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Developer Q&A: Cityline Partners Managing Director Donna Shafer

Cityline Partners Managing Director Donna Shafer
Cityline Partners Managing Director Donna Shafer at a 2018 Bisnow event

Cityline Partners is the developer behind Scotts Run, a planned 8M SF mixed-use project at the McLean Metro station in Tysons. Two buildings have already been completed on the site and new progress was made last year on upcoming multifamily and hotel portions of the development.

It continues to look for an anchor office tenant and last year came up short in its bid to land Amazon and Apple's large campus projects. Bisnow caught up with Cityline Managing Director Donna Shafer to hear the latest on Scotts Run.  

Bisnow: What exactly has been completed on the Scotts Run site so far?

Shafer: There's the Haden apartments, which is 425 units, and Mitre's most recent office building that is 340K SF. 

Bisnow: What is the development ultimately going to include at full build-out?  

Shafer: Scotts Run is divided into Scotts Run North and South. The north side is on the north side of Route 123 and it's approved for up to 1.5M SF. Scotts Run South on the south side of 123 is about 6.5M SF. There is a roughly 50-50 mix between commercial and residential on both of those. 

Bisnow: With so many large-scale mixed-use developments planned in Tysons and throughout the region, what makes Scotts Run unique?

Shafer: Scotts Run is unique because it offers the only naturally occurring water amenity anywhere in the heart of Tysons. As part of our approval process we proffered to complete stream valley restoration work, and once that happens, this amenity will live and play very comparably in terms of scale to Rock Creek in D.C.

The second piece is transportation. We know that, for now, there’s still a lot of folks driving their cars, so we are more connected to the local and regional road network than any place in Tysons. And we benefit from being on the first stop on the Silver Line coming into Tysons. And as part of our project, we’ll deliver a complete, gridded street network with pedestrian access and bicycle lanes.

The Tysons naysayers complain that its not pedestrian-friendly. Scotts Run is an enormous neighborhood, and we’re also connected to Capital One and areas outside the Beltway. There will be a new pedestrian bridge that deposits you into Scotts Run. This new bicycle and pedestrian connector runs from our Scotts Run project up Old Meadow Road over the Beltway and to the amenities that the mall has to offer. That is an amenity thats approved and fully funded and scheduled for construction in 2020.  

Bisnow: You sold a piece of the Scott’s Run development last year to Skanska to build a 350-unit multifamily project. What’s the latest on that project?

Shafer: They are moving toward site plan submission now with their project. It’s not just multifamily, it’s retail on four sides of the block and it has a private street which runs through Scotts Run, and it has a very significant public plaza space.

Bisnow: You also announced last year you signed a flag for the planned 200-room hotel. Where is that in the development process?

Shafer: We’re really excited about The Archer hotel. Archer is already in for site plan and we're hoping to begin construction in the spring.

Bisnow: Your development is planned to have a significant amount of office space. Are you waiting to sign a pre-lease before breaking ground?

Shafer: There’s plenty of office space. Our focus right now, like everybody, you’ve got to have enough of an anchor to kick off a building. We’re not looking to engage in speculative development.

Bisnow: Do you have any potential anchors on the market you are hoping to sign?

Shafer: Yes, there are a couple large ones right now. I don’t know that they’re on the market, but they’re coming through quietly. And then two or three others that are sizable enough to kick off a single building. Two would be large space consumers and a few others would be one building.

Bisnow: Can you give me any idea of what types of tenants are looking? Are they new entrants from outside the market or looking to relocate from elsewhere in Northern Virginia?

Shafer: I would say they run the gamut from someone who’s still trying to figure out if they’re going to land in Virginia all the way through to just trying to make sure this is the right site that they’re coming to. I would say it’s a good mix of those two. With the folks we’re talking to, most of them would be new to the market. I think you will continue to see the shuffling from folks in antiquated buildings or buildings not Metro-proximate or amenitized.

Scotts Run
A rendering of the Scotts Run development in Tysons

Bisnow: Tysons has landed several major corporate headquarters in the past. Do you think it could win any new corporate relocations in the near future?

Shafer: Absolutely. Northern Virginia and particularly Tysons has done very well with that over the years thanks to the [Economic Development Authority]. Look at all the headquarters we have here. Virginia is one of the top states to do business, and Fairfax County is the engine that drives the commonwealth. Now you have rails and the new comprehensive plan that embraces urban development. I absolutely see that trend becoming more of a trajectory. We’ve always trended in that direction, and it’s going to continue in a more dramatic fashion.

Bisnow: Tysons still has an office vacancy rate above 18%. Does that affect the way developers think about breaking ground? And do you think there is demand out there to help reduce that rate?

Shafer: Of course. To my knowledge, nobody is out there running to do spec. I’m not worried about a lot of empty buildings, but I do think there will be continued demand from new entrants that will bring those buildings that have come through the approval process and bring them online. We’re all subject to the whims of the market and of course the market is going to slow down at some point. I don’t think we’re immune to that, but I do feel that we are well-positioned to continue to take advantage of opportunities and compete head to-head with Arlington, the District, Montgomery County, you name it.

Scotts Run CityLine Partners
The site plan for the 8M SF Scotts Run development at the McLean Metro station.

Bisnow: You had submitted Scotts Run for Amazon HQ2, but it wasn’t included by Fairfax County or Virginia in the official bid. Do you think Tysons could have beat out Arlington had the county included your site?

Shafer: I do. The only thing Fairfax submitted was the site bordering Loudoun. In the rear view, if you look at what Amazon selected, Fairfax County certainly had other opportunities that would have stacked up more closely to what Arlington offered with a more urban setting. I’m not saying it's a mistake, but seeing what they selected, I think Fairfax could have done better with other sites. But do I think it will still be good for Tysons? Absolutely.

Bisnow: You had also reportedly been in contention for Apple’s new campus, but it ultimately chose to go with Austin. Do you think there could be future chances to land major corporate campuses like Amazon or Apple or do you think those were unique opportunities?

Shafer: Yes. Now are they going to be comparably sized? Probably not. That’s once in a lifetime. But even with Apple, I wonder if Apple wasn’t waiting in the wings to see where Amazon would land and if, knowing that Amazon came here and only gave half its requirement, I wonder how that impacted Apple’s decision. So does Amazon’s footprint preclude another huge user? Perhaps. Amazon said yes to 4M SF but not to 8M SF, and Apple decided to go elsewhere.

Shafer will talk more about Scotts Run Jan. 24 at Bisnow's Tysons State of the Market event at 1600 Tysons Blvd.