MURIEL BOWSER
MAYOR
January 7, 2021
The Honorable Phil Mendelson
Chairman
Councilof the District of Columbia
1350 Pennsylvania Avenue, NW, Suite 504
Washington, DC 20004
Dear Chairman Mendelson:
Pursuant to Section 451 ofthe District of Columbia Home Rule Act (D.C. Official Code 1
204.51), enclosed for consideration and approval by the Council of the District of Columbia is,
the DepartmentofGeneral Services hereby submits to the Councilof the District of Columbia
(the Council) for its review and approval the attached Amended and Restated In-Lease
Agreement by and between the District of Columbia and US Union Square DC 899 LLC for
205,860 rentable square feetofoffice space located at 899 N. Capitol Street, NE in Washington,
DC. The leased premises would be initially occupied by the Districts Department of Health.
Turge the Council to take prompt and favorable action on this proposed contract. If you have
any questions, please contact Keith A. Anderson, Director, Department ofGeneral Services, at
(202) 727-2800.
I look forward to the Councils favorable considerationof this proposed contract.
 GOVERNMENT OF THE DISTRICT OF COLUMBIA
DEPARTMENT OF GENERAL SERVICES
COUNCIL REAL ESTATE CONTRACT SUMMARY
December 18, 2020
Please note that any capitalized term used but not defined in this Summary shall have the meaning
given to such term in the proposed real estate contract.
1. The name of the proposed lessor, lessee, grantor or other party to the proposed real estate
contract, the type of real estate contract, the source selection method, the primary term
of the real estate contract (if applicable), and the consideration to be paid by the District
(for leases, the total annual rent for the first year and the fiscal years set forth in the
Funding Certification):
Contract Party Name: US Union Square DC 899 LLC, a Delaware limited
liability company
Type of Real Estate Contract: Amended and Restated In-Lease Agreement (District
is tenant)
Location of Real Property: 899 N. Capitol Street, NE
Source Selection Method: Non-Competitive
Primary Term (if applicable): 18 years
Consideration to be paid by District:
- First Lease Year Annual Rental:$10,293,000.00
- Certificate of Funding
Fiscal Year 2021: $6,155,450.00
2. If the real estate contract is a lease, a breakdown of the Annual Rental, the scheduled
escalations thereof and known Additional Rent obligations (e.g., parking and
supplemental HVAC costs):
The primary term of the proposed lease is comprised of a Phase I Term of about 3 years and a
Phase II Term of about 15 years. The Annual Rental for the Phase I Term is a full service
amount totaling $10,293,000.00 for the first Lease Year, which shall be subject to an annual
escalation of 1.75% during the Phase I Term. In addition to the Annual Rental, the District
will be responsible for its proportionate share of real estate tax increases over the base year of
2021 during the Phase I Term.
The following is a breakdown of the Annual Rental for the first Lease Year of the Phase II
Term:
Components of $/RSF Total Amount for Annual Escalations after First
Annual Rental First Lease Year Lease Year
_________________________________________________________________________________________________
2000 14th Street, NW, 8th Floor, Washington, DC 20009 Telephone (202) 727-2800 Fax (202) 727-7283
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 Net Rental $33.45 $6,886,017.00 2.5%
Initial Operating $9.00 $1,852,740.00 CPI-based
Costs
Initial Real $6.20 $1,276,332.00 Based on actual increases in Real
Estate Taxes Estate Taxes
Tenant $11.10 $2,285,046.00 N/A
Improvements
Allowance
Amortization
Total Annual $59.75 $12,300,135.00 N/A
Rental
The following is a breakdown of the known Additional Rent for the first Lease Year of the
Phase I Term and the Phase II Term (as applicable):
Known Additional Rent Obligations for First Lease Year
Phase I Term $360.00 $259,200.00 total 2.5% annual escalation
Parking: monthly/space
60 fleet parking
spaces
Phase I Term $55.00/hour Total for first Lease 2.% annual escalation
Overtime HVAC Year of Phase I
Term will depend
on usage
Phase II Term $387.00 $227,928.00 total 2.5% annual escalation
Parking: monthly/reserved
18 fleet reserved unstacked space
unstacked
parking spaces $194.00
and 62 fleet monthly/reserved
reserved stacked stacked space
parking spaces
Phase II Term $59.23/hour Total for first Lease 2.5% annual escalation
Overtime HVAC Year of Phase II
Costs Term will depend
on usage
3. If the real estate contract is a lease, a description of any options to renew the primary
lease term set forth above, the contract amount for the primary lease term and each
option period (and an explanation of any difference), and a description of any options to
purchase the real property:
The proposed Lease includes one option for the District to extend the primary term by 5 Lease
Years. The Annual Rental during the primary lease term is described above. The Annual
Rental for the Extension Term cannot be determined at this time, but is not anticipated to be
equal to the Annual Rental during the primary term. This is primarily due to the fact that the
Net Rental rate for the first Lease Year of the Extension Term shall be equal to the then fair
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 market rental rate for comparable properties in the District of Columbia, as determined by
Landlord and the District. In addition to the payment of the new Net Rental rate applicable to
the first Lease Year of the Extension Term, the District shall continue to pay for escalations in
Net Rental, Operating Costs and Real Estate Taxes during the Extension Term, as such
escalations are described in Section 2 above. The Lease does not include any option to
purchase the real property.
4. A description of the real property to be acquired, developed or leased, including any
applicable improvements:
Street Address: 899 N. Capitol Street, NE
Square/Lot Number: 0675/0855
Total RSF of Building: 314,317 RSF
Total RSF of Premises: 205,860 RSF
Description of Improvements: The building located at 899 N. Capitol Street, NE is an existing
multi-tenant office building. Under the proposed Lease, the Districts Department of Health
(DOH) would continue to occupy approximately 205,860 RSF of office space. DOH would
also continue to have the use of 60 parking spaces for government fleet vehicles during the
Phase I Lease Term (65 additional spaces are being made available for employee use, at no
cost or expense to the District). The District would have the use of 80 parking spaces for
government fleet vehicles during the Phase II Lease Term (150 additional spaces are being
made available for employee use, at no cost or expense to the District).
5. A description of the Districts specific real property need associated with the proposed
real estate contract and the selection process, including the number of offerors, the
evaluation criteria, and the evaluation results, including price, technical or quality, and
past performance components:
DOH currently occupies 205,860 RSF of office space at 899 N. Capitol Street, NE under two
separate lease agreements, which leases are scheduled to expire in February, 2021. In
anticipation of such expiration, DGS began a competitive process to either renew DOHs
occupancy or to relocate DOH. In June, 2018, as a result of the competitive process, DGS,
DOH and the Office of the City Administrator made the decision to relocate DOH to a new
250,000 RSF building to be constructed at 2201 Shannon Place SE, which is located east of
the Anacostia River. However, due to TIF approval delays for such development, it is
necessary to extend DOHs occupany at 899 N. Capital Street, NE. The cost to holdover at
899 N. Capitol Street, NE under the existing leases would total approximately $18,000,000
over three years. As this is economically prohibitive, DGS and Landlord negotiated the
proposed Amended and Restated Lease Agreement to replace and extend the two current
leases.
The proposed Amended and Restated Lease will:
o allow the District to avoid paying holdover rent due to the delayed TIF approvals for the
Shannon Place development;
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 o provide the District with over $41,000,000 in concessions that may be used for tenant
improvements and free rent;
o require Landlord to provide significant base building improvements at its sole cost,
including new systems, roof, restrooms, plumbing, elevators, windows, entrances, lobbies
and a fitness center; and
o provide the District with a solution to house 10 District agencies (ranging in size from
2,000 to 70,000 RSF) that must vacate the Reeves Building to allow for the disposition of
the Reeves Building.
6. The background and qualifications of the proposed contract party, including its
organization, financial stability, personnel, and performance on past or current real
estate contracts with requirements similar to those of the proposed contract:
US Union Square DC 899 LLC is a Delaware limited liability company and the owner of 899
N. Capitol Street, NE. US Union Square DC 899 LLC has no employees. US Union Square
DC 899 LLC has been the Districts landlord since it acquired 899 N. Capitol Street, NE in
July, 2019. US Union Square DC 899 LLC has performed satisfactorily to date under the 2
existing leases.
7. Expected outcomes of the proposed real estate contract:
The execution of the proposed real estate contract is expected to result in the continued
occupancy by DOH of the subject space for up to three Lease Years during the Phase I Term,
as well as occupancy by a number of District agencies vacating the Reeves Building during
the 15-Lease Year Phase II Term.
8. A statement that suitable space owned by the District is not available or cannot be
reasonably renovated or altered:
Based upon an evaluation of space owned by the District, there is no suitable space owned by
the District, either as-is or which can reasonably be renovated or altered, which would meet
the needs of the District under the proposed real estate contract.
9. ANC notice of the proposed real estate contract:
Notice was not sent to the applicable ANC based on Portfolio Divisions Standard Operating
Procedures (SOP) relating to ANC notices. The applicable SOP states the following, If
DGS intends to enter into (i) a lease amendment under which leased premises will be added,
(ii) a new lease agreement at a location or in a building where DGS has an existing lease
agreement, or (iii) a new lease agreement which replaces an existing lease agreement where
the new lease agreement increases the lease premises, the Realty Specialist shall provide the
PMEA with the information required in the monthly report if the square footage being added
is equal to or exceeds the greater of (x) 25,000 square feet, or (y) 20% of the square footage
being leased under the existing lease (or if there is more than one District lease at the same
subject property or building, 20% of the total square footage being leased under the existing
leases). Otherwise, an ANC Notification Letter will not be required for a lease amendment, a
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 new lease agreement at a location or in a building where DGS has an existing lease agreement
or a new lease agreement which replaces an existing lease agreement. Since the proposed
Amended and Restated Lease is a replacement for the 2 existing leases at the property and does
not increase the size of the leased premises, notice was not sent to the applicable ANC
regarding DGS intent to acquire a leasehold interest under the proposed Amended and
Restated Lease.
10. A certification that the proposed real estate contract is within the appropriated budget
authority for the agency for the fiscal year and is consistent with the financial plan and
budget adopted in accordance with 47-392.01 and 47-392.02:
The Office of the Chief Financial Officer has certified the availability of funds for the proposed
real estate contract. Please see the attached Funding Certification.
11. A certification that the proposed real estate contract is legally sufficient:
The Office of the General Counsel for the Department of General Services has certified that
the proposed real estate contract is legally sufficient. Please see the attached Legal Sufficiency
Certification.
12. A certification as to whether the proposed contract party has any currently pending legal
claims against the District:
According to the Districts Office of the Attorney General and based upon a certification from
Landlord, Landlord does not have any legal claims currently pending against the District.
13. A certification that the Citywide Clean Hands database indicates that the proposed
contract party is current with its District taxes:
The proposed contract party is current with its District of Columbia taxes. Please see the
attached Citywide Clean Hands certificate.
14. A certification from the proposed contract party that it is current with its federal taxes,
or has worked out and is current with a payment schedule approved by the federal
government:
Based upon a certification from Landlord, Landlord is current with its federal taxes, or has
worked out and is current with a payment schedule approved by the federal government.
15. The status of the proposed contract party as a certified local, small, or disadvantaged
business enterprise, as defined in subchapter IX-A of Chapter 2 of title 2-218.01 et seq.:
The proposed contract party is not a certified local, small or disadvantaged business enterprise.
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 Government of the District of Columbia
Office of the Chief Financial Officer 1101 4th Street, SW
Office of Tax and Revenue Washington, DC 20024
Date of Notice: December 16, 2020 Notice Number: L0004644937
US UNION SQUARE DC 899 LLC FEIN: **-***4268
9830 COLONNADE BLVD STE 600 Case ID: 620480
SAN ANTONIO TX 78230-2209
CERTIFICATE OF CLEAN HANDS
As reported in the Clean Hands system, the above referenced individual/entity has no outstanding
CO
liability with the District of Columbia Office of Tax and Revenue or the Department of Employment
Services. As of the date above, the individual/entity has complied with DC Code 47-2862, therefore
this Certificate of Clean Hands is issued.
TITLE 47. TAXATION, LICENSING, PERMITS, ASSESSMENTS, AND FEES
CHAPTER 28 GENERAL LICENSE
SUBCHAPTER II. CLEAN HANDS BEFORE RECEIVING A LICENSE OR PERMIT
D.C. CODE 47-2862 (2006)
PY
47-2862 PROHIBITION AGAINST ISSUANCE OF LICENSE OR PERMIT
Authorized By Marc Aronin
Chief, Collection Division
To validate this certificate, please visit MyTax.DC.gov. On the MyTax DC homepage, click the
Validate a Certificate of Clean Hands hyperlink under the Clean Hands section.
1101 4th Street SW, Suite W270, Washington, DC 20024/Phone: (202) 724-5045/MyTax.DC.gov
GOVERNMENT OF THE DISTRICT OF COLUMBIA
OFFICE OF THE CHIEF FINANCIAL OFFICER
GOVERNMENT OPERATIONS CLUSTER
OFFICE OF FINANCE & RESOURCE MANAGEMENT
Antoinette Hudson Beckham Angelique Rice
Agency Fiscal Officer Associate Chief Financial Officer
Date: December 24, 2020
Agency Budget: Department of General Services (AM0)
Occupying Agency: Department of Health (HC0)
Funds Needed: $6,155,450.00
Purpose: Funding is needed for an amended and restated lease at 899 North Capitol Street,
NE 20002 (Ward 6). The DC Department of Health (HC) will be the initial occupying
agency and will occupy 205,860 rentable square feet.
Certification: This is to certify that $6,155,450.00 is available in FY2021 and $10,661,054.38 is
subject to approval in the Districts FY2022 Budget and Financial Plan.
Cost of Obligation FY21 $6,155,450.00
Cost of Obligation FY22 $10,661,054.38
Lease Term: 18 Years
_________________________ 12.24.20
_______________________
Antoinette Hudson Beckham Date
Cc: Angelique Rice, Associate Chief Financial Officer, GOC
441 4th Street, NW Suite 890 North - Washington, DC 20001
 GOVERNMENT OF THE DISTRICT OF COLUMBIA
DEPARTMENT OF GENERAL SERVICES
Office of the General Counsel
MEMORANDUM
TO: Ronan Gulstone
Director, Office of Policy and Legislative Affairs
THROUGH: Xavier Beltran XB
General Counsel, Department of General Services
FROM: Katherine Jough KJ
Senior Assistant General Counsel, Department of General Services
SUBJECT: Legal Sufficiency Certification for Proposed Amended and Restated In-Lease
Agreement by and between the District and US Union Square DC 899 LLC
for premises at 899 N. Capitol Street, NE, Washington, DC (the Lease)
DATE: December 18 2020
This is to certify that this Office has reviewed the above-referenced Lease and that we have found
it to be legally sufficient, subject to the submission of any required materials and Council approval.
If you have any questions, please do not hesitate to contact me at (202) 727-2800.
__________________________
Katherine Jough
Senior Assistant General Counsel, Department of General Services
________________________________________________________________________________________________
2000 14th Street, NW, 8th Floor, Washington, DC 20009 Telephone (202) 727-2800 Fax (202) 727-7283