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Watergate East Committee against Hotel Conversion to Co-op Apartments v. Dist. of Columbia Zoning Commission

July 24, 2008

WATERGATE EAST COMMITTEE AGAINST HOTEL CONVERSION TO CO-OP APARTMENTS, ET AL., PETITIONERS,
v.
DISTRICT OF COLUMBIA ZONING COMMISSION, RESPONDENT, AND BRE/WATERGATE, L.L.C.,ET AL., INTERVENORS.



Petition for Review of an Order of the District of Columbia Zoning Commission. (ZC03-16).

The opinion of the court was delivered by: Fisher, Associate Judge

Argued February 22, 2006

Before RUIZ, GLICKMAN, and FISHER, Associate Judges.

Watergate East Committee Against Hotel Conversion to Co-op Apartments and Watergate West, Inc., have petitioned for review of an order of the District of Columbia Zoning Commission which approved a modification to the Watergate Planned Unit Development. The controversy is sparked by the plan of intervenor BRE/Watergate, L.L.C.*fn1 to convert the Watergate Hotel into a cooperatively-owned apartment building.*fn2 The petitioners object to several of the Commission's findings and challenge certain of its procedures. Finding none of their objections persuasive, we affirm.

I. Background

A planned unit development ("PUD") is a zoning process designed to facilitate the development of well-planned residential, institutional, commercial, and mixed-use developments, industrial parks, urban renewal and community development projects, or a combination of those developments and projects in any or several zoning districts.

1330 Connecticut Ave., Inc. v. District of Columbia Zoning Comm'n, 669 A.2d 708, 709 n.1 (D.C. 1995) (quoting 11 DCMR § 2400.1 (1994)). "[T]he PUD scheme is to be used as a tool of land use development which supports the objectives of the community by permitting the development of large areas as a unit." Dupont Circle Citizens Ass'n v. District of Columbia Zoning Comm'n,426 A.2d 327, 332 (D.C. 1981). The PUD process allows "flexibility of development and other incentives," 11 DCMR § 2400.2 (2003),*fn3 on the condition that "theproject offers a commendable number or quality of public benefits and that it protects and advances the public health, safety, welfare, and convenience." Id.

The Watergate complex, located in the Foggy Bottom neighborhood of Ward 2, was one of the first PUDs to be approved (in 1962) following the adoption of PUD regulations in the District of Columbia. Since its inception the Watergate development has mixed several uses of property -- apartments, commercial space, office buildings, and the Hotel. The Watergate PUD has not been static, however; it has changed several times over the years.*fn4 At the time of the Zoning Commission's order, it contained approximately 650 apartments, 250 hotel rooms, 500,000 square feet of office space, a significant amount of space devoted to retail sales and other services, and 1,240 parking spaces.The site of the Hotel is in an SP-2 District, a zoning classification which allows apartment houses as a matter of right; absent special permission, such as that included in the approval of the Watergate PUD, offices and hotels would "now normally require approval of the Board of Zoning Adjustment as a special exception."

This case began when Monument Residential L.L.C., which had contracted to purchase the Hotel, filed an application to modify the PUD on behalf of BRE/Watergate. Among other things, the proposed modifications would convert the Hotel into 133 cooperative apartments. The application also proposed increasing the parking available to the new apartment building, making minor changes to the exterior of the building and the roof area, and modifying, but not eliminating, the health club and restaurant facilities.

The Hotel sits on Lot 807, which is owned by intervenor BRE/Watergate. The health club, restaurant, and parking spaces that serve the Hotel are all located underground on Lot 806, which is owned by Watergate East, Inc. -- the owner of the building east of the Hotel. BRE/Watergate controls the underground facilities on Lot 806 (sometimes called the "Hotel Facilities Premises") through a long-term lease with Watergate East.

Neighborhood reaction to the proposed changes was mixed. Watergate West, Inc., which owns the apartment building to the west, opposed the application and is a petitioner in this case. The residents of Watergate East could not agree on whether they supported or opposed the application, so they formed two committees: the Committee of Concerned Owners of Watergate East, which supported the PUD modifications; and the Watergate East Committee Against Hotel Conversion to Co-op Apartments, which opposed the modifications and also is a petitioner here. Watergate South, Inc., which owns a third cooperative apartment building in the PUD, and the Advisory Neighborhood Commission (ANC) also supported the application for modification.

II. The Zoning Commission's Role

The process for approving a PUD typically is conducted in two stages. In the first stage, the Zoning Commission reviews "the site's suitability for use as a PUD; the appropriateness, character, scale, mixture of uses, and design of the uses proposed; and the compatibility of the proposed development with city-wide, ward, and area plans of the District of Columbia, and the other goals of the PUD process." 11 DCMR § 2402.2 (a). "The second stage is a detailed site plan review to determine compliance with the intent and purposes of the PUD process, the first stage approval, and [the zoning regulations]." 11 DCMR § 2402.2 (b). Applications for modifications to an existing PUD must "meet the requirements for and be processed as a second-stage application . . . ." 11 DCMR § 2409.9. See also Foggy Bottom Ass'n v. District of Columbia Zoning Comm'n, 639 A.2d 578, 582 (D.C. 1994) (proposed modifications treated as second-stage applications).

The Commission held hearings on March 1 and 4, 2004, and on July 27, 2004, it issued findings of fact and conclusions of law approving the application. Among the Commission's conclusions of law were the following:

3. The modification of this PUD project continues to carry out the purposes of Chapter 24 of the Zoning Regulations to encourage well-planned developments that will offer a variety of building types with more attractive and efficient overall planning and design, not achievable under matter-of-right development.

4. . . . [T]he change in use within the existing building will not cause any adverse effect on any nearby properties. Apartment use for this building is appropriate on this Site . . . . Allowing the hotel to be converted to an apartment house will not upset the mix of uses in the overall PUD. The impact of the project on the surrounding area is not unacceptable. . . .

8. Approval of this modification to the approved PUD is not inconsistent with the Comprehensive Plan . . . .*fn5

9. The Commission is required under D.C. Code [§ 1-309.10 (d) (2001)] to give great weight to the affected ANC's recommendation. The Commission has done so and concurs with the ANC's position that the Application should be approved.

10. The approval of the Application will promote the orderly use and development of the Site in conformity with the entirety of the District of Columbia zone plan as embodied in the Zoning Regulations and Zoning Map of the District of Columbia.

III. Petitioners' Arguments

Petitioners raise several challenges -- procedural and substantive -- to the Zoning Commission's approval of the proposed modifications to the Watergate PUD. First, they contend that the Commission made a fatal procedural error by considering the application for modification even though a necessary party had failed to sign it. They also object to the Commission's nearly verbatim adoption of the applicant's proposed findings of fact and conclusions of law and to its limitations of cross-examination during the hearing. Petitioners make a broad substantive argument that the changes approved by the Commission interfere with their vested rights and amount to an unconstitutional taking of private property. They also challenge some of the findings of the Commission, including that the Hotel ...


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