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- [00:11]
A
Join Willie Walker, Walker and Dunlop's Chairman and CEO, as we bring you fresh perspectives about leadership, business, the economy and commercial real estate. Willie hosts a diverse network of leaders as they share wisdom that cuts across industry lines. His guests are experts in their fields, from leading economists and CEOs to Harvard and Yale professors and everything in between. Our one goal is simple, providing you with unique insights, unparalleled data, and real time market analyses.
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B
Welcome to the Walker Webcast. I was on live about a half an hour ago saying that unfortunately the mayor of Washington, D.C. muriel Bowser, was called into an emergency meeting given the federal government shut down last night and that we weren't going to be able to do the Walker webcast this week. And thanks to, I would assume, the mayor's great work, as well as being able to move through the issues that were front and center at the moment, which she has done consistently throughout her time as mayor of Washington, D.C. she was able to come back on and we're going to record this now and we're going to publish this tomorrow. Madam Mayor, it's great to see you.
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C
It was great to see you, Willie.
- [01:21]
B
It's I have to say, as I was talking through to people earlier about with the job you've done in D.C. as mayor and sort of just doing a little bit of a monologue, one of the things that I was underscoring was the uniqueness of Washington, D.C. the uniqueness of being a federal city. Every other major city in America is part of a state. And basically, if you will, the governance structure is you've got a governor and then you've got the mayor of the city. And the two of them kind of work together to keep the city and the state moving in the right direction. And you have an extremely complex job as it relates to being the mayor of Washington, D.C. our federal city capital. And I guess my question would be, how are you doing right now? Because there are a lot of moving parts going on and you've been so consistent in your leadership of Washington, D.C. you've dealt with Republican administrations, you've dealt with Democratic administrations. You have to deal with governors in Maryland and Virginia, the D.C. city Council, the various jurisdictions in Maryland, Virginia that abut Washington, D.C. talk. How are you?
- [02:32]
C
I'm good. And I appreciate you asking. And you have put the, you have nailed it. Like we're not exactly a city, we're not quite a state. We have city, county and state functions. I act as the mayor, the county executive and the governor all at once. And with an important and unfortunate distinction is that we have no representation in the Congress. Like our Congresswoman doesn't have a vote and we don't have two senators. And so in times like this, especially the federal government has shut down, we have no voice in issues that concern us. In particular, we have members of Congress that are trying to legislate in D.C. and we have no voice. So all of those things make the job of mayor is Washington D.C. a unique one. And you're also right that no matter who, who the President is or who the leaders are in Congress, the mayor of Washington D.C. will always have a special relationship with them because they have an outsized impact on us. So I am blessed with longevity, as you know, and I have worked with every iteration that there is in the White House and in the Congress. And my approach is the same. Tell them who we are, what we need from them, and tell them to leave us alone. And that sometimes works. Right now we're in an unprecedented situation with the White House and also in some ways unprecedented with the Congress because while we have interference that is not helpful. We also got through the biggest economic development deal in the history of the city because we convinced the Republican Congress to transfer land to us that will allow us to build a new RFK stadium.
- [04:33]
B
Double click on that for a second, Madam Mayor. As it relates to, I think many people would sit there and say, oh, the RFK site was there, it had a stadium built on it. It was just up to D.C. government to go and say, let's cut a deal with Josh Harris and get the commanders back into dc. It's not that simple. Why don't you explain it at all?
- [04:51]
C
Because like a lot of land in D.C. in the city, city limits, the federal government still owns them and has title to them. And RFK is one such parcel of land. It's 180 acres. It's really big. And for people watching from DC, they know the wharf that's right on the banks of the Potomac, four wharfs. The type of development that's at the wharf times four is what can happen at RFK with NFL Stadium. So we've gone back and forth for a number of years trying to convince the federal government to give it, to give it to us or to give us a long term lease, 99 year lease. And at the end of last year we finally got that legislation passed that will allow that to happen.
- [05:40]
B
Thanks to a Republican congressman as far as his relationship with you and leadership on the issue.
- [05:47]
C
Yeah. So Jim, James Comer is the Republican from Kentucky that right now is the oversight chair. And we agree on three really solid issues, rfk, public safety and the federal return to the office. And we have worked pretty steadfastly on all of those issues. And he's done, he's done the things he said he would do.
- [06:13]
B
So I want to, I want to loop back to sports because a, you've been exceptional in leading, in leading Washington D.C. on these issues. And getting Josh Harris and his consortium of owners to bring the team back into D.C. is a, is a massive win. You also were very, very successful at, at getting Ted Leonis and his consortium to keep the Capitals and the Wizards and the mystics in D.C. i want to loop back on that, but for a moment, if, if, if I can back up a little bit. You're from D.C. and you went to high school in Maryland. You went to college in Pennsylvania. You went to grad school in D.C. i asked your. Your dad was a, was a baseball fan. And I know you lost, I know you lost your dad a year ago August, and I'm, and I'm sorry for your loss, but he was a, he was a big Senators fan. And then there was a big gap of time between the Washington Senators and when the Nats came back, how, how excited was your dad In March of 2008 when this first pitch was thrown out at NAT Stadium for the NATs.
- [07:15]
C
Back in D.C. my father was the biggest baseball fan that there is. He loved the Nationals. And even in his late, late years when he wasn't able to do a lot, he love listen to the games. And it just brought him so much joy. Going to Nats park bought him so much joy. And we had a tradition that we would go to opening day together and he would invite some friends and he just really loved baseball. And that story is kind of emblematic of why we focus so much on our sports economy. Because my father grew up with the Senators. He grew up going to Griffith Stadium. That wasn't far from where he lived, another urban stadium. But I didn't grow up with baseball. There was no team when I was growing up, but we had softball. And softball for girls has always been competitive in D.C. i went to my first professional baseball game. It was a Pittsburgh Pirates game when I was in college.
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B
Right.
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C
So it was just so remarkable to be able to welcome and have our, our home team and also for our kids. A lot of our kids didn't grow up with baseball and didn't know the game. They really didn't know the game. So having the Nats come in, wrap their Arms around Little League in D.C. in all eight wards of D.C. start an academy to teach baseball. Allows our kids to be exposed to professional athletes, a professional team, great coaching and all that a great team brings to the city. So it's been a, it's been a big win.
- [09:06]
B
So if you think about sports and one of the things I think that a lot of people kind of miss about DC Is the competitive nature with which the city being situated so close to Northern Virginia and suburban Maryland that you're constantly in competition. I mean, for instance, we're. You're bringing the Commanders back from suburban Maryland into the District. And yes, you know, certainly Prince George's county doesn't love losing the Commanders and the capital flows that would come on the eight home games every season that the Commanders have, and hopefully some playoff games on top of that. And similarly, when you almost lost the Wizards and the Mystics and the Caps to Northern Virginia, Governor Yamkin had worked very hard to put together a package that was going to pull them across the river and you were capable enough to keep them in the District. Talk about that sort of. It sort of feels a little bit like Maryland and Virginia are frenemies. They're friends at one moment and they're sort of competitors at the next moment. That's a very difficult dynamic. They're not. Other than New York City, there really aren't any other major cities in the country that deal with that dynamic of sort of cross borders between states and cities that you constantly have to be thinking about as it relates to where your population is living, where companies are based and where sports diet based.
- [10:25]
C
Right? Yes, you're exactly right to point out that it's all economic development. And I think we've done a better job over the years of having some regional cooperation and going after companies because companies are looking at the region. Sure, we want everybody to be within our city limits, but we have a 4 million person region. And so we know that the whole region is marketing D.C. is marketing D.C. as a region. I just left an event where we were promoting the talent capital, where all of our businesses are saying, look, we have these openings. Federal workers, don't leave this great region. Put your, your profile and resume and skills up on this regional portal so that we're keeping our really highly skilled, skilled employees right here in this region. So we've done that. We had a regional bid for the Olympics some years ago. I know, a regional. And we should have that, by the way. We should still have it. A regional bid for Amazon. It didn't go our way. But we're still, we still reap a lot of benefits from Amazon workers who are, you know, coming to work at their headquarters across the river, but our D.C. residents. So there is a lot of cooperation that can happen. And even in the case of the commanders, I think that we had a pretty cooperative dialogue with Governor Moore. And anything that we do with the King, we want to make sure that Prince George's county is going to be in good shape. And so they signed off on an MOU at the certainly with my support to commit to getting development going there and a development that is going to be more beneficial for Prince George's County. So we know, though, that it's the center city. And you won't be surprised by my pitch that the transportation infrastructure, the big event infrastructure doesn't have to be remade because we have it right here in D.C. and that's better for the region.
- [12:47]
B
Talk about that for a moment as it relates to Metro. So, you know, you and I both actually, I got to do a quick check on your age. I remember I was old enough to remember when Metro opened, but Metro open.
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C
And you, baby, I was.
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B
But I was going to put it this way. You and I were both young when Metro. You and I were both young.
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C
Yes. Oh, yes.
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B
But we both remember when Metro opened and it's the second largest mass transit rail system in the United States behind the New York City subway. Obviously, Covid had a huge impact on ridership of Metro. Metro is back to pre pandemic levels as far as ridership. And you were a big proponent of return to work when the Trump administration came in. But it sort of had the counterbalance to it of DOGE and the cut system under the federal workforce. We're now sort of what are we we're nine months after all of those movements came in, of federal workers back into the office. We've seen ridership come up and we haven't quite seen the Doge cut that people had expected to have happen. What's your take on that as it relates to the revitalization of D.C. given those two moves, as it relates to return to office and the Doge effect?
- [13:53]
C
Well, we definitely need for the federal government to stabilize this footprint. We believed that they had kind of bottomed, hit the bottom of their cuts and were in. We started to see some rehiring, but then now we have the federal shutdown and different threats. So we need some and I hope the president makes that clear, that there will be no further gutting of the infrastructure. I do think we've seen more promising signs when stabilizing headquarters locations in the region. And I hope that holds that the various secretaries are focused on the people that they need and that they're going to we've already seen some more hiring happen in the federal space, so we hope that happens as well as in the contractor space. You know this well, that it's not just the direct employees, but there are a lot of contract employees that are impacted by federal spending decisions. So we want everything to be legal and fair and orderly and the Congress has a role to play in some of these decisions. And that's important that, you know, budgeted dollars are spent in the way that they were intended.
- [15:17]
B
And as far as as Metro and ridership, it has been, if you will, reassuring to see that system back up. And, and yes, and you're in your director of WMATA is, it appears from all signs is doing a fantastic job. And he came, he met his I was doing a little research on him. I don't know him personally, Madam Mayor, and I saw that he met his wife on the subway in Boston. A great story.
- [15:42]
C
As you asked how somebody I think he came to us from somewhere in Texas. I think he's done an outstanding job. He's, as I understand it, a new homeowner in D.C. so I think he likes us, too. And I think we made some really important decisions during the pandemic. And Metro did they continue to invest in mates and in expansion, but in reliability and service? So there weren't drastic cuts in lane times. Instead, they invested in the system. And that's what people want in a manned transit system. They want safety, affordability, and they want it to be reliable. And that's what we're seeing in the Metro system. And the really big story is around Metro bus. Metro bus came back pre pandemic, even before the rail.
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B
That's interesting. And that's do you think that that was just is that the root system and where people wanted to go or is that the convenience factor? What do you think it was that made bus come back before Metro.
- [16:51]
C
Gotten a full analysis about that. But we have a pretty robust bus network and I think especially probably more service workers were, you know, were they didn't have access to remote work as much as office workers did. And so I think that that ridership maintained and even grew as more people came back to the office and the.
- [17:18]
B
Purple Line, I think, opens a year from now is what I think is planned.
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C
Yes, I'm a Purple Line expert, but I've been a Skeptic of the purple line for a lot of years and they're making a believer out of me. Every time I drive through Silver Spring. I think that, okay, it must be close because it's a lot of stuff ripped up right now. But that will be a long promised connection, east west connection across, you know, a bi county connection that should take a lot of traffic off the Beltway.
- [17:51]
B
Thinking about Silver Spring, it makes me think about Discovery, who used to have their headquarters in Silver Spring and now it's up in New York as they pulled all those companies together. But it makes me think about companies, Fortune 500 companies. I think the D.C. has three, Maryland has two, and Virginia has something like 12 or 13. For the D.C. region to be, I think it's sixth or seventh in the country as it relates to being a base for Fortune 500 companies. What are you doing, Madam Mayor, to attract companies to dc? What do you, you know, I, I, there's a, there's this movement of companies like Boeing that want to be kind of co located next to the dod, next to Congress, and therefore moved from Seattle to Chicago and Chicago to D.C. or Northern Virginia. When you are out there pitching why companies ought to move to D.C. versus Northern Virginia or Maryland, what's the, what are the differentiators that you're, you're touting?
- [18:51]
C
Well, the biggest one is, is proximity. People want to be closer to the decision makers and they want to be, they want access to the talent and we have all of those things. We also just have a very livable city, especially where young workers want to be. So we know a lot of especially headquarter decisions are made based on where the CEOs live and where the young talent wants to live and raise their family. So the way that we do that is continue to invest in transportation, parks and education. So there's no place in the region where three year olds have universal pre K except D.C. there's no place in the region that has the percent of Michelin starred restaurants like D.C. that has walkable neighborhoods and parks like D.C. so our region in many ways is rich in all of those things. But you have a bigger concentration in D.C. and access to the type of arts and culture that a lot of people want. And so that's why we have seen at the end of last year, we were the fastest growing jurisdiction. No other state, not Florida, not Texas, us. We were the fastest growing jurisdiction in the nation. So we're continuing to attract great people to the city and we know when jobs stabilize that will be even better. And we got some news yesterday that we're all thrilled by, if not surprised. But our economy is even showing resilience year over year. We're up in revenues. We see a lot of our, even despite job loss or threatened job loss, we see our revenues improving. So if we can hold on to our displaced federal workers, last year will be even better than this year. I mean, next year will be even better than this year.
- [20:56]
B
Interesting talk for a moment, Madam Mayor, about your view on taxes, because you just mentioned a couple cities that people are sitting there saying, hey, everyone's moving to Texas because they got no income tax or everyone's moving to Florida. And I went and dove in a little bit on, on some things like sales tax, where it won't come as any surprise to you that, you know, Dallas, Texas, sales tax is significantly higher than Washington, D.C. at the same time, they don't have income tax. Property taxes are about 2x Washington, D.C. and Dallas. And that's how Dallas pays for all the great growth that they have. But they're, I would put forth to you, they're sort of winning the, the publicity war, if you will, of, of a CEO sits there and says, hey, I'm going to move my headquarters somewhere. And it's like, well, if we move to Dallas, Texas, there's no income tax and my employees will be thrilled with that. Versus there's much higher property taxes. There's much higher sales tax in Dallas than there is in D.C. talk about how you manage that and how you talk to the council as it relates to that, that if you will, bucket of taxes that you see places on its residence.
- [21:59]
C
Well, we're very sensitive to it and it is a bucket. It is a combination of things. And I don't know what their taxes are in Dallas, but I do know that our property taxes are very competitive with the region, with our region. Now property values are high. And so when you buy here, it's a great investment in a property. But our taxes are only 85 cents per $100,000. And even in the region, Maryland, it's a lot higher than that. We try to keep our sales taxes equal to the region. And that's.
- [22:36]
B
They're moving up a little bit now.
- [22:37]
C
Right now they're moving up a little, delayed it with this budget year and we're going to keep trying to push it off until the region is equal. And we were able to do that this year. We don't think that sales taxes are the way to fund your government because they're so regressive and it just when the people who can least afford it paying the same as people who can more afford it for the same goods, it doesn't allow us to reach our other kind of goals in a community of closing income gaps and education gaps and more people being able to afford housing. So we don't, we wouldn't, we wouldn't try to close gaps with more regressive tax policy. Now at the same time, you probably know this about me. I haven't raised any income taxes since I was mayor. Now my council, they feel differently and we have had a higher income tax increase and I have fought back another one because I believe firmly that people have choices. And we want more high income individuals to choose DC because it makes a huge difference in our bottom line when people choose to have their homes here, especially when they have homes in many places. So we don't want to say no. We don't want high income individuals to live in our city or blindly say, well, they're not going to move because of taxes. Because I'm not convinced that that's true. So even in a tough budget year, we advanced a budget that was balanced but did not raise income taxes or property taxes. And that's why focusing on growth is so important. Because everything is getting more expensive to do the things that we're doing right now, a year from now is going to be vastly more expensive. So either we have to cut programs or we have to grow or we have to raise taxes. Those are our options. And we have. Part of the reason why we've been a city that's growing is because we have, we have great amenities. You know this. When Mayor Fenty promised to remake our schools 15 years ago, like that has happened. Billions of dollars in new facilities, innovative compensation scheme for our teachers that makes them the best paid in the region and some of the highest paid in the nation has translated into more students in our public schools and more and better achievement in math and ESL and graduation. So like that is, is that's a good use of taxpayer dollars making our schools better. Our park system is vastly better and we have great transportation options. So people are willing to pay for that in D.C. as long as they know it's being used.
- [25:48]
B
Well, yeah, just to underscore some of the comments on the tax rates, so the sales tax in D.C. is moving from 6 to 6.5%, but in Dallas it's 8 and a half percent. So it's fully 200 basis points higher in Dallas. And I actually, yeah, I did the math on if you owned a $570,000 home in Dallas or in DC, how much would you pay in property taxes? And the property tax on a $570,000 home in Dallas is $9,804 a year and in DC, it's $4,271 a year. So. Well, immediately someone jumps in and says, yeah, but DC's getting 4 to 10% of my income. Taxing 4 to. So it's taxing my income at 4 to 10% depending on where I am in there. And back to your point, taxes versus non aggressive taxes. I do think it's important for people to understand that you hear this headline that Texas or Florida are no tax states. Well, they, they get revenue in other ways and.
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C
In other ways.
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B
Absolutely. And, but I would, I would put forth to you, Madam Mayor, that look, Dallas is the fastest growing metro in the country. And since the pandemic has added almost half a million jobs in the D, in the Met, in the Dallas metro, they're winning the, the, if you will, the publicity war. They're winning the, hey, there's a corporation that's based in Denver, Colorado or in San Francisco, California that's saying, I'd like to go to Dallas, Texas.
- [27:14]
C
And you know, one thing that they have, it's more affordable. Yeah, it's bad taxes, but that you can get probably a $570,000 house in Dallas, I dare say is newer and bigger, in more, in more supply than it is here.
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B
Yeah.
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C
And that's, that's the difference.
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B
But so then on that, you've been investing a lot in affordable housing in the Dispatch and put over a billion dollars into it. Is that talk for a moment about is there anything specifically as it relates to where you're investing for that type of housing or what type of workforce slash affordable housing you're hoping to get developed in DC?
- [28:00]
C
Well, right now, what we saw with producing 36,000 new units in like five years, like we beat it by a year of what we thought we could do it in is we held rents pretty steady. We went up some, but it didn't go up as much as it did across the nation. And so that's good. And we know that supply is the only way to address affordability and to maintain the competitiveness of the region. Now here's the other thing that we need to do as a region. We have to do it here, they have to do it in Fairfax, they have to do it in Alexandria. We need to do it as a region and in Montgomery county as well to make sure that we're continuing to have a greater supply of housing and a diverse supply of housing. And so I have been kind of beating the drum for years that we need more single family housing in D.C. we have lost a part of our middle class and some people say they've been priced out of the city. That's not exactly accurate. But they are choosing different housing options that are available in our region that aren't available here. And a lot of that is single family new construction. And in my tenure we've added a lot more than we had before. But I still see, and this is why I say that our friends at Prince George's county at their, their old football site are going to do just fine because they're going to build single family new construction.
- [29:36]
B
You know, it's such a good point. And I, and I do know that you have been, you know, you've been a big advocate of the supply.
- [29:43]
C
Yes.
- [29:44]
B
Scenario. In other words, it's not renting control. And I will tell you this as somebody who is on the, the tip, you know, I'm on the, I'm on the bleeding edge, if you will, or the tip of the spear as it relates to where capital is flowing in the housing market in America because we have sales teams out there every day that are meeting with the largest developers and buyers of multifamily properties in the country. And we hear things before anybody else of what concerns them. And so for instance, your move to push back on the city council on Topa and try and make it so that it's a more, you know, if you will, investor friendly to try and create supply to bring down the cost of housing is, is a huge eff on your part. And I will tell you Montgomery county on the flip side of that, some of the rent control measures that have been put in place in Montgomery county and look, Walker Nol's headquarters is in Montgomery County. I'm there all the time. But I will tell you that incredible buildings that have wonderful, wonderful futures have lower values because of the rent control measures that have been put into place in Montgomery county, which people would say in, in the short term, well that's great. I, I, I have relief from rent increase or rent bumps. But the problem is long term we're not going to get new supply that there and you're going to have a scarcity of supply and you're going to have rents going up in the long term. And so I would just put forth, I praise your efforts to try and stimulate supply side in D.C. to lower the cost of housing, both in multi as well as in single. And I would also underscore your 36,000 units that you've built to give people who are listening just a data point. Pulte Homes, which is the third largest single family home builder in the United States in 2024, built 41,000 homes across the country. In the entire United States of America, the third largest home builder built 41,000 homes. So when you hear that 36,000 unit homes. And by the way, those are both single family homes as well as apartment homes. Those are homes for people to build lives. 36,000 in D.C. is a very significant number.
- [31:36]
C
Yes, it's a huge number. And we have locally invested that, like $100 million a year out of local funds to be to build up both the nonprofit and private development community to go out there and find great deals and know that for 10 years running, the district has been there as kind of the. To close the gap in their financing. You know, how hard affordable housing deals are. So it's just always, you know, us being at the table has meant that the private sector has gone out to find great deals and build new. And now, like, we could talk forever about how we have to get the cost, the per unit cost of building affordable housing down because it's through the roof and it's unsustainable. So we have to figure that out. Industry has to work with government to drive those costs down. But right now, what we're facing, we still are dealing with the Tales of COVID in D.C. probably more than any place near us. And that's why we just passed a piece of legislation that we think is going to help to restore the relationship between landlord and tenant. Make it clear that you have to pay your rent. There's nothing in life that's free, including your rent. And we're seeing signs that that is improving in our market. Another really big bright spot for us is the commercial conversion to residential. We set like. Like, literally we set a goal of building 15,000 units downtown. I thought it was aggressive, to be honest with you. I think we're going to blow that out of the park because we see, like, you know, the story. Everybody said residential conversion is so hard, it can't happen. It's too expensive. There's no water, there's no light. I am going literally to. I'm turning down openings for groundbreaking because there have been so many in D.C. that if you've turned.
- [33:41]
B
Yes, I'm very appreciative. And don't tell my client, don't Tell my client that you turn them down to do the Walker Web crash.
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C
Oh, no, no, no. Which one? I believe it worked, but it's. Seriously, property owners are making it happen. They're saying like, this is our reality. This is what we're looking at. This is how we can make money. We have, we want to partner with them. So we created a subsidy program for housing in downtown and I think it's going to be a real Success story for D.C. we'll have a school downtown soon and, and we got to recruit a grocery store.
- [34:12]
B
You know, the, the other piece is the, you know, the investment in office, which I think everyone sort of have sort of written off. And Boston Properties is building a brand new building right over Metro center that is going to be a, a gleaming office tower. And the, the fact that Owen Thomas and Boston Properties is invested in that property. And to your point about location, I mean, it's like, who would have thought, I mean, literally two years ago the, that a company like Boston Properties would be going and building a new office tower in downtown D.C. was just, just wasn't even in the dialogue. And if they're doing it now and they're going to do it and it's going to be an incredible building right in the, in the core of D.C. right on top of Metro center is really, it speaks a lot to the.
- [34:53]
C
Revitalization of D.C. yeah, it's, it's, it's happening like it's. All of us are really nervous about the downtown. The downtown has fueled all of the great things I just told you about for the last half hour. Our ability to invest in schools, our social services. We have, you know, we have some work to do on the social service area, but we make huge investments in getting people a fair shot and on their feet in our city. But we're been able to do that because of our downtown property values. I got some criticism over, you know, post, in the post Covid years because I had been, been so focused on downtown. But we literally can't make investments in neighborhoods, even neighborhood commercial corridors because they needed to without a robust and valuable downtown.
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B
Yeah, no doubt talking about that. Just looping back a little bit to the Commander Stadium and the development of that. Would you say 170 acres?
- [35:57]
C
180.
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B
180 acres. Which by the way, Walter Reed, Madam mayor, was, is 140 acres.
- [36:03]
C
It's a little bit less, I think. Yeah, but it's in there like one between 100 and 120. And we have only half of it.
- [36:11]
B
You have only half of the commander's development.
- [36:14]
C
No, of the Walter elite.
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B
Right, exactly.
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C
And that's the other half to those.
- [36:20]
B
People who, when we talk about Walter Reed, they may know that there was a very large military hospital on Walter Reed and that then moved outside of the city to suburban Maryland. And that's all been redeveloped. But tell people for a moment what the city has been able to achieve at Walter Reed, because I do think it's. I mean, I was on the board of Children's Hospital for six years, six of six, great year on the Children's Hospital board. And we obviously opened up a research facility at Walter Reed that is turned out.
- [36:48]
C
It's just amazing. Yeah, it's working well. So we are, I would say probably half. Half of the DC portion has been delivered. And like you should think about a Walter Reed headquarters for your company. We still have building one. Building one is still available. That's the historic hospital. It would be amazing. So we many, I guess I think about half of the housing units have been delivered. Whole Foods has opened. Park space. Retail space has opened. About a quarter, I think of the single family has delivered. And another, I think Kilty actually may have come in as the builder, the single family builder that is going to take up a very prominent street at Walter Reed. And it's a neighborhood. I don't live far from Walter Reed for full disclosure. And so I go to the Whole Foods. My daughter and I love to get sushi and just love it. Just quick story. And attracting the Whole Foods, I really knew that's what the community wanted. I went down to Austin to meet with the Whole Foods execs. What was his name? Walter. Is it Walter? Walter Robb. Does that sound right?
- [38:08]
B
I should know his name, but I.
- [38:09]
C
Think he was the CEO at the time he came to D.C. and we toured him around like four or five sites out at Skyland. Walter Reed, I think we were over by Children's Hospital at McMillan Reservoir and he fell in love with it. It was, you know, we had to do a lot to close some gaps to get him there. But it is a great amenity in the neighborhood.
- [38:33]
B
It's fantastic. You mentioned McMillan Reservoir. So as you also know, I was chairman of the board of DC Water and I think that a lot of people don't understand the complexity. Back to my original questions to you about how it is to manage a federal city. A lot of, you know, just the water system in D.C. is a perfect example of how challenging it is for the mayor and the things that you do and don't control so to those who don't understand the DC Water system as well as I do, all water is supplied to the D.C. region by the. By the aqueduct. And the Washington Aqueduct is actually run by the Army Corps of Engineers. So that is a federal entity that has federal workers taking care of the water supply. The wastewater treatment statement is DC Water, which, as you very well know, Madam Mayor, is run by a board of directors that has a chairman who is. Who's appointed by the mayor of D.C. and I was fortunate enough to be appointed the chairman by our mutual friend Adrian Fenty. But then the board is made up of 12 board members and then 12 alternates who come from D.C. maryland, and Virginia. And so you have, in that, three different jurisdictions with the different counties that all have distinct, distinct desires and needs and budgets and everything else. And it is exceedingly difficult to be blunt about it, to manage all the different interests of the different regional groups on something like DC Water. And the mayor obviously has the ability to appoint the chairman and try and drive through what the mayor of D.C. would like. But as someone who sat in that seat and understood exactly what my mayor wanted me to do there, it's not as easily done as it is said. And you have similar types of. Of setups with the, you know, the Metropolitan Transportation Authority. You have the similar setups with the Airport Authority.
- [40:17]
C
How do you.
- [40:18]
B
How do you manage all that? It's. It's so vast and, and you're such a good executive, yet there are certain things that you have total executive authority over and other things that you don't.
- [40:30]
C
Yes. And so. Well, we're lucky when great executives like yourself are willing to volunteer for those positions. And we have a lot of talent to draw from in the mayor. Fenty did a great job of tapping his network to really attract great people. And then we keep going through our networks. Like, we'll ask you to recommend somebody from your company to be on another board. But it's important in all of those positions. Even in all the years I've been doing this, I personally interview people to sit on those boards, and we have 1800 of them. Some of them are more like yours, operational, like the DC Water Board. So I don't put people on those. And I think my staff thinks I'm crazy sometimes because I say, set up the interview. Like, I can't. I need to know that this person has the judgment and ability to move a board in the best interest of the District of Columbia, and that's that. That goes for all the boards. And we. We really Draw a, put out a huge net to try to attract talent, but I think it's a great opportunity as well. I hope you saw your service on that board as a great opportunity. I put, just to give you an example this time, I appointed one of our agency directors who is their director of employment services, because in addition to running a great water agency, I wanted the water agency with the billions of dollars that it spends and has spent over the last years, also be concerned about how we put D.C. residents in good paying jobs. And so you'll be proud to know that DC Water is kind of one of our founding organizations in our infrastructure academy where we train D.C. residents to be hired by contractors that have helped build our water system. And I'm sure it was probably in your tenure that we started these big tunnels projects for the combined vital system. Yeah, they said, oh yeah, but guess what? It's working, Willie.
- [42:50]
B
Oh, a hundred percent it's working. There, there is a, there is a sort of trite response to that, which is when you spend $3 billion on something, it better work. But, but with that, but with that said, I will say, I mean like your point about, about who you have in there now when, when Mayor Fenty turned to me and said, you know, the person that you ought to think about for general manager of DC Water is George Hawkins. At that time, he was running the D.C. department of the Environment. And I knew George, he was on my board. But I sort of, kind of looked sideways at Mayor Fenty and sort of said, you know, George Hawkins, he's an environmental lawyer from Harvard. You know, like I, I, I don't get how he's going to run a water utility. And to Adrian's great credit, he knew exactly what was needed at the Water authority at that time, because the water Authority had had challenges from the environmental community as it relates to the quality of the water and the, and, and what we were putting into the Potomac and into the Anacostia. And that was right when we were starting the tunnel project to build the capture tunnels to make it. So we didn't get the combined sewerage overflows into the Anacostia as well as in the Potomac. And, and Adrian was exactly right. And George, as you well know, was an amazing general manager.
- [44:06]
C
Yeah.
- [44:07]
B
From being one of the worst utilities in the country to being one of the very best.
- [44:11]
C
Absolutely.
- [44:12]
B
And, and it is, I would say, you interviewing those candidates, there's so many of them, but you taking the time to do that, particularly in the important jobs, is all the difference between getting good Leadership and getting great leadership on those missions.
- [44:26]
C
Absolutely. Absolutely. And it is. And I think Mayor Fenty doesn't get the credit he deserves for picking talent. And I don't say that because he endorsed me. Like, it's true.
- [44:39]
B
When you were talking about where you live and you said, you know, a little secret, I actually live near Walter Reed, I was gonna tell everyone that's. That's called Ward 4. So, Madam Mayor, I want to. I want to be mindful of your time because you. You had other things come up. But as. As we close out on this, as you. As you think about the future of the city, you've been trying to diversify the city dramatically. I think the investment in bringing the commanders back in is a. Is a huge statement that says, look, we're. We are a city that has a lot of federal employees. We're. You're going to be inextricably linked to the federal government forever because you're a federal city. And at the same time, like lots of state universities, like the University of Michigan, that used to get all of its funding from the state of Michigan and now gets, I don't know, 3% of its funding from the state of Michigan, it's still the University of the State of Michigan. And yet they did an amazing job of diversifying their revenue base to make it so that they don't have to go to the state Capitol every year and wait for their allocation from the State House. As it relates to how they're going to run the University of Michigan. I feel that you're very focused on. On. On. On trying to do a similar diversification play with Washington, D.C. as a reliance on the federal workers and the federal government as it relates to Washington, D.C. what's the. What's the next chapter in that playbook book?
- [45:52]
C
Well, we're kind of throwing everything on the table, Willie. And this may sound strange given kind of the tense kind of incursion on our autonomy right now, but we also see it as an opportunity. If you want to say you're the best President for Washington, D.C. let's go big. Let's not just talk about beautification. Let's talk about some real structural change in how the federal government can help us more diversify our economy. And so there are things, some things that we're kicking around incentive wise and involving how the federal government can invest structurally in some change. And we think that could have long lasting impacts on how the District operates and our ability to attract industry. And that's what we need to do. We need to attract companies that have good paying jobs because we're high amenity city. We're an amenity rich city city. And that cost. And so we need people to be able to earn a good living. We also need companies that are going to hire people from diverse backgrounds, from, you know, no high school diploma to advanced degrees. And we see this kind of AI revolution. And even the current administration is attracting a lot of technology interest in the District that we haven't seen before, you know, at, you know, this concentrated time period. So we want those high tech companies globally, you know, international companies and from across the nation. And the, the, even the changing landscape of our downtown office is attractive to people who haven't been in the District before. And so they're going to be making some real estate play as well. And so we're going to, you know, we have a growing relationship with the Treasury Department and omb and we're exploring different ways that the Fed, the federal government can help.
- [48:03]
B
I heard when you were talking about the decision to get the commanders to come back into D.C. you said that there was a window of opportunity, a window of time, and you jumped through it. And in your leadership experience, when those windows get set up and there's an opportunity to move through it, you've got to move through it at that time.
- [48:18]
C
Yes, yes.
- [48:20]
B
Do you see what's that window right now? What's that, what's that next window? And, and by the way, you mentioned the challenges, and I'm sure there are lots of people are saying like, oh, well, Willie didn't go into, you know, the, the, the national guard being in D.C. and all that kind of stuff. I think one of the big things that people miss is that mayors and governors don't have the luxury to play politics.
- [48:41]
C
Politics. Right.
- [48:42]
B
You don't, you have to manage a city. You have, you have too many pressures coming on you from too many different constituencies for you to think red, blue, center, wherever. You need to do what's best for the residents of the District of Columbia and represent their interests the best you can. And it's one of the reasons why I have such massive respect for mayors and governors who are in my way, even in the most blue or most red city, they're purple because they don't have the ability to just lead one side of the aisle or the other. And unfortunately, many people who go to Congress go up and they say, I'm carrying a red flag or a blue flag. And I don't quite honestly want to listen to nor work with the other side so on that, what's that window you see right now for your team to be able to jump through?
- [49:22]
C
Well, I don't know in this case, you never know when it opens and closes. And so we see every day there's a new opportunity. So there are negotiations over the cr. We want to know what can we get out of it for the District? They have a real focus on America. 250. What can we get out of it for the District? You might be surprised the DC Water came up in that discussion. Like the President has said he wants to go to Congress or he wants to put together $2 billion for the district. Well, we actually need an alternate water supply for the city. For our homeland security in Brazil. We need.
- [50:08]
B
I know all too much about that topic. Yes, much about that topic.
- [50:12]
C
So like that, that, that comes up. So everything. And this is my approach, and you couldn't be more right. You know how the old saying goes, there's no Democratic or Republican way to pick up the trash that we're always looking for common ground. And I don't care who it is, is like you could be very different politically. And I'm very different politically in a lot of ways from this administration. But I agree very much on beautification. I do think D.C. should be the most beautiful city in the world. And if there is a way to work to do that, then we're going to do it. But I know you're not the most beautiful city in the world if people can't get a job or if you have vacancy in your central business district. District. Or if they're boarded up buildings. So an economic partnership leads to all of the other things that are important for the city.
- [51:13]
B
Final thing, the national headline is National Guard goes into Washington D.C. crimes down. And that's great. Okay, that's the national headline. That's not the local headline. What's, what's the pro and the con from it in the sense that there's a huge cost to having the national guard in Washington D.C. now it's, I think, to the tune of a million or a million and a half dollars a day that at some point you either can sit there and say, we keep paying that as a national cost to have the national guard in Washington D.C. or not. But as you look at it, one of the things that I've heard, Madam Mayor, is that the, the, the foot traffic on streets and people going to restaurants has actually come down quite a bit, even though the streets are, quote, unquote, safer than they were before. Just real quick probably as it relates to having this increased presence.
- [52:00]
C
So, okay, alternate headline. Crime was already going down in two years post 23, which is where we had a spike and a very troubling spike, and we aggressively addressed it. It went down 35% in 24 so far this year. I think we were down 27 before the federal surge. So no mayor wants any crime. So additional police resources, law enforcement resources, we think made a difference in the month of August, where it went down even more. It accelerated the decrease. National Guard, in my opinion, is another issue entirely because it implicates the role of the military on American soil. And that's a bigger debate and it's one that's being played out in court right now. I'm not of the belief that the military should be used against Americans on American soil. That's what we have civilian law enforcement for. Sworn law officers should be doing that work. Now, the federal government, we tap into federal law officers all the time who are FBI, dea, atf, all the DOJ agencies, policies work really well. I think the business community also has to be real concerned about the impact of immigration enforcement, which I think is really upending a lot of industry. Our construction industry, restaurant industry, childcare, you name it. So having federal law enforcement is one thing. I think the issue with the National Guard has to. To be worked out legally because you don't want. It's one thing to say you want people for patrols, but what if they were used in our democratic process around elections? Like, we don't, we don't. We don't need that in our democracy. We need a stable, healthy democracy is good for the city. It's good for our citizens, it's good for business. And so I would just. For people who are not here, we haven't been taken over. It doesn't look like Baghdad. You don't see troops on every corner, but the presence of troops, I think is a kind of bigger issue for our democracy.
- [54:23]
B
I'm super thankful of you sharing your thoughts on that. I know it is a very challenging topic right now, and so thank you for sharing those thoughts. And I can only imagine how challenging it is for you to manage all these moving parts. And so as someone who loves the District, and my parents still live there, and I'm back there all the time because W and D is still based in the District area. I'm. I'm just very appreciative of your leadership of the city. I do get back to all the moving parts that you manage so, so well.
- [54:53]
C
Thanks for making time for me. We made my. I'm glad to connect on Zoom.
- [54:58]
B
It's so great. And I'll. I'll come see you next time I'm in D.C. and I really do appreciate you taking the time, Madame there. It's just a real pleasure.
- [55:07]
C
Well, thank you. You're. You're still. Your wealth of knowledge about us, and we appreciate you. Thanks, Willie. Bye. Bye.
- [55:12]
B
Bye.
- [55:12]
C
Bye.