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Plans to Redevelop O Street Market Are Met With Cautious Optimism

By Michael Birnbaum
Washington Post Staff Writer
Friday, July 4, 2008

Wooden struts are all that keep the walls of the O Street Market from toppling. Blue sky has shown through its buckling window panes ever since the roof collapsed in a 2003 snowstorm. Its cherry-painted brick is peeling, revealing a deeper shade of burnt red underneath.

Proposals for the 1881 structure, which is a close cousin to Eastern Market and the Georgetown building that houses upscale grocery store Dean & DeLuca, have ebbed and flowed over the years.

Last week, Mayor Adrian M. Fenty (D) announced $35 million in city financing for the project, the final piece of a $320 million redevelopment deal with groundbreaking set for fall 2009. Construction would be finished in 2010 or 2011. Many Shaw residents and business owners hope that the project will spark a revival in the neighborhood.

The O Street Market, once a bustling center in Shaw, closed in 1968 after riots swept through the area. The market reopened in 1980, but its last years were troubled. A 1994 shooting rampage there killed one person and wounded eight others, gang activity rose around the building, and tenants fled. Then, the roof caved in.

The site has stood empty since. Pigeons swoop in from the parking lot of the Giant supermarket next door, perching briefly along the top of the market's walls. Teenagers hang out across O Street in front of a tall apartment building. A few people walk into the new public recreation center on the other side of Seventh Street NW, but the market's corner stays quiet.

Now, with the help of the District's financing, that corner might bustle again.

The planned nine-story development would span two city blocks. Roadside Development, the firm in charge of the project, says it will build 630 units of housing, several storefronts, 200 hotel rooms and hundreds of parking spaces. A new Giant, double the size of the current store, would be built inside and around the shell of the market building. Eighty to 100 apartments would be designated as affordable senior housing, and new businesses would add up to 400 jobs, Roadside officials said.

Many residents of Shaw are eager for the project to begin.

"The only concern I have is that I hope they hurry and get started with it," said Letha Blount, head of the Foster House Tenant Association on nearby Rhode Island Avenue.

The neighborhood has heard promises made, and not kept, before.

The Walter E. Washington Convention Center, which looms just a few blocks south on Seventh Street from the O Street Market, was promoted as a source of money and new life in Shaw when it opened in March 2003. But few conventioneers ever venture into the neighborhood, business owners said, and Seventh and Ninth streets are pockmarked by boarded-up storefronts and houses.

Azeb Desta, who owns Azi's Cafe diagonally across from the planned development, said that she had heard about the project after she opened her cafe three years ago. Since then, her enthusiasm has waned.

"I'm not as excited as I was three years ago," she said. Her attitude toward the project: She'll believe it when she sees it. As for the convention center, she said she gets no business from it -- "Nothing."

The largest projected disruption during construction would probably be the closing of the Giant for as long as two years. The supermarket said it would offer a free shuttle to its Columbia Heights store. Roadside said that it would fund a Peapod delivery service for area senior citizens, making it possible to order groceries online without delivery fees.

Some questions about the economics of the project remain. The housing market across the country has been shrinking. Douglas Jemal, another District developer who has undertaken projects similar to the O Street Market, said that he is concentrating on smaller buildings.

Susan Linsky, Roadside's manager for the project, said that the company is not concerned about the tighter market.

"We think the economy will be doing better in a year," Linsky said. "And [the project] is in the District of Columbia. While things are not as go-go as they were, there's still a very solid market in the city."

Some D.C. officials are nervous about the District's large commitment to the project. The $35 million that would be provided by the District, pending final council approval in September, would come from property taxes generated by the project. If the anticipated increases in tax revenue are not realized, the city might have to turn to other sources to pay for the project.

That makes it critical for the city to be cautious, some officials argue.

No tenant for the hotel has been signed, but 44 percent of the taxes to repay the city would come from the hotel, said John Ross, a senior adviser in the Office of the Chief Financial Officer. At a hearing Wednesday, Ross said that his office would be "more comfortable" if there was a tenant before the city contributed any money.

The criticisms do not faze D.C. Council member Jack Evans (D-Ward 2), whose district includes the Shaw neighborhood. "You have to take a little bit of a chance," he said. "The flipside is the wild success we've had on these things."

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