JBG Smith pledges 1,000 affordable housing units if arena passes

Developer JBG Smith pledged Friday to preserve 1,000 workforce-affordable housing units in Alexandria near the proposed sports arena and entertainment district, up from its previous promise of 500 units — upping the ante on the controversial project, which has one more chance to succeed this year.

The $2 billion public-private project championed by Gov. Glenn Youngkin — which would move the Monumental Sports & Entertainment-owned Washington Wizards and Capitals teams to Alexandria — has faced significant opposition in the Virginia Senate, led by Sen. Louise Lucas, chair of the Senate Finance & Appropriations Committee. She blocked every opportunity for a Senate floor vote on a state sports arena authority that would own the buildings and property in Potomac Yard, but there’s still a slim chance for the deal if the arena authority is part of the state’s finalized 2024-26 budget expected to be enacted in April.

According to JBG Smith Chief Strategy Officer Evan Regan-Levine, the company had 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.” In Friday’s announcement, JBG Smith said it would instead preserve 1,000 units of workforce housing, in response to discussions with city officials, state lawmakers, Alexandria residents and the Virginia Department of Housing and Community Development — contingent on the General Assembly’s passage of a budget that includes the arena authority.

“Our extensive conversations with members of the Alexandria community, leaders such as Mayor Wilson, the council and legislators from the commonwealth further reinforced the centrality and necessity of housing preservation efforts in Alexandria,” said AJ Jackson, JBG Smith’s executive vice president of social impact investing. “As a result, we are doubling the number of units we are preserving to maintain affordability and prevent displacement in advance of the arena’s opening so that as many Alexandrians as possible are able to take advantage of this incredible economic development opportunity.”

In announcements about the arena project, Youngkin touted the possibility of up to 30,000 more jobs in Virginia and billions in tax revenue, and a report released in February by George Mason University’s Center for Regional Analysis found that the project would include the construction of 5,405 workforce-affordable housing units, more than twice the 2,250 affordable housing units the City of Alexandria aims to have by 2030.

JBG Smith said in its announcement Friday that the increase of preserved affordable housing from 500 to 1,000 units would help toward the city’s housing goal. If the arena authority is passed by state lawmakers, the developer will collaborate with the city to “proactively identify and preserve the affordability of 1,000 workforce housing units within the City of Alexandria, with a particular focus on the neighborhoods adjacent to the proposed arena development.”

Earlier this month, as the Virginia General Assembly regular session ended without arena legislation passed, Youngkin declared, “I believe the Senate is about to make a colossal mistake,” but Lucas has held firm. A major holdup for Lucas and some other Senate Democrats was Youngkin’s apparent unwillingness to make compromises on Democrats’ priorities, including setting a $15 per hour minimum wage in Virginia by 2026 and setting up a structure for recreational cannabis sales and taxation.

According to a Washington Post story published Wednesday, the Republican Youngkin met virtually with Lucas for budget negotiations, and she said, “He brought up the arena again, and I told him that was a nonstarter for me.”