The many costs of the NCC

The National Conference Center in Lansdowne was built in 1974 as Xerox Training Center, later Xerox Document University with small guest rooms sharing a bathroom. The Whitehall Funds (WXIII/Oxford DTC) purchased it from Xerox in June 2000 for $37.7 million, taking out a $60 million loan secured by a deed of trust. Oxford spent $23 million on renovations the first year, converting 919 guest rooms, 800 with shared baths, to 951 guest rooms, just 192 with shared baths. A decline in the Dulles area high-tech industry that began in 2001 was exacerbated by terrorist attacks that same year.

In 2005, Oxford borrowed $50 million from GMAC Commercial Mortgage Corporation’s hospitality industry division to construct a 16,000 sq. ft. ballroom, the largest in Northern Va. other than the Ritz Carlton in Arlington. The property was managed by Aramark Harrison Lodging, a division of Aramark Corporation.

Then in 2007-08, the real estate bubble burst, and even the federal government had to cut back on spending, reducing the per diem allowance for overnight stays at the NCC for training. As the effects of the real estate bust continued to reduce revenue for the NCC, payments on its mortgage(s) continued.

In late December, 2010, Loudoun County Board of Supervisors Chairman Scott York and Broad Run Supervisor Lori Waters announced the county would construct a high school to relieve overcrowding in the Ashburn/Lansdowne area. But they were coy about revealing the location until Spring of 2011, when they announced that land for the high school would be purchased from the NCC rather than other proposed sites.

In March, 2011, Thorne Consultants Inc., with then-NCC General Manager Kurt Krause present, appraised the NCC acreage to be sold to the county at $12,650,000 million. The appraiser, Oakleigh J. Thorne, added an extra $6,425,700 million to offset “damages” for building a parking deck to replace 723 rarely-used surface parking spaces that would be used not for the high school building itself, but more likely for ball fields associated with the new school. Three months later, in June 2011, Krause and the NCC’s financial and legal representatives went to the Board of Equalization to have its assessment reduced by $6 million at a public meeting on June 28 2011 that exploded in a controversy over the BOE’s secret, unrecorded vote that lowered the assessment three months after the appraiser had raised it.

The Whitehall Funds / Oxford had borrowed $60 million to buy the NCC in 2000 for $37.7 million and spent $23 million on renovations in 2001. In 2005 Oxford had borrowed $50 million from GMAC to construct the ballroom. The NCC was sold in 2014 for $36.9 million, $800,000 less than the price paid by Oxford 14 years earlier. The math:

– $60 million loan in 2000
– $50 million loan in 2005
= $110 million invested in 14 years
+ $20 million paid by Loudoun County to purchase 45 acres for HS 8 in 2012
= $90 million invested by Oxford
+ $36.9 million (2014 sale price)
= total loss of $53.1 million in capital investment over 14 years (irrespective of year to rear revenue loss or gain.)
Cost to Loudoun County: $20 million paid by Board of Supervisors to purchase 45 acres of unbuildable land at the NCC under the pretext of building a high school.

Permanent loss, after proffer abandonment, of Lansdowne Sports Park and $300,000 in improvements funded by parent volunteers from “club” sports leagues.

Inestimable loss of full market value in 2013 sale to Raging Wire of 75 acres, intended as a high school site, at Waxpool Road and the Loudoun County Parkway. Once known as the “ISA site.” The Loudoun County Board of Supervisors sold this parcel direct to Raging Wire for $20 million after removing it from a special tax district for Metro and without offering it on the open market.

Costs to Loudoun County Public Schools: Road improvements to widen Upper Belmont Place and construct a 2-lane roundabout to serve both the high school and the NCC. Extra cost of construction to build HS8 on unstable infill land.

Meanwhile, Va. Del. Randy Minchew (R-10th), a land use attorney for the Loudoun office of Walsh, Colucci, et. al., was elected to the Virginia House of Delegates in 2011 and immediately proposed an “Outer Beltway” crossing on the Potomac River near the NCC. In one scenario, such a crossing would extend from Upper Belmont Road across the Potomac River to suburban Maryland to deliver traffic and business direct from I-95 to the NCC entrance, then south to I-95 via a proposed north-south connector to I-95 in Prince William County.

This “Outer Beltway,” according to proponents, would make it easier to deliver cargo to Dulles International Airport. Those who oppose it object that it would open all of Loudoun County west of U.S. Route 15 to residential and commercial development.

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