Friday, September 28, 2007

Akridge Acquires Stadium Bus Site

DC-based Akridge Development has agreed to purchase a WMATA-owned bus garage and employee parking lot one block from the planned Washington Nationals baseball stadium in southeast D.C. The transit agency’s Board agreed yesterday to sell the 2.2-acre parcel containing a bus depot and employee parking lot to the John Akridge Development Company for more than $69 million.

Metro listed the M Street property for sale over the summer with the asking price of at least $60 million, receiving three bids by the end of August. The Akridge bid was the most advantageous in terms of price and leaseback rental, Metro managers said. WMATA said that revenue from the sale will help fund the construction of a new garage and proposed police training facility, the latter of which is expected to be built at D.C. Village in southwest DC, with construction set to begin within the next three years. Metro plans to vacate the current property by late winter, employees and buses will temporarily move to other Metro bus garages in the region.

The two parcels at 17 M Street, SW are just one block from the new Washington Nationals ballpark and adjacent to the Navy Yard Metro station. The parcels are 69,607 and 27,558 square feet and are separated by Van Street. The 71-year old bus parking facility has housed 114 buses for the agency.

DC Council to Halt West End Development Process


This week, several DC Council members pledged to rescind a resolution passed earlier this summer which would have granted the rights to purchase three separate parcels of land in DC’s West End to DC-based Eastbanc Inc. at market rate. The Council had passed the emergency measure in July, granting Eastbanc the right to develop the properties in exchange for its commitment to rebuild the fire station, library and the Tiverton apartment building. Eastbanc would have purchased the properties for the appraised value of the "highest and best use" of the land, less any improvements and services that the Council required as a condition of the transfer. 

Under the terms first passed by the Council, Eastbanc would have been required to build a new fire station and library to the specifications of the city, and provide an affordable housing component in what is probably the highest priced neighborhood in the city, on average. The Council also bestowed an interest in the project to a minority developer by requiring Eastbanc to grant 35% of the contract value to a "disadvantaged" local firm, naming several such firms in case Eastbanc's rolodex was short on minority business owners.

The DC Library Renaissance Project, an interest group formed by Ralph Nader with the goal of maintaining the public interest in the District’s libraries, held a rally opposing the resolution. Members of the Library Renaissance Project communicated with both Eastbanc and the tenants of the Tiverton in an attempt to head off the resolution. Robin Diener, director of the DC Library Renaissance Project, commented on the tenants' position: “The residents of the Tiverton had entered into a contract to negotiate exclusively with Eastbanc, and the negotiations later broke down and were legally severed. According to the tenants I spoke with, the terms of the contracts offered by Eastbanc for the purchase of the building were not as promised. A non-negotiable requirement of the tenants was that they support the terms of the Planned Unit Development unconditionally for the ultimate development of Lot 37 by Eastbanc.”

The disposition of the 24th and L Street property went to council on July 10th 2007, where Council members voted on whether to approve Eastbanc’s acquisition of the public property. Councilmember Carol Schwartz, chairperson for the Committee on Workforce Development, halted the process, claiming in a letter to the general public that she “wanted citizens to have at least some opportunity to delve into the particulars of the proposed disposition.” She, together with Councilmember Kwame Brown, scheduled an emergency public meeting on July 3rd after which she voted to approve the Mayor’s legislation in a rushed effort to protect the tenants of Tiverton.

In her statement to the public, Councilmember Schwartz stated, “now that the Tiverton tenants are pursuing other options that should protect them, there is in my mind no longer an emergency.”
Eastbanc has revitalized several neighborhoods in the District. Their past projects include a majority of the development around the West End and Georgetown, including both Ritz Carlton residences, 3303 Water Street and Cady’s Alley. Eastbanc is currently building 22 West, an 95-unit condominium fetching anywhere from $800 to $1000 per square foot, one of the highest selling properties in the DC area.

Wednesday, September 26, 2007

Montgomery County Median New Home Prices hit $1.1 Million

The Montgomery County Planning Department released a housing study today concluding that the median price for a new single-family detached home in Montgomery County crested $1.1 million in the first quarter of 2007. In a finding the department called "startling", the report determined that prices in the county for existing single-family homes and new townhouses decreased slightly to just above $500,000, but that new detached homes jumped from just $860,000 last year to $1.133m this year, and that average prices for all types of housing increased 8 percent in the first quarter while prices were flat, it said, for the rest of the Washington, D.C. area as a whole.

Researchers say that developers appear to be responding to current trends in the housing market by focusing on building high-end houses, demand for which remains strong, rather than adapting to more price-sensitive markets.

Although county law already requires residential developers to sell 12.5 percent of their new units as "moderately priced", as well as add "workforce housing" for any development of 35 or more new housing units near Metro Stations, the Planning Board was cognizant of the din this will raise among the public, and was quick to add that it "and other officials are working to provide affordable housing options...the Planning Board has placed even greater emphasis on the importance of affordable housing opportunities in the county, initiating a new housing study that will become a new element of the county’s General Plan."

The Board also announced, coincidentally, that late this month it would send new recommendations to the County Council suggesting the Council require developers to pay even higher impact fees to offset the costs of infrastructure, including roads and schools, required by brand-new homes. The new fees would equal approximately $31,000 in impact taxes levied upon the developer of most new homes, according to the Board.

Monday, September 24, 2007

DC Announces New Convention Center Hotel


Washington DC Mayor Adrian Fenty announced today that the District has signed an agreement with Marriott International to build a new hotel at 9th and L Streets, on the west side of the new convention center. Marriott had been planning on as many as 1400 units at the site, and has been expected to begin the project since at least early this year, but will now scale the project back a notch, building approximately 1140 rooms and not begin construction for at least a year. The hotel is expected to open in 2011.

The two-acre site, combined from 2 parcels separately operated by the Washington Convention Center Authority (WCCA) and Kingdon Gould III, is currently mostly vacant and is being used as a parking lot. Gould's portion of the site is being traded for a portion of the old Convention Center site that the District now controls. Gould was not part of the agreement today, but has agreed in principal to terms of the transfer. Marriott has agreed to begin the planning process immediately, incorporating the land south of L Street and north of Massachusetts Avenue, along 9th Street. Sean Madigan of DC's Office of Planning says the site plan will no longer include the parcels north of L Street, which Marriott previously acquired in expectation of building into the final designs, but will likely incorporate the historic office building at the southeastern corner of the lot into the hotel. The utility building at the northeastern corner of the block will remain. Madigan said the transaction has been signed and will be executed "shortly", but would not speculate on a timeframe.

The entire transaction is valued at about $540m, of which $134m will be contributed by the DC government through Tax Increment Financing (TIF) in the form of bonds issued by the WCCA and repaid by taxes generated through the hotel. The city will lease the site to Marriott for 99 years, on which Marriott will build and operate the hotel.

Furthering DC's new legislation for the construction of 'green' buildings, Marriott has agreed to meet the District's standards with a building that will be LEED certified, meeting the U.S. Green Building Council's "Silver" standard. The hotel will include 100,000 s.f. of meeting space and at least 400 new parking spaces, but it is unclear if retail will be included in the new design.

Friday, September 21, 2007

NDC Breaks Ground on Georgia Avenue


Neighborhood Development Company (NDC) broke ground last week on one of the numerous projects along Georgia Avenue that are expected to revitalize the flagging area in conjunction with the District's redevelopment plans, approved by the DC Council in July 2006, to introduce development and improve public and private services. The Residences at Georgia Avenue, just north of the Petworth Metro station at Taylor and Georgia, is designed as a seven-story structure with 72 small, affordable rental apartments. The city is providing subsidies to enable NDC to reserve apartments for tenants at or below 60% of the AMI. The ground floor will be dedicated to retail, with a recently announced Yes! Organic Market as the sole tenant.

The project was designed by Weinseck Architects and will be built by Hamel Construction, providing 57 underground parking spaces when complete, likely in early 2009, at which point it should have good competition from numerous other new residential developments, including Donatelli Development's 148-unit Park Place at the Petworth Metro, a 57-unit condominium at the corner of Upshur, a 110-unit apartment building at 3910 Georgia Avenue by Jair Lynch (not yet under construction), and the Renaissance, a 105-unit condominium by Lakritz Adler, though NDC head Adrian Washington pointed out that this will be the first residential project on Georgia to complete. NDC recently completed the Lofts at Brightwood, and is a development partner on the CityVista project. The ceremonial groundbreaking took place in July.

Thursday, September 20, 2007

Montgomery Mall Expansion May be Approved Today

The Montgomery County Planning Board at its meeting today issued a tentative approval to a revised expansion plan for Westfield Montgomery, better known as Montgomery Mall, a nearly 4 decade-old mall at Democracy Blvd. and Westlake Drive along I -270 just outside the beltway. The plan could include new retail, restaurants and parking structures along the entry streets to the mall. The Board has recessed temporarily, and plans to take a formal vote tonight to decide the matter.

The 60-acre project will expand to enlarge Macy's, relocate the Sears, and add a promenade with freestanding retail. The Board had been working over the past several days with a citizen's group to improve pedestrian access, and add a bike lane, shade trees, and a raised median strip. The the Planning Board originally approved the plan in 2005 to include 308,000 square feet of new retail, the new proposal includes approximately 60,000 feet of additional retail, including 25,000 square feet recently acquired from an existing strip mall.

UPDATE: The project was voted on and approved by the Board.

Sunday, September 16, 2007

North Bethesda Square's First Building Tops Out

The nearly $900m North Bethesda Town Center project saw its first building topped out this week as the Wentworth House, an 18-story, 312-unit apartment building, reached its full height last week. The apartment building will house a swimming pool deck above the 18-story-wing and a “sunset” terrace above the 15-story wing, green roof, and 65,000 s.f. Harris Teeter for the "Whole Foods effect" on the neighborhood. Construction on the building began in June 2006, completion on both the supermarket and apartment is scheduled for July of next year.

LCOR, a large east coast development team headquartered in Pennsylvania, was chosen by WMATA as the master developer for the 32-acre North Bethesda Town Center Project, developing a
master plan that includes approximately 930,000 s.f. of office space, 1,275 residential units, a 320-room full-service hotel, and 202,000 square feet of retail space at the White Flint Metro station. LCOR anticipates this project will generate 5,400 new jobs and almost 6,500 additional daily Metro trips, citing it as "the largest joint development project ever approved by WMATA." The project received a "Smart Growth" award from the D.C. chapter of the Urban Land Institute and The Smart Growth Alliance.

The Wentworth House was designed by Dorsky Hodgson Parrish Yue Architects (DHPY), with offices in DC, Cleveland and Fort Lauderdale. DHPY is also designing the Midtown Bethesda North condo project by Kettler.

Thursday, September 13, 2007

Downtown Bethesda Condominium Pair Gets First Stamp of Approval

Bethesda real estate development, PN Hoffman and Stonebridge Development, Woodmont Avenue, Lot 31,The Montgomery County Planning Board staff has issued its report recommending approval of a site plan to jointly develop a pair of parking lots in downtown Bethesda into mixed-use, multi-family condominiums with as many as 250 residential units in LEED certified buildings, construction of which will require a closing and realignment of Woodmont Avenue south of Bethesda Avenue. Lot 31, now sporting a metered parking lot at the crossroads of Bethesda and Woodmont Avenues - on the west side - and Lot 31A, across Woodmont Avenue to the east, are now on track for development as the southern gateway to Bethesda (depicted above, looking south), a predominantly Bethesda real estate development, PN Hoffman and Stonebridge Development, Woodmont Avenue, Lot 31,glass and brick duo with a combined 250 units (up to 146 in the west building and 97 in the east), 40,000 s.f. of retail space and as many as 1480 underground parking spaces. Both the 3-acre and the one-third acre lots are currently owned by the county, and will be jointly developed between the county and the development team, itself a joint venture between DC-based PN Hoffman and Stonebridge Development. The County will require 12.5% of the units built as MPDUs (moderately priced dwelling units) and an additional 35 as workforce housing. The conditional approval by the Planning Board will require conformity to a list of preconditions, including traffic, structural, public space, affordable housing, and bike trail accommodations, limiting the building height to 90 feet to the east of Woodmont, though stepping down to 65 feet at street level, considerably shorter than the 143-foot Seasons apartment building to the immediate east, and to a maximum of 54 feet to the west of Woodmont. Retail will accommodate outdoor seating, extending Bethesda Row to the south, and significant concessions will be made for the Capitol Crescent Trail, including additional bike racks and a "drop-off" point on Woodmont where bikers can unload from vehicles onto a new branch of the trail on the south side of the west building, providing an additional access point to the bike trail from Woodmont, which will be shifted to the west to line up Woodmont more directly where it crosses Bethesda Avenue. PNH and Stonebridge most recently jointly developed Chase Point Condominiums in Chevy Chase DC. The staff report is not final, but signals a likelihood the full Board will approve the project. A hearing on the issue will be held September 20th. 

Bethesda Maryland real estate development news

In Noma's Shadow, Eckington Mushrooms

As the next great construction site in the District, NoMa has attracted justifiable media attention as well as some of the heaviest-hitting real estate development teams in the area, Akridge, Douglas Development, Trammell Crow, MRP and the Wilkes Company, vying for the ability to write upon the blank slate of its startlingly empty surface. Admittedly not likely to be on any tourist agenda or history tour, the newly invented moniker still offers commercial developers an attractiveness that seems hard to have missed in the past - a downtown development site with major bisecting traffic arteries, a pair of Metro stations and a train terminus within walking distance of Congress.

Attracting decidedly less media attention, Eckington, its immediate neighbor to the north, has nonetheless been discovered by local developers not quite ready for an Akridge-sized purchase of air rights over railroad yards, but who view the more than 10 million square feet of commercial space being built on its southern edge as an invitation to develop the residential market. 

Bounded by North Capitol to the west, New York Avenue to the south, Rhode Island Avenue to the north and, of course, the proverbial railroad tracks, Eckington appears to sit on the right side of those tracks judging from development teams that have been quietly converting forlorn apartments into condominiums and vacant lots into loft-like housing for the inevitable office workers that will soon pour into NoMa. Zoned largely for residential and bounded north and south by Metrorail stations, the neighborhood has been populated by rows of single family homes, many of which still belatedly sport the once ubiquitous metal awnings, and small, forgotten apartment buildings, providing affordable alternatives to out-of-the-ground construction.

The area's conversion process began auspiciously when a joint venture between CSX and Fairfield Residential announced plans to build 650 condominium units, but braked in early 2007 as the condo market slowed as construction costs were rising. But by then other developers had used the momentum to build and sell condos like the Jordan (314 V St.), Eckington Heights (330 Rhode Island Ave.), and Basilica Lofts (1900 4th St.), adapting former apartment buildings and abandoned storefronts into modern homes even before the first ceremonial groundbreaking in NoMa.

With NoMa construction now underway, the pace of development in Eckington has now quickened, with new, modern projects now dotting the Eckington map, including Century Court at 14 S Street (14 units), The Indigo at 1901 Lincoln Road (30 units), Todd Place Condos at 302-310 Todd Place (12 units), Eckington Station at 1927 3rd St. (7 units), Capitol Overlook at 221 R Street (12 units), and the Winthrop at 1956 3rd Street (5 units); other buildings beginning construction include 219 T Street, 1921 2nd St., as well as a pair of buildings on 4th Street at V and U and several vacant lots, now under contract by developers. While the scale of development does not match that to the south due to height restrictions and its residential nature, real estate developments here seem more concentrated than any other existing neighborhood. 

"Eckington is is one of the rare neighborhoods in DC next to massive commercial development that has not yet matured, so the potential upside for buyers is tremendous", says Dan Lindsay, whose development team, Lindsay Development & Hillsborough Investments, recently completed a project on Capitol Hill and is now completing the full renovation of Todd Place. Most of the new projects have sold from $340 to $400 per square foot, a price that is difficult to match on the other side of North Capitol Street or anywhere closer to nearby Capitol Hill.

Washington D.C. retail and real estate updates

Friday, September 07, 2007

ICON Condos to Break Ground Again?

When we last visited the ICON Condominiums in July of last year, Dawn Limited Partnership had just celebrated the "groundbreaking" of its $70 million mixed-use development project in Prince George’s county near the Addison Road Metro, and we (and others) dutifully reported its imminent arrival. County exec Jack Johnson was effusive about the smart-growth development and its local benefits. Sales began shortly thereafter, and the development was said to be expecting occupancy in mid 2008. More than a year after the ceremonial start, however, the project has yet to see any activity, but the sales office now reports that actual construction may begin by next month, with completion now more likely in early 2009.

Plans for the project include "luxury" condominiums, retail and restaurant space. The site is part of Prince George’s County Addison Road Metro Town Center Development Plan (PGCARMTCDP for short, sort of). The ICON will be located at the intersection of Addison Road and Central Avenue, at the Addison Road Metro Station. The 8-story project will offer 400,000 square feet of residential, retail and commercial property, including 170 "luxury" condominium units, 25,000 square feet of commercial space, fitness center, business and media centers, a recreation lounge, and a roof-top swimming pool and picnic areas, and previous ads have boasted views of the Washington Monument - several miles to its West.

Thursday, September 06, 2007

JPI Adds to its Stadium Collection

Developer JPI has added to its holdings near the new stadium with the purchase of one acre of land between K, I, and Half Streets, the latter being the major pedestrian entrance to the future ballpark. JPI, a nationwide developer of apartment buildings and, to a lesser extent, condos, says it intends to build the Jefferson at the Ballpark, a mixed-use project with ground floor retail and 416 units. The site is currently occupied by a Wendy's restaurant, groundbreaking is likely to take place next summer.

JPI already owns 901 New Jersey Avenue, one block away, on which it is currently constructing a 240-unit mixed-use apartment building, to be completed late next year; JPI has also begun construction on 70 and 100 I Street, SE (448 and 246 apartment units, respectively), designed by WDG Architecture.

Sunday, September 02, 2007

Kettler Ends Midtown Springfield Project

In a letter sent to the Fairfax County Department of Planning and Zoning, McLean-based Kettler Services, Inc. withdrew their requested rezoning for their 9-acre, $500 million Midtown Springfield project which would have included 800 residential units, 100,000 s.f. retail, 40,000 s.f. office space, and a hotel. The company had previously requested a deferral of the rezoning to gain time to work with the community and County and, according to the July 27th letter sent by the developer’s attorney, Gregory Riegle of McGuire Woods, LLP, to “respond to, among other things, unanticipated and unprecedented changes in construction costs.”

The letter also said, “Rather than pursuing a diluted plan that does not respect community expectations, there is no practical alternative than to withdraw the rezoning.”

Cassie Cataline, Vice President of Marketing and Communication for Kettler, said the company is taking the “wait and see” approach. She said the project’s future depends on the improvement of the real estate market, therefore, no alternative plans have been announced.

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