RPAI Halts Largo Development, Citing 'Current Macroeconomic Conditions'
The economic crisis created by the coronavirus pandemic is beginning to have an impact on the D.C.-area development pipeline.
The developer expects to finish site work preparation on the property this year, but RPAI said it has decided not to go vertical on the project in response to "current macroeconomic conditions." It also said it is evaluating a "material reduction in scope and spend" for the development.
"Our sound capital allocation discipline enables us to take this step in order to prudently de-risk our overall operating plan, focusing on preservation of our already outstanding balance sheet prior to commencement of any vertical construction at Carillon," RPAI CEO Steve Grimes said in a release. "We continue to believe that this project can drive compelling risk adjusted returns when conditions support commencement in the future."
The first phase of the development was planned to deliver 351 apartments, 100K SF of medical office space and 136K SF of retail, including a 12-screen AMC IMAX movie theater. The full 50-acre development has been slated for more than 2,600 units and 300K SF of retail, UrbanTurf reports.
Prince George's County Executive Angela Alsobrooks said at a Bisnow event last year she was preparing an incentive package to help the Carillon development move forward. Alsobrooks said the project would help transform Largo into a vibrant, downtown area and spur additional development opportunities.
The project sits near the under-construction University of Maryland Capital Region Medical Center, a $543M project expected to deliver next year. Other developers including The NRP Group and Peter N.G. Schwartz Co. are moving forward with projects near the medical center.