By Yolanda Woodlee and Miranda S. Spivack
Washington Post Staff Writers
Thursday, March 6, 2008
The District has negotiated a $40 million deal with National Public Radio to keep the company's headquarters in the city, granting tax abatements over the next two decades and edging out a bid by downtown Silver Spring.
Forty years after taking root in Washington, NPR will build a 10-story headquarters at 1111 N. Capitol St. NE., Mayor Adrian M. Fenty said yesterday. The site, a warehouse of the former Chesapeake and Potomac Telephone Co., will feature a 60,000-square-foot newsroom in the up-and-coming NoMA community, the neighborhood north of Massachusetts Avenue near Union Station.
Fenty (D), joined at a news conference in the area by Del. Eleanor Holmes Norton (D-D.C.) and NPR chief executive Ken Stern, said it was the city government's responsibility to ensure that businesses don't leave the District for the suburbs. He said the emerging NoMA community has everything the company needs "to stay and have the quality of life" it wants for its 600 employees.
NPR could have gone "anywhere" the mayor said, adding that the 20-year tax abatements and planned street improvements in the neighborhood were necessary incentives. On Monday, Fenty announced the Center City Action Agenda, a plan to spark investment by private businesses in neighborhoods such as NoMA, the area near the new Nationals ballpark and those along the waterfront east of the Anacostia River.
Neil O. Albert, deputy mayor for planning and economic development, said that NPR will not pay property taxes on the building for 20 years, saving $40 million. The city has agreed not to raise property taxes by more than 3 percent on the station's Massachusetts Avenue building for two decades, or until NPR sells it.
Arthur Greenberg, an executive of Studley, the real estate firm that brokered the deal, said NPR looked at more than 100 sites. Montgomery County officials presented a package that "caused us to take a second look" at a location near the Silver Spring Metro station, he said.
County officials spent months trying to lure the company, crafting scenarios including one that would have provided about $32 million in permanent property tax breaks because NPR is a nonprofit with an educational mission. The county also offered to build a parking lot for the company that would have been worth about $18 million, said Diane Schwartz Jones, a top aide to County Executive Isiah Leggett (D).
County Council President Michael Knapp (D-Upcounty) said he wasn't surprised that Montgomery had fallen out of contention, because NPR and District officials had made it clear that they wanted the company to stay in the city.
"I was pleased that we were part of the discussion as long as we were," Knapp said, "but I would have been surprised if they left downtown D.C."
Norton said she was happy that the city was "landing another big one in NoMA."
"I knew NPR would not do that to us," said Norton, who noted that the media company will join the Bureau of Alcohol, Tobacco, Firearms and Explosives, CNN and XM Satellite Radio in NoMA.
NPR plans to sell its Massachusetts Avenue building, Stern said. The tax abatements were critical to the deal, he said.
"We think of our investment in NoMA the same way we thought of our part in the growth and development of Penn Quarter," Stern said. "It's another exciting area in Washington, D.C. This is a wonderful moment."
But some business owners near the NoMA development had mixed reactions to the deal.
Patricia Ellis-Mitchell, president of North Capitol Main Street, a business group that works to spur commercial development, said that the value of real estate along North Capitol Street is outpacing the market and that small businesses are suffering.
"We want commercial development, but at the same time, the small businesses need some help in meeting the escalating costs of property taxes," she said. "The small businesses in the area, especially along North Capitol, are being squeezed out."
Nicholas Deoudes, who owns three buildings less than a mile from the future NPR location, said that his property taxes increased last year from $13,614 to $36,151. Deoudes, who has owned the buildings for 29 years, said the city needs to help longtime business owners who stayed when the area was a "ghost town."
"That's criminal," Deoudes said about the NPR deal. "My assessments went up . . . while somebody else got it for 20 years with no property taxes. They're handing out benefits to the big guys and leaving the small-time guys like myself and my tenant out of business. We're picking up the tab for somebody else."
Albert, the deputy mayor, said he understands the business owners' concerns about escalating property taxes and encouraged them to appeal the assessments.
"Some taxes went up 36 percent because of proximity to NoMA," Albert said. "It's a good thing for the District that property values continue to go up, but we want to make sure people are not artificially inflating the values of property."