Page 2 - CREW DC September Sponsor Newsletter

2 / Sponsor Newsletter

The CRE limitations in the cannabis industry are significant. moderated the panel, teasing out the intricacies of each project.
Landlords with bank loans cannot have cannabis related activities Akridge’s Burnham Place project, which hopes to fill a gap in
occur in their buildings or they risk defaulting on their loan. the District’s fabric, is still in the midst of environmental review.
Regional and national banks cannot service cannabis related It provided a sobering view of the complexities inherent in
business without risking federal prohibitions. CM Grosso also projects where numerous federal and local entities are involved.
explained he was pushing the City Council for a public bank Chairman and Founder, Chip Akridge, noted that it will be
that could alleviate financial constraints on cannabis operators. nearly twenty years between when Akridge obtained the right to
Chanda explained she found a property with no loans, but the size develop the air rights associated with Burnham Place and when
of the commercial space limited her operation to only dispensing the first buildings can be delivered.
rather than cultivating. The industry is seen as an easy business
to make a lot of cash, but all panelists agreed that regulations This two-decade delay between project planning and realization
and additional costs such as higher rents, excessive bank fees, was a reality echoed by the other panelists. Sean Cahill, Senior
and additional site control, reduce profits for businesses. VP of Property Group Partners, the developers behind Capitol
Ancillary markets that don’t directly “touch the plant” are more Crossing, noted that the District could do more to incentivize
nimble and are great ways to enter the industry. Businesses these projects and mitigate the risks associated with the complex
such as technology services that manage data, POS software, construction required to make them a reality. Pushing to deliver
and CRE services like 420 friendly Airbnb residences, cannabis in early 2019, the Capitol Crossing project will restore three
industrial brokers and industrial build out are examples of such blocks to the city grid and be a beacon for sustainable buildings
ancillary markets. and infrastructure.
New York City planner, Annie White, provided the audience
Out of Thin Air: Can these Projects with an overview of the largest real estate development in U.S.
Create Value and Reconnect the history, NYC’s Hudson Yards. She noted that this development
was possible through a combination of vision, planning and
Community?
zoning which laid the foundation for a successful air rights
June 5, 2018 development. When completed, the project will result in a new
neighborhood on the west side of Manhattan, adding up to 26
Complicated and time intensive – these were the main million square feet of commercial office space, 20,000 residential
themes that emerged from CREW DC’s luncheon on air units, and 16 acres of open space.
rights developments. The speakers gave an overview of these
developments, highlighting the projects of Burnham Place, Cities looking to reconnect or create new communities can lay the
Capital Crossing, and Hudson Yards (NYC); and provided the groundwork to encourage these types of developments through
audience a glimpse into what it takes to create projects “out of long-range planning, zoning bonuses, and tax financing options.
thin air.” While air rights developments are not appropriate everywhere,
it was agreed that in markets where land is scarce and prices are
Neil Albert, President of the DowntownDC Bid, expertly high, they can make a lot of sense and are worth the sweat.

Pictured above: Sherry Kissal, Sean Cahill, Lynn Bennett