Some developers wary of Gray’s ultimatum to Wal-Mart

LAS VEGAS — D.C. Mayor Vincent C. Gray surprised Wal-Mart officials last week when he told them he was not interested in having the chain open in the city without seeing a commitment for the retailer to place a store at a redeveloped Skyland Shopping Center in Southeast Washington.

But Wal-Mart folks weren’t the only ones caught off guard, as the brokers and developers of other Wal-Mart sites now see the future of their deals tied to the future of Skyland, a development plan that has dragged on for more than a decade.

“It kind of came out of the blue, I can tell you that,” said Grant M. Ehat, principal of JBG Rosenfeld Retail. Ehat is developing the New Jersey Avenue NW property that is slated for a Wal-Mart and apartments on top. Ehat got word about the mayor’s demand on Monday at the International Council of Shopping Centers conference in Las Vegas, as word spread among the other Washington landlords with Wal-Mart plans.

“It just feels like it’s a very strong tactic, and I don’t know whether it will work or not. It sure doesn’t make us feel very good — that our destiny now is being taken out of our own hands. But I guess the mayor and the city council feel that it was warranted in order to get Skyland going,” he said.

Gray’s announcement was particularly surprising because with the exception of the planned store at the corner of Georgia and Missouri avenues NW, in Ward 4, reception to the chain in many of the neighborhoods around the planned stores had been positive, according to Council member Michael A. Brown (I-At Large).  

“It’s tricky. Going to community meetings, it’s always the Ward 4 store where there’s opposition,” Brown said.

The mayor, Brown and other members of the council also discussed the possibility of a community benefits agreement in their meeting with Wal-Mart last week, and Brown said the chain was very resistant to signing a legally binding agreeement of any kind. Could that have been the reason Gray turned to negotiating for Skyland?

Brown said that at the least, he thought Wal-Mart needed to respond better to a binding community benefits agreement request.

“You have to come up with some talking points other than, ‘We don’t do it,’ ” he said.

Jonathan O'Connell has covered land use and development in the Washington area for more than five years.

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