Gross Income
Subject $/Unit Total
Newmark Projection $24,529 $12,436,355
Compiled by Newmark
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 134
St. Elizabeth's East Site - Parcel 6
Our projection is heavily based on the expense comparables shown above with the exception of
the real estate taxes, general and administrative, management, and replacement reserves.
Note, we included a real estate tax expenses based on loaded capitalization rate analysis. The
Subject Property’s income/rent restrictions per the Development Plan makes projection of tax
expenses based on assessments of comparable properties impossible. I nstead, we utilize a
loaded capitalization rate analysis, in which the applicable tax rate of 0.85% is added to the
capitalization rate. Otherwise, our expense projections are highly consistent with the comparable
data, brand new Class A apartment properties in the market.
We app ly a slightly elevated general and administrative expense since properties with rent -
restricted units typical have higher expense due to the additional work and reporting required to
make sure that the units are in compliance.
Comp 1 Comp 2 Comp 3 Comp 4 Comp 5
Year Built 2021 2018 2019 2016 2020 AVERAGE
SF 300,478 194,453 121,557 172,908 270,123
Number of Units 387 198 173 227 308
Average Unit Size (SF) 776 982 703 762 877
Operating Data Type Trailing-12 Trailing-12 Actual Actual Actual
Year 2024 2023 2021 2021 2023
Effective Gross Multifamily Income Per Unit $27,372 $37,630 $36,343 $32,321 $32,499 $33,233
Effective Gross Commercial Income Per Unit $0.00 $2,945 $2,906 $1,534 $0.00
Effective Gross Income Per Unit $27,372 $40,575 $39,249 $33,855 $32,499 $33,233
Operating Expenses Per Unit
Real Estate Taxes $2,752 $3,659 $2,916 $3,651 $4,162 $3,428
Insurance $820 $316 $386 $397 $604 $505
Utilities $1,922 $2,075 $2,227 $1,213 $1,550 $1,797
Repairs and Maintenance $1,969 $1,521 $2,016 $1,591 $1,829 $1,785
Payroll and Benefits $2,461 $3,289 $4,255 $2,830 $2,177 $3,002
General and Administrative $1,176 $1,006 $680 $583 $691 $827
Advertising and Marketing $376 $214 $809 $313 $270 $428
Management $590 $543 $772 $749 $1,130 $757
Replacement Reserves
Total Operating Expenses Per Unit $12,066 $12,623 $14,061 $11,327 $12,413 $12,530
Total Operating Expense Per Unit Excluding RET $9,314 $8,964 $11,145 $7,676 $8,251 $9,102
Net Operating Income Per Unit $15,306 $27,952 $25,188 $22,528 $20,086 $20,703
Operating Expense KPIs (% of EGI)
Management 2.16% 1.34% 1.97% 2.21% 3.48% 2.28%
Operating Expense Ratio (% of EGI) 44.08% 31.11% 35.83% 33.46% 38.20% 37.70%
Net Operating Income (% of EGI) 55.92% 68.89% 64.17% 66.54% 61.80% 62.30%
Compiled by Newmark
Expense Analysis Per Unit
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 135
St. Elizabeth's East Site - Parcel 6
We apply a management expense that is roughly 3.00% of the EGI for the multifamily section of
the property, which is in line with our expense comparables on a per unit basis.
While the expense comparables did not report a reserve line item as an operating expense, it is
customary to include replacement reserves as an expense line item in development an estimate
of the net operating income for direct capitalization purposes. Rep lacement reserves are
estimated to account for replacement costs of certain capital items, such as the roof and HVAC
system. We project a replacement reserve of $250 per unit based on the proposed condition of
the property.
The loaded capitalization rate analysis and projected operating expenses is as follows:
Stabilized Pro Forma (Effective Date) $/Unit
Effective Gross Income - Multifamily $11,841,635 $23,356
Effective Gross Income - Commercial $0.00
Expenses (excluding Real Estate Taxes)
Insurance $253,500 $500
Utilities $912,600 $1,800
Repairs and Maintenance $907,530 $1,790
Payroll and Benefits $1,521,000 $3,000
General Administrative $507,000 $1,000
Advertising and Marketing $152,100 $300
Management 3.00% of EGI $355,249 $701
Replacement Reserves $126,750 $250
Total Expenses $4,735,729 $9,341
Net Operating Income
Going-in Capitalization Rate (As if Stabilized) 5.00%
Estimated Ad Valorem Tax Rate 0.85%
Loaded Capitalization Rate 5.85%
Implied Assessed Value @ 100% of Market Value as of Effective Date $80,952,633 $159,670
Rounded $80,950,000 $159,665
Implied Assessed Value @ 90% of Market Value as of Effective Date $72,855,000 $143,698
Estimated Ad Valorem Tax Rate 0.85%
Estimated Ad Valorem Taxes as of Effective Date $619,268 $1,221
Compiled by Newmark
Loaded Going-in Capitalization Rate Analysis
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 136
St. Elizabeth's East Site - Parcel 6
Direct Capitalization Assumptions
Capitalization Rate Conclusion
As previously discussed, we apply a capitalization rate of 5.00% for the multifamily section and
6.25% for the retail section.
Adjustments to Value
Capitalization of the projected stabilized net operating income results in an As Stabilized value
indication as of the effective date of this appraisal. The As Is value indication is derived by making
additional deductions for construction costs and lease-up expenses.
Projected Escalation Rate
From our discussion with land developers in the market, developers have included inflation when
determining the current value of land on a residual basis for multifamily properties. Therefore,
property inflation is “baked” into the current purchase price of land.
Taking this into consideration, while also trying to maintain a somewhat apples -to-apples
comparison of the valuation analysis and market participant behavior, we estimate the market
value “as is” by making lease -up cost and construction cost deductions from the prospective
market value at completion.
We apply an escalation factor of 2.50% annually based on the previously shown PwC data
Stabilization Discount Estimate – Multifamily Section
We conclude to the following lease-up costs for the Subject’s proposed multifamily section.
Source Indication
Comparable Multifamily Sales Range 4.75% - 5.50%
Investor Surveys 6.00% - 6.50%
Market Participants 5.00% - 5.50%
Concluded Going-In Capitalization Rate - Multifamily 5.00%
Concluded Going-In Capitalization Rate - Retail 6.25%
Concluded Blended Capitalization Rate 5.10%
Compiled by Newmark
Capitalization Rate Conclusion - Multifamily
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 137
St. Elizabeth's East Site - Parcel 6
For our valuation, we assume that property will have a faster absorption pace than typical due to
30% of the units being affordable housing. As a result, we apply an absorption pace of 20 units
per month. This results in a lease-up period of 25 months. We assume three months of pre -
leasing. Based on this analysis, we conclude to a lease-up period of 22 months following the
delivery of the property in 36 months (April 1, 2028).
Stabilization Discount Estimate – Retail Section
We conclude to the following lease-up costs for the Subject’s proposed multifamily section.
Direct Capitalization Summary
Valuation of the proposed improvements based on the Development Plan by direct capitalization
is shown in the following table.
Monthly Market Rent Estimate - at Stabilization $990,397 94.00% stab. occ. = $930,973
Stabilization Period 22 Mos.
Income Loss During Stabilization
Monthly Rent Loss $930,973
Divide by Two for Straight Line Stabilization $465,487
Stabilization Period (mos.) 22 Mos.
Total Income Loss During Stabilization $10,240,705
Total Income Loss $10,240,705
Add: Concessions (One Month of Free Rent) $930,973
Add: Profit 20% $2,234,336
Stabilization Discount $13,406,014
Stabilization Discount Inflated to the Date of Completion (4/1/2028) $14,542,704
Rounded $14,500,000
Compiled by Newmark
Multifamily Stabilization Discount
MLA Category
Mos. To
Absorb
Market Rent
($/SF/Yr)
Lease Term
(Mos.)
Est. Op.
Exp. ($/SF) TI/SF
Free Rent
(Mos.)
Leasing
Commission
Discount
Rate
Ground Floor Retail Space: 9 $35.00 120 $0.00 $25.00 3 5.00% 0.00%
Compiled by Newmark
Stabilization Discount - Assumptions
MLA Category Rent Loss Total Revenue
Loss
Tenant
Impvts.
Free Rent /
Concessions
Leasing
Commissions
Total Cash Flow
Loss
Stabilized
Vacancy
Effective Cash
Flow Loss PV Factor PV of Cash
Flow Loss
Ground Floor Retail Space: $464,625.00 $464,625.00 $442,500 $154,875 $309,750 $1,371,750 0.00% $1,371,750 1.000000 $1,371,750
Subtotal $464,625 $464,625 $442,500 $154,875 $309,750 $1,371,750 $1,371,750 $1,371,750
Plus Profit: 20.0% $274,350
Stabilization Discount: $1,646,100
Stabilization Discount Inflated to Date of Completion (4/1/2028): $1,785,672
Rounded: $1,800,000
Compiled by Newmark
Stabilization Discount
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 138
St. Elizabeth's East Site - Parcel 6
Summary of Stabilized Net Operating Income
Item Description % of Income $/Unit Total $
Multifamily Income 507 507 Units
Rental Income $23,441 $11,884,764
Concessions 0.00% $0 $0
Potential Rental Income $23,441 $11,884,764
Vacancy -5.50% ($1,289) ($653,662)
Collection Loss -0.50% ($117) ($59,424)
Effective Rental Income $22,035 $11,171,678
Net Parking Income $621 $314,712
Net Other Income $701 $355,245
Effective Gross Multifamily Income $23,356 $11,841,635
Commercial Income 507 507 Units
Effective Gross Commercial Income $1,173 $594,720
Effective Gross Income $24,529 $12,436,355
Operating Expenses 507 Units
Real Estate Taxes $1,221 $619,268
Insurance $500 $253,500
Utilities $1,800 $912,600
Repairs and Maintenance $1,790 $907,530
Payroll and Benefits $3,000 $1,521,000
General and Administrative $1,000 $507,000
Advertising and Marketing $300 $152,100
Management 2.86% $701 $355,249
Replacement Reserves $250 $126,750
Total Operating Expenses 43.06% $10,562 $5,354,997
Net Operating Income $13,967 $7,081,359
Income Capitalization Approach
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 139
St. Elizabeth's East Site - Parcel 6
Residual Analysis
To arrive at a pre-development land value indication, under the Development Plan for the mixed-
use buildings, we make deductions from the “upon completion” value indicated in the preceding
analysis for construction costs (direct and indirect excluding lease -up costs, which have already
been deducted from the upon -completion value), and required entrepreneurial i ncentive
(developer profit).
Building and Site Improvements
We utilize Marshall Valuation Service cost data to develop an estimate of the cost of completing
the proposed improvements. As previously stated, the subject would require 185 parking space.
We assume the garage will have an efficiency of 375 SF per parking space. Per the Development
Plan information provided, the proposed property will have 1 level of underground parking. This
requires that the underground parking be at least 69,375 SF for each level. Since the property will
have one-level of below grade parking, we assume the site will be excavated 10 feet. Apply site
preparation costs and excavation, we conclude to a site improvements cost of $727,218.
Direct Capitalization Method
$/Unit Total $
Stabilized Net Operating Income $13,967 $7,081,359
Overall Capitalization Rate 5.10%
As Stabilized Value Effective Date: $138,714,722
Rounded $273,570 $138,700,000
Value
$145,857,631
$138,714,722
$132,238,753
Escalated Prospective Stabilized Value Indications Value Indication
Appreciation Factor (per year) 2.75%
Prospective As Stabilized Value as of Date of Completion Effective Date: $150,598,797
Prospective As Stabilized Value as of Date of Stabilization Effective Date: $158,306,982
Estimates of Prospective As Stabilized and Prospective Upon Completion Values
As Stabilized
Prospective As Stabilized Value as of Date of Stabilization Effective Date: $158,306,982
Rounded $312,229 $158,300,000
As Complete
Prospective As Stabilized Value as of Date of Completion Effective Date: $150,598,797
Stabilization Discount - Multifamily ($14,500,000)
Stabilization Discount - Retail ($1,800,000)
Prospective As Complete Value Effective Date: $134,298,797
Rounded $264,892 $134,300,000
Compiled by Newmark
Value Indication
3/21/2025
4/1/2028
4/1/2028
4.85%
5.10%
5.35%
4/1/2028
2/1/2030
OAR
2/1/2030
Valuation Matrix
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 140
St. Elizabeth's East Site - Parcel 6
Our conclusions for the estimated cost of construction via MVS are as follows:
This yields a cost of roughly $271.11/SF for the hard and soft costs. Per our previous analysis of
construction cost comparables for midrise Class A apartments in the MSA, our projection appears
reasonable.
Per the construction cost comparables shown earlier in this appraisal for mid-rise buildings, we
compare those figures to our proposed construction costs via MVS for the Subject Property
below.
Improvements (Structures) Retail Store
Above Grade
Apartments
Below Grade
Parking Appliances Subtotal
MVS Improvement Type
Retail Stores
(353)
Luxury
Apartments (High-
Rise)
Basements - High-
Rise Apartments
Residences and
Motels Built-Ins
Construction Class A C A-B
Quality Good Good Parking Good
MVS Section 13 11 11 12
MVS Page 26 18 19 41
Source Date 5/1/2024 11/1/2024 11/1/2024 8/1/2024
Base Cost PSF $205.00 $176.00 $81.50 $3,750.00
Has Sprinklers? Yes Yes Yes Yes
+ Sprinklers $4.49 $2.74 $3.75 $0.00
+HVAC (var. from base) $0.00 $0.00 $0.00 $0.00
Other $0.00 $0.00 $0.00 $0.00
Adjusted Base Cost PSF $209.49 $178.74 $85.25 $3,750.00
Height & Size Refinements
# of Stories Multiplier 1.000 1.010 1.010 1.010
Ceiling Height Multiplier 1.000 1.000 1.000 1.000
Perimeter Multiplier 1.000 1.000 1.000 1.000
Adjusted Base Cost $209.49 $180.52 $86.10 $3,787.50
Final Calculations
Current Cost Multiplier 1.040 1.040 1.040 1.040
Local Area Multiplier 1.050 1.050 1.050 1.050
Other Multiplier (Site Congestion, etc.) 1.000 1.000 1.000 1.000
Adjusted Base Cost $228.77 $197.13 $94.02 $4,135.95
x Structure Size (SF GBA per building) 18,632 454,007 69,375 507 542,014
Adjusted Cost per Building $4,262,395 $89,499,586 $6,522,795 $2,096,927 $172,267,357
x Number of Buildings 1 1 1 1 5
Total Adjusted Cost $4,262,395 $89,499,586 $6,522,795 $2,096,927 $102,381,703
Site Improvements $727,218 $727,218
+ Indirect Costs @ 20.00% $997,923 $17,899,917 $1,304,559 $419,385 $20,621,784
MVS Indicated Cost New Before Profit $5,987,536 $107,399,503 $7,827,354 $2,516,312 $123,730,706
Compiled by Newmark
Building and Site Improvements - Cost Summary (Development Plan - Mixed-Use Buildings)
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 141
St. Elizabeth's East Site - Parcel 6
Accordingly, we consider our projection to be appropriate and have applied it in our analysis.
Entrepreneurial Profit
Based on our analysis and research, we conclude that an appropriate entrepreneurial profit for
the subject is 15.00%.
We conclude to a replacement cost new value, with profit, based on the current figures ( March
29, 2024).
Residual Analysis – Mixed-Use Buildings
By subtracting all costs necessary to complete the project based on Development Plan, we arrive
at a current indication for the Subject as follows:
As shown, our analysis indicates a substantially negative residual value. Accordingly, we
conclude that the Development Plan for the multifamily section is not feasible absent some type
Reconciliation of Replacement Cost New Before Profit (Development Plan - Mixed Use Bldgs)
Source Total $/SF
Cost Comparables $127,612,530 $270.00
Marshall Valuation ("MVS") $123,730,706 $261.79
Reconciled Replacement Cost New (Before Profit) $123,730,706 $261.79
Compiled by Newmark
Improvements (Structures) Retail Store
Above Grade
Apartments
Below Grade
Parking Appliances Subtotal
Reconciled Cost New Before Profit $5,987,536 $107,399,503 $7,827,354 $2,516,312 $123,730,706
Entrepreneurial Profit @ 15.00% $898,130 $16,109,925 $1,174,103 $377,447 $18,559,606
Replacement Cost New (RCN) $6,885,667 $123,509,428 $9,001,458 $2,893,759 $142,290,312
$ PSF $369.56 $272.04 $129.75 $5,707.61 $262.52
Total Replacement Cost New (RCN) $142,290,312
$/SF-FAR (491,271 SF) $289.64
Compiled by Newmark
Entrepreneurial Profit (Development Plan - Mixed-Use Buildings)
Concluded Value
Prospective Market Value at Completion $134,298,797
Replacement Cost New (with 15% Profit) -$142,290,312
Indicated Value -$7,991,515
Rounded -$8,000,000
Compiled by Newmark
Residual Analysis - Mixed-Used Buildings
DEVELOPMENT ANALYSIS APPROACH (VALUE SUBJECT TO DEVELOPMENT PLAN) 142
St. Elizabeth's East Site - Parcel 6
of outside subsidy. Newmark notes that our negative residual value is generally consistent with
the level of projected affordability in this scenario.
We conclude that the Market Value of the land subject to the Development Plan requirement is
negative, as the project is not feasible absent significant subsidies.
TOTAL RESTRICTED VALUE
By adding the value indications for the two components of the property, which is commonly how
market participants treat this type of development scenario , we reach a total restricted value
indication as follows):
Value Conclusion
Mixed-Use Buildings Total Value -$8,000,000
Residential Subdivision Value -$700,000
Total Indicated Value -$8,700,000
Rounded $1
Compiled by Newmark
Total Development Plan Value
RECONCILIATION OF VALUE 143
St. Elizabeth's East Site - Parcel 6
Reconciliation of Value
The values indicated by our analyses are as follows:
The Sales Comparison Approach is focused on comparing sales and other market transactions
to the Subject Property with the aim to develop an indication of value that is founded on the theory
of substitution. Basically, the intention is to estimate value through considering the prices of
properties which would be a substitute property to the Subject Property. In this case, a selection
of reasonably similar sales were obtained and the adjustment process was well founded by
reasoning and direct evidence. Ac cordingly, the appropriate weight is given to the sales
comparison approach for the market value of the Subject Property’s site as if unencumbered. We
were also estimate the market value of the underlying land based on a residual analysis, also
known as the Development Analysis Approach. This approach incorporates elements of the
income, cost, and sales comparison approach. Due to the complexity of the property, we place
appropriate weight on the Development Analysis Approach.
For the market value under the Development Plan, we only utilized the Development Analysis
Approach.
Based on this analysis, we conclude to the following:
Market Value Premise
Market Value As If
Unencumbered
Market Value of the
Subject Under the
Development Plan
As of Date: March 21, 2025 March 21, 2025
Cost Approach: Not Used Not Used
Sales Comparison Approach: $16,200,000 Not Used
Income Capitalization Approach: Not Used Not Used
Development Analysis Approach: $14,800,000 $1
Market Value Conclusion $15,500,000 $1
Compiled by Newmark
Market Value Indications
Value Conclusions
Appraisal Premise Interest Appraised Date of Value Value Conclusion
Hypothetical Market Value Unencumbered Fee Simple 3/21/2025 $15,500,000
Market Value Under Development Plan Fee Simple 3/21/2025 $1
Compiled by Newmark
RECONCILIATION OF VALUE 144
St. Elizabeth's East Site - Parcel 6
EXPOSURE TIME
Exposure time is the estimated length of time the subject property would have been offered on
the market prior to the hypothetical consummation of a sale at market value on the effective date
of the appraisal. It is a retrospective estimate based on an an alysis of past events assuming a
competitive and open market.
The following is national investor survey data which is one source for the underlying data to this
conclusion.
1. Our opinion of the market value subject to the Development Plan assumes that: 1) the Parcel will be conveyed
subject to a 99-year ground lease (leasehold conveyance), with zero or nominal ($1/annually) ongoing rent
payments; and, 2) the Developer will obtain the required approvals needed (parking), if any, to complete
construction of the proposed properties in accordance with the proposed plans and details provided by the
Sponsor.
2. The Subject Property, per the Sponsor's documentation, contains a WMATA Green Line tunnel easement and DC
Water utility easement for sanitary and storm sewer piping. Development of the Subject Property to the density
envisioned by zoning and consistent with maximally productive use of the property will require sub-grade
development (e.g. parking) which may necessitate relocation of existing water and sewer lines and a
configuration that avoids underground tunnels for WMATA. Accordingly, this appraisal assumes that the costs of
infrastructure reconfiguration of this type will be separately funded, with the purchaser of the Subject Property
held responsible for the abnormal development costs only.
1. Affordable Housing Requirements (10-801): Dispositions of properties owned by the District of Columbia are
subject to various development requirements, including that any multifamily use set aside a significant number of
units (30%, in the case of the subject's location) for low and very low income households. These restrictions are
embodied in Section 10-801 of the D.C. Code. This appraisal assumes that the Subject Property is not
encumbered by said restrictions.
2. The market value as if unencumbered is hypothetical as the property is currently encumbered with a number of
restrictions.
Compiled by Newmark
Extraordinary Assumptions and Hypothetical Conditions
An extraordinary assumption is defined in USPAP as an assignment-specific assumption as of the effective date regarding
uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.
The value conclusions are subject to the following extraordinary assumptions that may affect the assignment results.
A hypothetical condition is defined in USPAP as a condition, directly related to a specific assignment, which is contrary to
what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of
analysis. The value conclusions are based on the following hypothetical conditions that may affect the assignment
results.
The use of these extraordinary assumptions might have affected assignment results.
The use of these hypothetical conditions might have affected assignment results.
RECONCILIATION OF VALUE 145
St. Elizabeth's East Site - Parcel 6
Recent sales transaction data for similar properties, supply and demand characteristics for the
local Multifamily market, and the opinions of local market participants were reviewed and
analyzed. Based on this data and analysis, it is our opinion that the probable exposure time for
the subject at the concluded market values stated previously is 3 to 9 months.
MARKETING TIME
Marketing time is an opinion of the amount of time it might take to sell a real or personal property
interest at the concluded market value level during the period immediately after the effective date
of an appraisal. Marketing time differs from exposure time, which is always presumed to precede
the effective date of an appraisal. As no significant changes in market conditions are foreseen in
the near term, it is our opinion that a reasonable marketing period for the subject is likely to be
the same as the exposure time. Accordingly, we estimate the subject’s marketing period at 3 to 9
months.
ASSUMPTIONS AND LIMITING CONDITIONS 146
St. Elizabeth's East Site - Parcel 6
Assumptions and Limiting Conditions
The Appraisal contained in this Report (herein “Report”) is subject to the following assumptions
and limiting conditions:
1. Unless otherwise stated in this report, title to the property which is the subject of this report
(herein “Property”) is assumed to be good and marketable and free and clear of all liens
and encumbrances and that there are no recorded or unrecorded matters or exceptions
to title that would adversely affect marketability or value. No responsibility is assumed for
the legal description, zoning, condition of title or any matters which are legal in nature or
otherwise require expertise other than that of a pro fessional real estate appraiser. This
report shall not constitute a survey of the Property.
2. Unless otherwise stated in this report, it is assumed: that the improvements on the
Property are structurally sound, seismically safe and code conforming; that all building
systems (mechanical/electrical, HVAC, elevator, plumbing, etc.) are in good working order
with no major deferred maintenance or repair required; that the roof and exterior are in
good condition and free from intrusion by the elements; that the Property and
improvements conform to all applicable local, state, and federal laws, codes, ord inances
and regulations including environmental laws and regulations. No responsibility is
assumed for soil or subsoil conditions or engineering or structural matters. The Property
is appraised assuming that all required licenses, certificates of occupanc y, consents, or
other legislative or administrative authority from any local, state, or national government
or private entity or organization have been or can be obtained or renewed for any use on
which the value estimates contained in this report is based, unless otherwise stated. The
physical condition of the Property reflected in this report is solely based on a visual
inspection as typically conducted by a professional appraiser not someone with
engineering expertise. Responsible ownership and competent property management are
assumed.
3. Unless otherwise stated in this report, this report did not take into consideration the
existence of asbestos, PCB transformers or other toxic, hazardous, or contaminated
substances or underground storage tanks, or the cost of encapsulation, removal or
remediation thereof. Real estate appraisers are not qualified to detect such substances.
The presence of substances such as asbestos, urea formaldehyde foam insulation,
contaminated groundwater or other potentially hazardous materials and substances may
adversely affect the value of the Property. Unless otherwise stated in this report, the
opinion of value is predicated on the assumption that there is no such material or
substances at, on or in the Property.
ASSUMPTIONS AND LIMITING CONDITIONS 147
St. Elizabeth's East Site - Parcel 6
4. All statements of fact contained in this report as a basis of the analyses, opinions, and
conclusions herein are true and correct to the best of the appraiser's actual knowledge
and belief. The appraiser is entitled to and relies upon the accuracy of info rmation and
material furnished by the owner of the Property or owner’s representatives and on
information and data provided by sources upon which members of the appraisal
profession typically rely and that are deemed to be reliable by such members. Such
information and data obtained from third party sources are assumed to be reliable and
have not been independently verified. No warranty is made as to the accuracy of any of
such information and data. Any material error in any of the said information or data could
have a substantial impact on the conclusions of this Report. The appraiser reserves the
right to amend conclusions reported if made aware of any such error.
5. The opinion of value stated in this report is only as of the date of value stated in this report.
An appraisal is inherently subjective and the conclusions stated apply only as of said date
of value, and no representation is made as to the effect of subsequent events. This report
speaks only as of the date hereof.
6. Any projected cash flows included in the analysis are forecasts of estimated future
operating characteristics and are predicated on the information and assumptions
contained within this report. Any projections of income, expenses and economic
conditions u tilized in this report are not predictions of the future. Rather, they are
estimates of market expectations of future income and expenses. The achievement of
any financial projections will be affected by fluctuating economic conditions and is
dependent upon other future occurrences that cannot be assured. Actual results may vary
from the projections considered herein. There is no warranty or assurances that these
forecasts will occur. Projections may be affected by circumstances beyond anyone’s
knowledge or control. Any income and expense estimates contained in this report are
used only for the purpose of estimating value and do not constitute predictions of future
operating results.
7. The analyses contained in this report may necessarily incorporate numerous estimates
and assumptions regarding Property performance, general and local business and
economic conditions, the absence of material changes in the competitive environment and
other matters. Some estimates or assumptions, however, inevitably will not materialize,
and unanticipated events and circumstances may occur; therefore, actual results achieved
during the period covered by the analysis will vary from estimates, and the variations may
be material.
8. All prospective value opinions presented in this report are estimates and forecasts which
are prospective in nature and are subject to considerable risk and uncertainty. In addition
to the contingencies noted in the preceding paragraphs, several events may occur that
could substantially alter the outcome of the estimates such as, but not limited to changes
ASSUMPTIONS AND LIMITING CONDITIONS 148
St. Elizabeth's East Site - Parcel 6
in the economy, interest rates, capitalization rates, behavior of consumers, investors and
lenders, fire and other physical destruction, changes in title or conveyances of easements
and deed restrictions, etc. In making prospective estimates and forecasts, it is assumed
that conditions reasonably foreseeable at the present time are consistent or similar with
the future.
9. The allocations of value for land and improvements must not be used in conjunction with
any other appraisal and are invalid if so used. This report shall be considered only in its
entirety. No part of this report shall be utilized separately or out of context.
10. Neither all nor any part of the contents of this report (especially any conclusions as to
value, the identity of the appraiser, or any reference to the Appraisal Institute) shall be
disseminated through advertising media, public relations media, news media or any other
means of communication (including without limitation prospectuses, private offering
memoranda and other offering material provided to prospective investors) without the prior
written consent of the Firm. Possession of this report, or a copy h ereof, does not carry
with it the right of publication.
11. Client and any other Intended User identified herein should consider this report and the
opinion of value contained herein as only one factor together with its own independent
considerations and underwriting guidelines in making any decision or investment or taking
any action regarding the Property. Client agrees that Firm shall not be responsible in any
way for any decision of Client or any Intended User related to the Property or for the advice
or services provided by any other advisors or contractors. The use of this report and the
appraisal contained herein by anyone other than an Intended User identified herein, or for
a use other than the Intended Use identified herein, is strictly prohibited. No party other
than an Intended User identified herein may rely on this report and the appraisal contained
herein.
12. Unless otherwise stated in the agreement to prepare this report, the appraiser shall not be
required to participate in or prepare for or attend any judicial, arbitration, or administrative
proceedings.
13. The Americans with Disabilities Act (ADA) became effective January 26, 1992. No survey
or analysis of the Property has been made in connection with this report to determine
whether the physical aspects of the improvements meet the ADA accessibility guidelines.
No expertise in ADA issues is claimed, and the report renders no opinion regarding the
Property’s compliance with ADA regulations. Inasmuch as compliance mat ches each
owner’s financial ability with the cost to cure the non -conforming physical characteristics
of a property, a specific study of both the owner’s financial ability and the cost to cure any
deficiencies would be needed for the Department of Justice to determine compliance.
ASSUMPTIONS AND LIMITING CONDITIONS 149
St. Elizabeth's East Site - Parcel 6
14. Acceptance and/or use of this report constitutes full acceptance of these Assumptions and
Limiting Conditions and any others contained in this report, including any Extraordinary
Assumptions and Hypothetical Conditions, and is subject to the terms and cond itions
contained in the agreement to prepare this report and full acceptance of any limitation of
liability or claims contained therein.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Addendum A
Glossary of Terms
ADDENDA
St. Elizabeth's East Site - Parcel 6
The following definitions are derived from The Dictionary of Real Estate Appraisal, 7th ed.
(Chicago: Appraisal Institute, 2022).
Absorption Period: The actual or expected period required from the time a property, group of properties, or
commodity is initially offered for lease, purchase, or use by its eventual users until all portions have been sold or
stabilized occupancy has been achieved.
Absorption Rate: 1) Broadly, the rate at which vacant space in a property or group of properties for sale or lease
has been or is expected to be successfully sold or leased over a specified period of time. 2) In subdivision analysis,
the rate of sales of lots or units in a subdivision.
Ad Valorem Tax: A tax levied in proportion to the value of the thing(s) being taxed. Exclusive of exemptions, use-
value assessment provisions, and the like, the property tax is an ad valorem tax. (IAAO)
As Is Market Value: The estimate of the market value of real property in its current physical condition, use, and
zoning as of the appraisal date. (Interagency Appraisal and Evaluation Guidelines) Note that the use of the “as is”
phrase is specific to appraisal regulations p ursuant to FIRREA applying to appraisals prepared for regulated
lenders in the United States. The concept of an “as is” value is not included in the Standards of Valuation Practice
of the Appraisal Institute, Uniform Standards of Profess ional Appraisal Practice, or International Valuation
Standards.
Assessed Value: The value of a property according to the tax rolls in ad valorem taxation; may be higher or lower
than market value, or based on an assessment ratio that is a percentage of market value.
Cash Equivalency Analysis: An analytical process in which the sale price of a transaction with atypical financing
or financing with unusual conditions or incentives is converted into a price equivalent or consistent with what a
cash buyer would pay with all other factors the same.
Cash-Equivalent Price: The sale price of a property that is equivalent to what a cash buyer would pay.
Contract Rent: The actual rental income specified in a lease.
Disposition Value: The most probable price that a specified interest in property should bring under the following
conditions: 1) Consummation of a sale within a specified time, which is shorter than the typical exposure time for
such a property in that market. 2) The pro perty is subjected to market conditions prevailing as of the date of
valuation. 3) Both the buyer and seller are acting prudently and knowledgeably. 4) The seller is under compulsion
to sell. 5) The buyer is typically motivated. 6) Both parties are acting in what they consider to be their best interests.
7) An adequate marketing effort will be made during the exposure time. 8) Payment will be made in cash in US
dollars (or the local currency) or in terms of financial arrangements com parable thereto. 9) The price represents
the normal consideration for the property sold, unaffected by special or creative financing or sales concessions
granted by anyone associated with the sale. This definition can also be modified to provide for valu ation with
specified financing terms.
Economic Life: The period over which improvements to real estate contribute to property value.
Effective Gross Income (EGI): The anticipated income from all operations of the real estate after an allowance
is made for vacancy and collection losses and an addition is made for any other income.
Effective Rent: Total base rent, or minimum rent stipulated in a lease, over the specified lease term minus rent
concessions; the rent that is effectively paid by a tenant net of financial concessions provided by a landlord.
Excess Land: Land that is not needed to serve or support the existing use. The highest and best use of the
excess land may or may not be the same as the highest and best use of the improved parcel. Excess land has the
potential to be sold separately and is valued separately. See also surplus land.
Excess Rent: The amount by which contract rent exceeds market rent at the time of the appraisal; created by a
lease favorable to the landlord (lessor) and may reflect unusual management, unknowledgeable or unusually
motivated parties, a lease execution in an earlier, stronger rental market, or an agreement of the parties.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Exposure Time: 1) The time a property remains on the market. 2 An opinion, based on supporting market data,
of the length of time that the property interest being appraised would have been offered on the market prior to the
hypothetical consummation of a sale at marke t value on the effective date of the appraisal. (USPAP, 2020 -2021
ed.)
Extraordinary Assumption: An assignment -specific assumption as of the effective date regarding uncertain
information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.
Comment: Uncertain information might include physical, legal, or economic characteristics of the subject property,
or conditions external to the property, such as market conditions or trends, or about the integrity of data used in an
analysis. (USPAP, 2020-2021 ed.)
Fee Simple Estate: Absolute ownership unencumbered by any other interest or estate, subject only to the
limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.
Floor Area Ratio (FAR): The relationship between the above-ground floor area of a building, as described by the
zoning or building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a
decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area.
Frictional Vacancy: The amount of vacant space needed in a market for its orderly operation. Frictional vacancy
allows for move-ins and move-outs.
Full Service (Gross) Lease: See gross lease.
General Vacancy: A method of calculating any remaining vacancy and collection loss considerations when using
discounted cash flow (DCF) analysis, where turnover vacancy has been used as part of the income estimate. The
combined effects of turnover vacancy and general vacancy relate to total vacancy and collection loss.
Going-Concern Premise: One of the premises under which the total assets of a business can be valued; the
assumption that a company is expected to continue operating well into the future (usually indefinitely).
Going-Concern Value: An outdated label for the market value of all the tangible and intangible assets of an
established and operating business with an indefinite life, as if sold in aggregate; more accurately termed the
market value of the going concern or market value of the total assets of the business. See also Market Value of
the Going Concern and Market Value of the Total Assets of the Business (MVTAB).
Going-In Capitalization Rate (Ro): The overall capitalization rate obtained by dividing a property’s net operating
income for the first year after purchase by the present value of the property.
Gross Building Area (GBA): 1) Total floor area of a building, excluding unenclosed areas, measured from the
exterior of the walls of the above grade area. This includes mezzanines and basements if and when typically
included in the market area of the type of property involved. 2) Gross leasable area plus all common areas. 3)
For residential space, the total area of all floor levels measured from the exterior of the walls and including the
superstructure and substructure basement; typically does not include garage space.
Gross Lease: A lease in which the landlord receives stipulated rent and is obligated to pay all of the property’s
operating and fixed expenses; also called full-service lease.
Hypothetical Condition: 1) A condition that is presumed to be true when it is known to be false. (Appraisal
Institute: The Standards of Valuation Practice [SVP]) 2) A condition, directly related to a specific assignment,
which is contrary to what is known by the appraiser to e xist on the effective date of the assignment results, but is
used for the purpose of analysis. Comment: Hypothetical conditions are contrary to known facts about physical,
legal, or economic characteristics of the subject property; o r about conditions external to the property, such as
market conditions or trends; or about the integrity of data used in an analysis. (USPAP, 2020-2021 ed.)
Intended Use: 1) The valuer’s intent as to how the report will be used. (SVP) 2) The use(s) of an appraiser’s
reported appraisal or appraisal review assignment results, as identified by the appraiser based on communication
with the client at the time of the assignment. (USPAP, 2020-2021 ed.)
ADDENDA
St. Elizabeth's East Site - Parcel 6
Intended Users: 1) The party or parties the valuer intends will use the report. (SVP) 2) The client and any other
party as identified, by name or type, as users of the appraisal or appraisal review report by the appraiser, based
on communication with the client at the time of the assignment. (USPAP, 2020-2021 ed.)
Investment Value: 1) The value of a property to a particular investor or class of investors based on the investor’s
specific requirements. Investment value may be different from market value because it depends on a set of
investment criteria that are not necessarily typic al of the market. 2) The value of an asset to the owner or a
prospective owner given individual investment or operational objectives (may also be known as worth).
(International Valuation Standards [IVS])
Land-to-Building Ratio: The proportion of land area to gross building area; one of the factors determining
comparability of properties. See also floor area ratio.
Lease: A contract in which the rights to use and occupy land, space, or structures are transferred by the owner to
another for a specified period of time in return for a specified rent.
Leased Fee Interest: The ownership interest held by the lessor, which includes the right to receive the contract
rent specified in the lease plus the reversionary right when the lease expires.
Leasehold Estate: The right held by the lessee to use and occupy real estate for a stated term and under the
conditions specified in the lease.
Lessee: One who has the right to occupancy and use of the property of another for a period of time according to
a lease agreement.
Lessor: One who conveys the rights of occupancy and use to others under a lease agreement.
Liquidation Value: The most probable price that a specified interest in property should bring under the following
conditions: 1) Consummation of a sale within a short time period. 2) The property is subjected to market conditions
prevailing as of the date of valuation. 3) Both the buyer and seller are acting prudently and knowledgeably. 4) The
seller is under extreme compulsion to sell. 5) The buyer is typically motivated. 6) Both parties are acting in what
they consider to be their best interests. 7) A normal marketing effort is not possible due to the brief exposure time.
8) Payment will be made in cash in US dollars (or the local currency) or in terms of financial arrangements
comparable thereto. 9) The price represents the normal consideration for the property sold, unaffected by special
or creative financing or sales concessions granted by anyone associated with the sale. This definition can also be
modified to provide for valuation with specified financing terms.
Market Rent: The most probable rent that a property should bring in a competitive and open market under all
conditions requisite to a fair lease transaction, the lessee and lessor each acting prudently and knowledgeably,
and assuming the rent is not affected by undue stimulus. Implicit in this definition is the execution of a lease as of
a specified date under conditions whereby • Lessee and lessor are typically motivated; • Both parties are well
informed or well advised, and acting in what they consider their best interests; • Payment is made in terms of cash
or in terms of financial arrangements comparable thereto; and • The rent reflects specified terms and conditions
typically found in that market, such as permitted uses, use restrictions, expense obligations, duration, concessions,
rental adjustments and revaluations, renewal and purchase options, frequency of payments (annual, monthly, etc.),
and tenant improvements (TIs).
Market Value: A type of value that is the major focus of most real property appraisal assignments. Both economic
and legal definitions of market value have been developed and refined.1
Market Value of the Going Concern: The market value of an established and operating business including the
real property, personal property, financial assets, and the intangible assets of the business.
Market Value of the Total Assets of the Business (MVTAB): The market value of all of the tangible and
intangible assets of a business as if sold in aggregate as a going concern.
Modified Gross Lease: A lease in which the landlord receives stipulated rent and is obligated to pay some, but
not all, of the property’s operating and fixed expenses. Since assignment of expenses varies among modified
1 The actual definition of value used for this appraisal is contained within the body of the report.
ADDENDA
St. Elizabeth's East Site - Parcel 6
gross leases, expense responsibility must always be specified. In some markets, a modified gross lease may be
called a double net lease, net net lease, partial net lease, or semi-gross lease. See also net lease.
Net Lease: A lease in which the landlord passes on all expenses to the tenant. See also gross lease; modified
gross lease.
Net Net Net Lease: An alternative term for a type of net lease. In some markets, a net net net lease is defined as
a lease in which the tenant assumes all expenses (fixed and variable) of operating a property except that the
landlord is responsible for structural maintenan ce, building reserves, and management; also called NNN lease,
triple net lease, or fully net lease.
Net Operating Income (NOI or Io): The actual or anticipated net income that remains after all operating expenses
are deducted from effective gross income but before mortgage debt service and book depreciation are deducted.
Note: This definition mirrors the convention used in corporate finance and business valuation for EBITDA (earnings
before interest, taxes, depreciation, and amortization).
Occupancy Rate: 1) The relationship or ratio between the potential income from the currently rented units in a
property and the income that would be received if all the units were occupied. 2) The ratio of occupied space to
total rentable space in a building.
Operating Expenses: The periodic expenditures necessary to maintain the real estate and continue production
of the effective gross income, assuming prudent and competition management.
Overage Rent: The percentage rent paid over and above the guaranteed minimum rent or base rent; calculated
as a percentage of sales in excess of a specified breakpoint sales volume.
Percentage Rent: Rental income received in accordance with the terms of a percentage lease; typically derived
from retail store and restaurant tenants and based on a certain percentage of their gross sales.
Prospective Opinion of Value: A value opinion effective as of a specified future date. The term does not define
a type of value. Instead, it identifies a value opinion as being effective at some specific future date. An opinion of
value as of a prospective date is frequently sought i n connection with projects that are proposed, under
construction, or under conversion to a new use, or those that have not yet achieved sellout or a stabilized level of
long-term occupancy.
Rentable Area: For office or retail buildings, the tenant’s pro rata portion of the entire office floor, excluding
elements of the building that penetrate through the floor to the areas below. The rentable area of a floor is computed
by measuring to the inside finished surface of the dominant portion of the permanent building walls, excluding any
major vertical penetrations of the floor. Alternatively, the amount of space on which the rent is based; calculated
according to local practice.
Retrospective Value Opinion: A value opinion effective as of a specified historical date. The term retrospective
does not define a type of value. Instead, it identifies a value opinion as being effective at some specific prior date.
Value as of a historical date is frequently sought in connection with property tax appeals, damage models, lease
renegotiation, deficiency judgments, estate tax, and condemnation. Inclusion of the type of value with this term is
appropriate, e.g., “retrospective market value opinion.”
Shell Rent: The typical rent paid for retail, office, or industrial tenant space based on minimal “shell” interior
finishes (called vanilla finish or white wall finish in some areas). Usually the landlord delivers the main building
shell space or some minimum level of interior build -out, and the tenant completes the interior finish, which can
include wall, ceiling, and floor finishes, mechanical systems, interior electricity, and plumbing. Typically these are
long-term leases with tenants paying all or most property expenses.
Surplus Land: Land that is not currently needed to support the existing use but cannot be separated from the
property and sold off for another use. Surplus land does not have an independent highest and best use and may
or may not contribute value to the improved parcel. See also excess land.
Turnover Vacancy: A method of calculating vacancy allowance that is estimated or considered as part of the
potential income estimate when using discounted cash flow (DCF) analysis. As units or suites turn over and are
available for re-leasing, the periodic vacancy time frame (vacancy window) to release the space is considered.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Usable Area: 1) For office buildings, the actual occupiable area of a floor or an office space; computed by
measuring from the finished surface of the office side of corridor and other permanent walls, to the center of
partitions that separate the office from adjoini ng usable areas, and to the inside finished surface of the dominant
portion of the permanent outer building walls. Sometimes called net building area or net floor area. See also floor
area. 2) The area that is actually used by the tenants meas ured from the inside of the exterior walls to the inside
of walls separating the space from hallways and common areas.
Usable Site Area: The area of a site that can legally and physically accommodate buildings or significant site
improvements. The usable site area equals the total site area less certain obstructions, such as flood hazard areas,
required natural buffers, cemeteries, archeol ogically restricted areas, ecologically restricted areas, areas within
certain restrictive easements, and other obstructions. The net site area or usable site area should be more precisely
defined in each appraisal because the significance of improvements or the obstruction depends on the specific
assignment.
Use Value: The value of a property based on a specific use, which may or may not be the property’s highest and
best use. If the specified use is the property’s highest and best use, use value will be equivalent to market value.
If the specified use is not the property’s highest and best use, use value will be equivalent to the property’s market
value based on the hypothetical condition that the only possible use is the specified use.
Value In Use: 1. The amount determined by discounting the future cash flows (including the ultimate proceeds of
disposal) expected to be derived from the use of an asset at an appropriate rate that allows for the risk of the
activities concerned. (FASB Accounting Stan dards Codification, Master Glossary) 2. Formerly used in valuation
practice as a synonym for contributory value or use value. See also use value.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Addendum B
Financials and Property Information
ADDENDA
St. Elizabeth's East Site - Parcel 6
Addendum C
Comparable Data
ADDENDA
St. Elizabeth's East Site - Parcel 6
Land Sales
ADDENDA
St. Elizabeth's East Site - Parcel 6
Former NewCityDC Site
Location Data
Location 1901 New York Avenue Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN 4268 0006, 4268 0012, 4268 0014, 4268
0819, PAR 0153 0113, PAR 0153 0152
Physical Data
Property Type Land (MF Residential)
Proposed Use MF Residential Sale Data
Acres 9.87 Acres Transaction Type Closed
Land SF 429,803 SF Date October 1, 2024
Useable Acres 9.87 Acres Marketing Time N/A
Useable Land SF 429,803 SF Grantor Jemal's Schaeffer LLC; Douglas Development Corp.
Frontage 1025 Grantee AP DC Schaeffer LLC, AAFMAA Property
Visibility Above Average Document No. 2025001490
Topography Level Price $30,243,768
Shape Irregular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Corner Price Adjustments For:
Flood Zone 0 Feet (Avg.) Financing $0
Utilities Conditions of Sale $0
Other $25,599,705
Offsite/Onsite Costs 25599705 Adjusted Price $55,843,473
Zoning MU-5B
Allowable Bldg Area 1,805,173 SF Analysis
Allowable Bldg Units 0 Price per Acre $5,659,678
Price Per SF $129.93
Verification Secondary Verification Price per Unit $0
Price per FAR $30.94
Comments
Land Sale Comparable 1
This represents the sale of the leased fee interest of a land site located in Ivy City neighborhood of Washington, DC. The site has extended frontage on Route
50/New York Avenue NE, with frontage on Montana Avenue NE. Douglas Development initially owned the site outright. Douglas Development signed a ground
lease agreement to fracture the site and retained the leasehold value. The underlying land (leased fee value) was sold to a third party for $30,243,768. Per public
record, the ground lease agreement had a consideration amount of $25,599,705. The ground lease has a 99-year term with an option to purchase the fee
interest in the land for the purchase price of this deal subject to certain conditions, as more particularly described in the ground lease. The site is zoned MU-5B
for mixed-use development which allows for a maximum FAR of 4.2 with inclusionary zoning. The seller originally intended to construct a mixed-use project,
titled NewCityDC, which would have had over a million square feet of housing and retail use including restaurants and a movie theater. In Spring of 2024,
Douglas Development had submitted the paperwork to convert the zoning of the site to PDR-1; however, as of the date of sale, the site was stilled zoned MU-
5B.
Electricity, Gas, Sewer, Water
ADDENDA
St. Elizabeth's East Site - Parcel 6
Modera H Street Land
Location Data
Location 801 17th Street Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN 4494-0145
Physical Data
Property Type Land (MF Residential)
Proposed Use MF Residential Sale Data
Acres 1.16 Acres Transaction Type Closed
Land SF 50,601 SF Date December 23, 2022
Useable Acres 1.16 Acres Marketing Time N/A
Useable Land SF 50,601 SF Grantor DC Developing Families
Frontage 292 Grantee BOZ 17th Owner, LLC
Visibility Above Average Document No. 2022125749
Topography Level Price $20,000,000
Shape Irregular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Interior Price Adjustments For:
Flood Zone X Financing $0
Utilities Conditions of Sale $0
Other $160,000
Offsite/Onsite Costs 160000 Adjusted Price $20,160,000
Zoning MU-7B
Allowable Bldg Area 242,885 SF Analysis
Allowable Bldg Units 325 Price per Acre $17,355,372
Price Per SF $398.41
Verification Confirmed-Other Price per Unit $62,031
Price per FAR $83.00
Comments
Land Sale Comparable 2
Electricity, Gas, Sewer, Water
This property was improved with a vacant 16,000 office building that was built in 1960. The zoning (MU-7B) can support a 4.8 FAR, or 242,885 square foot
building with inclusionary zoning. The buyer was planning development of a 7-story multifamily building with 325 units including 286 market-rate units and 39
inclusionary zoning units (12%) and structured parking. The site sold for $20 million; however, we estimate an effective price of $20,160,000 that includes
demolition costs of $10 PSF ($160,000). The recorded sale price was $8,850,000; however, this did not include $11,150,000 of cash consideration.
ADDENDA
St. Elizabeth's East Site - Parcel 6
40th Street Site
Location Data
Location 307 40th Street Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN Square 5083 Lot 00179
Physical Data
Property Type Land (MF Residential)
Proposed Use MF Residential Sale Data
Acres 0.61 Acres Transaction Type Closed
Land SF 26,789 SF Date October 13, 2022
Useable Acres 0.61 Acres Marketing Time N/A
Useable Land SF 26,789 SF Grantor DRA Advisors; KPR Centers
Frontage 135 Grantee National Housing Trust
Visibility Average Document No. 2022108205
Topography Level Price $7,500,000
Shape Irregular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Interior Price Adjustments For:
Flood Zone X Financing $0
Utilities Conditions of Sale $0
Other $0
Offsite/Onsite Costs 0 Adjusted Price $7,500,000
Zoning MU-7
Allowable Bldg Area 128,587 SF Analysis
Allowable Bldg Units 0 Price per Acre $12,195,122
Price Per SF $279.97
Verification Secondary Verification Price per Unit $0
Price per FAR $58.33
Comments
Land Sale Comparable 3
Electricity, Gas, Sewer, Water
The property is currently a clear vacant parking lot with all utilities available to the site. The property was purchased by a non-profit affordable housing
developer. The maximum density allowed on the site by-right is 128,587 SF with inclusionary zoning.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Brookland Grove
Location Data
Location 4th Street Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN Square 3648, Lots 1074 - 1135
Physical Data
Property Type Land (SF Residential)
Proposed Use SF Residential Sale Data
Acres 4.74 Acres Transaction Type Closed
Land SF 206,474 SF Date March 4, 2021
Useable Acres 4.74 Acres Marketing Time N/A
Useable Land SF 206,474 SF Grantor The Missionary Society of Saint Paul The Apostle
Frontage 550 Grantee DRP DC 1, LLC; Tri Pointe Group
Visibility Average Document No. 2021028827
Topography Level Price $12,000,000
Shape Irregular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Interior Price Adjustments For:
Flood Zone X Financing $0
Utilities Conditions of Sale $0
Other $0
Offsite/Onsite Costs 0 Adjusted Price $12,000,000
Zoning RA-1
Allowable Bldg Area 222,992 SF Analysis
Allowable Bldg Units 60 Price per Acre $2,531,646
Price Per SF $58.12
Verification Secondary Verification Price per Unit $200,000
Price per FAR $53.81
Comments
This is a proposed residential subdivision located in the Brookland/CUA community in DC. The builder, Tri Pointe Group (Winchester Homes), plans to develop
60 townhome units on the site, nine of which will be set aside as affordable housing via inclusionary zoning guidelines. The site was subdivided prior to the
sale. The proposed floor plans range from 2,027 to 2,149 square feet and will have three or four bedrooms, three bathrooms and a roof terrace. Planned
standard features for the residences include stainless-steel appliances, granite countertops, hardwood floors on the main level, and a two-car garage. Home
prices are starting in the $800s.
Electricity, Gas, Sewer, Water
Land Sale Comparable 4
ADDENDA
St. Elizabeth's East Site - Parcel 6
Proposed Residences at Benning Road Site
Location Data
Location 123 45th Street Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN 0
Physical Data
Property Type Land (MF Residential)
Proposed Use MF Residential Sale Data
Acres 0.74 Acres Transaction Type Closed
Land SF 32,217 SF Date October 29, 2020
Useable Acres 0.74 Acres Marketing Time N/A
Useable Land SF 32,217 SF Grantor Industrial Bank
Frontage 31 Grantee The Residences at Benning Road LLC
Visibility Average Document No. 0
Topography Level Price $8,350,000
Shape Rectangular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Corner Price Adjustments For:
Flood Zone X Financing $0
Utilities Conditions of Sale $0
Other $78,200
Offsite/Onsite Costs 78200 Adjusted Price $8,428,200
Zoning MU-7B
Allowable Bldg Area 154,642 SF Analysis
Allowable Bldg Units 0 Price per Acre $11,395,619
Price Per SF $261.61
Verification Secondary Verification Price per Unit $0
Price per FAR $54.50
Comments
Land Sale Comparable 5
This is a site that was purchased for redevelopment. Improvements on site included two buildings totaling 9,777 SF of rentable building area. The developer
plans to demolish this buildings and build a multifamily property. The site is zoned MU-7B which allows mixed-use development. By-right, the developer could
build a 154,641 SF residential building with inclusionary zoning units. According to information from an Alley Closure request filed with the District of Columbia,
the buyer is planning development of a 6-story affordable housing property. A Declaration of Covenants filed on the same day as the deed also notes that the
housing on the property will be restricted to residents earning at or below 60% of AMI. The property is within walking distance of the Benning Road Metrorail
Station.
Electricity, Gas, Sewer, Water
ADDENDA
St. Elizabeth's East Site - Parcel 6
The Residences of Kenilworth Park Site
Location Data
Location Kenilworth Avenue Northeast
City, State Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN 5113 0806, PAR 0185 0038
Physical Data
Property Type Land (MF Residential)
Use at Sale Planned
Proposed Use MF Residential Sale Data
Acres 2.82 Acres Transaction Type Closed
Land SF 122,866 SF Date July 2, 2020
Useable Acres 2.82 Acres Marketing Time N/A
Useable Land SF 122,866 SF Grantor Lewis C. Booker, Henok A. Mengesha
Frontage 50 Grantee The Residences at Kenilworth Park LLC
Visibility Below Average Document No. 0
Topography Level Price $5,069,397
Shape Irregular Financing Terms Cash to Seller - Buyer Obtained Financing
Corner/Interior Location Interior Price Adjustments For:
Flood Zone AE Financing $0
Utilities Conditions of Sale $0
Other $0
Offsite/Onsite Costs 0 Adjusted Price $5,069,397
Zoning RA-1
Allowable Bldg Area 119,180 SF Analysis
Allowable Bldg Units 155 Price per Acre $1,797,266
Price Per SF $41.26
Verification Secondary Verification Price per Unit $32,706
Price per FAR $42.71
Comments
Land Sale Comparable 6
Electricity, Gas, Sewer, Water
This represents the sale of two parcels located near the Kenilworth Aquatic Garden in northeast DC. The site was partially raw land at the time of sale. Our
information was obtained from CoStar and public record, including design plans from the DC Zoning Commission. The buyer obtained two parcels, a 2.50-acre
landlocked site and a 0.33-acre strip of land that connects the landlocked site to Kenilworth Avenue NE from two separate owners. As a result, the entire site
has an irregular shape with limited street frontage (50 feet). Part of the site is located in a Flood Zone AE which likely spurred the buyer to obtain a special
exemption on the site for height. The buyer submitted an application for design review and a special exemption for building height to the DC Zoning
Commission in March 2019. The buyer intends to build a 5-story, U-shaped building on the site with a gross floor area of 118,719 SF which yields an FAR of 0.97
for the site; however, by-right zoning regulations allows a maximum FAR of 1.08 and building height of 40 feet. All of the units will be age-restricted senior
apartments where units are set aside for households making 60% or less of AMI. The plans were approved in September 2019, prior to the sale. According to
public record, these two parcels were purchased simultaneous in July 2020. The larger parcel sold for $4,844,397. The smaller parcel sold for $225,000.
ADDENDA
St. Elizabeth's East Site - Parcel 6
Rental Surveys
ADDENDA
St. Elizabeth's East Site - Parcel 6
Good Hope Rd Mixed Use Building
Location Information
Location 1516 Good Hope Road SE
Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County 0
APN 5606 0060
Physical Property Summary
Property Type Retail (Other)
Gross Building Area 24,000 SF
Rentable Area 2,800 SF
No. of Stories 4
Max Ceiling Height (Feet) N/A
Year Built (Renovated) 2019
Construction Concrete
Condition Excellent Lease Availability Details
Parking 0 Survey Date Jan-2024
Investment Class Class B Overall Occupancy at Survey 0.0%
Elevators 0 Leasing Agent 0
Company 0
Lease Summary
Start Date - Term Tenant Name Lease Status: Lease Size (SF) Base Rent/SF Reimb. Rent Steps Free Rent & TI Allowance
5/31/24 - 132 Mos. DC Wildflower Public Charter
School
Signed Lease: 2,654 $27.13 Triple Net 3.0% annually 5 mos. free; No TI
Lease Comments:
Comments
This is the lease of ground floor retail space to a public charter school tenant with a starting rent of $27.13/SF, triple net for an 11-year term. The
tenant reportedly received 5 months of free rent upfront.
Retail Rental Survey Comparable 1
ADDENDA
St. Elizabeth's East Site - Parcel 6
Good Hope Marketplace
Location Information
Location 2845 Alabama Avenue, SE
Washington, DC
Market DC - District of Columbia
Submarket Valuation Retail
County District of Columbia
APN 0
Physical Property Summary
Property Type Retail (Neighborhood)
Gross Building Area 0 SF
Rentable Area 97,213 SF
No. of Stories 1
Max Ceiling Height (Feet) N/A
Year Built (Renovated) 1997
Construction Concrete
Condition Good Lease Availability Details
Parking 0 Survey Date Mar-2023
Investment Class Class B Overall Occupancy at Survey 100.00%
Elevators 0 Leasing Agent 0
Company 0.0%
Lease Summary
Start Date - Term Tenant Name Lease Status: Lease Size (SF) Base Rent/SF Reimb. Rent Steps Free Rent & TI Allowance
6/1/23 - 120 Mos. Quickway Hihachi Signed Lease: 3,500 $45.00 Triple Net 10% / 5YRS No Free Rent; No TI
Comments
Retail Rental Survey Comparable 2
ADDENDA
St. Elizabeth's East Site - Parcel 6
Fort Davis Shopping Center
Location Information
Location 3863 Alabama Avenue Southeast
Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
Physical Property Summary
Property Type Retail (Strip)
Gross Building Area 44,147 SF
Rentable Area 44,147 SF
No. of Stories 2
Max Ceiling Height (Feet) N/A
Year Built (Renovated) 1941 (2013)
Construction Masonry
Condition Average Lease Availability Details
Parking Surface lot Survey Date Jun-2023
Investment Class Class B Overall Occupancy at Survey 94.30%
Elevators 2 Leasing Agent 0
Company 0.0%
Lease Summary
Start Date - Term Tenant Name Lease Status: Lease Size (SF) Base Rent/SF Reimb. Rent Steps Free Rent & TI Allowance
8/1/22 - 126 Mos. Fort Davis Orthodontic and
Pediatric Dentistry
Signed Lease: 2,875 $35.00 Triple Net 3.0%, Annually 6 mos. free; $15.00/SF
Comments
Retail Rental Survey Comparable 3
ADDENDA
St. Elizabeth's East Site - Parcel 6
Skyland Town Center - Ground Floor Commercial/Retail
Location Information
Location 2700 Good Hope Road Southeast
and 2219 Town Center Drive Washington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
APN Block 5633, Lots 819, 7002, 7005,
7006Physical Property Summary
Property Type Retail (Urban Retail)
Gross Building Area 84,264 SF
Rentable Area 84,264 SF
No. of Stories 1
Max Ceiling Height (Feet) N/A
Year Built (Renovated) 2021
Construction Steel
Condition Excellent Lease Availability Details
Parking 0 Survey Date Apr-2023
Investment Class Class A Overall Occupancy at Survey 57.20%
Elevators 0 Leasing Agent 0
Company 0.0%
Lease Summary
Start Date - Term Tenant Name Lease Status: Lease Size (SF) Base Rent/SF Reimb. Rent Steps Free Rent & TI Allowance
4/1/22 - 120 Mos. Roaming Roster Signed Lease: 2,225 $45.00 Triple Net 2.5%, Annually No Free Rent; $370.00/SF
Comments
Retail Rental Survey Comparable 4
ADDENDA
St. Elizabeth's East Site - Parcel 6
Shops at Penn Branch
Location Information
Location 3200 Pennsylvania Avenue,
SoutheastWashington, DC
Market DC - District of Columbia
Submarket District of Columbia
County District of Columbia
Physical Property Summary
Property Type Retail (Neighborhood)
Gross Building Area 0 SF
Rentable Area 88,254 SF
No. of Stories 1
Max Ceiling Height (Feet) N/A
Year Built (Renovated) 1964 (2017)
Construction Brick/Block
Condition Average Lease Availability Details
Parking Surface Survey Date Mar-2023
Investment Class Class B Overall Occupancy at Survey 95.20%
Elevators 0 Leasing Agent 0
Company 0.0%
Lease Summary
Start Date - Term Tenant Name Lease Status: Lease Size (SF) Base Rent/SF Reimb. Rent Steps Free Rent & TI Allowance
6/1/21 - 120 Mos. Chipotle Mexican Grill Signed Lease: 2,613 $36.00 Triple Net 10%/5 YRS No Free Rent; $25.00/SF
Comments
Retail Rental Survey Comparable 5
ADDENDA
St. Elizabeth's East Site - Parcel 6
Appraiser Qualifications and Licenses
1
Douglas L. Nickel MAI, FRICS currently serves as a Senior Managing Director and
Market Leader for Washington DC, Delaware, Maryland and Virginia. In this role, Doug
is responsible for business development; aggressively recruiting top appraisal talent;
providing outstanding service to clients; third party appraisal review services; and
overseeing a team of appraisers in the regional offices of Newmark. Doug joined
Newmark in 2017 following the acquisition of several Integra Realty Resources offices.
Doug has been actively engaged in real estate valuation and consulting throughout the
Mid-Atlantic region since the mid‐1980s. Doug has expertise in valuation and
counseling on all major types of real estate, including commercial, industrial, office,
mixed-use, multifamily housing, lodging, residential and commercial land development
and special-purpose properties, with particular expertise in the valuation of investment-
grade real property. Doug has performed specialized real estate valuations on air rights
and avigation easements; cold storage/refrigerated facilities; sand, gravel and rock
quarries; golf courses, sports facilities and fieldhouses; self storage facilities; student
housing; and road racing facilities.
Doug’s clients have included investment firms, law firms, lenders, corporations, private
investors, institutions and public agencies. He has performed valuations for financing,
equity participation, due diligence, condemnation, estate planning, right‐of‐way
acquisitions and litigation support. Doug has also completed valuations and market
studies for proposed, partially constructed, renovated and existing structures.
Doug is qualified as an expert witness in U.S. Bankruptcy Court (Eastern District of
Pennsylvania, District of Maryland, District of New Jersey), U.S. District Court (Eastern
District of Pennsylvania, Southern District of Florida), State of Delaware Court of
Chancery, State of Delaware Superior Court and New Jersey Tax Court.
Professional Affiliations
– Member, Delaware Council on Real Estate Appraisers (state licensing board), 2013 –
2019; Chairman, 2016 – 2019, Vice Chairman, 2015 - 2016
– Delaware Chapter of the Appraisal Institute; President, 2007 – 2008, Board of
Directors, 2009 - 2013
– Delaware Association of Appraisers (Past Member); President, 2010 – 2012, Board of
Directors, 2010 - 2013
Licenses and Designations
– MAI designation, Appraisal Institute
– Fellow, Royal Institution of Chartered Surveyors (FRICS)
– Certified general appraiser; District of Columbia, commonwealth of Virginia, state of
Delaware, commonwealth of Pennsylvania, and state of Maryland
Education
Doug earned a Bachelor of Arts degree in economics from the University of Richmond.
He has also successfully completed numerous real estate and related courses and
seminars sponsored by the Appraisal Institute and others.
Douglas L.
Nickel
MAI, FRICS
Senior Managing Director
Market Leader – DC, DE, MD, VA
t 202-774-9040
t 302-998-4030
m 302-373-7660
douglas.nickel@nmrk.com
YEARS OF
EXPERIENCE
35+
AREAS OF
SPECIA LTY
Office
Industrial
Retail
Multifamily
Investment-Grade Assets
Complex Mixed-Use Assets
Residential Development
Expert Witness Testimony
Appraisal Review Services
District of Columbia Real Estate Appraisers
Douglas Nickel
Appraiser Certified General
838 Summerset Drive Summerset Drive
Hockessin, DE 19707
GA40000058 8/24/2022 2/28/2026
1
Senior Appraiser Chizoma Ohanyerenwa, has been providing valuation and consulting
services since 2012. Initially starting as a market researcher, over time, she has
developed expertise in property valuation with a focus on multifamily properties,
particularly new multifamily and mixed-use construction and government-
subsidized/affordable housing. Recent valuation assignments have included but are not
limited to, office buildings, apartment complexes, mixed-use properties, residential
subdivisions, residential condominiums, neighborhood and community shopping
centers, freestanding retail buildings, industrial buildings, charter schools,
churches/places of worship, and vacant land for different uses throughout the DC metro
area. These valuation and consulting services, which include appraisal reports,
appraisal reviews, market rent surveys, and market and feasibility studies, have been
performed for a wide variety of client types including national and local governmental
agencies, commercial and investment banks, law firms, real estate investment trusts,
life insurance companies, universities (public and private), and pension funds.
Chizoma joined Newmark Knight Frank in 2017, when the firm acquired several
affiliates of Integra Realty Resources (IRR). At the time of acquisition, she had been
with IRR for five years.
Licenses and Designations
– Certified General Real Estate Appraiser, District of Columbia, #GA2002168, Expires
February 2024
– Certified General Real Estate Appraiser, Maryland, #31931, Expires November 2023
– Certified General Real Estate Appraiser, Virginia, #4001018066, Expires November
2022
Education
Chizoma earned a Bachelor of Arts Degree in English, with a minor concentration in
Chemistry, from the University of North Carolina – Chapel Hill in 2010. She has
successfully completed all relevant courses required to obtain the Certified General
Real Estate License. Other relevant appraisal coursework includes:
– Residential Sales Comparison and Income Approach
Chizoma
Ohanyerenwa
Senior Appraiser
t 202-774-9047
chizzy.ohanyerenwa@nmrk.com
YEARS OF
EXPERIENCE
10+
AREAS OF
SPECIALTY
Multifamily
Subsidized/Affordable Housing
Complex Mixed-Use Assets
Institutional Assets
Feasibility Studies
Market Rent Surveys
*
TheDepartmentofLicensingandConsumerProtectiongrantsthislicense,insupportofandundertheauthorityofthe:
Districtof Columbia Real EstateAppraisers
To:ChizomaOhanyerenwa
Asa: AppraiserCertifiedGeneral
AffiliatedWith: 3603ChillumPlaceNEWashingtonDC20011
LicenseNumber: IssuanceDate: ExpirationDate:Ga2002168 1171972020 2128/2026
VY
TiffanyCrowe
Director
DepartmentofLicensingandConsumerProtection
GOVERNMENT OF THE DISTRICT OF COLUMBIA
Executive Office of the Mayor
Office of the Deputy Mayor for Planning and Economic Development
February 21, 2024
VIA ELECTRONIC MAIL
TO: Georgette Joy, 8C01@anc.dc.gov
Joyce M. Doyle, 8C02@anc.dc.gov
Dascha Cleckley, 8C03@anc.dc.gov
Erica Green, 8C04@anc.dc.gov
Chery Moore, 8C05@anc.dc.gov
Robbie Woodland, 8C06@anc.dc.gov
Chairman Salim Adofo, 8C07@anc.dc.gov
CC: The Honorable Trayon White, Sr., Ward 8 Councilmember, twhite@dccouncil.us,
Office of Advisory Neighborhood Commissions, oancs@dc.gov
RE: St. Elizabeths East Campus Parcel 6 – Public Disposition Hearing and RFP Developer
Presentation Meeting Notice
Dear Commissioners of ANC 8C,
Pursuant to D.C. Official Code § 10-801 et seq., the District will conduct a public disposition hearing
to receive comments on the St. Elizabeths East Campus Parcel 6, located at 2700 Martin Luther King Jr
Ave Street S.E., Washington, D.C. (“Property”). This public disposition hearing will be held to obtain
community comments and suggestions on the proposed use of the Property. Received comments and
suggestions will be submitted to the Council of the District of Columbia for review.
Immediately following the public disposition hearing, the District will conduct a community meeting in
continuation of the Mayor’s RFP process for the Property redevelopment. This meeting will be held at
the R.I.S.E Demonstration Center – 2730 Martin Luther King Jr SE. At this meeting, the development
teams will present their visions for the Property redevelopment and there will be a question-and-
answer opportunity.
The date, time, and location of the public disposition hearing and community meeting is:
Date: April 10th 2024
Time: 6:30 pm
Location: 2730 Martin Luther King Ave, SE
Washington, D.C. 20032
Written public comments and suggestions will be accepted in person at the public disposition hearing
and via email to anthony.moore@dc.gov until 3:00 pm on April 17, 2024.
You may contact Anthony Moore, DMPED Project Manager, at (202) 727-4282 or via email should you
have any questions about the public disposition hearing and community meeting.
Nina Albert
Acting Deputy Mayor
John A. Wilson Building | 1350 Pennsylvania Ave, NW, Suite 317 | Washington, DC 20004
71 D.C. Reg. 2358
Volume 71, Number 10, March 8, 2024
PUBLIC HEARINGS
Reporter
71 D.C. Reg. 2358
DC - District of Columbia Register > 2024> March >
March 8, 2024 > PUBLIC HEARINGS > OFFICE OF THE DEPUTY MAYOR
FOR PLANNING AND ECONOMIC DEVELOPMENT
Agency
OFFICE OF THE DEPUTY MAYOR FOR PLANNING AND ECONOMIC DEVELOPMENT
Text
NOTICE OF PUBLIC HEARING REGARDING
DISPOSITION RESOLUTION PURSUANT TO D.C. OFFICIAL CODE § 10-801
Pursuant to D.C. Official Code § 10-801, the Office of the Deputy Mayor for Planning and Economic Development
will conduct a public disposition hearing regarding the St. Elizabeths East Campus Parcel 6. The site at 2700 Martin
Luther King Ave SE (Square 58688S, Lot 986) (the "Property") to obtain community input on the proposed use of
the Property.
The public hearing will be held in person the date, time, and location listed below. The public hearing will include an
online option for those members of the public who wish to attend virtually.
The date, time, and location of the public disposition hearing is:
Date: Wednesday, April 10, 2024
Time: 6:30 p.m. -- 8:30 p.m.
Location: R.I.S.E Demonstration Center
2730 Martin Luther King Jr. Ave S.E
Washington, DC 20032
Please feel free to contact Anthony Moore at anthony.moore@dc.gov should you have any questions or concerns.
Please note that written comments and suggestions will be accepted by U.S. Mail or email until April 17, 2024, at:
The Office of the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attention: Anthony Moore, Development Manager
Email:anthony.moore@dc.gov
DISTRICT OF COLUMBIA REGISTER
GOVERNMENT OF THE DISTRICT OF COLUMBIA
Executive Office of the Mayor
Office of the Deputy Mayor for Planning and Economic Development
JOHN J. FALCICCHIO
INTERIM DEPUTY MAYOR
1350 Pennsylvania Avenue, N.W., Suite 317 • Washington, D.C. 20004 • T (202) 727 -6365 • F (202) 727 -6703 • dmped.dc.gov
VIA ELECTRONIC MAIL
TO: Mike Austin (Chairperson), 8C01@anc.dc.gov
Chyla D. Evans, 8C02@anc.dc.gov
Robinette Woodland, 8C03@anc.dc.gov
Regina Sharlita Pixley, 8C04@anc.dc.gov
Mustafa Abdul-Salaam, 8C05@anc.dc.gov
Rhonda L. Edwards-Hines, 8C06@anc.dc.gov
Salim Adofo, 8C07@anc.dc.gov
CC: Honorable Trayon White, Sr., DC Councilmember, Ward 8, twhite@dccouncil.us
Nate Fleming, Legislative Director, nfleming@dccouncil.us
From: Latrena Owens, Executive Director
Date: November 26, 2019
The Office of the Deputy Mayor for Planning and Economic Development (“DMPED”) has selected District
owned properties located on the St. Elizabeths East Campus between Pine St. and Alabama Ave., S.E. known
for tax and assessment purposes as A&T Lots 829, 828, 820, 818, 825, 826, 830, 831, 832, 833 & 834 in
Square S-5868 (the “Property”) for redevelopment. As part of the redevelopment process, the Property must
be declared surplus by the Council of the District of Columbia (“Council”). Declaring a property surplus
means that it is no longer required for a public purpose.
DMPED will conduct a public meeting to receive comments and feedback from the community on the
proposed designation of the Property as surplus property. Comments collected at the public meeting will be
submitted to the Council for their review. The surplus meeting will be conducted pursuant to D.C. Official
Code §10-801. The date, time, and location of the meeting are below:
Date: Thursday, January 9, 2020
Time: 6:30pm
Location: R.I.S.E. Demonstration Center
2730 Martin Luther King Jr. Avenue, SE
Washington, D.C. 20032
Please feel free to contact James Parks at 202.724.4282 or james.parks2@dc.gov should you have any
questions or concerns.
66 D.C. Reg. 16092
Volume 66, Number 50, December 6, 2019
BOARDS, COMMISSIONS, AND AGENCIES
Reporter
66 D.C. Reg. 16092
DC - District of Columbia Register > 2019 > December >
December 6, 2019 > BOARDS, COMMISSIONS, AND AGENCIES > OFFICE
OF THE DEPUTY MAYOR FOR PLANNING AND ECONOMIC DEVELOPMENT
Agency
OFFICE OF THE DEPUTY MAYOR FOR PLANNING AND ECONOMIC DEVELOPMENT
Text
NOTICE OF PUBLIC MEETING REGARDING
SURPLUS RESOLUTION PURSUANT TO D.C. OFFICIAL CODE § 10-801
The Office of the Deputy Mayor for Planning and Economic Development will conduct a public meeting to receive
public comments on the proposed surplus of the District of Columbia owned property identified below.
Property:
A&T Lot Square/Lot Premise Address
829 5868/02 1100 Alabama Ave., SE
828 5868/02 1100 Alabama Ave., SE
820 5868/02 1100 Alabama Ave., SE
818 5868/02 1100 Alabama Ave., SE
825 5868/02 1100 Alabama Ave., SE
826 5868/02 1100 Alabama Ave., SE
830 5868/02 1100 Alabama Ave., SE
831 5868/02 1100 Alabama Ave., SE
832 5868/02 1100 Alabama Ave., SE
833 5868/02 1100 Alabama Ave., SE
834 5868/02 1100 Alabama Ave., SE
The public meeting will be held at the date, time, and location as follows:
Date: Thursday, January 9, 2020
Time: 6:30-8:30 p.m.
Location: R.I.S.E. Demonstration Center
Page 2 of 2
66 D.C. Reg. 16092
2730 Martin Luther King Jr., Ave., SE
Washington, D.C. 20032
Contact: James Parks, James.Parks2@dc.gov
(202) 769-7830
Please note that written comments will be accepted by U.S. Mail or email until Friday, January 24, 2020, at:
The Office of the Deputy Mayor for Planning and Economic Development
1350 Pennsylvania Avenue, NW, Suite 317
Washington, DC 20004
Attention: Latrena Owens, Executive Director of St. Elizabeths East
Latrena.Owens@dc.gov
DISTRICT OF COLUMBIA REGISTER
End of Document