It does not matter whether or not you are looking for a “hairy” deal – in DC, you will most likely find a deal that is “historic”. More likely than not you will encounter (or already have encountered) the complexities of the DC’s Historic Districts.
In April 2006, Mayor Anthony Williams said that “preserving buildings isn’t just about retaining architecture. It’s about preserving our history, our culture, our way of life and our spirit of community.”
We have identified three issues created for DC real estate deals by the Historic Districts and related multi-faceted review procedures. We refer to them as “the three H’s”: Hard to Avoid; Hyper-Technical; and High-Quality Products.
Hard to Avoid: According to the Office of Planning’s data on historic preservation, there are more than fifty Historic Districts in DC, including the monumental civil complexes like the National Mall. There are over thirty local neighborhood and residential Historic Districts. According to the chart below, DC has a higher percentage of historically-designated areas than other major American cities. Consequently, most developers at some point will have to navigate the rules and regulations imposed on historic properties.
Given the above statistics, it may be hard to believe that new Historic Districts are being approved but, on March 7, 2018, the Office of Planning proposed the Kingman Park Historic District, between 21st Street NE and 26th Street NE and bounded by Oklahoma Avenue NE. Several weeks ago, the Historic Preservation Review Board (“HPRB”) approved Case No. 17-17 creating the Bloomingdale Historic District. Additionally, the HPRB has two other new districts pending.
Hyper-Technical: When developing an historic property, the project will require design review by any number of entities. In most areas, that would be the HPRB. The HPRB is a group of private citizens appointed by the Mayor to represent professional and community viewpoints in the historic preservation process. The group meets monthly to review and approve projects affecting DC’s many historic buildings, districts, and sites.
But historic review does not stop there. Properties sometimes require what some consider to be additional “hyper-local” review. Any project in historic Georgetown, for example, requires review by the Old Georgetown Board. Given the increasing trend toward Federal divestment of real estate in downtown DC, more developers may find themselves before the Commission of Fine Arts (“CFA”). The CFA is an independent agency, comprised of seven members appointed by the President, which reviews both government and private projects based under three areas of jurisdiction: government projects; Shipstead-Luce Act projects; and Old Georgetown Act projects. In the Capitol Hill Historic District, the Capitol Hill Preservation Society will weigh in on proposed matter of right projects as well as zoning relief.
High-Quality Products: At an HPRB hearing, one may witness an accomplished architect either divulging a mistake or admitting that an area of the design is less than fully fleshed out, and taking recommendations from the Board members. One must be prepared for Board members to dive into ALL aspects of the design – massing, materials, color pale, trip or window scale, and more. While many developers see these varying review processes as hurdles to get over in order to proceed with a project, the end result is, typically, a high-quality design that both warrants a premium on the market and creates a barrier to entry for the more complicated or “hairy” historic deals.