The Washington PostDemocracy Dies in Darkness

Spy Museum plots $162 million move to L’Enfant Plaza, seeks District support

A rendering of a proposed $162 million International Spy Museum at L’Enfant Plaza. (Courtesy Spy Museum)
Placeholder while article actions load

Owners of the International Spy Museum are trying to move their hidden camera neck ties, lipstick pistols and James Bond paraphernalia to a new home, one built with a $65 million donation of their own money and possibly $15 million in support from the D.C. government.

Founded by midwestern media mogul Milton Maltz, the museum currently operates in Northwest D.C. on F Street in Penn Quarter on a lease that expires in the summer of 2017.

For nearly two years, Maltz, 85, and the museum’s management have been trying to find a new location. They spent a year trying to complete a deal to expand the Carnegie Library building in Mt. Vernon Square into a suitably large space, only to shelve the plans after failing to win approval from the District’s historic preservation panel.

Now the museum’s owners are giving it another shot. Though they haven’t signed a lease, its owners are trying to finalize a deal with developer JBG Cos. to build a new museum at L’Enfant Plaza and turn the organization into a non-profit controlled by the District.

The new location — part of a series of upgrades JBG has been putting into place at L’Enfant — would be in a 65,000-square-foot stand-alone building featuring space for exhibits, retail, a theater, classrooms and operations support.

L’Enfant Plaza has long been considered a drab government enclave, and the museum’s owners and JBG issued a statement saying the museum’s new location would “catalyze redevelopment there and establish important new connections between the National Mall and the emerging Southwest Waterfront,” where construction is underway a few blocks south.

The new museum would be paid for by a combination of mostly private sources, led by a $65 million donation from Maltz’s communications business, the Malrite Co.

The Malrite Co. also proposes to donate the existing collection, valued at $42 million, to the newly formed non-profit as a “gift in perpetuity” to the city. To complete the building, the museum would then borrow $25 million in tax-exempt bonds and another $15 million from private sources to be repaid by a capital campaign, backed by the Malrite Co.

Representatives of the Spy Museum and JBG have repeatedly met with District officials on Mayor Muriel E. Bowser’s economic development team to see if the District would be willing to foot part of the cost, much as it did when the Spy Museum first opened in 2002.

Back then, the District issued $6.9 million in tax increment financing (TIF), money the District borrowed and later repaid using tax revenue from the museum. Though it was one of the city’s first uses of TIF, the museum was such a success that its owners say they paid back the money in five years, seven years ahead of schedule.

Spy Museum representatives initially asked for $30 million, but District officials are now discussing whether to provide $15 million. They say the money will help revitalize L’Enfant Plaza — part of a proposed neighborhood eco-district — the way the original museum gave a boost to Penn Quarter, now one of the District’s most sought-after neighborhoods for retailers, condo buyers and apartment renters.

L’Enfant Plaza, meanwhile, is in one of the District’s last remaining areas where few live. Some businesses close their doors after lunch.

“Keeping this museum in the District greatly benefits the city and the community,” the museum and JBG said in their statement. “It will anchor the SW Ecodistrict Initiative and the revitalization of 10th Street SW, creating 350 jobs throughout construction, and up to 200 permanent jobs at the Museum upon completion. Additionally, this project would generate over $2 million in annual tax revenue for the District.”

Bowser sacked the idea of putting a contemporary art museum in the former Franklin School, but mayoral spokesman Joaquin McPeek said District officials are in “active negotiations” over the spy museum’s proposal and acknowledged the operation’s value to the city.

“The spy museum has been a positive contributor to the revitalization of Chinatown. Further we recognize the important role museums play in our creative economy and in our ability to attract visitors from around the world,” McPeek said.

Follow Jonathan O’Connell on Twitter: @oconnellpostbiz