The Diamond District term sheet, annotated

Richmond City Council officially selected RVA Diamond Partners LLC to lead The Diamond District project. 

All eight council members who were present at Monday’s city council meeting voted to have RVA Diamond Partners complete the 67-acre redevelopment project in a northwest portion of the city adjacent to Scott’s Addition. 

After the vote, councilmembers and city officials exchanged high-fives to mark a major economic development plan clearing the hurdle. Two other major entertainment plans — one for a casino and another for a stadium — were defeated in recent years. 

“My Administration and Council have worked together diligently to deliver not only the largest economic development project in city history, but also the most equitable.  A project that will provide quality jobs, affordable housing and public amenities benefiting all Richmonders. Working together, we will continue to move our city forward,” Mayor Levar Stoney wrote in a statement shortly after the vote. 

A final deal needs to be worked out in the coming months, but a nonbinding 20-page term sheet outlined the city’s goals for the project. Its four phases are expected to be completed at the end of 2033.

Below are highlights from the term sheet.

“This Term Sheet is not intended to create, and it does not create, any legal rights, obligations or consequences. Only those rights and obligations that are set forth in definitive written agreements (“Definitive Agreements”), if any, duly authorized, executed, and delivered by all parties thereto, will create any legally binding rights, obligations or consequences with respect to the subject matter thereof or of this Term Sheet.” 

Monday’s resolution made RVA Diamond Partners the developer on The Diamond District project and laid out a proposed, but not final, deal. Hammering that out will be the city’s chief administrative officer and city attorney. They’re enabled by this ordinance to negotiate with the developer toward an agreement that’s “consistent” with the proposals outlined in the term sheet. That final deal will be brought back to council for approval. 

“Our next steps are getting all of those legal documents in place, having them introduced to city council, and for city council to deliberate and take action on those,” said Economic Development Director Leonard Sledge. “From there, we'll proceed with the financing for the bond issuance and get this thing started.”

The term sheet also outlines conditions for all four phases of the project, not just the first, 21.83-acre phase. 

“Developer has provided, in a form deemed acceptable by the City, evidence of project labor agreements for the Project that at a minimum include the following for all construction management companies, general contractors, and subcontractors.” 

Project labor agreements, or PLAs, are negotiated between labor organizations and developers or governments to set pay and benefits for workers on a project. They also can include training programs or hiring goals. 

The term sheet here sets a goal that 40% of construction hours come from union workers for publicly financed portions of the redevelopment, as well as 25% of construction hours on privately financed portions. It also would require RVA Diamond Partners to have contractors “make a good faith effort” to hire Richmond residents, depending on the role: 100% of new laborer hires, 50% of newly hired skilled tradespeople and 15% of existing skilled tradespeople would come from city residents, according to the plan. 

Charles Skelly, president of Richmond Building Trades, argued that a project labor agreement was the way to deliver on those hiring goals.

“Unless the city and the developer are actually firmly committed to ensuring everyone all the way through the subcontractors are adhering to all these very valuable goals for the community, there's no real enforcement except under a project labor agreement,” he said. 

“The Phase 1 Project shall also consist of: 

• A minimum of 1,134 residential rental units (+/- 1.13 million square feet)  
  
  • A minimum of 20% of the residential rental units will have the following minimum affordable housing development components:  
    
    • 184 units at 60% AMI  
      
    • 39 units at 30% AMI, with at least 20 such units set aside for public housing residents with project based vouchers 
•  A minimum of 92 residential for sale units (+/- 206,400 square feet) 
  
  • A minimum of 20% of the residential for sale units will have the following minimum affordable housing development components:
    
    • 18 units between 60% to 70% AMI"

At least 1,134 housing units will be a part The Diamond District’s first phase. The term sheet sketches out a deal where another 1,729 residential rental units are built after phase one; subsequent phases have similar affordable housing requirements. The city will use figures from United States Department of Housing and Urban Development for these area median-income assessments.

Sixty percent of AMI in Richmond is $60,420 for a family of four, according to figures published by the Virginia Department of Housing and Community Development. Sledge said RVA Diamond Partners would help support closing costs on for-sale affordable housing units. 

“The City, EDA, and Developer shall work collaboratively to cause the issuance of revenue bonds by the CDA to finance the construction of the Infrastructure, Stadium, and other public improvements (not including structured parking) for the Project and to pay fees related to establishing the CDA and issuing the bonds.” 

The project’s financing through bonds, issued by a community development authority, will be a major piece of legislation before council in the coming months. CDAs are similar to tax-increment financing, which use future revenues to pay back the bonds.

The final amount of bonds to be issued will need to be outlined in future legislation from city council, but Sledge told reporters that only revenue within the 67-acre development will fund the bonds. 

After the bonds are repaid, revenue goes to the city. In a note to policymakers, the Department of Economic Development said it projected “$156.2 million in new General Fund revenue from the first phase of the project over a 30-year period.” As explained in the term sheet, each of the project’s four phases will issue separate bonds. 

“In coordination with the family of Arthur Ashe, Jr., the Developer shall continue to honor the legacy of Arthur Ashe, Jr. by creating elements in the Phase 1 Project and the overall Project.” 

The city’s Request for Information, issued in December 2021, said that an ideal project would “[c]ontinue to honor Arthur Ashe Jr.’s legacy.”

The Arthur Ashe Jr. Athletic Center is a 6,000-seat athletic center currently located on land allocated to Phase 4 of the project. The facility’s planned removal prompted city council to say it would try to find other venues for the youth athletics, concerts and camps that the center hosts. At Monday’s meeting, one of two speakers against the selection ordinance mentioned the center’s demolition.

“The Project includes the development of approximately 11.1 acres of park space (the “Parks”), as shown on Exhibit D. The Developer, in consultation with the City, shall develop a plan to address the maintenance, operation and programming for the Parks and the proper allocation of responsibilities with respect thereto between the Developer and the City.” 

The term sheet lists features of a park, which could include skateparks, public fountains, shaded portions and playgrounds alongside greenspace. Whether the public spaces will belong to the city or be privately owned — but publicly accessible — isn’t yet determined. 

“We're working on the details of it, but there will definitely be public access to the park and people will be able to come and enjoy the park free of charge,” said Maritza Pechin, of the city’s Office of Equitable Development.