DC Passes Convention Center Hotel Bill

The District Council today passed legislation that authorizes and helps finance a new convention center hotel. The bill provides for District financing of nearly 40% of the costs of the Marriott Marquis Hotel, which government and civic leaders have sought for years to provide services to support the city's investment in the convention center. The project has been on-again off-again for several years, with builder Quadrangle Development Corporation reducing the one-time size of the project and negotiating with the District, which by one recent plan would have funded the entire project in order to help kick start the neighborhood and use of adjacent Washington Convention Center. Council members have been motivated to alleviate the Center's obvious Achille's heal - its dearth of hotels in the immediate vicinity - while distancing themselves from the cost of the project. Councilmember Kwame Brown (at-large) said in a press release that though today's legislation was "not ideal," the overall result was positive. "We went from a 100 percent publicly financed hotel to a deal that requires the developer to fund the majority of the costs." The mayor is expected to sign the legislation, which could get construction going as early as this fall. Development of the four-star hotel is expected to cost more than $500 million.

Washington DC retail and commercial real estate news

Smart-Bike: DDOT's Transportation Plan

At a recent Zoning Commission hearing for the (much sought) Marriott convention center hotel, as the quid for the hotel's exceptions to zoning regulations, DC's Department of Transportation (DDOT) asked the developer to install a Smartbike station with a pretty $70,000 price tag. When you're already dropping $500 million on a project, one might reason $70,000 is but a speed bump on the road to development. But Conference Center Associates I, LLC, the developers, proffered alternative proposals, i.e. trees and green space, considering the lack of bicycle lanes and the unlikelihood that future occupants would opt for pedals over cars. Only one commissioner pressed the group about Smartbikes, but it raised the question of how Smartbikes fit into the larger development plan, and whether Smartbikes were now an integrated part of the District's transportation plan.

But according to DDOT Transportation Planner, Jim Sebastian, there is no written DDOT policy on Smartbikes, which came onto the scene in DC in 2008 and now has 10 locations throughout the city and over 120 bikes. Rather, Smartbikes are now just another negotiating chip the city can use to meet "transportation goals inherent in the PUD process." Similarly, DDOT requested Zipcars, which the developer agreed to. These improvements come in exchange for exceptions to sundry zoning regulations.

When DCMud raised the developer's concerns about the lack of bicycle lanes and demand in the project area, Sebastian's response was that the building projects often take years to complete and that by that time there might be more access and demand in the area. In the past 7 years, DDOT has added 37 miles of bike lanes and that's only going to increase. Maybe so, but how does DDOT determine which project would be good locations for new Smartbike stations? According to Sebastian, DDOT reviews several criteria including: population density, employment density,retail density, proximity to public transportation, bike-to-work statistics, and proximity to existing Smartbike stations.

What about that $70,000 pricetag? Sebastian was uncertain of the actual cost of individual stations (including installation and maintenance), largely because DDOT funded the first 10 stations through an advertising deal with ClearChannel, which built the new bus shelters, maintains them and uses them for ads. The ad revenue (or at least an undisclosed percentage of it) initially paid for 10 stations in the downtown area. ClearChannel runs the Smartbikes under the direction of DDOT. While DDOT continues to negotiate with ClearChannel over 90 potential additional bike locations throughout the city, they are also trying to place some of the cost on developers. Uncertain of the exact number, Sebastian estimated that DDOT has mulled adding the stations at a dozen or so projects, but only a few have made it as far as the Zoning Commission. Lots of carrots and sticks going around these days.

LEED Platinum Office Building Opened in Chinatown Today

The redevelopment of Chinatown continues with the opening of a 12-story LEED Platinum certified office building today. The building, at 700 6th Street, NW, appropriately named "700 SIX", features the largest green roof on a private sector building in Washington DC and boasts Capitol Dome views. Mayor Adrian Fenty and Deputy Mayor for Planning and Economic Development Valerie Santos joined the Akridge development team in cutting the ribbon on the $150 million project, one of a mere handful of projects in the city to obtain such a high LEED certification.

Matt Klein, President of Akridge, boasted that "over 90% of the construction and demolition debris was recycled" and that "the building would consume 40% less water than a typical Washington building." The environmental standards set by the project continue a trend for new developments in the city.

700 SIX features 300,487 s.f. of retail space (7,001 SF on ground floor for retail or office and 10,400 SF of concourse-level retail space). According to Mary Margaret Plumridge, Director of Marketing & Communications for Akridge, the space is currently 1/3 leased by the law firm of Cadwalader, Wickersham & Taft. The other 2/3 is up for grabs, though Plumridge indicated that they were currently working with a restaurant group to find a good fit for the ground level, which runs directly next to the G-Street cut through between the Verizon center and the movie theater complex.

The website for 700 SIX describes the glass bridges and metal walls as "virtually free standing with upper-floor windows on all four sides." HOK Architecture, the project architect, is familiar to DC residents as the designer of the new Washington Nationals stadium, and slightly less so for its design of the new office buildings at 88 K Street, SE.

H Street Transit Developments, Don't Stop Believin'

H Street, NE has been coming into its own over the past few years. With a dozen or so new bars and restaurants and the Atlas District, the area surprises those who remember the H Street of 10 years ago - but for one constant: the utter lack of metro accessibility. Residents can see signs of progress on the line, but continue to wonder about the reality of service. The DC government has made several promises to improve transportation there, including rail, and have already bought the trains. So trains will be running any day, right?

In January 2008, Mayor Adrian Fenty and Councilman Tommy Wells celebrated the groundbreaking on the Benning Road/H Street Great Streets Project, and plans were set in motion to develop an at-grade street car connection between H Street NE and Benning Road. The Great Streets title means the area will receive money for streetscape improvements in addition to transit lines. But Shannon Yadsko, an urban planner at Parsons Brinckerhoff, opines that even if residents see rails going into the ground, "service is probably at least 5 years away." Yadsko says that though she is not connected to the project, she foresees a slew of obstacles including, "DC's ban on overhead wires (which streetcars need to run, generally)" as well as competition with other DC projects for increasingly limited financing. One such project is a similar street car line, in Anacostia, which Yadsko notes is "probably a higher profile project." When DC committed to the project, they purchased the street cars for both the Anacostia and and H Street. You might say they got the whole "if you build it, they will come" thing backwards. According to a WTOP article from last April, the DC streetcars are still chilling out in the Czech Republic. Slightly different from the ambulance loan to the Carribean, but equally odd. Better just hail a cab.

Washington DC commercial property news

Zoning Considers Long-Awaited Plan for Michigan Ave and Iriving St NE

If all goes well, Marriott will team with a developer to replace a parking lot with a 314 room hotel at the intersection of Irving St. and Michigan Avenue, NE, adding a gym or grocery store, fixing the dearth of retail nearby, and adding much-needed services and improving the look of the intersection. That's the developer's pitch, anyway. This and adjacent parcels, boxed in by Catholic University, Veterans Affairs Medical Center, Washington Hospital Center, and Trinity University, have long gotten the notice of developers for its large stable workforce and lack of services and housing.

Local partner H Street Community Development Corporation and planners from WDG Architecture and Mariani Architects met before the Board of Zoning Adjustment last night to consider Conference Center Associates I, LLC's consolidated PUD for Parcel 121/31 in Brookland. The developers are seeking to change the unzoned property to a C-3-A zone. The project also includes a commitment from Marriott International.

Phase 1 of the proposed two-stage PUD consists of a 314 room suite hotel and conference center as well as a four-story above-grade structure with 20,000 sq. ft. of retail space at- and below-ground, and approximately 400 parking spaces on the upper levels.

While the zoning commission raised points on traffic flow (planned left turn access to retail from eastbound Michigan Avenue - an issue raised by DDOT in a report submitted to the zoning commission), and the likelihood of successful retail on the below-grade site, comments were overall positive.

Commissioner Peter May noted the problems with duality of the street as both a parkway and retail center, it "feels high speed." His comments highlighted concerns raised by several Commissioners over allowing left turns from eastbound Michigan Avenue. DDOT's representative indicated that the agency had initially sought to restrict access from Michigan Avenue and felt they offered a "reasonable compromise" with their "right-in, right-out" traffic plan. DDOT conceded that a left turn on streets he compared to an "interstate freeway" were "not completely impossible," but the safer option was the right-in, right-out traffic pattern supported by signage and potentially an island at the entrance.

Retail Concerns
Commissioner Konrad Schlater said about the project that he knew "it had been on the drawing board for a long, long time" but that with Marriott as a partner it had a "high likelihood of success." Schlater proceeded to express the commission's skepticism that a grocery store would be willing to accept sub-grade space. The Ward 5 ANC has been supportive of the project largely because of the need for retail in the area. Robert Reinders, of Marriott International, said a small grocery (like Trader Joes) "makes sense," but there could be no guarantees. Sean Stadler of WDG Architecture acknowledged that, "getting a retail tenant is sometimes challenging these days." Uh, yeah, we've read that somewhere before. Another option for the space would be a Health Club, something the nearby Washington Hospital Center favors because, according to Reinders, they currently have no on-site facilities for their more than 14,000 employees.

Local ANC members Ronnie Edwards, Commissioner for ANC5C-11, and Anita Bonds, Commissioner for ANC5C-01, both praised the project team for their work with the community, specifically the ANCs. And as part of the love-thy-neighbor quid pro quo, Marriott will provide "community benefits," in the form of meeting space for Ward 5 ANC throughout the year. (Note to other developers: pay attention here)

The marching orders were given to continue a dialogue with DDOT on the traffic concerns, to find a more physically appealing design for the parking garage, develop an alternative layout for the hotel's pent house suite because of concerns over the height, and to resolve issues raised by a report on the current trees on the property.

The next Zoning Commission hearing on this project is scheduled for July 27.

Renderings provided by WDG Architecture

DC Council Ponders Major Land Disposition

The DC Council hosted a roundtable Wednesday evening to thoughtfully ponder Disposition Approval Resolutions of 5 major developments planned across the city and give residents a chance to air concerns. Officially held to determine whether the city-held land was "surplus" - in lay terms, unneeded and salable - and whether or not selling them would benefit the city and the surrounding community in real terms (jobs, quality of life, etc.). Below is an abbreviated (luckily for you) roundup of the evenings discussions:

1. Minnesota-Benning Phase 2 Redevelopment: As previously reported Donatelli Development and Blue Skye Development won the bid to develop low-income housing and retail space adjacent to the Minnesota Avenue metro station. Panel members described the property as blighted, vacant and underused. Cheryl Cort of the Coalition for Smarter Growth disagreed with statements that the space was underutilized and also argued for a public easement and right of way, requesting that a segment of the property not be developed in case of future transportation demands. Councilmember Kwame Brown (at-large) described development as a way to "bring the city together."

2. New Communities Northwest One: By far the most contentious property of the evening was the site of the former Temple Courts Apartments. Arguments against the land, now used as a parking lot as developers work through the tangles of DC government, included ANC Commissioner Keith Silver's, who submitted a thesis-sized objection, and community members' claims that during Phase1 the developer failed to meet hiring standards requiring that 51% of jobs be given to DC residents. Chris Smith, Jr., Chairman and CEO of William C. Smith & Company, who disclaimed involvement in Phase1, promised to make good on employment promises in Phase2. But some Council members wagged fingers at Smith for having failed to interact directly with local ANCs while assuring community members of Smith's strong standing in the development community. The only change was the decision to build each of 5 buildings in separate phases to improve financing; i.e. former residents will have a long wait until they can return to their new homes.

3. Strand Theatre- It was a big night for Ward 7, with 3 of the 5 projects coming to the ward. The panel, including developers and community members, voiced overwhelming support for the Strand Theatre revitalization and redevelopment project. Council members asked the necessary questions to afford political cover, but there was little contention over the project.

4. Eastern Avenue Property - We previously wrote about ODMPED's call for plans to redevelop properties located at 400-414 Eastern Avenue, NE and the 6100 block of Dix Street NE. The selected plan will offer 56 affordable for sale units - all be 3-bedroom townhouses, something the community supports enthusiastically. Mary Cheeks, a Ward 7 resident, stepped up to opine that "this property has sat vacant for too long...it is time to move forward..." Council members were particularly impressed by the approximately $3.5 million dollar investment that would yield so much housing. Councilman Brown remarked on the millions of dollars being discussed among the projects and remarked over the efficient use of city resources, "I like that," he said. Enough said.

5. Fourth/Sixth and E. Street, S.W.: We reported on the intial appointment of Potomac Investment Properties, City Partners and Adams Investment Group, to redevelop land currently occupied by a fire station and a parking lot. A 9-story building will replace that former fire stationa and house a cafe and work site for DC Central Kitchen, and possibly even a stationery store, wine store and coffee shop. The property is currently planned as a 99-year lease, largely due to the presence of the district's fire station. Council member Tommy Wells (Ward 6), concerned about financing, advised John Holmes of Adams Investment Group that the "stakes are raised" on the project. To paraphrase, "don't screw this up."

Jazzed about Florida Avenue

You've got to appreciate DC's Shaw residents. The small northwest neighborhood has seen more development projects announced - and sit idle - than any other, leaving residents in a cycling state of hope and apathy as the neighborhood talks about big plans with little effect. One such disappointment was the flea market-sporting WMATA site at 8th and Florida Avenue, awarded to a developer more than a year ago, only to sit out the ensuing financial crisis. But thanks to city and federal dollars, and a restructured partnership, that may finally change.

Banneker Ventures has announced a new partnership with Bank of America (BOA) to develop the former WMATA site into three new "affordable" apartment buildings. Banneker can now go forward with The Jazz @ Florida Avenue, designed by Silver Spring-based Torti Gallas, turning 3 separate lots into 124 apartment units above 20,000 s.f. of ground floor retail and a 61-space parking garage, all straddling WMATA's metro tunnel below. The developers have already applied for, and been granted, Tax Increment Financing (TIF) in the form of a $7m promissory note from the District. And with the District's recent receipt of $33m in stimulus money for housing, the developer has petitioned the District government to receive a portion of those funds. As a result, the apartments will be entirely below-market, open to a mix of income ranges, with the cheapest one-bedroom units to rent out at $768. Developers hope to deliver the project in late 2011.

The long path to development began in May of 2007 when the WMATA Board of Directors issued an RFP for developers to build on the site. The Board did not make its final selection, however, until June of 2008, selecting a team that included Banneker and Metropolis Development. But the latest announcement drops Metropolis from the picture in place of BOA. In addition, the formerly tiny project footprint now includes two adjacent parcels on 9th Street recently acquired by the development team. Bozzuto will serve as the general contractor for the project.

Area Housing Projects Look to Affordable Housing for Salvation

As reported last month, DHCD recently received $33.7 million in stimulus funds for the development of affordable housing in the District. According to DHCD spokesman Angelita Colon-Francia, the distribution of the federal money is currently under review, pending the evaluation of 21 projects currently seeking Federal Low Income Housing Tax Credits from the agency. In a release by the District government, it is clear that a number of recent developers are hoping that money will find its way to their projects. The list includes several developments presumably slowed by declines in the real estate market, including NDC's The Heights on Georgia Avenue, Matthews Memorial Terrace and Banneker Venture's Florida Avenue WMATA site project, which have all applied for stimulus money for affordable housing creation in their projects. Comments on applicants are due to DHCD by July 16th.

But fear not, federal-dollar-seeking developers, DCHD will submit another application for round two of American Recovery and Reinvestment Act funding on July 17th. To date, the Department of Housing and Urban Development has awarded the District $94.5m of the $10 billion it has distributed nationwide in funding as a result of the American Recovery and Reinvestment Act of 2009. Funding will be applied to foreclosure prevention, homelessness prevention, "community development", affordable housing, and lead hazard prevention.

DHCD Opens Affordable Housing Center

Mayor Adrian Fenty today officiated the opening of the Department of Housing and Community Development’s new Housing Resource Center. As a real world counterpart to DCHD’s recently launched online housing database, DCHousingSearch.org, the first-floor addition to the agency’s Anacostia Gateway headquarters offers District residents an array of services to ensure easy access to affordable housing.

The new Resource Center, located at the at the prominent intersection of Martin Luther King, Jr. Boulevard and Good Hope Road, SE, was made possible through a $300,000 contribution from Fannie Mae – which, along with the US Department of Housing and Urban Development, will provide literature on their own affordable housing initiatives in the metropolitan area. "All the time when I’m in and out of the neighborhoods of DC, people ask about jobs…They’re excited about school reform and they also want to know where they can go to find housing – specifically affordable housing,” said Fenty.

K Street Think Tank Seeks PUD Approval for New Scott Circle HQ

Representatives of Jones Lang LaSalle and Hickok Hickok Cole Architects will head before the National Capital Planning Commission again this Thursday to discuss their Second Stage PUD application for a new Center for Strategic and International Studies (CSIS) headquarters on one of the last empty lots in DC's Golden Triangle.

The influential DC think tank purchased the commercial parking lot at 1616 Rhode Island Avenue, NW - formerly the site of a Gramercy Inn just off of Scott Circle - from Gould Properties in 2007 with the intent of constructing a new 130,000 square foot HQ to replace their aging K Street office space. Though CSIS has had to pursue $100 million plus of revenue bond funding from the District to fund the project, their purchase did come with one positive upshot. Gould had previously secured Stage I PUD approval for the site, leaving the CSIS' designated development team free to move on the project's design phase.

Since that time, Hickok's initial designs have taken a minor shave - resulting in the loss of 16,000 square feet worth of floor area and 12 of the original 90 parking spaces. At the same time, it has gained a green roof (in the hopes of achieving a LEED silver certification) and will still top out at 9-stories. CSIS' original timeline remains in place for a 2012/2013 completion. The project previously won approval from the DC Zoning Commission just last week.

With their new glass-faced HQ up and running, the former K Street defense industry influence peddlers will neighbor another prominent non-profit of a decidedly more liberal bent, the Human Rights Campaign - which should make for interesting, inside-the-Beltway bedfellows at the local Starbucks.

Downtown BID: State of the Downtown

The Downtown Business Improvement District (BID) issued their 2008 State of Downtown report this week and found that - for an imploded real estate market - things aren't so bad. The BID, which represents the downtown core of Washington DC from Union Station to the White House below Massachusetts Avenue, reports a general trend of rising job rates, more residents, and fuller commercial buildings.

Among the statistics compiled for the report are the creation of 3,800 jobs during 2007 and 2008; 250 new residents during 2008, for a total 7,600; a "record year" for downtown hotels, which boasted a 75% occupancy rate; and a Class A commercial vacancy rate of only 9.6%. Though no new buildings have broken ground since the financial crisis began in September of 2008, commercial projects already under construction are expected to drag down both occupancy and lease rates.

A growth in both daily Metro ridership (108,000 on weekdays, 41,000 on weekends) and tourist attendance (10.1m visitors, give or take a few) helped fuel a rise in "destination restaurants" from 113 to 122.

DC Scouts $1.2 Billion in New Development for Rhode Island Avenue

"Think of Rhode Island Avenue NE as a 'diamond' - a largely un-mined yet valuable investment opportunity."

So begins the Office of the Deputy Mayor for Planning and Economic Development's (ODMPED) Draft Rhode Island Avenue NE Economic Development Plan. Focusing on corridor's three-mile stretch through Northeast Washington, the report recommends "over $1.2 billion in new investments in housing, retail, office and public art" over the next 16 years for the surrounding communities of Brentwood, Brookland, Eckington, Edgewood, Langdon and Woodridge.

Developed under the auspices of the Mayor's Great Streets Initiative with contributions from everyone from the three local ANC 5 commissions to WMATA to the DC Commission on the Arts and Humanities, among many, many others, the "diamond" draft hopes to realize more than 3,000 new residential units, almost 600,000 square feet of office space and over 500,000 square feet of retail along Rhode Island Avenue by 2025 – the earliest of which could deliver by 2011. In doing so, they hope to lure residents and shoppers back from surrounding counties, in order “to capture a portion of the $1 billion in retail sales revenues (and jobs) lost each year to other jurisdictions.”

As such, the plan highlights several promising projects already in the pipeline for the corridor, though delayed “until further change in the economic market”: Mid-City Urban and A&R Development’s mixed-use, 274-unit Rhode Island Station project; the H Street CDC’s 170-unit Rhode Island Avenue Gateway; and, lastly, Republic Land’s 257-unit Brookland Square development (pictured). In total, ODMPED states there are “as many as 14 residential development projects planned or proposed…[that could] include over 13,000 residential units combined.”

Beyond merely underlining Rhode Island Avenue’s Grade-A potential for mixed-use development, the draft plan also delves into suggestions for sustainable building practices, public art installations, small business development, job creation, safety improvements and smart growth transit options – the latter of which includes a proposal for new MARC station at Eastern Avenue and Wells Street on the Prince George’s County border near Mount Rainier (though previously suggested alternatives, like a Rhode Island Avenue street car line, rapid bus transit service, or extension of Metro’s Yellow Line are no longer being considered at this time.)

As the “diamond” draft is broken down into four distinct sub-areas - 3rd to 12th Streets NE, 12th to 18th Streets NE, 18th Street to South Dakota Avenue, NE and South Dakota to Eastern Avenue, NE – residents are encouraged to peruse the recommendations made for their specific neighborhoods and submit comments to Great Streets Coordinator, Derrick Woody. ODMPED will hold an open forum to discuss the plan during the week of September 7th “to formally receive any other comments on the plan before it is finalized.”

This is the second such draft plan released by the Deputy's Mayor's office in as many months; in early May, they posted their proposed plans for redeveloping the Florida Avenue Market into "vibrant, mixed-use neighborhood."

Ten Years On, GW Puts Finishing Touches on Palisades Campus

When George Washington University (GW) acquired the Mount Vernon College for Women in Northwest’s Palisades neighborhood in 1999, they had planned for an extensive build-out of the 134-year-old former seminary that would include 320,000 square feet of new academic and dormitory buildings.

A decade later, GW's satellite campus is co-ed for the first time in its history, but has achieved less than half of the approved additions once intended for the 26-acre campus. Now, with the tenth anniversary of Mount Vernon's incorporation into the University approaching, GW officials have teamed with EE & K Architects to realize the remaining 167,000 square feet of new development for the college at Foxhall Road and Whitehaven Parkway, NW.


The development team – which also includes EDAW, AECOM and VIKA Capitol, LLC – has been holding monthly community meetings to outline their plans for a 2010 Mount Vernon Campus Plan. At present, there are three differently oriented project plans on the table - all of which, however, would achieve the same result: four new academic buildings, ranging from 25,000 to 45,000 square feet; a new 50,000 square foot, 100-bed residential complex; and, lastly, a new three-story gym/sports and recreation center. According to University reps, the idea is to concentrate the new development towards the center of the campus, thereby giving it the bucolic college green feel so rarely afforded to urban universities, and behind Mount Vernon’s blink-and-you’ll-miss-it front gate on Whitehaven Parkway.

In order to make way for this slew of new building projects, some of the institution’s 70s-era academic and residential will be razed, in order to free up campus space. Mount Vernon’s Cole Residence Hall, Gatehouse Building, the Webb and Acheson academic buildings, along with a portion of the Ames academic building, are slated for demolition once a final plan is put together.
Upcoming meetings will adhere to a strict outline of community concerns regarding the project. On July 9th, the development team will present their findings on noise, lighting and population counts, to be followed on August 13th by a presentation on landscaping, storm water management and the green building techniques to be employed in the new facilities. The final scheduled meeting is to be held on September 10th, whereupon a final development scheme will be presented to locals and students alike. All meetings are held at 7:30 pm in the Mount Vernon Campus’ Webb Building.

Washington DC real estate development news