New Grocery Store Chain to Land In Northeast

The supermarket wars rage on, now with a new competitor. The poor man's Trader Joe's is coming to Ward Five next week, as discount grocer chain ALDI will break ground on what is set to become their first store in the District of Columbia. Work will officially begin on September 7th at 901 17th Street, NE; ALDI executives will be joined by Ward 5 Councilmen Harry Thomas Jr. to celebrate the good news. ALDI summarizes their unique business model as this: "A select assortment discount grocer featuring its own ALDI select brands, ALDI applies smart and efficient operational and business practices to save more than 20 million monthly customers up to 50 percent on their grocery bill." With limited shelving, and most products displayed on the same wooden pallets they're shipped on, it seems as if the end product will be the less complicated, groceries-only version of Costco.

As it is now

Looking more like Soviet Safeway here

Although it may be tempting to poke fun at the grocer as the District becomes overpopulated with gourmet supermarkets, it will likely be a vast improvement upon the "UnSafeway" just next door. With a neglected Safeway on Rhode Island Avenue shut down earlier this year, it is clear that northeast has not received anything like the attention from grocers lavished on northwest. In Germany, where ALDI originated, the chain was once sneered at and dismissed as a low-quality, thrifty-alternative for impoverished shoppers, but has now gained momentum as hip and simplified shopping for the parsimonious. Future customers be warned however, you must come armed with a quarter (redeemed upon return of the grocery cart), and cash or a debit card (credit cards not accepted). Customers are also required to pay for the grocery bags they use, so bring your own reusable cloth sacks to save time, money, and the environment.

The new store should look something like this

Since their business philosophy is a no-frills shopping experience that focuses on cutting costs and passing the savings onto the customer, it's hard to imagine the architecture being inspirational. And like the majority of ALDI's business relationships, they've contracted with a single entity, ADP Engineering and Architecture, to bring their new stores across the country to life. No official construction timeline has been published, but it is expected the turn around will be fairly short. The need for better shopping options in the area certainly remains strong.

Washington D.C. Real Estate Development News

An H Street Spring

H Street's gritty, scrappy texture is giving way. In its place, the northeast corridor's devotees will soon find supermarkets, condos, smart retail, upscale apartment buildings, and trolleys clanging by pricey latte vendors. Long predicted, the year 2011 looks ready to bear out prognostications of a gentrification and resurgence that had seemed, until now, like a mirage, always ahead, always retreating. With last week's announcement that Giant officials had signed an agreement to anchor the northeast corner of 3rd and H, kickstarting Steuart Investment Co's long dormant development and blessing H Street with its first full-sized supermarket, the strip has become one of the hottest sites for development plans.

The Steuart project will add 215 apartments above the Giant, along with additional retail space. Around it, development booms. The District just announced a 16-unit residential project by Wall Development at 12th and H that should kick off next year, and at the eastern end Clark broke ground on a 257-unit apartment complex in October, as did an Aldi supermarket destined for the starburst intersection next year. And the biggest project by far will be Rappaport's 400-unit residence that will fill H Street from 8th to 10th Streets, while Dreyfus' plans for Capitol Place, a 300-unit residence opposite the future Giant, are loaded and ready for the right moment. And the trolleys, of course, are on the way.

Things could have been so different. Just two years ago a New York team went bankrupt betting on H Street and lost their 432-unit building at auction. The Giant will sit on the former BP site, a plot that was intended to house an interstate truck-servicing megaplex. Akridge's dreams to connect H Street with downtown by burying the rail yard at Union Station haven't progressed, and the most consequential projects have not yet broken ground, so the volte-face is not guaranteed, but its looking like its going to be a big year for H Street.

Washington DC real estate development news

Steuart Plans to Start H Street Giant by July

Steuart Investment's H Street residential project should be underway by July 1st, says the firm's principal, setting the stage for an early 2013 opening of the Giant supermarket and 215 apartments. The 3rd and H site is one block from AvalonBay project that should break ground later this year for an additional 140 units, densifying the H Street corridor as its retail renaissance continues to build up speed.

The Steuart project, designed by Torti Gallas, will add a 6 story, LEED certified building - a 5 story residence above a retail pad - with a 42,000 s.f. Giant supermarket. "We're down to the short strokes" says Steuart principal Guy Steuart, who "hopes to have a shovel in the ground by July 1st." Despite not yet having financing fully secured nor permits, Steuart has had zoning approval since late 2007 and is confident construction will start mid summer. The building will have 2 floors of underground parking, a residential lobby and small retail bay on H Street with a 22 foot high ground floor.

The project will face competition from the AvalonBay project and Senate Square's 432 rental units, and on the grocer side from the new Aldi at the opposite end of H and, just a few blocks away, Noma's recently opened Harris Teeter. The sudden concentration of quality supermarkets in northeast D.C., once devoid of such retail, leads to the question of whether northeast will be over-grocered. "Giant is still the dominant grocer in this area. Competition makes everyone keener, I think Giant will do a great job for the community," says Steuart in response.

The project has been a long time coming. Steuart first filed for the PUD more than 5 years ago, with up to 8 stories in mind, but was encouraged to shave some density from the east as a concession to the lower buildings. "Then the world changed and we had to try and make sense economically," says Steuart, who responded by taking out the 3rd floor of parking, limiting the height to 6 stories, and modifying the upper top 5 floors, which sit on the poured concrete retail podium, into a less expensive steel beam and concrete construction.

Steuart's family has been at it even longer, his great-grandfather having started the family business in 1904, according to Steuart, as an ice and coal delivery company that opened a Ford dealership in 1916, with his family owning land "the first time there was a trolley in the neighborhood." BP eventually bought land next door for its filling station and leased Steuart's parcel, at one point planning a larger truck stop for H Street. Steuart later bought out BP's site - the western 40% of the current site - and let them out of the remaining lease in order to start this project.

Steuart predicts an 18 month time frame to open the residences, with the Giant to open "shortly thereafter." Steuart is also building a 390-unit apartment building in Mt. Vernon Triangle with Paradigm, which it began last October.

Washington D.C. real estate development news

DCMud 2010 Year in Review

2010 may not have been a chart buster for real estate, but by most accounts it beats 2009. DCMud presents its annual report of what happened, and what didn't, this year in the world of commercial real estate. 

To start the year, the Coast Guard Headquarters received a thumbs up (Jan 7) from NCPC for the WDG Architecture and HOK designs. Silver Spring will get its arts venue now that the county has reached an agreement (Jan 15) with developers to swap land.  Lee Development Group intends to build a hotel, office building, and 2,000 person music hall in the CBD. Another church sold out to developers (Feb 2), as Lakritz Adler planned to build 200 apartments in place of the First Baptist Church of Silver Spring, just across the street from the library that just got going. Right next door, the county asked developers to submit bids (Feb 3) for another residential project. Progress crept forward on the purple line when the county decided to place it next to the bike trail. The Moda Vista finally took off (Nov 8). Wheaton could be transformed, now that Montgomery County and WMATA have asked developers to submit bids (Jan 21) to control 10 sites downtown, with a B.F. Saul lead team chosen for most of it (July 29). Patriot Realty submitted formal plans (April 13) for 500 apartments above a new Safeway downtown (pictured). EYA began plans to demolish the James Bland Addition public housing project in Old Town Alexandria, which it followed through on, to make way for a mixed-income housing project, now for sale. The Takoma Theater was the subject of a showdown between its owner, who wanted to tear it down and build apartments, and the Historic Preservation Review Board, which liked it just the way it was. The District pushed forward with plans for Skyland, pushing out owners to make room for a developer, testing constitutional boundaries (March 12), even after a national trend by states to stop such practices. Middle Georgia Avenue boomed this year, while the northern and southern ends were a bust. Middle Georgia got a new restaurant (Jan 27), and a new apartment building by Chris Donatelli (March 21), now that both have started construction and are well on their way to completion, as well as a new CVS. NDC got underway on The Heights (May 24), and proposed The Vue (Dec 12). On the lower end, redevelopment of the Bruce Monroe school fizzled (Aug 10), and the planned Howard Town Center went nowhere.

Moving to downtown DC, L'Enfant Plaza stands a chance of becoming less frightening, now that a cabal of federal planners and developers are in cahoots (sort of) (Jan 29) to rebuild the '60's era mass of concrete into something less awful. Not quite ready for prime time: a 14th Street condo project in Logan Circle promised for 2009 failed to get underway in 2010, despite ongoing predictions things were "imminent". The Arts at 5th and I took one step forward and two steps back, as Donohoe Companies and Holland Development, which won the rights to develop the site in 2008, admitted they were not ready and turned the Mt. Vernon site into a parking lot (Feb 9). Holland later said (Nov 18) that they were getting "closer." Alexandria pondered how to make the King Street Metro less unfriendly to pedestrians (Feb 10). The District began a long process (Feb 12) of reshaping Dupont's underground trolley station into something useful, long after it failed as a restaurant venue. The District eventually selected an arts coalition (Oct 21) to build out the space. The Corcoran, which had partnered with Monument Realty to convert southwest's Randall School into a large apartment building, gave up the ghost and sold the project to private investors (Feb 18). Senate Square on H Street was sold at auction (Feb 22) to its mezzanine lenders, relieving New York's Broadway Development of one its DC debacles. Broadway had already defaulted on the Dumont, and soon Arbor Place, its investment in Jim Abdo's New York Ave project-that-wasn't, would also fall apart (May 14). M.M. Washington High School was given to a team of local developers who planned to turn it into subsidized senior housing (March 15), construction is expected by mid 2011. A Woodmont Triangle church has been trying to morph into an 8-story, 107-unit apartment building along with a new church, moving through approvals and looking for a partner after Bozzuto backed out (March 16). DC and the feds gave money ($7.2m from DC) to Urban Atlantic and A&R Development Corp. (March 18) for the 8.5 acre Rhode Island Station, which then broke ground May 18th. Greenbelt Station gets more hopeless by the year (March 24). H Street swelters: The Rappaport Companies got ANC approval (March 26) for its Torti Gallas designed, 400-unit building on H Street, heating up the retail corridor just as the trolley lines are finishing up. Clark Realty broke ground on Arboretum Place (Sept 15) at the eastern end, and new supermarkets are planned for the east (Aldi) and west (Giant) ends. After years of litigation, Ed Peete's Bromptons project made a comeback in Arlington (March 27). Alexandria skyline rising: The Hoffman Company will put 1,200 new rental apartments and upwards of 70,000 s.f. of retail adjacent to the beltway in Alexandria, rising up to 31 stories (March 30). An Arlington church cleared its last legal hurdles (April 16) and began building the Views at Clarendon (pictured), a mixed church and residential project, which other urban churches eyed with interest (Oct 11). Arlington kicked off Long Bridge Park (April 21), its 46-acre isolated brownfield on the edge of Pentagon City that it hopes will become a major attraction. DC opened its riverfront park next to Nationals Stadium (April 27). Next door, Canal Park got underway in Southeast's Capitol Riverfront (Aug 26), a neighborhood that added more than a thousand new residents in 2010. Hopes of Utopia were raised, then deflated, U Street developer Georgetown Strategic Capital predicted imminent progress (Apr 22), then got a 2-year extension (June 26) to build his apartment building and retail project. LCOR broke ground on the Nuclear Regulatory Commission building in North Bethesda (April 28). The MBT bike trail opened a new leg in Northeast DC (May 3). Georgetown's Social Safeway reopened, newer, bigger, better (May 4), as did the Georgetown Library (Oct 14) after a devastating fire in 2007 on the same day that Eastern Market smoldered. The Cohen Companies floated plans for a large residential project at 14th Street and Virginia Avenue, SE (May 5). Brookland had a great year, breaking ground on Dance Place and Artspace, EYA broke ground (May 6) on 237 townhouses, and Bozzuto and Pritzker Realty Group partnered up to build Jim Abdo's mixed-use project (Aug 20). Abdo's other grand plan, Arbor Place on New York Avenue, got no such reprieve, and faded away (May 14). The District broke ground on Sheridan Station, a 344-unit public housing project in Southeast, hoping to cure its crime and upkeep problems (May 10), as well as a host of other affordable housing projects. Construction got underway on the Martin Luther King Memorial (May 14). Louis Dreyfus demolished a block of historic homes (May 20) on the edge of Capitol Hill, ostensibly to build Capitol Place, with 302 apartments, but so far have only turned it into a parking lot. Columbia Pike saw several apartment buildings open (May 23) as development of all kinds took hold, but no trolleys yet. The Loree Grand opened to residents (May 31) just after Paradigm opened its doors (May 28) as the first new housing in NoMa in a century. Archstone broke ground on more residences for NoMa (July 21), 469 apartment units (pictured, right) designed by Davis Carter Scott, on track for a mid 2012 opening. DC reached the 100th anniversary of the act of Congress that gave the District height limits (June 1). Southwest DC passed several milestones, as the Southwest station reopened (June 3) along with a new Safeway. It made nominal progress on the Waterfront (Aug 18) with its first demolition and release of early designs (Sept 30), but construction is not expected any time soon. Capitol Hill's Old Naval Hospital began the rebuilding process on its way to becoming a community center (June 10). The Monty, a long-planned Bethesda high-rise, got a new owner (Bainbridge) (July 1) and soon after got ready to break ground (Nov 5). Work got started on 1000 Connecticut Ave, designed by Pei Cobb Freed, perhaps DC's most visible office building (July 12). Post Properties got underway (Aug 9) on phase two of its Carlyle Square apartment project in Alexandria, 344 new apartments designed by SK&I Architectural Design Group. Park Morton got another public injection of cash, likely clearing the way for a large affordable housing project. Developers should break ground on the 500 units during 2011. JBG found a financing partner (Aug 15) for its 14th Street condo project, gave it a new name (Oct 27), and said it was ready to break ground this year, though that hasn't happened yet. A 42-acre parcel in Northeast was planned by Trammell Crow for a big box destination (Aug 17). Capital One proposed a more urban remake of 23 acres (Aug 19) in downtown Tysons Corner. The Bonstra Haresign design, however, is expected to be built only a few bits at a time, if at all. A long time coming, the Howard Theater began a transformation that should help restore some if its former glory (Sept 1). The Smithsonian unveiled revised plans for the the Museum of African American History and Culture, to take up the last free spot on the Mall (Sept 3). Reston Station got underway as the public garage component began construction (Sept 6), and Comstock Partners planned an early 2011 groundbreaking on their portion, more than a million s.f. of development at the end of phase 1 of the Silver Line Metro extension. Urban planners began thinking through a full makeover of Mt. Rainier nearly a century after the city peaked as an inviting community (Sept 22). Washington Property Company started work on its 16-story residential building in Silver Spring's Ripley district, designed by the Lessard Group (Sept 29). After decades in the making, Marriott's development team began site prep (Oct 20) in downtown DC next to the Washington Convention Center, then broke ground on the 1175-room hotel. Equity Residential bought the plans for a Lyon Park project in Arlington and expected to break ground soon on the new apartment building and retail (Oct 5). Arlington selected Arlington Partnership for Affordable Housing as the developer of the residential portion of Arlington Mill, a subsidized residence and community center (Oct 6). In Rosslyn, the Artisphere opened, adding a touch of nightlife to the 9-5 neighborhood, a new office building and street got underway courtesy of Skanska (Sept 18), and JBG nearly started work on Rosslyn Commons (Oct 3), 454 new units of housing. Monday Properties began work (Oct 12) on 1812 N. Moore, their speculative 35-story, 390 foot office building (pictured), what will be the region's tallest building when completed. The Davis Carter Scott-designed structure will rise above the new Rosslyn Metro station. Developers of CityCenter DC said they would be ready to fill the gaping hole downtown by next spring (Oct 22), despite the apparent lack of an anchor tenant. Paradigm Development began work on more than 400 apartments in Mount Vernon Triangle (Oct 27). Carr Properties and architects at SmithGroup came up with plans to add an office building onto the Corcoran Gallery of Art (Nov 5). The cash-strapped Perseus sold 14W to JAG, which said it could start building the 14th Street project almost immediately (Nov 24). Next door, work began on UDR's apartment building after delays and extensions (Dec 15). In the last item of note, Shaw's Progression Place started up (Dec 22), though the more meaningful O Street market got nowhere, despite an official groundbreaking (Aug 30).