Far right, Christopher Clemente, chairman and CEO of Comstock Holding Companies, Inc., offers a presentation during the public hearing of the Herndon Town Council Regular Meeting, Agenda Item 5.a. and provides an update on the Comstock Herndon Project.
During its Town Council Meeting and public hearing on the evening of August 13, the seven-member Herndon Town Council unanimously approved Resolution 24-G-46, with all members present. Resolution 24-G-46 approved an extension of the Outside Satisfaction Date [OSD] of the November 1, 2017, Comprehensive Agreement between the Town and Comstock Venture, LC, to Sept. 10, 2024. It is the third extension in the last two and a half years.
“I'm here to tell you that it is now finally coming around to the point where we can make this work,” Christopher Clemente, chairman and CEO of Comstock Holding Companies said during the public hearing. He explained that “the anticipated interest rate reductions over the next couple of years” matter because construction financing is typically floating.
“You don't borrow it at a fixed rate; you borrow based on the federal fund rate and some margin above that. So we're excited to be here. We're excited to be in a position by the end of this year to get this thing started, and we're excited to deliver a world-class project for the downtown,” Clemente said.
Steven Porter questions if the project should be allowed to “flat line.”
Sept. 10 is the new deadline for satisfying remaining contract conditions regarding Comstock’s redevelopment project of approximately 4.675 acres of town-owned downtown land for a mixed-use town center project, Arts Center, and associated parking. The town transferred the parcel to Comstock Herndon, LC, in December 2020. No construction has occurred on the parcel, although Comstock did fence in a portion.
According to online meeting documents, the Town and Comstock desired to extend the OSD briefly to allow further progress and discussions regarding the project. The first extension occurred from Dec. 21, 2021, to April 30, 2022. Then, following Comstock's action on April 28, 2022, to exercise its contractual right to a 24-month market pause, a second extension of the OSD occurred on April 25, 2024. A Letter Amendment extended the second OSD until August 15, 2024.
As of last night, Resolution 24-G-46, approved on August 13, 2024, authorized the Mayor to sign a letter of amendment extending the OSD from August 15 to September 10, 2024. That date, Sept. 10, coincides with the last day of employment with Town Manager Bill Ashton, who has accepted a position elsewhere.
Public Hearing
Status update presentation on the Comstock Herndon Project and Resolution 24-G-46 to approve an extension of the Outside Satisfaction date to Sept. 10, 2024.
Clemente opened his presentation, kicking off the public hearing, saying that Comstock sees “the stars are now aligning” and believes they can start this project early next year. “January is when we hope to start,” Clemente said. He spoke about how the pandemic and economy had made the process a “roller coaster” for the construction industry, turning it upside down. [0:35:30]
“It has been very difficult to make the numbers on this project work, but I think, long story short, I think we're there now,” Clemente said. He described multiple rebiddings and said the numbers “were just crazy.” “Financing costs also soared.“ “Imagine the difference between a 300 or 400 percent increase in the cost of financing projects for construction and development projects. So that has played a huge [role]." [0:39:51]
Lesa J. Yeatts, the Herndon town attorney, answered a question from Town Councilmember Cesar del Aguila about why the town council had yet to comment on the closed meetings concerning the Comstock project. Yeatts said that the parties are still parties to a contract and contractually bound. “There are certain things at this point that the parties, especially the town council members, would not be able to disclose publicly, as they might jeopardize the relationship,” she said.
Councilmember del Aguila responded, “I think that led to some of the apprehension that was out there. I certainly heard about it. I just want to be clear that no one on this dais has wanted anything but this to move forward. So, if you've heard otherwise, you were misinformed. We are committed. I like to use the analogy, ‘We're at the altar, and we just want to get married.”
Highlights of Comments Christopher Clemente Responses
Councilmember del Aguila asked Clemente: “What else do you need to move forward?”
Clemente said, “Other than getting the agreement in place and getting the financing lined up and finalized, I don't think we need anything. … I think we'll probably need some help separating the permits so that we can deliver the garage first … . But I think the town's waited long enough to get parking added to the downtown, so we'd like to work with the council and staff to get that built into the transaction.”
Councilmember Donielle M. Scherff said to Clemente: “We love this town. We've been staring at that sign that says, ‘Excitement is building’ for a really long time. And I have to tell you, excitement is not what's building; resentment is … . We have done our dead level best to meet you where you are. Please finish this.”
Christopher Clemente: “I wouldn't be here tonight saying what I've said if I didn't believe that we now have the opportunity to get the financing put in place, and the bond piece is a big piece of it. But that's all part of how we've restructured the project to account for the costs that were something like 40 percent higher than what was anticipated when we signed this agreement in 2017.”
Ann Null: “When should we say enough of this?”
Jason Sickels: “This was a great example of selling the future. You know, Herndon is at the inflection point now. We're losing business to Reston and Wiehle [Station] ... I can't wait to have a drink at the rooftop of the JW Marriott, but I also want to come back to Herndon. And this is where I want to live, and I want to have a great cocktail sometime at Herndon Station.”
Steven Porter: “As a paramedic, though, I do want to share a concept here. I want every patient I deal with to survive … I want this patient to survive; I want this building project to go forward and be successful … [Addressing Town Council:] If things are looking good and you think things are going to move forward, then please vote for this extension, and let's get this built. If, on the other hand, you think this is just going to be kicking the can down the road and just frustrating this community more and more, maybe it's time to let it flat line.” [Applause].
Outside Satisfaction Date and Commencement of Construction defined.
Amendment to Comprehensive Agreement 11/6 2020, by and between the Town of Herndon Virginia [“Herndon” or the the “Town”] and Comstock Herndon Venture, LC [“Comstock”]
View: 5. Conditions Subsequent; Outside Satisfaction Date, pages 5-7 of 55 of Amendment
View: 6. Commencement of Construction, page 7 of 55 of Amendment
Herndon Town Council Adopts Resolution to Appoint Interim Town Manager
Herndon, VA (August 14, 2024) – The Herndon Town Council has adopted a resolution to appoint Christopher Martino, former county executive for Prince William County, as interim town manager to replace departing Town Manager Bill Ashton. Ashton has resigned his position with the town to accept the county executive position in Stafford County. His last day as Herndon’s manager is September 10, 2024.
Martino’s appointment was facilitated by the Bridgewater, VA-based Berkley Group and is in effect from September 3, 2024, until a permanent replacement for Ashton is named, likely in the first quarter of 2025. The town will be working with an executive search firm to conduct a national search for the town’s next manager.
Additional interim management changes include the appointments of two town department heads to Acting Deputy Town Manager positions. Scott Robinson, the town’s director of Public Works, will have oversight for the Community Development, Golf, Parks & Recreation, Police and Public Works departments. Kirstyn Jovanovich, currently serving as Town Clerk, will have oversight for the Communications, Economic Development, Finance, Human Resources, Information Technology and Town Clerk departments. Robinson and Jovanovich will report to Martino and move into their new interim roles effective immediately.