Commercial landowners in Tysons Corner are wrestling over how best to raise $263 million or more needed for road improvements in the area in a way that balances their differing — and often competing — development visions.
County officials and Tysons developers largely have agreed that at least $263 million will be required from the private sector to afford major road improvements needed to alleviate congestion in the area, out of an estimated $810 million total. The Tysons Partnership, a private group of nearly all major Tysons landowners, presented some financing ideas to the county on Sept. 7.
But the partnership’s members — many of whom are competitors — are struggling to agree on who should pay what. They largely fall into one of three categories: those who need zoning approvals for development under the new Tysons land use plan, those who already have approvals under previous zoning rules and those who have little or no interest in development.
Jonathan B. Cox, senior vice president for development at Avalon Bay Communities, an apartment builder with holdings in Tysons, has been studying the costs for the Tysons Partnership. He said a major issue facing the group was persuading members with widely different priorities to support an agreement that would cost all of them. To create a special tax district, the most talked about idea, at least 51 percent of the landowners by value or by acreage must agree to a special tax district in order for it to be created.
“We’re trying to figure out what will be palatable, but will still bring in enough money,” he said. Cox said Avalon Bay, which will require zoning approval for a site it owns on Tyco Road, was in a holding position because of the uncertainty around the issue.
“We just don’t want to work through all of these issues with the county on the fly,” he said.
Among the ideas are a tax of 7 cents per $100 of assessed property and mini-tax districts with different rates. Cox said that creating mini-districts may require the Virginia General Assembly to make legislative changes.
Other developers, particularly the Lerners and Macerich Co., already have approval to go ahead with their development plans and are not relying on the new zoning rules or planned infrastructure improvements to make their projects work. Both have announced that they are constructing speculative office buildings.
Having approvals “places us in a bit of different position,” according to Tim Steffan, Macerich senior vice president of property management. Steffan pointed out that many of the improvements weren’t adjacent to Macerich’s property, which provided little incentive for Macerich and others to pay for something, “that’s not located anywhere near them and does not have any direct or ancillary benefit.” Tysons landowners already agreed to a tax to pay for the extension of Metrorail that is currently being built.
“It seems very clear to the participants that if the infrastructure doesn’t directly benefit you as a landowner, it would be very difficult to absorb that,” Steffan said.
Barbara Byron, director of the Fairfax County office of community revitalization, cautioned that the financing ideas were still in the early stages. She acknowledged that formulating a deal to reach the 51 percent threshold might be difficult.
“That may be challenging because people are in different phases of life in Tysons,” she said.