Comstock, a Reston-based developer, plans to begin construction on the redevelopment of downtown Herndon by August of next year.

A company spokesperson told Reston Now that a groundbreaking date has not been finalized yet, but could offer a ballpark estimate of when construction might begin.

“We are finalizing updates to plans to ensure constructability given the numerous supply chain constraints currently affecting the industry and hope to start construction in Q1 or Q2,” the spokesperson said.

The project recently secured a commitment for five million dollars in county funding earlier this month, allowing the project to move forward.

In the public-private partnership between the Town of Herndon and Comstock, the developer plans to transform 4.7 acres of land previously owned by the town into a mixed-use town center with 273 residential apartments, 17,000 square feet of retail space, an arts center and a 726-spae parking garage.

The project’s total cost increase by nearly $25 million due to issues related to materials, labor, and workforce restrictions caused by the pandemic, the town’s economic development manager Dennis Holste, told the Herndon Town Council earlier this month.

The revitalization of downtown Herndon has been on the drawing board for several years. A groundbreaking date was first anticipated in late 2019.

Town leaders agreed Tuesday to accept $5 million more from Fairfax County to finally begin the construction of a residential-retail-arts complex downtown.

The long-awaited development, which calls for 273 apartments, a parking garage, retail space and an arts center, will get $6.2 million from the county through the additional support.

“This is huge,” Councilmember Signe Friedrichs said. “This isn’t just a little bit of money; this is a lot of money,” she said of the county’s increased contribution. “We are so grateful.”

The new funding arrangement calls for releasing the $5 million in $1 million increments each year; payment would begin once the project gets an occupancy certificate for its first residential unit.

The support came after the town and developer agreed to equally split an estimated increase of $24.6 million of the project. Dennis Holste, economic development manager for the town, said that eight-figure increase was related to materials, labor and workforce restrictions “due to the pandemic.”

Town officials were unable to comment Wednesday what the breakdown of the additional costs involved. Comstock didn’t immediately respond to a message seeking comment.

In November 2020, the town and Comstock amended an earlier agreement with the company from 2017. The town then sold the nearly 4.7-acre parcel at 770 Elden St. to Comstock for over $10.06 million on Dec. 16, 2020, according to a county property database.

“I think this is a big win not just for the town but for the area,” said Vice Mayor Cesar del Aguila, following the council’s unanimous vote to accept the county contribution, coming from an Economic Opportunity Reserve Fund, designed for strategic investments to stimulate growth.

Comstock has to start the project by Dec. 31, 2021 but can extend that by up to two years depending on market conditions or other matters, such as the COVID-19 pandemic, according to the town.

A software company has signed a lease for 85,000-square-feet of space at Reston Station — a big move that will bring 400 new jobs to Fairfax County.

In a release today, Gov. Ralph Northam announced that Qualtrics will invest $15.9 million as it moves from former offices in Reston. Virginia courted the experience management software company from other competing states like Pennsylvania and Ohio.

“Organizations everywhere are undergoing an experience transformation and Qualtrics has an incredible opportunity in front of us. With its strong talent pool, Virginia is a perfect place for Qualtrics to grow,” said Qualtrics CEO Zig Serafin. “The investments we’re making today will put us in an even stronger position to help our customers build their next great customer, employee, product, and brand experiences.”

The office will be located at 1906 Reston Metro Plaza, part of Comstock’s Reston Station development.

Here’s more from Northam’s office on the news:

The FCEDA worked with the Virginia Economic Development Partnership to secure the project for Virginia. Governor Northam approved a $1.4 million grant from the Commonwealth’s Opportunity Fund to assist Fairfax County with the project. The governor also approved $2 million in funds from the Virginia Economic Development Incentive Grant. Support for job creation will be provided through the Virginia Talent Accelerator Program.

“Virginia offers access to the highest concentration of tech talent in the United States,” Northam said. “The Commonwealth’s diverse tech ecosystem is driven by our stable business climate, competitive operating costs, and a world-class workforce. We look forward to Qualtrics’ continued success in Fairfax County.”

Victor Hoskins, president and CEO of FCEDA said the news marks a second vote of confidence that the company places in Fairfax County.

“First was the purchase of Clarabridge, a homegrown tech success story, and now the expansion being announced today. We thank and congratulate Qualtrics for this tremendous growth and we stand ready to assist the company further as it expands its footprint here.”

Reston Station is already home to big companies like Google and ICF International.

Photo via Comstock

The clock to begin the stalled redevelopment of downtown Herndon by the end of the year is ticking.

Members of the Fairfax County Board of Supervisors have expressed support for providing $5 million for the delayed development of downtown Herndon — a project that faced a nearly $25 million funding gap last year.

The $109 million project would transform 4.7 acres in the town’s historic district with 273 apartments, 17,000 square feet of retail, a 16,265-square-foot arts center, and a 726-space public parking garage, 330 of which would be reserved for the town.

At a meeting with the board earlier this week, town manager Bill Ashton said a major funding gap prompted the town to turn to the county for help.

The Town of Herndon and Comstock, its private development partner, agreed to split a funding gap of roughly $24.6 million. Tax abatement efforts and several design changes — including eliminating the mezzanine of the arts center and reducing one underground level of the planning parking garage — still left a $5 million funding gap.

The project has been marred by delays since its inception. Groundbreaking was originally planned for December 2019.

The estimated price tag of the project rose from $79.4 million in 2016 to $111 million in 2019 due to increases in the cost of construction, materials and labor, Ashton said. 

Comstock rebid the project in 2020 in order to leverage possible savings due to the pandemic, but a significant funding gap still remained.

The town then quickly crafted a robust tax break program, creating the mechanism to offer Comstock $2.4 million in fee reductions and $1.9 million in real estate tax abatement.

The project is expected to result in $886,500 in Fairfax County General Fund Real Estate taxes after the first year of occupancy, according to an analysis by JLL.

County staff suggested dishing out funds over a period of years in order to minimize the impact of the request on the reserve fund. The economic opportunity reserve fund is intended to purchase real estate, fund capital development projects and provide programming support for economic development activities of “strategic importance,” according to the county.

Board chairman Jeff McKay encouraged staff to ensure that the delivery of funds was tied to development milestones. County staff noted that funds would be dispersed conditionally. 

The board is expected to vote on the funding request at its board meeting on Dec. 7. Groundbreaking is expected to begin in December — nearly two years after the first estimate.

The garage will be completed by August 2023, followed by the arts center in December of that year. The entire project is expected to close out in March 2024. The Town selected Comstock for the redevelopment project in November 2016.

It’s not the first time the town went before the board for project funding.

In 2018, the board approved $1.2 million in funding for the project. But no funds have been dispersed to date because the agreement required the town to contribute $1.2 million first.

The arts center will include a black box theater with programming by ArtsHerndon and NextStop Theatre Co.

Mason District Penny Gross urged the Town of Herndon to ensure the arts center is accessible to all, especially in a town with as much economic diversity as Herndon.

Hunter Mill District Supervisor Walter Alcorn also said he wanted to ensure the arts center and the overall project was an asset to the public.

Ashton said that the arts center will include programmable outdoor space and a public plaza. The council will determine an operating model for the arts center once groundbreaking begins, he said.

Photo via handout/Comstock

 

The last retail space at the Wiehle-Reston East Metro Station’s plaza has been officially leased.

Scissors and Scotch, a men’s grooming spa and cocktail bar, plans to open a 2,066-square-foot location at 1901 Reston Metro Plaza next year. The addition is part of Comstock’s Reston Station project, a sprawling mixed-use development directly at the metro station. 

“At Scissors & Scotch our team of seasoned barbers, stylists and bartenders strive to make our customers look and feel great. We believe those who live and work in the Reston area will love the unique combination of grooming services and cocktails our locations are known for,” said Kai Christian, the company’s operations director, in a statement.

The business offers hair and grooming services for men in an upscale lounge with custom cocktails. Clients can take part in a membership program or drop by for walk-in services, according to the company’s website.

Founding in 2015 by three friends, Scissors & Scotch has locations in nine markets, including two locations in the District, Kansas City, Des Moines, Dallas, Nashville, and Oklahoma City.

In a statement, Timothy Steffan, Comstock’s executive vice president, said the addition of Scissors & Scotch is the “perfect complement to our existing best-in-class lifestyle and wellness brands.”

“We are thrilled to welcome Scissors and Scotch to our line-up of lifestyle and wellness offerings at Reston Station,” Steffan said.

Other retail tenants at Reston Station include Orange Theory, Pure Joe Pilates, and Nordine Day Spa. Reston Station is also home to Founding Farmer’s, Matchbox, and Big Buns.

Volunteers Needed for New Fall 5K — Reston Association is looking for volunteers to help with the inaugural Friends of Reston Fall 5K fundraiser on Oct. 17 from 7-10 a.m. [RA]

Police to Host Community Information Session — The Fairfax County Police Department’s Reston district station will host a community information forum tonight at 7 p.m. The session is online. [FCPD]

Blackstone Lends $350 Million for Refinancing — Comstock, a Reston-based developer, has landed a refinancing deal for three Reston Station office towers, which are 84 percent leased. [Bisnow]

Comstock Holding Companies, Inc. has officially secured refinancing for a trio of office towers at Reston Station, according to a company release.

The Reston-based company arranged a $350 million financing package for the first three office towers built at Reston Station, a 60-acre, mixed use project near the Wiehe-Reston East Metro Station.

The office towers at 1900, 1902 and 1906 Reston Metro Plaza are anchored by tenants like Google, Neustar, Rolls-Royce North America, and ICF Global.

Comstock received roughly $2.6 million in debt and equity origination fees, which are charged by the lender for compensation for a loan application.

The package includes $312 million by a Blackstone subsidiary and $43 million with a DivcoWest subsidiary. The three buildings are 84 percent leased, according to a company release.

Here’s more from Comstock on the restructuring effort:

The Anchor Portfolio primarily includes mixed-use properties located adjacent to key Metro rail stations in the Dulles Corridor in the northern Virginia suburbs of Washington, DC. Additionally, CHCI, through its institutional venture platform, acquires and manages stabilized properties with a focus on transit-oriented, mixed-use assets throughout the Washington, DC region.

“Building long term relationships with best-in-class capital providers such as Blackstone and DivcoWest is among our key strategic initiatives and we believe the financial commitment of these market leaders to Comstock and Reston Station affirm the pre-eminence of our office portfolio in the Dulles Corridor”, commented Chris Clemente, CHCI’s Chairman and Chief Executive Officer. “Closing this long-planned recapitalization in an attractive interest rate environment allows us to accelerate the recently commenced development of the next phase of Reston Station while we also focus on aggressively scaling up acquisitions of multi-family assets in our institutional venture platform. We look forward to updating the market in the very near-term on our progress on that front as we continue to focus on creating value for all Comstock’s stakeholders”.

Plans to develop a new luxury brand hotel in Reston were revealed today.

Comstock Companies made the announcement that one of its managed companies, CRS Hotel, LC, entered a franchise agreement for the development and operation of a JW Marriott and Residences Reston.

The hotel is expected to be in Phase I of the Reston Row District at the Reston Station development. It will take up 8.4 acres of space at the intersection of Reston Station Boulevard and Wiehle Avenue near the Wiehle Reston-East Metrorail Station.

“We are excited to partner with Marriott to bring Virginia’s first JW Marriott to Reston,” Chris Clemente, CEO of CHCI, said in a press release.
“We look forward to adding this incredible brand to Reston Station and expect that the unrivaled amenities and meeting spaces will attract business and social functions from around the Washington, DC area, while meeting the needs of our corporate office clients, including Google, Rolls Royce of North America, Neustar, ICF Global, and others.”

In addition to an expected 250 guestrooms, the proposed 26-story tower will provide 90 luxury branded residences. The residences will include a separate residential lobby entrance and will be located on the upper floors of the JW Marriott tower. The residences will also have dedicated spaces and amenities such as an owner’s lounge, fitness center, outdoor area and dog park.

Two restaurants on the site are also included in the current plans for the hotel.

“We are thrilled Comstock Companies has chosen to bring the JW Marriott brand to Reston, in the heart of the Dulles Technology Corridor,” Noah Silverman, Chief Development Officer, North America Full-Service Hotels at Marriott International said in a press release. “This project will serve as a signature component of the exciting Reston Row development, offering both guests and owners a welcoming luxury experience.”

The expected timetable for the hotel’s opening is in 2024. The Comstock press release lists the project’s price tag at approximately $250 million.

In addition to the proposed hotel, the Reston Row District at Reston Station will eventually include various mixed-use buildings, two office towers and a 350-unit multi-family building. It will also include more than 65,000 square feet of retail, service and fitness spaces that will surround a 1.2-acre park.

Images courtesy Comstock

After decades of discussion, proposals and delays, the town of Herndon has approved a final amendment to its comprehensive agreement with Comstock Holding Companies, Inc. to redevelop downtown.

On Tuesday night, the town council unanimously approved a resolution to amend the existing comprehensive agreement it entered into with Comstock in 2017.

“We are taking a leap of faith that this will inject into the downtown a needed sort of vibrancy that we all hope it is,” council member Cesar del Aguila said.

“But let’s be clear, there are no guarantees here. But I think we’ve done all the right things. The ballroom is rented, the orchestra is playing, now it’s time to see if we can dance.”

Elements of the initial agreement still include redeveloping town-owned land into a mixed-use project with 273 apartments and approximately 17,00 square feet of retail space. It also includes a 16,265-square-foot arts center and a parking garage with 726 spaces.

The amendment – which was presented to the council during a work session on Nov. 10 –  establishes a variety of matters. Those items include a sunset date of Dec. 15 by which time the town and Comstock must close on Comstock’s purchase of the 4.675-acre property.

The amended agreement adjusts the date by which Comstock must have the project under construction to Dec. 31, 2021. However, Comstock does retain the right to pause the start of construction up to two years due to market conditions and other complications, including issues arising from COVID-19.

Also included in the amendment is an increase in the parent corporate guarantee by $5 million to $10 million to cover the arts center and the parking.

“The parent guarantee refers to Comstock’s parent corporation putting forth the guarantee of $10 million to cover this project were Comstock Herndon LLC to default,” town attorney Lesa Yeattes told the council.

“So, this is a key component of the amendment and gives the town much more safety than it had previously in the additional $5 million guarantee.”

The amendment also provides licenses to the town to continue utilizing the property following Comstock’s purchase for the existing art space and public shared parking.

It also provides priority recordation of a parking easement on the site that will act as insurance for 162 parking spaces for the town regardless of the loan on the property.

A final part of the amendment permits Herndon to refund a portion of property taxes for the area used for arts purposes. The amendment includes a 10-year tax refund to the arts district that is estimated at $1.9 million over that time, wherein the estimated tax return above refund would be $1,165,000.

“The town receives no tax benefit on this site currently,” town manager Bill Ashton said.

“And the town will not receive any benefit as long as the town owns the property. Only when it is redeveloped will the town ever see any of this tax benefit.”

As a part of the amendment, the town council will vote to appropriate funds required prior to closing during its December public session.

“Bringing this project to fruition has been a priority for me and for the town council,” Mayor Lisa Merkel said in a press release.

“This adopted amendment establishes specific parameters by which we are moving forward. We greatly appreciate Comstock’s collaborative spirit as well as the many town citizens and business owners who continue to advocate for this transformative, energizing redevelopment project. Herndon’s bright future is now!”

The Herndon Town Council met Tuesday night in a work session to discuss downtown redevelopment.

The council discussed a proposed amendment to the existing comprehensive agreement with Comstock Herndon Venture, LC, from 2017.

The redevelopment was first proposed in the 1980s and a handful of proposals over the years were heard for the project, but none materialized.

In the Nov. 10 work session, town manager Bill Ashton and town attorney Lesa Yeatts laid out issues that have delayed the redevelopment project and detailed proposed amendments to the comprehensive agreement the town has with Comstock.

When finished, Comstock will develop the area into a mixed-use neighborhood. It will include 273 apartments, a 787-space parking garage, 18,000-square-foot arts center and 17,000 square feet of retail space.

Ashton pointed to a variety of issues that have caused delays because of economic pressures. Among those, he specified rising commodity and labor prices as a result of a thriving construction market in Metro DC since 2017. He also cited COVID-19 economic pressures that included commodity issues when mills were closed down.

He also recognized a reenergized interest from the community and its “palpable frustration” that was shared by the council about the delays in the redevelopment.

“They were certainly well founded, but it was out of the fact that we couldn’t just rush into development when we had these economic pressures sitting out there,” Ashton said.

Yeatts presented to the council members a variety of amendments to the comprehensive agreement with Comstock to address issues and other concerns.

The existing agreement has the town contributing land with an assessed value of roughly $10 million, and $3.6 million cash that is broken into two categories, according to Ashton. The first category for the cash value is $2.2 million to be utilized for the project.

The remaining $1.4 million is to be used in a series of allowances that will allow the town to take care of its obligations prior to releasing the property. Those obligations include environmental remediation, transitional downtown parking, transitional art space relocation and box culvert repair for the storm water management feature.

According to a presentation from Yeatts and Ashton, the changes to the existing agreement include:

• Establishing the closing date on the property on or before Dec. 15, 2020.
• Permitting the satisfaction of certain conditions precedent subsequent to the conveyance.
• Requiring town appropriation prior to closing.
• Adjusting the outside satisfaction date by which Comstock must have the project under construction to Dec. 31, 2021.
• Extending certain rights of Comstock to pause the commencement of construction (up to 24 months) due to market conditions and other matters, including delays caused by the COVID-19 pandemic.
• Increasing the parent guarantee by an additional 5 million to 10 million to cover the arts center and the parking.
• Priority recordation of a parking easement on the site for a minimum of 162 spaces.

“These financial economic stresses led us, both parties, to feel that negotiation of an amendment to the existing agreement between us would really improve our situation,” Yeatts said.

She highlighted the priority recordation of a parking easement as a significant “concession on the part of our partner in this agreement.” This amendment will ensure that Herndon will receive 162 parking spaces regardless of the loan on the property.

Ashton detailed potential economic development incentives to “help at least close the gap on some of the elements cost that have gone up on our components.” Those incentives amount to a total fee reduction of $2.35 million for water, sewer and building permits.

He also listed a 10-year tax refund to the arts district with an estimated value of $1.9 million over that time, wherein the estimated tax return above refund would be $1,165,000. At this time, the town does not receive tax benefit on the site and will not as long as the town owns the property, Ashton explained.

Ashton also broke down the town’s return on its investment of the project. He totaled Herndon’s investment at $15,950,000 while looking at a return of $16,637,000. The public parking to be returned will be worth an estimated $9,537,000, the arts center shell $2.25 million, and public improvements worth $3.5 million. Comstock will also take care of the town’s responsibility for temporary parking, temporary arts center and the environmental cleanup that combines for an estimated $1.35 million.

To keep on schedule, Ashton told the council that it would be looking for an adoption of this amendment in November to allow for appropriation of funds in December.

“I think this amendment, if anything, has enhanced the deal,” Ashton said.

The town council will vote on this amendment at a public session on Nov. 17 at 7 p.m. Mayor Lisa Merkel has asked the council and Yeatts for public comment on this project to be the first item discussed during the meeting.

The Town of Herndon and Comstock Companies are set to close on the redevelopment of downtown Herndon on Dec. 15, bringing a long-anticipated project mired by nearly a year of delays to fruition.

In a memo to the Herndon Town Council, which will discuss the matter on a Nov. 10 work session, staff attributed delays to a “significant rise in labor and material costs” in the DC construction market since 2016, an issue that was exacerbated by the COVID-19 pandemic.

“This week is a lesson in patience for Americans….  and for Herndon patience is paying off,” said Mayor Lisa Merkel, whose eight-year time as mayor has revolved around the redevelopment project.

The Town of Herndon will sell 4.7 acres of town-owned land for $10 million to Comstock, which will develop the area into a mixed-use neighborhood with 273 apartments, a 787-space parking garage, an  18,000-square-foot arts center, and 17,000 square feet of retail space.  The town purchased the land for $5.8 million and will pitch an additional $3.6 million for the project to cover the following:

• Environmental remediation:  $500,000
• Transitional public parking: $500,000
• Arts center relocation: $250,000
• Culvert repair: $100,000

The Herndon Town Council will consider the matter at a work session on Nov. 10.

To close, both parties negotiated a new comprehensive agreement that was finalized after months of deliberation and few answers on why the project was stalled. The previous agreement was signed by the town in 2017. The council will vote on the proposed agreement.

“In the interest of the continued forward movement of the project the Town and Comstock now desire to amend the Comprehensive Agreement in order to better address the changes in the market, unforeseen effects of COVID-19 and to provide both parties maximum advantage,” the memo states.

Per the agreement, Comstock must begin construction of the project by Dec. 31 of 2021 after a closing date of Dec. 15. The company will also pitch in $10 million instead of $5 million to cover costs associated with the arts center and parking. Among other changes, appropriation for the project will be required before closing and Comstock will be allowed to pause construction due to market conditions and other delays caused by the pandemic.

Additionally, Comstock will receive several tax breaks, which were recently established by the Herndon Town Council.

The company will have to pay $2.5 million less in fees for water, sewer, and building permits than typically allowed. At the time, the town declined to indicate if the recently-passed tax rebates were designed for the redevelopment project in downtown Herndon.

So far, the town says that it’s very confident the agreement will result in a big return for the town.

“All together the financial investment plus development incentives for the project are approximately $16 million and the town anticipates the value of its capital return on the project to be over $16.6 million,” according to a memo by town manager Bill Ashton and town attorney Lesa Yeatts.

Image via Comstock

Comstock Companies has long-term plans to redevelop Commerce Metro Center (1900 Centennial Park Drive) into a transit-oriented neighborhood called the Commerce District at Reston Station.

Now, through a lease-back transaction, the company has acquired United Bank’s branch building and a one-acre parcel located at the site. The lease-back allows Comstock to ensure United Bank remains on the site as the company finalizes plans to redevelop the office park.

United Bank’s property is located at the intersection of Centennial Park Drive and Sunrise Valley Drive near the entrance of Comstock’s Commerce District. The acquisition would allow Comstock to ensure that the front entrance of the transit-oriented development is pedestrian-friendly and accommodates transit, according to a news release.

“This strategic acquisition affords us the opportunity to focus on the project’s entry experience as we finalize our placemaking plans to remake this 1990’s vintage office park into an exciting place to live, work, and promote health and wellness,” said Timothy Steffan, EVP of Asset Management, Leasing & Development of Comstock. 

Comstock plans to redevelop 22 acres to the south entrance of the Wiehe-Reston East Metro Station into the Commerce District. Preliminary plans include upgrades to existing office buildings, new. Office, hotel and residential buildings, and new retail.

In Feb. 2019, Comstock acquired JBG Smith’s Commerce Metro Center Portfolio in Feb.  2019 — a move that will increase the Reston Station area to 4.5 million square feet once fully built.

The company is currently finalizing plans for additional development “while exploring options for enhancing open spaces and connectivity to Metro for the surrounding community,” according to the release.

Comstock’s Metro District station, which is near the north entrance of the station, is well underway. Most of the office space in that district — which includes three office towers — has already been leased to big companies like Google, ICF Global, and Rolls Royce North America.

Image via Google Maps