Please ensure Javascript is enabled for purposes of website accessibility

GMU report: Arena project would produce 5,400+ affordable housing units

Developer JBG Smith requested study of project's housing impact

Kate Andrews //February 21, 2024//

Ted Leonsis, founder, CEO and chairman of Monumental Sports & Entertainment, owner of the Washington Capitals and Washington Wizards, speaks at a Dec. 13, 2023, news conference in Alexandria announcing a plan to invest $2 billion in a new arena and accompanying entertainment complex in Potomac Yard. Virginia Gov. Glenn Youngkin is at left. Photo by Will Schermerhorn

Ted Leonsis, founder, CEO and chairman of Monumental Sports & Entertainment, owner of the Washington Capitals and Washington Wizards, speaks at a Dec. 13, 2023, news conference in Alexandria announcing a plan to invest $2 billion in a new arena and accompanying entertainment complex in Potomac Yard. Virginia Gov. Glenn Youngkin is at left. Photo by Will Schermerhorn

GMU report: Arena project would produce 5,400+ affordable housing units

Developer JBG Smith requested study of project's housing impact

Kate Andrews // February 21, 2024//

Listen to this article

Updated Feb. 22, 2024

A study conducted by George Mason University’s Center for Regional Analysis found that the proposed $2 billion Alexandria sports arena and entertainment district supported by Gov. Glenn Youngkin would create more than 5,400 workforce-affordable housing units, far exceeding the city’s goals.

The report released this week was requested by JBG Smith Properties, the proposed project’s developer, which would bring Monumental Sports & Entertainment’s NHL and NBA teams — the Washington Capitals and Wizards — from their home stadium in Washington, D.C., to the City of Alexandria.

According to the report, authored by Terry Clower, director of the Center for Regional Analysis in GMU’s Schar School of Policy and Government, the proposed development would include 5,405 housing units completed between 2027 and 2036. The rental and purchasable residences qualify as “workforce housing,” meaning that they are expected to be affordable to people who make about 80% or 90% of the area median income, or between $66,000 to $154,000 annually.

The report noted that Alexandria is “currently far behind in its goal to produce 2,250 workforce-affordable housing units by 2030. The proposed [arena] development will dramatically support that goal in Phase 1 and will help the city exceed longer-term goals for workforce housing.”

Also, the arena’s developers plan to donate land that would support between 100 and 150 affordable housing units, as well as a new school, and contribute $25 million to the city’s affordable housing fund, the study says.

Evan Regan-Levine, JBG Smith’s chief strategy officer, said in an email Thursday that the company doesn’t have a specific housing unit count tied to the $25 million contribution, because “we do not know how the city will deploy the funds. … JBG Smith has separately committed to preserving the affordability of more than 500 affordable workforce housing units in Alexandria — with a specific focus on the Arlandria neighborhood near the site — to avoid displacement of existing vulnerable residents.”

Clower confirmed that JBG Smith requested the report in December 2023 and will pay for it. Although GMU is a state-funded public university, the Center for Regional Analysis is not funded by the state and receives funding via commissioned studies from state agencies, companies and other organizations. Nevertheless, Clower said, the center “takes as much rigor as the data will allow us” in conducting studies, and its researchers are “dispassionate” about the outcomes of study subjects like the arena deal.

“I’ve got too many years left to work to start selling my opinion,” Clower said in an interview Wednesday with Virginia Business.

On Thursday, JBG Smith’s chief strategy officer, Evan Regan-Levine, responded to Virginia Business’ questions about the report via email.

The developer asked the center to provide a third-party review of the HR&A Advisors fiscal and economic impact report produced for the Alexandria Economic Development Partnership, Regan-Levine said. “We have significant investments around the proposed arena and, while we were involved in providing inputs for HR&A, we wanted another review. We know that George Mason University’s Center for Regional Analysis is a reputable group locally who is familiar with these kinds of analyses.”

Also, “the governor’s office encouraged us to have a third-party review, which they believed would highlight the veracity of the HR&A analysis,” Regan-Levine said. He added that JBG Smith did not give Clower a specific deadline, just “asked that the report be completed in a timely fashion,” and said that the firm did not have any expectations for a certain outcome in the report.

Clower started working on the report in December (“instead of Christmas break,” he added) following Youngkin’s Dec. 13, 2023, announcement of the proposed arena project with Monumental CEO Ted Leonsis.

Following that announcement, JBG Smith gave Clower the outlines of what they wanted covered by the study and provided information about the housing they expected to develop as part of the entertainment district, and Clower obtained information from the City of Alexandria about its workforce housing goals, he said.

Clower also received an earlier draft of the HR&A report that was released last week. The state’s secretary of finance, Stephen Emery Cummings, and his office also assisted Clower by providing some information about the deal and the way it would be funded by the state and private partners, Clower said, although he had no direct contact with the governor’s office.

Although Youngkin and Leonsis framed the arena proposal in December as nearly a done deal, with the support of Alexandria’s mayor and U.S. Sen. Mark Warner, the project has faced some state and local pushback. A bill introduced in the Virginia General Assembly this session to create a state authority for the project has faced opposition and challenges from Democratic state senators, who want to see the Republican governor agree to more of their priorities, including a $15 per hour minimum wage by 2026.

Youngkin, however, signaled opposition to a minimum wage hike in January, saying he doesn’t think an increase is necessary and that the job market will take care of the issue without governmental input. Democrats in the House of Delegates and the state Senate passed a bill in February to increase the minimum wage, sending it to the governor’s desk. On Tuesday, Virginia’s AFL-CIO member unions went public with their opposition to the arena, saying the project wouldn’t provide needed protections for workers because the unions had not reached labor agreements with developers.

The House version of the bill has been referred to the Senate Finance Committee, where the Senate measure died quietly without being placed on the committee docket for a vote, a move by Sen. Louise Lucas, the finance committee’s powerful chair, who has raised multiple concerns about the proposed public funding of the project.

Although the House’s amended 2022-24 state budget does include language creating the sports authority, the Senate’s bill does not, setting up a battle over the matter in upcoming negotiations. The dueling budgets were passed by the legislative bodies Thursday.

P
YOUR NEWS.
YOUR INBOX.
DAILY.

By subscribing you agree to our Privacy Policy.