Crowdfunded venture proposed for city property in D.C.


Shown is the scene on H and 13th streets NE, where the R.L. Christian Library sits. The library will be demolished to make way for a five-story apartment complex. (Ricky Carioti/The Washington Post)
January 2

The one-story structure at 13th and H streets in Northeast Washington isn’t much to look at. A dim interior, vacant since 2009, sits behind wide plastic windows that stretch around the yellowing building. A few posters from pop-up art events cling to the exterior. Pink, green and purple clouds painted across the facade give it a whimsical dreariness.

But for the next few months, city governments across the country will be paying attention to this corner. The shuttered R.L. Christian Library is slated to be replaced by a mixed-use residential building, pending approval by the D.C. Council. It will join H Street’s new apartment complexes and a coming Whole Foods Market.

Unlike those other properties, though, the plan for the library property uses a new approach that could change the dynamics of urban development.

The company behind the project, Rise Development, seized on the 2012 Jumpstart Our Business Startups Act, or JOBS Act, which aims to help small companies raise money and hire workers by easing federal regulations.

One provision of the act allows companies to crowdsource funding. Rather than rely on traditional sources to put up the funds, this approach allows individuals in the community to have a stake in the project.

“The library site is like a national test case,” said Benjamin Miller, one of two brothers behind Rise. “I’m talking to governments in San Francisco, Los Angeles, Cleveland and New York, and they’re all watching to see if this D.C. government deal works.”

Rise intends to create a design for the 10,800-square-foot site, including a residential building with about 30 units and retail space. The company presented a contract of sale to the D.C. Council on Dec. 17 and is waiting for approval.

Miller realizes that the D.C. government will be taking a political risk by embracing a model that relies on individuals to both raise the money and risk a potentially bad investment.

Parts of the JOBS Act have yet to be implemented. And until the Securities and Exchange Commission adopts final regulations that will allow companies to raise up to $50 million, Miller and others must limit crowdfunding to $5 million.

The company has also faced questions about the risk associated such an investment. Several professional advisers who last year reviewed plans for another of the company’s projects on H Street said they would advise against the investment, citing concerns about the developer’s relative inexperience.

And the brothers’ first project, the food-and-fashion boutique Maketto, soon to open down the street from the library site, is the only one to produce returns for its investors so far.

Miller and his brother, Daniel, grew up in the District’s Palisades neighborhood, along the Potomac River in Northwest. They learned the real estate business from their father, Herman S. Miller, and worked at his company, Western Development Corp., before creating their own investment company, WestMill Capital Partners, now known as Rise, in 2010.

Benjamin Miller said he has found supporters for the proposed project along the H Street corridor, including such groups as H Street Main Street and the H Street Community Development Corp. (HSCDC).

Anwar Saleem, a founder of H Street Main Street and a board member of HSCDC, grew up in the area and remembers meeting R.L. Christian, for whom the former library is named. “He was a neighborhood guy,” Saleem said. “He really wanted to teach kids and direct them to do the right thing.”

He said he thinks Christian would have liked a community-funded model that gives people a chance to support and profit from the businesses next door.

“There’s nothing like investing in the neighborhood that you grew up in,” Saleem said.

In 1957, R.L. Christian moved to the District with his wife, Alice, and three daughters: Roslyn, Faye and Kaye. For Christian, who had a successful career in real estate, education was a priority. Every Saturday, he drove his daughters to the nearest library, where they would each read one book and select another to take home.

“Oh, God — We hated it,” Roslyn Christian said. “We were children. Everybody was out playing, and we had to go to the library.”

A decade later, Christian opened the Northeast Neighborhood House — two red brick buildings where people could play ball, study for a general equivalency diploma and get job training, among other services. He worked there for two years before he died in 1969; he never took home a salary.

In the District, some federal funds, part of Johnson’s War on Poverty, went to the creation of satellite libraries for underserved communities. It seemed a perfect way to honor Christian, who had served on the District’s Model Cities Commission, an urban-renewal program.

The first R.L. Christian Library opened in a storefront on H Street in 1972; it moved to the current, 1,400-square-foot building down the street in 1981.

Today, the Model Cities program’s successes are considered limited. But on H Street, some still remember what the library meant to the community.

“It probably stayed crowded every day, all day until it was closed,” said Lisa North, who owns a salon across 13th Street.

But according to D.C. Public Library officials, circulation at the site was poor. In 2009, its final year, 4,981 books were checked out at the branch. The system’s least-busy neighborhood library checked out 30,000 books that year.

When North looked out the windows of her salon and contemplated what she would like to see on H Street, she came up with two things: parking and a library. Saleem, of H Street Main Street, said that retail and apartments would be a nice addition but that once H Street’s newcomers start having kids, they’re going to want one a library.

Roslyn Christian also believes the neighborhood needs a library, “more so than a streetcar.” But her concern is ensuring that her father’s legacy lives on.

“My parents were good neighbors, so they would be good neighbors to newcomers,” she said. “I think the main thing they would say is, ‘Respect what existed prior to your arrival.’ I think that’s the very first thing that they would say.”

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