One Loudoun: Work in Progress

Those who have wondered when work would begin on the One Loudoun project can now see heavy machinery moving dirt from one place another and colorful signs identifying the future location of various elements, like an amphitheater, a daycare center or the clubhouse.

Plenty of critics have harped on blogs or in reader comments about the project, which occupies the southwest corner of the Route 7 intersection with Loudoun County Parkway, or its financial restructure last year. Others opposed the 700,000 square feet of retail uses permitted.

Many of those critics may now even use Marblehead Drive or Russell Branch Parkway to bypass traffic elsewhere, or have children at Steuart W. Weller Elementary School. Miller & Smith built those roads and donated the site for the school before building the first structure on its site.

“They really stepped up,” said Supervisor Lori Waters (R-Broad Run).

May pointed out that the project currently has no impact on those item because nothing has been constructed.

“From Oct. 2007 through the fall of 2010, we put over $30 million of infrastructure on the ground and we’ve dedicated 40 acres to public purposes,” he said during an interview last fall. “And we haven’t done anything for us. All we’ve done in four years time is build $30 million in infrastructure and dedicate 40 acres to public purposes.”

But one significant hurdle remains: construction of the Route 7-Ashburn Village Parkway intersection, an offsite improvement. Loudoun County had already signaled its intent to use bonds to pay for the Loudoun County Parkway intersection at Route 7. Miller & Smith awaits final approval for the interchange plans from several entities, including the Virginia Department of Motor Vehicles.

“There’s progress. We’re moving along and working out the revisions of the plan that are necessary to get full and final approval from the county, VDOT and the adjacent landowner,” May said. “We’re still a few months from wrapping a bow on that, but we’re making progress toward a final agreement.”

Waters there’s little Miller & Smith could have done to speed up the process.

“They have been diligently pursuing that project,” she said.

Initially approved just as the entire country sank into recession based largely on a real estate market leveled by poor investments and questionable practices, Miller & Smith boasted new plans for the 358-acre site.

In 2008, investment bank Lehman Brothers Holding Inc. crashed. As the global recession kicked in, One Loudoun partner Goldman Sachs decided to cut off access to a $125 million loan.

“The financial markets got very nervous. As a result of that, our financial partner did the same,” May explained. “We continued to manage the project and get the infrastructure open by working with Goldman Sachs. We came up with an agreement to finish the infrastructure we started.”

After drawing down about $30 million of the loan, Goldman decided not to move forward and foreclosed on the remainder, selling the note back to Miller & Smith and its then-new partner Sekisui House Ltd., the largest homebuilder on the planet, for $35 million in 2008. Sekisui is now the financier of the project.

“We needed a partner, they wanted infrastructure here,” May said about the partnership with the Japanese company.

“There is no doubt that economic crunch and the housing crisis created a financial hurdle … and really put them at risk of losing the site,” Waters said. “I really appreciate their dedication to this project and not letting it be carved up into little pieces which was a real possibility not long ago.”

Site work recently began at One Loudoun.

“We’re moving a lot of dirt and putting a lot of pipe in the ground,” May said. “It’s not very exciting to your average Joe. But it’s exciting to us.”

He said construction would likely start sometime between December and February.

“We’re projecting our first phase of the downtown area to be 175,000 square feet,” May said, adding that it would be mostly retail with some office mixed in.

Miller & Smith must have all of its retail space preleased before obtaining building permits for residential unit, which would be limited to 450 homes until 1 million square feet of nonresidential.  Then another 450 homes would be permitted. In all, plans call for 1,040 homes, 700,000 square feet of retail, 3 million square feet of office space, a hotel and an amphitheater.

In addition, One Loudoun has long touted the planned World Trade Center at the site.

“The World Trade Center component of One Loudoun is very important to us,” May said. “We’re working hard to make that a reality here.”

He attributed a generational change in leadership, along with the economic crunch, to hiccups in progress with the WTC. But May believes it will go forward.

“I think the dust has settled there and we’re working hard to breathe life into the World Trade Center,” he said.