Dive Brief:
- Vornado Realty Trust has paused or canceled several Washington, DC-area projects in advance of its merger with JBG Cos. next quarter, according to the Washington Business Journal.
- Vornado had three projects — one residential and two commercial mixed-use projects — planned for the Pentagon City and Crystal City areas of Northern Virginia, but officials from JBG Smith, the post-merger name, have either withdrawn the applications or put them on hold indefinitely.
- Representatives from Vornado and JBG have reportedly declined to comment on what is behind the pullback, according to the Business Journal, but at the time of the merger announcement, company officials said at least one of the development areas might need a different approach than such high-density, large-scale projects.
Dive Insight:
Despite these recent moves ahead of the merger, there has been no mention of any change in Vornado's position as a potential developer for the new Department of Labor's headquarters in DC. The company is reportedly one of three other companies in competition for the project.
Vornado has also been at the forefront of major development in New York City. Last September, New York Gov. Andrew Cuomo announced that a joint venture between Related Cos., Vornado Realty Trust and Skanska USA (RVS) would redevelop the James Farley Post Office — next door to Pennsylvania Station — into Moynihan Train Hall under a fixed-price, design-build contract. The $1.6 billion project is part of the overhaul of Penn Station.
RVS put up $600 million for what the governor's office referred to as "the value of the development opportunity" at Farley. RVS will renovate the 255,000-square-foot train hall, which will create ticketing and waiting areas for the Long Island Rail Road and Amtrak. The joint venture will also build out 112,000 square feet of retail and 588,000 square feet of office space at Farley. Construction will start later this year and should be complete in 2020.