How should the city of Fredericksburg revitalize its commercial corridors outside of its historic downtown?
On Wednesday, city leaders took another step toward answering that question during a joint work session with the city council, planning commission and members of the city’s Economic Development Authority.
This week’s meeting captured the third phase of a commercial corridor study initiated by the city in June 2024. Last year, real estate advisory firm W-ZHA studied the feasibility of redeveloping Greenbrier Center, Fredericksburg Shopping Center and Village North.
During Wednesday’s meeting in council chambers, W-ZHA’s Sarah Woodworth presented five possible ways the city could redevelop Gateway Village Shopping Center alongside Route 3: by-right zoning that allows for 350 townhomes; two mixed use development options with varying amounts of commercial space; a mixed-use development anchored by a sports facility and two hotels; or a headquarter office anchor with retail, a hotel, commercial space and nearly 1,000 apartments.
“Gateway Plaza represents a complex and challenging commercial corridor,” Economic Development and Tourism Director Josh Summits told the audience Wednesday. “[It’s] one of the largest feasible assemblages of commercially zoned acreage possible within the city, it has multiple property owners and a diverse mix of existing uses.”
Woodworth recommended the final two options for the 29-acre property, currently valued at $34 million. The higher-density options would bring more tax revenue in from sales tax, BPOL taxes and property taxes, said Woodworth.
“The net new taxes generated by the higher density mixed use development can cover the debt service on the city investment required to make them feasible from a developer’s standpoint,” Woodworth said.
While redevelopment of Gateway isn’t on the immediate horizon, city leaders have been in contact with owners of several aging commercial areas along U.S. 1 and State Route 3 in recent years, according to Fredericksburg Mayor Kerry Devine. Devine would like to see the sports facility idea come to fruition. She envisions it generating revenue year-round, serving not just city residents but also traveling sports teams.
“Maybe it’s volleyball one weekend, a basketball tournament the next weekend, soccer, indoor field hockey, all sorts of things,” Devine said. “Something along those lines is what we’re envisioning.”
Funding public parking, at least partly, would be necessary to ensure that a higher density mixed-use development gets off the ground, said Woodworth. In addition, the city could incentivize redevelopment by funding a stormwater facility (estimated at $500,000) or create a destination plaza — a $5 million option and the one recommended by Woodworth.
The price tag for the destination plaza designation — an informal term used for developments like the Mosaic District in Fairfax County and The Waterfront in Washington, D.C. — is an estimate based on the construction cost of Fredericksburg’s Riverfront Park, said Woodworth.
“When you create great places, whether it be a park, a plaza, it enhances the value of all of the uses within walking distance,” said Woodworth of the destination plaza option.
Woodworth said the city could use tax-increment financing to fund the redevelopment. By doing so, the hope is that the value of the commercial property being re-developed will increase, and the difference between the new value and the old value will come back to the city coffers instead of using tax dollars upfront on the redevelopment.
