The city is not in the real estate business," said James P. Gray, chief of the space management division in the city's Department of General Services."... I don't think it's a function of government to be medling in private enterprise."
Most officials agree. However, when the city does happen to sell a building it owns, the figures show that it can reap profits as stunning as those that private investors and speculators make here.
For example, the city is planning to sell its former Georgetown police station at 3218 Volta PL NW, according to Sam Starobin, head of the Department of General Services that oversees properly owned or leased by the city.
DGS officials said the Volta Place property will be put on the market for $270,000, a price that DGS appraisers believe a developer will pay. The appraisers believe a developer can tear down the old building on the site, put up six or seven town houses there and sell them for $250,000 each.
Yet just three years ago, city appraisers put the value of that same property at $175,000, according to William C. Green, supervisor of the DGS real estate division's acquisition branch. Greeen said the city originally bought the site in the early 1890s for $9,750 and soon thereafter spent $20,500 building the police station.
Starobin said the mechanisms the city employs for buying and selling land are so cumbersome that the city can never he successful in real estate dealings, where "the whole thing is timing."
The complexity is deliberate, he added. "There's the possibility of corruption.If we could buy and sell freely without the reins, there's a possibility of deals being made."
Bernard Frieden, professor of urban studies at the Massachussets Institute of Technology, said that in general courts have insisted that when a local government buys land that it demonstrate some public purpose for doing so other than simply to make a profit.
The District of Columbia owns more property than it leases - 28.4 million square feet of building space, 26 million of which is located inside Washington itself, and with a total assessed valuation of $825 million, according to city records.
This space includes the District Building and other general office space, courts, police headquarters and substations, warehouses and other buildings. The city also owns 7275 million square feet of land both inside and outside the District of Colubia.
In addition to all this, the city leases about 3.1 million square feet of building space, according to Gray, paying a total, about 1.4 million square feet, is office space. Youth group homes, halfway houses and the like occupy only 118,000 square feet at $246,844 in annual rents.
The city also has some control over more than 600 properties that were purchased as a result of U.S. urban renewal and public housing programs, and four of these properties have been given by the Department of Human Resources for its youth group home program DHR plans to open threee of the homes in Southeast Washington and one in Norteast.
Federal approval and an enormous amount of paperwork and red tape was required for this, and city officials are doubtful whether it can be done on a broader scale.
Starobin said that the Redevelopment Land Agency, the independent city agency that was set up to handle urban renewal here and that holds title to most of the properties, "is not intended to be a permanent landlord. Now they have a bunch of boarded up houses, it's true...(But) their function is not to meet the needs of D.C. agencies."
All of the more than 600 properties are scheduled to be renovated during the next five years and sold or rented, mostly to moderate and low-come people, according to officials of the city's Department of Housing and Community Development.
Several officials of DHR, which is having difficulty finding suitable houses to rent on the private market for use as youth group homes, said they wished the city could buy houses for the program.