Cash-Strapped D.C. Area Governments Try to Snap Up Discounted Parkland

Officials in Montgomery County and across the Washington region are trolling for bargain parkland in the economic downturn. Some are finding gems. This 53-acre wilderness in Burtonsville is home to crayfish and sweetbay magnolias. Officials bought it from a developer for about half price. Video by Michael Laris/The Washington Post
By Michael Laris
Washington Post Staff Writer
Friday, August 14, 2009

In the boggy wilderness beside a log cabin on the eastern edge of Montgomery County, crayfish build runny mud towers, and green bursts of ground pine spring from the forest floor.

And that's the way things will stay, thanks in part to the recession.

Montgomery officials agreed last month to buy the area, a 53-acre ecological refuge, at a deep discount from a developer who had long turned away government suitors. They are paying $8.75 million, roughly half of the $16.35 million price appraised in December.

And officials in Virginia last month were able to knock $2 million off what they paid for 1,100 acres of forested waterfront land in Stafford County. The area, known as the Crow's Nest, is near the spot where Pocahontas was said to have been abducted by Jamestown settlers.

Some governments in the Washington area are experiencing an upside to the economic downturn: cheaper parkland. They are trying to take advantage of the bad real estate market to negotiate deals.

"We're finding people coming to us, particularly lending institutions, that are anxious for us to look at their properties," said Judy Pedersen, spokeswoman for the Fairfax County Park Authority. She said that such talks are confidential but that "for us, it's a good time to buy."

The problem is, it's also a terrible time to buy. With sharp drops in tax revenue, governments are facing hundreds of millions of dollars in budget cuts. So officials are responding in different ways to the real estate shakeout. Officials in Montgomery see a chance to buy low. In parts of Virginia, officials are trolling for low prices, although some are relying more on tax incentives to encourage preservation.

"We're in a bit of a Catch-22 in that we have many more opportunities to bring great projects forward at a bargain, but we have less money to spend," said Kent Whitehead of the Trust for Public Land, which works with government agencies.

Whether officials have the money to use their negotiating leverage varies by state and county, Whitehead said. The Trust for Public Land is working with officials in Maryland to buy three parcels for significantly less than their appraised values.

In the District, the priority is to sell or lease some underused government properties to revive neighborhoods and collect new taxes. "We've kind of got the opposite problem" from governments trying to buy land, said Sean Madigan, a city spokesman. "We're not seeing the kind of valuations that we were a couple of years ago."

At the real estate market's height, developers would line up, sometimes by the dozens, to bid on opportunities in the District. Now some projects, such as an offer to redevelop the former Grimke Elementary School on Vermont Avenue NW, have received only a handful of bids, city officials said.

Maryland officials said they have money to bargain-shop because the state dedicated funds from the real estate transfer tax for purchases decades ago.

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