JM Zell weighs hotel plans with National Science Foundation on its way to Alexandria

JM Zell Partners Ltd. is studying plans to build a 240-room hotel at its Carlyle Plaza development in Alexandria that could stand to benefit from the National Science Foundation’s planned relocation from Ballston to the city in 2017.

The 250,000-square-foot hotel would replace plans for a much bigger, 33-story office tower Zell had been considering developing for potential lease to federal agencies such as the NSF. Zell was among the bidders for the science foundation. In an interview, Zell CEO Jeff Zell told me he believes the agency’s planned move will be a significant benefit to Alexandria. If he can’t be it’s landlord, the next best thing would be to rent rooms to the agency’s out-of-town visitors.

Zell plans to pitch the idea to city leaders next week since it represents a shift in the makeup of the planned 1.4 million-square-foot development. But he said the property’s zoning allows for the option of building a hotel instead of an office building on part of the land at 760 and 765 John Carlyle St. It is a short walk down Eisenhower Avenue from there to the NSF’s new home at Hoffman Town Center.

“I think they’ll be receptive because it’s an important part of having them down there,” Zell said. “I think it’s the right thing to match up with NSF’s needs.”

The General Services Administration oversaw the NSF’s search process and noted in its solicitation the agency generates about 60,000 visitors per year. The GSA required in the solicitation that potential locations have at least 800 hotel rooms within walking distance.

Generating additional hotel stays was one of the benefits that prompted the city and the Alexandria Economic Development Partnership to supporting Zell’s and Hoffman’s bid to lure the NSF to Alexandria. The city has approved granting $23 million in tax breaks to Hoffman Town Center in support of the developer’s winning bid for the NSF and estimates the project will still bring in $50 million a year in new taxes.

Zell said he would still be open to developing Carlyle Plaza Two as an office building if the right tenant surfaces. If not, he estimates a hotel at the site could be timed to open as the NSF and its 2,100 workers start settling into their new offices.

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