Firm Losing $6.6 Million in National Science Foundation Brokerage Commission?

An Arlington firm that helped negotiate the deal to bring the National Science Foundation to Alexandria is apparently missing out on a $6.6 million brokerage commission, according to a recent report by the Washington Business Journal. 

Judge Anthony Trenga ruled April 4 that JLL is not entitled to a brokerage commission for helping Hoffman Co. attract the NSF to a new headquarters at Hoffman Town Center because the lead broker involved in the deal, JLL Senior Vice President Art Turowski, was not licensed as a real estate broker in Virginia at the time, WBJ reported.

Read the judge's rulling here.

JLL provided the following statement to WBJ: "JLL provides superior service and is committed to getting great results for our clients as we did for the Hoffman family with the National Science Foundation lease," the company said. "It has always been our practice to comply with relevant rules and regulations, and we continue to believe we did so in this situation. We are obviously disappointed with the court's ruling and are weighing our options to continue this through the legal process."

In June 2013, the General Services Administration announced it had selected a 15-year lease on a plan submitted by longtime property owners the Hoffman family for a 667,759-square-foot complex located next to the AMC Hoffman Center 22, Patch previously reported. 

The final rate is expected to save U.S. taxpayers about $65 million over the life of the lease.

In order to secure the lowest lease-rate offer in an extremely competitive process to land the NSF, Alexandria gave Hoffman Development a $23 million tax abatement and offered the GSA $35 million in credits towards rent and relocation costs. 

The city also waived a $750,000 contribution to the Eisenhower Avenue Improvement Fund and considered eliminating a $1.04 million contribution to the city’s affordable housing fund.

Planning Commissioner Derek Hyra said in October 2013 that the affordable housing waiver was a blemish on the deal.

“Added up, there are probably $80 million in incentives to get NSF to move here and it’s probably worth that money,” Hyra said at the time. “But I think we’re sending a signal to the federal government, to NSF and to the developers in the city that we’re willing to put some of this on the backs of the low- and moderate-income residents of this city by giving up a million dollars in affordable housing contribution.”

Ultimately, City Council opted to dedicate $500,000 of the tax revenue generated from the construction of the NSF complex to the city’s affordable housing fund.