Some say it’s now or never in quest to remake Columbia’s downtown 

Posted: 5:40 pm Thu, October 29, 2009
By Robbie Whelan
Daily Record Business Writer

Only at Christmastime, when she needs to do errands at the mall, does Mary Kay Sigaty really walk around downtown Columbia.

The chair of the Howard County Council says she lives just a short walk from the center of town, but going there on foot is pointless, because there’s no clear path to the center of things, no walkability, not even a restaurant that entices her.

“Downtown Columbia is a mall,” she said. “There’s no reason for me to walk there. … And in order to get to the mall, you walk from my house past the residential [area] to a huge parking lot. What fun is that?”

Sigaty’s gripes about downtown Columbia are a familiar refrain here.

Downtown development has dwindled to a halt. The last office building in Columbia’s core was built in 1995. Two independent restaurants there have failed in the last year, and according to one Baltimore research firm, overall office vacancy is at nearly 20 percent. As the locals like to say, Jim Rouse’s visionary city, America’s original planned community, finds itself, ironically, without a plan.

That is, until Monday.

Next week, Sigaty will introduce two bills to the council on behalf of General Growth Properties — the Chicago-based real estate company that bought The Rouse Co. on credit in 2004 and assumed all its responsibilities for transforming Columbia.

One is an amendment to the county’s General Plan that lays out a grand, 30-year vision for thousands of new homes, millions of square feet of office and retail, and bounteous green space to be remake Columbia’s core. The other, a zoning amendment, would give GGP the legal authority to build residential property throughout downtown.

The Council will have 95 days, or until Feb. 1, to approve or throw out the two bills, but in the meantime, its advocates say nearby developments in Prince George’s and Anne Arundel counties are bearing down on Columbia, making it vital for the developer’s mammoth plan to gain approval, and fast.

The young, educated 20- and 30-somethings who Howard County leaders want to attract may very well be going to other communities in the Baltimore-Washington corridor because Columbia cannot provide them with the walkable, dynamic, happening community they’re looking for, these advocates say.

Critics of the plan caution patience and practicality. The county, they say, is forfeiting its leverage with GGP, and confusing the company’s obligations to its shareholders with its duties to the citizens of Columbia.

To complicate things, GGP in April filed the largest real estate bankruptcy in history, claiming more than $25 billion in debt and not enough time to pay it off. Many analysts blamed the bankruptcy on the Rouse acquisition — an expansion that was too fast and too costly at the height of an economic bubble that was about to burst.

The city of Columbia, which was not listed in the Chapter 11 filing, is the only development project that GGP is still spending money on, and could potentially be a test of the strength of its footing as it comes back out into the light.

Everyone involved in the downtown redevelopment plan, as a decision-maker, observer or resident, seems to have one thing in common: they all want commitments — either from GGP or from the county — that what’s promised will be delivered.

“As I tell people, I’ve been waiting since 1978 for downtown to develop into an urban downtown,” Sigaty says.

And with competition from surrounding jurisdictions, it seems to be now or never.

Seeking employment

Gregory F. Hamm, GGP’s vice president for master-planned communities and head of the Columbia project, lives in Northern Virginia. He says that region has lessons to teach to Columbia.

Specifically, when the second phase of office construction at Reston Town Center, a planned city 18 miles from downtown Washington, began in 1997 and attracted outsourcing giant Accenture as its lead tenant, it changed the entire landscape of the project, he said.

Young people got jobs there, and moved into nearby housing. Restaurants opened. Public spaces downtown came alive with outdoor events and entertainment. Reston, once not even a pit stop on the way to Dulles Airport, became a real place.

“Downtown Columbia’s hurting at the moment,” Hamm said. “It didn’t get the revitalization it needed in the ’90s, so we’re now getting ready to make some changes. We get our own Accenture, and everything changes.”

The sense that Columbia is missing out on the benefits of having a young, educated, and ultimately affluent middle class is frequently articulated by advocates of the GGP plan, and also borne out by some statistics.

Sigaty, of the County Council, said that young professionals are “the one demographic that seems to be missing” from Columbia, while the U.S. Census Bureau predicts that Howard County’s over-60 population will nearly double in the next two decades, to more than 80,000 seniors.

“Ellicott City and Columbia really have a high concentration of 65-and-over people,” said Sue Vaeth, administrator of the Howard County Office on Aging. “We are one of the fastest-growing populations in the state as far as people over 60.”

This month, four Howard County residents — lawyer Michael W. Davis, Lin Eagan, who heads a Columbia real estate title company, Realtor David Yungmann and retired architect Phillips S. Engelke — formed a group called New City Alliance to advocate for the swift approval of GGP’s plan by the Howard County Council.

There are two prongs to the urgency, according to Yungmann: Young people are not coming to the county, and empty-nesters are moving away, eroding the area’s consumer and business base.

The New City Alliance also points to nearby projects that are vying for the same type of young residents and workers. Annapolis Towne Centre at Parole opened last year. It is smaller than Columbia Town Center, but is geared toward a similarly young and well-off consumer.

Konterra Town Center, a $3 billion mixed-use project near Laurel, is moving steadily through the planning and permitting stages. Its developer, Forest City Washington, plans to bring more than 5,000 housing units and nearly 6 million square feet of commercial space to a site along the under-construction Inter-County Connector over roughly the same timeline as the Columbia plan.

“It’s going to be a major part of the competition for Columbia,” Davis said.

Yungmann’s concerns are even more specific: “We’re probably two years away from a site plan even if we stay on this track. If they’re poised to start leasing up when the economy really starts growing again, and we’re still talking, it’s an issue.”

Extensive plan

The plan that General Growth has proposed is extensive, but at the same time relatively vague.

We know that the company would like to re-style downtown as more of a traditional rectilinear grid, and that it plans for extensive green space and measures to ensure environmental stewardship of the natural elements (the lake, the forested areas, the waterways), all very much in keeping with Rouse’s original goals for the city.

We also know that GGP plans to bring residential and commercial space on-line in three phases. Starting with between 656 and 2,296 housing units and up to 2.5 million square feet of office space and shops in the first five to 10 years after plan approval, over 30 years, the plan calls for 5,500 housing units, 640 hotel rooms, 4.3 million square feet of office space and 1.25 million square feet of retail.

What’s not clear is where, exactly, all this new development will go. GGP’s Hamm has said the residential component will be “all over downtown,” and GGP’s sketches of their vision include six new neighborhoods with general details about what will go there.

Warfield, for example, will be a “traditional mixed-use neighborhood for families” north of the Mall along Gov. Warfield Parkway, with up to eight stories of office space above street-level retail.

The Lakefront, a long, kidney-shaped swath on the west side of Lake Kittamaqundi, will be improved with a “modestly-scaled primarily residential and hotel community” at its north end, and new “retail, restaurant, office, residential and hospitality uses” along its central strip.

The details don’t go much deeper than that. Nor do the specifics about who, exactly, will pay for these new additions and pick out their nuts and bolts.

Columbia was left out of General Growth’s April bankruptcy filing, a sign the company still considers the project a high priority.

“General Growth has made it very clear that they’ve curtailed all major developments in the country and stopped all major zoning activities in the country, except this one,” Hamm said. “A lot of it has to do with the process that started five years ago. … I think we have a feasible short-, medium- and long-term plan. As the capital markets allow, this plan will unfold.”

At the same time, the general plan amendment obliges GGP to fulfill a laundry list of promises to the community. Before getting a building permit, the company must find a way to relocate a firehouse, renovate bridges and roads, make improvements to Merriweather Post Pavilion, the nearby concert venue, and do extensive environmental remediation work.

Among the 29 “public amenities” listed in the general plan amendment are a $5 million donation that GGP must make to Columbia’s affordable housing foundation and improvements to public transportation, including contributions to the initial cost of a downtown circulator shuttle.

Competing loyalties

But critics of the plan say that GGP’s interests in remaking downtown Columbia are not completely in line with the needs of the community.

Alan Klein, a management consultant who lives in the village of Harper’s Choice and acts as spokesman for the Coalition for Columbia’s Downtown, said that the company’s weak financial position could change the terms of all the promises in the general plan amendment, because general plans are not binding under Maryland law.

Specifically, he worries that if the county approves zoning that allows GGP to put 5,500 units on its downtown landholdings, the value of the land could increase by as much as $1 billion, and GGP will have incentives to sell it off piecemeal to as many developers as get in line. Those developers have not agreed to contribute to transit and affordable-housing measures, and they don’t have the same long-term commitment to Columbia that GGP does, or Rouse did.

“They bought the entire Rouse Co. 100 percent on credit. They owe huge amounts to people. That’s what the bankruptcy’s about, that’s why their stock went from $58 to 58 cents,” Klein said. “If I was in charge of the company, and I had all that debt … it’s not an unreasonable thing to do. … They could sell it all off, and then we’re in the nightmare situation of where do we go to for all the amenities we’ve been promised?”

Instead, Klein says, his group, which he says has 450 members, wants the county to only approve a zoning change that allows roughly 1,500 housing units at the outset, let the company complete a series of goals including building the first phase of housing, and then give the company more zoning authority at a later stage.

“Vibrancy, walkability, density … we are perfectly fine with all those things. We are perfectly fine with more residential development in downtown,” Klein said. “We want to make sure they can be held accountable, and the only lever that the citizens, through our county council, have, is that residential density.”

Hamm, of GGP, said that selling the residential land is a possibility, but that the zoning bill does protect residents by requiring that the amenities in the general plan be fulfilled before development goes forward.

“We could sell it, sure,” he said. “But unless there are many things called for to coincide with the ability to build the units, and if those things called for are not done, you can’t get a building permit. Amenities, parks, open space, stormwater management, environmental restoration, roads, streets. You simply cannot move forward until that work is done. … If the zoning says that unless the things called for in the general plan are provided, you can’t go farther, then you can’t go farther.”

The zoning amendment does include language saying that no permit for development in the later stages of the proposed revitalization plan will be issued unless these amenities to the community — referred to as Community Enhancements, Programs and Public Amenities — have been provided.

But in the next paragraph, the bill says that if those CEPPA requirements cannot be reasonably met, “then flexibility shall be granted.”

Bankrupt benefactor

It is in discussions about GGP’s duty to carry out the Rouse Co.’s obligations to the community that the bankruptcy seems to become more important.

Is Columbia a priority for the company because it matters to the people who live there, or because the project is a potentially profitable asset that could help GGP emerge from bankruptcy?

Hamm insists that the bankruptcy will have “absolutely no” effect on the project.

Mary Kay Sigaty says she thinks the plan will work even without GGP.

“It doesn’t matter what happens to [GGP] at this point, because the plan will be a county plan. It’s our job to make sure that the policy statements in the plan go forward,” she said. “The way it’s planned over time, if we encounter difficulties that can’t be resolved, it will stop.”     She and the members of the Howard County Council will have until Feb. 1 to make up their minds completely.