Capital One, owner of 26 acres in Tysons Corner, sued two neighboring property owners last week in a dispute over the financial giant’s rights to develop its headquarters campus.
With a complaint filed in Fairfax County Circuit Court July 7, Capital One alleged that Tysons’ largest landowner, CityLine Partners, and another firm are improperly attempting to restrict Capital One’s development rights by insisting that Capital One adhere to an agreement between the firms made before Fairfax County amended its plan for Tysons Corner.
Capital One and CityLine are neighboring landowners on the doorstep of the Tysons East Metrorail station, which is currently being constructed near the intersection of the Beltway and Route 123.
Both have big development plans that the county is expected to consider this year or next: Capital One has requested zoning approval to build 4.4 million square feet by adding 12 buildings, including 2.7 million square feet of offices, five residential buildings, a hotel and 91,000 square feet of retail. Meanwhile CityLine, which owns the Westgate Office Park, has applied for the right to 8.5 million square feet in the area, including three new three office buildings and two residential buildings on the north side of Route-123, next to Capital One.
However a previous agreement between the firms appears to be creating friction between the two as they advance their plans.
Capital One bought the land for its headquarters from a predecessor of CityLine’s, WestGroup, in 2000. Capital One said in the complaint filed last week, seeking declaratory judgement, that as part of the purchase the two agreed to share any future development allowances provided by the county according to a formula that has not been disclosed. CityLine is now run by much of WestGroup’s development team, including Executive Vice President Thomas Fleury.
But Tysons Corner development is now governed by a new plan passed by the county last year, one that allows landowners near the Metro to apply for unlimited density. Seeing this, Capital One considers the companies’ initial agreement defunct. “The county’s very substantial changes in its 2010 comprehensive plan has rendered the parties’ formula as it pertains to future density useless and wholly inapplicable,” the company said in its complaint.
Capital One says, however, that CityLine and a smaller property owner, RECP IV WG Land Investors LLC, “continue to assert that the formula is still applicable and that the future unlimited density rights available to all parties must be apportioned under it.”
CityLine’s insistence, Capital One said, “is prejudicing Capital One’ s ability to to plan, develop and construct a mixed-use community.” A Capital One spokeswoman declined to comment further.
If Capital One is forced to abide by the original deal, the agreement could have the effect of limiting what the banking and credit card giant is allowed to build. Reached briefly last week to comment on the lawsuit, Fleury said, “I am surprised, but I have no idea what it says or why they’re doing it.” He declined to comment further, and other CityLine executives did not return requests for comment.
Stuart Mendelsohn, a land-use attorney at Holland & Knight who knows both parties, said the dispute’s outcome might affect CityLine agreements with other property owners in the office park. “It’s not just Capital One. There’s more properties included in the Westgate rezoning than just Capital One, so maybe they view this as a precedent,” he said.
County officials said they hoped the dispute wouldn’t slow the transformation of Tysons from one of sprawling office parks to a more urban, transit-accessible city. Barbara Byron, director of the Fairfax County Office of Community Revitalization and Reinvestment, said she wanted to ensure that property owners work together toward public space and transportation improvements, even as they compete for office tenants and other business.
“We have seen a lot of cooperation going on in the area around Tysons East and my concern would be that this could interfere with that cooperation,” she said.
Supervisor Linda Smyth (D-Providence) agreed. “I’d like to see differences settled and everyone get back to work addressing all of these other issues in Tysons,” she said.