1. PUBLIC PRIVATE PARTNERSHIPS WORKING TOGETHER: PUBLIC/PRIVATE PARTNERSHIPS Prepared for Prince George’s County Planning Staff July 18, 2012

2. PUBLIC PRIVATE PARTNERSHIPS METRO’S JOINT DEVELOPMENT PROGRAM

3. METRO SYSTEM FIRST OPENED IN 1976 TO DATE, 33 JOINT DEVELOPMENT PROJECTS AT 27 OF 86 STATIONS 20 COMPLETED PROJECTS CURRENT AVERAGE ANNUAL REVENUE - $15 MILLION TOTAL EARNINGS 1976 – 2010 ARE $250 MILLION JOINT DEVELOPMENT PROJECTS HISTORY AND REVENUE

4. METRO JOINT DEVELOPMENT PROGRAM Gallery Place - Chinatown

5. OFFICE AREA: 237,000 SF RETAIL/ENTERTAINMENT AREA: 250,000 SF RESIDENTIAL: 192 UNITS METRO FACILITIES: BUILT OVER RAIL STATION METRO JOINT DEVELOPMENT PROGRAM Gallery Place - Chinatown

6. METRO JOINT DEVELOPMENT PROGRAM Bethesda

7. OFFICE AREA: 323,000 SF RETAIL AREA: 41,600 SF HOTEL: 390 KEYS METRO FACILITIES: BUILT OVER RAIL AND BUS STATIONS ECONOMIC EFFECT: ANCHOR TO DEVELOPMENT BOOM; NOW A SUBURBAN DOWNTOWN METRO JOINT DEVELOPMENT PROGRAM Bethesda

8. Dunn Loring METRO JOINT DEVELOPMENT PROGRAM

9. Dunn Loring METRO JOINT DEVELOPMENT PROGRAM RESIDENTIAL: 624 UNITS RETAIL AREA: 125,000 SF METRO FACILITIES: NEW PARKING GARAGE WITH BUS BAYS ON GROUND LEVEL; 60,000 SF OF RETAIL SPACE FACING THE GARAGE AND ADJACENT TO IT TO BE BUILT

10. METRO JOINT DEVELOPMENT PROGRAM White Flint

11. METRO JOINT DEVELOPMENT PROGRAM ED C PHASES - 8 OFFICE - 3 HOTEL - 1 RESIDENTIAL - 4 RETAIL - 200,000 SF TOTAL - 2.7M sf

12. PROVIDE FOR FUTURE TRANSIT NEEDS—BUS AND STATION NEEDS ASSESSMENT ENHANCE PEDESTRIAN/BICYCLE CONNECTIVITY DENSE MIXED USE DEVELOPMENT AS MAY BE LIMITED BY MARKET & ZONING CREATE HIGH QUALITY PLACES ADDITIONAL RIDERSHIP CAPITAL FUNDS METRO GOALS

13. THE OFFERING – ALTERNATE METHODS-- RFP Selection based on Financial Offer and Qualifications Respond with a price Best Suited for less complicated sites No Zoning or Master Plan Issues to Resolve

14. THE OFFERING – ALTERNATE METHODS— RFQ Selection based on Qualifications Benefit: Do Planning First to Resolve Land Use Issues Negotiate business terms when planning is near completion

15. RFQ PITFALLS Large $ to Plan Developer needs patience and staying power Without development rights, developer will want to limit investment Public aid for consultant costs

16. SELECTING A PARTNER Financial Strength + Commitment = Staying Power Require Experience in each Land Use Category It may be best to select a team Experience Financial Strength Commitment to the Project

17. NEW CARROLLTON ISSUES Site Issues Amtrak Purple Line Bus Bays Kiss & Ride All Day Parking

18. THE NEW CARROLLTON PLAN ?

19. FINANCIAL STRUCTURES Align Interests as Much as Possible Know Your Public Constraints Plan in Advance if Public Facilities will be Required Sale Lease Joint Venture

20. FINANCIAL STRUCTURES--SALE Developer likely to Prefer Ongoing Land Use Requirements Can be Enforced Thru Easements or Covenants Otherwise More Difficult to Enforce Public Requirements

21. FINANCIAL STRUCTURES--LEASE Public Retains Long Term Fee Interest in Land Provides Mechanism to Enforce Long Term Public Requirements More Difficult to Finance Traditional—Annual Payments Alternative—Capitalized lease payment + Deferred Participation

22. FINANCIAL STRUCTURES—JOINT VENTURE Higher Risk--Fee Interest in Land Can Be Lost Must Provide for Subsequent Capital Investments Aligns Interests Public Relies on Developer’s Profit Motive Must Have Transparent Accounting & Audit Rights Synthetic Joint Venture Risk/Reward Continuum

23. VALUATION Value Today – Three Appraiser Method Value Tomorrow – Method and Instructions Joint Venture

24. THE MARKET THE PUBLIC SECTOR CAN’T CHANGE THE MARKET BUT IT CAN SPUR THE MARKET

25. THE MARKET The Reeves Building on U Street NW

26. THE MARKET Wheaton: New M-NCPPC Headquarters

27. COVERED IN OTHER PRESENTATIONS Stakeholder Involvement Financial Assistance Expedited Process Developer Certainty Fiscal Impact Analysis