Douglas Picks Up Another Penn Quarter Site

Douglas Development has picked up another building, this time a club in the making. After letting many of its DC-area properties slide toward tax sale for lack of tax payments, Douglas has picked up the Equitable Building at 915 F Street, NW, a building that had been previously pushed as the Museum of Arts and Sciences (MoA&S), a place where nothing was as it seemed.

Douglas' plans for the building are unclear. Owners of the building, who paid $10m in a recent sale, gave in to Douglas' negotiating ability for a sale price of $5m. The building was planned for the MoA&S, which in fact would have been a large, 3-floor dance club serving alcohol late into the night.

Peter Andrulis, through The Equitable Place LLC, bought the property for $10 million in June of 2009, hoping to turn it into a hot spot for receptions, fund-raising events, and art shows (read: partying) in the Penn Quarter neighborhood.

There had been serious concern from residents that the business operating under the moniker "Museum" and purporting to act as an "educational" event space for curated art events, live performances, poetry readings, and the like, was a guise for a nightclub like Platinum to be reincarnated. The MoS&A was shut down after only a couple soft openings in late 2010, and prior to its planned 2011 New Year's Eve grand opening.

Washington D.C. Real Estate Development News

Historic Landmark Status Arises in Plan for Old Wonder Bread Building

An adaptive reuse plan by Douglas Development for the old Wonder Bread building has recently encountered a new factor in the mix - potential Historic Landmark status. An application, signed by Douglas and the D.C. Preservation League, was filed with the Historic Preservation Office on August 8th, requesting the Landmark status of the early-20th century industrial craftsman building.

The old Wonder Bread building at 641 S Street, NW in Shaw, is part of a seven-building industrial complex built between 1913 and 1936. The building was purchased by Continental Mills in 1936, and much more recently by Douglas Development (d.b.a. Jemal's Wonder LLC) in October of 1997.

As reported by the Washington City Paper, the 2- and 3-story, 60,000-s.f. building will be redeveloped as office space. Paul Millstein, in charge of Douglas' construction happenings, confirmed this fact, but acknowledges that there is uncertainty as to first-floor uses: "It could go retail or office, depending on the market."

Either way, the plan was always to retain the building's historic façade.

Millstein said, in July, that the redevelopment, designed by R2L:Architects' Sacha Rosen, will work around the building's well-known face on the block. Added density will be tucked into the back (not the top) of the building, which will push the building's envelope out towards the alley, and transform the structure into a "clean box shape" without significantly changing the building's appearance, said Millstein.

Rebecca Miller, executive director of the D.C. Preservation League, said the decision to submit the building to the HPO for Historic Landmark status was an easy one and has been in the works for the past year; the process was facilitated by the fact that Douglas' working concept has always included retention of the building's historic character.

As far as progress goes, Millstein reports that Douglas has not obtained construction permits yet, but, in July, he foresaw having the necessary paperwork in place by early September. Landmark Status review is not yet scheduled, although it could be as early as next month.

Expedited construction/repair permits were issued on the site in April, in order to ready the building for the D.C. Preservation League's 40th anniversary party, however the 90-year-old structure requires more than the last-minute nip-and-tuck (although impressive) that it underwent for the spring gala.

Of redeveloping the '20s-era structure, Millstein declared, “It’s a very cool building, a very cool project.”

The first Wonder Bread bakery in D.C. was located nearby at Georgia Avenue and Bryant Street NW, which was absorbed by the growing Howard University campus in the '90s. The Wonder Bread building being redeveloped at 7th and S Streets first housed the Bond Bakery, then the Dorsch's White Cross Bakery (responsible for the façade that now stands, with white crosses made out of tile), which was bought by Continental Mills.

Washington D.C. real estate development news

Douglas Secures Hecht's Warehouse at Auction

With Patriot Equities having defaulted on more than $44 million for its property known as "Hecht's Warehouse", noteholder Douglas Development picked up title to the property this afternoon as the sole bidder of the auction it held through Alex Cooper Auctioneers. Douglas gained control of the title with an unrivaled bid of $20 million (a hair above the "outstanding debt in excess of $19,999,000") for the entirety of the four-parcel property spanning New York Avenue in Northeast: 1401-1403, 1545 New York Avenue NE, and 2001 16th Street, NE. Meaning, Douglas is no longer the noteholder, but the property owner, and potential developer, of the site.

The City Paper reported last week that Douglas Development had bought the promissory note for the Hecht's Warehouse property from U.S. Bank in March of this year, after Penn.-based Patriot Equities was unable to keep up with a $66 million loan, and the Bank nearly went into foreclosure last year.

Patriot Equities had purchased the Hecht's Warehouse property in 2007 for $78 million and planned a development called Patriot Yards, a warehouse facility that boasted "loading accessibility which is virtually unmatched in the District." At the time of purchase, Abdo was thrilled to have future development in the Northeast neighborhood, with the hopes it would encourage investors for its own 17-acre Arbor Place project, which never happened, nor has development of New York Avenue taken hold.

As reported by the Post on Monday, Norman Jemal of Douglas asserted that his company "is considering a warehouse distribution space at the site or possibly apartments with streetfront retail."

Washington D.C. real estate development news

Plan in Queue for Babe's in Tenleytown

Plans for the former Babe's Billiards site at 4600-4614 Wisconsin Avenue NW in Tenleytown have been knocked around, and ultimately scratched, since early 2004, three years before the well-known neighborhood hangout was forced to give its final last-call-for-alcohol. The site, dormant now for four years, is owned by Douglas Development, and the developer plans to rekindle an earlier vision for the parcel: a six-story, mixed-use development with a significant retail component. Douglas Development, flying as Jemal's Babes LLC, purchased the site at auction in February of 2009 for $5m - in what many insiders considered an overly aggressive bid - after previous owner and developer, Clemens Construction, went into foreclosure and was forced to fold on its plan to turn the site into the 70-unit Maxim Condominiums, first conceptualized in 2006. In 2009, Douglas asserted it would re-establish the site as simple retail, but then filed a request with the Zoning Commission in September of 2010 to rezone the property and develop the site into a significantly more dense mixed-use project incorporating anywhere from one-to-three floors of retail topped with residential. This plan, however, was scaled back in December of 2010 - back to a one-story, one-tenant redevelopment of the existing structure, likely to be occupied by a restaurateur. Following through with this downsized plan would have allowed Douglas to forgo the PUD and rezoning process and develop by right, in line with the property's current C-2-A zoning (low density, maximum height of 50'). Yet, eight months later, with the corner building still empty, Douglas is opting to go big again and has returned to the six-story, mixed-use plan for five stories of residential above 12,600 s.f. of ground-floor retail, confirms Paul Millstein, head of construction-related activity at Douglas (the rendering above is just a concept). Plans are currently in Shalom Baranes' design queue, although there are no active renderings yet, per the architect. The PUD-plans will be submitted to ANC 3 "by September" said Millstein. "If not September, October for sure." Meanwhile, anyone looking for pool can head to Babe's new home in Silver Spring, where the watering hole relocated in November of last year. Anyone looking for vestiges of the neighborhood's seamier days of the '60s and '70s will have a harder time finding it. 

Washington D.C. retail and commercial real estate news

No Mo' for East NoMa This Year?

Charles "Sandy" Wilkes founded The Wilkes Company over three decades ago and began investing in NoMa - North of Massachusetts Ave - shortly thereafter, acquiring property as early as 1985, when Reagan was in office, Mandela wasn't free, and Back to the Future was the highest grossing film in the U.S.  That investment may soon pay dividends, as Wilkes plots a course to finally develop the block of property at 3rd and M Streets, NE, in Noma's long underdeveloped eastern branch. While signs of construction have been evident at the site for several months, Wilkes is holding back on development until the moment is right. That moment may well depend on Douglas Development and its development of Uline Arena; restoration of the historic 60-year-old Uline/Washington Coliseum, according to Douglas, depends on finding a marquee tenant, which they are actively seeking. Despite other real estate projects in the Northeast area rolling forward - Valor Development's 49-unit condo at 3rd and L, slated to begin in spring of 2012; the AvalonBay's 215-unit apartment project at 3rd and I; and Guy Steuart's Giant project at 3rd and H - Wilkes seems to be keeping an eye on what may be the city's most unique entertainment venue just across the street. 

 In addition to the combined Uline and Ice House project by Douglas and 300 M St NE, there are two other substantial planned projects on the boards for East NoMa proper: Union Place II, a 500-unit apartment with 30,000 s.f. of retail by The Cohen Companies, now in the design phase and looking to break ground in first quarter 2012, according to TCC's executive vice president, Eric Siegel; and the long-way-off Burnham Place project, a massive, billion-dollar build by Akridge.

300 M Street has long been idle and is being used for parking in the interim; the reason for the long wait time, according to Wilkes, is that he is "taking the time to determine the right mix of uses [at the site] and determine the right timing." The market is a big factor, specifically the uncertainty of the market for office space in the immediate area, and the unknown effect of substantial commercial density being added to west NoMa. Wilkes is familiar with the market, as well as the ongoing changes in NoMa: along with being an owner of substantial property for over 25 years, he invested in the construction of the New York Avenue Metro stop, and serves as vice chairman of the NoMa BID (a map with the boundaries of NoMa is found below). 

Although the specifics may change given Wilkes' earlier statement, an original design for 300 M, conceptualized by D.C.-and-New York-based Beyer Blinder Belle , incorporated retail, loft-style residences, and office space catering to a large organization: a non-profit HQ, government agency or trade association. One thing is clear about the future use of the site,"It will require zoning relief," explains Wilkes. The Ward 6 location is zoned C-M-1, low bulk commercial and light manufacturing uses, with a maximum height of 3 stories or 40'. Wilkes asserts that the zoning process will take some time, and that ground breaking at the site is not imminent. Wilkes also claims that east NoMa will eventually develop as more of a nod to New York's SoHo and Tribeca than anywhere else in DC, and "patience" is required, but that patience is wearing thin for some. For now, it seems Wilkes' project will sit on the sideline for the rest of the year, as west NoMa continues to witness the highest concentration of construction in Washington D.C. With over $3 billion of private investment shuttled into the whole of NoMa since 2005, 15.7 million s.f. of the neighborhood has been developed, and with 16.8 million more square feet to go, more patience may be a necessary asset. 

Washington D.C. real estate development news

Douglas Close to Construction on 14th Street

Redevelopment abounds along the 14th Street corridor within the mile-long strip that runs from Meridian Park through U Street and into Logan Circle, with several condo projects and new retail on track to arrive within the next one-to-two years. At the top of the corridor, at 2221 14th Street (14th & Florida Ave), Douglas Development will soon add another: a 6-story, 30-unit, mixed-use residential-and-retail project. Sasha Rosen, principal at R2L:ARCHITECTS – responsible for the design – relays that the permitting process is underway and involved parties foresee construction will start in three months or less. Per Rosen, the design for the complex has not changed since reported in November of last year, when Rosen stated that "the massing, form, and rhythm are in the Washington historic tradition, but the details are contemporary." 

Located within the Greater U Street Historic District, the project first sought approval from the Historic Preservation Review Board (HPRB), which gave Douglas the go-ahead, and the OK to demolish the crumbling Latino Auto Sales shop on site, at the end of last year. In January, the Board of Zoning Adjustment (BZA) also approved the project's plan, and granted the developer zoning relief, with a few conditions, including one-time mass-transportation and/or car-sharing funds for future residents, as well as requiring "that a temporary mural [be painted] on the south façade of the building,which shall remain on the building until such time as construction on the adjacent property to the south would obstruct the mural." Douglas Development could not be reached for comment this morning. 

Washington D.C. real estate development news

Washington DC's Retail Prices Surge

The best, or busiest, intersection in Washington D.C. is at H and 7th Streets NW, in the heart of Chinatown - at least according to those who own property on either axis. With four corners available to capitalize on the heavy traffic, only one corner remains open to incoming retailers. But it'll cost 'em. The lofty asking price for the ground floor of the future mixed-use site at 675 H St NW is just one indication that retail around the city is in high demand as retailers vie for limited retail space and rents around the city rise quickly, sometimes dramatically.

The joint-venture in control of leasing the retail space, as well as developing the site, is McCaffery Interests Inc. and Douglas Development, which obtained the property at auction in February. According to Juan Cameron, Managing Director of McCaffery, "The site commands a strong asking price." That price has been relayed, by several sources, as asking $250-$300 per square foot.

Cameron, who declined to speak on the record about price points, acknowledged that the space will "be on the high side" and asserts that the companies are "looking to set a new benchmark," but won't divulge specifics while leasing is underway. However, Cameron added that "the site has generated a considerable amount of interest."

John Asadoorian, founder and head of Asadoorian Retail Solutions, confirmed having heard an asking price around $250 p.s.f. for the corner spot, which is adjacent to the Friendship Arch/Chinatown Gate, a one-block stumble away from a Caps game at the Verizon Center.

Asadoorian did not speak to the feasibility of the high asking price at 7th and H, however agreed with site developers that the intersection is the closest D.C. has to New York's Times Square. Fuddruckers, located on the intersection's opposite southwest corner, struck a deal early in the decade for about $80 p.s.f., a price that raised eyebrows then, before the substantial investment in Chinatown in 2006.

Asadoorian notes that although retail rates have been rising in the few years following the recession, the jump in price at this location is relatively the largest. Whereas Georgetown leases have generally increased by around $50 p.s.f. in the last 10 or 15 years, the jump in price at Chinatown would be double that, and in less than half the time.

The increase in price underscores the fact that D.C. is fast becoming a vibrant spot for unique retail, as well as a foodie destination and Food Network-inspired hot spot, with a proliferation of national restaurateurs and chefs - even a barrage of food trucks.

It remains to be seen whether retailers will pay $250 to $300 p.s.f. for prime real estate in the District, but it's visible that the pace of retail space being leased is picking up.

The five-to-six blocks along 14th Street, NW between the U Street Corridor and P Street is witness to a similar retail surge, and the retail space here is "practically all leased up," tells Asadoorian. Steve Gaudio, JBG Rosenfeld's leasing manager for the District Condos at 14th and S Streets, said the 18,000 s.f. of ground-floor retail at the 125-unit complex is already entirely leased up, and construction is only recently underway.

Although Gaudio won't talk shop on pricing for the retail space, JBG, which is about to start Utopia a few blocks north, and the Atlantic Plumbing site, and is already mentioning higher retail rents than the $40-$50 p.s.f. rates that have prevailed in the area recently.

To return to Chinatown, if the final price for retail at 675 H Street is anywhere near $300 p.s.f., then the site will secure the highest per square foot retail lease in the District; higher than Georgetown, which commands $100 to $120 p.s.f. for similar-sized retail space, and higher than Union Station, which is currently the highest in the city, up to $200 p.s.f. That, in turn, may get the attention of property owners around the city, who may get even bolder with the prices they expect.

Washington D.C. real estate and retail news

Douglas' 450 K Street in Final Design Phase for January Groundbreaking

On March 24, the Historic Preservation Review Board (HPRB) gave the go-ahead (with a few reservations) to Douglas Development's plans to build out 450 K Street N.W., a 13 story, 250 unit development in Mount Vernon Triangle. The finished project will be managed by Kettler.

R2L Architects Principal Tom Lenar said designs for the facade are being finalized to address HPRB concerns over a west end wall that is not as deep as the modestly sized adjoining buildings.

The HPRB report advised that "while this is not problematic in itself, it does suggest that that west wall need not be 'sculpted' and complicated by the division of the three window bays into separate columns at different planes...a more straightforward approach, as on the east end, would be better."

The organization also requested recessed, more traditional balconies as opposed to steel suspended ones which HPRB deemed "out of character with a historic district," though Mt. Vernon Triangle has far more numerous parking lots and newer towers than historic properties. Lenar said he expected the design changes will be reviewed by HPRB by the end of the month.

Other design features embraced by HPRB are the 5,000 s.f. of ground floor retail and the "modified C plan" which allows for outdoor space and more sunlight into the building. Amenities include a cyber cafe, fitness center, roof deck, and pool. Lenar said the developers are hoping for a January 2012 groundbreaking for a project that's projected to span 18 to 20 months.

Washington, D.C. real estate development news

McCaffery and Douglas Pick Up Chinatown Corner Site

The last undeveloped corner in one of the most high-traffic areas of Washington has just been acquired by McCaffery Interests Inc. and Douglas Development, at 675 H Street N.W., encompassing the iconic corner building, long since boarded up, and the vacant lot behind it.

"This is the best intersection in metro D.C." said Juan Cameron, Managing Director of McCaffery, comparing it to Georgetown's Wisconsin Avenue and M Street hub. "It is a central location with a lot of pulse, narrow streets, tons of foot traffic, a heavy daytime population, tremendous residential presence, plus the energy of the Verizon Center. In our eyes, its the closest thing Washington has to Times Square."

Though "everyone has their ideas for how the property will take shape," said Cameron, in these early stages the venture is dubbed as a state of the art, mixed use development. "Step one is looking for a marquee tenant," said Cameron.

General partners for the venture Douglas Development and McCaffery Interests acquired the property yesterday at auction. The property had gone into foreclosure thirty days ago, after Yeni Wong of Riverdale International had been unable to secure financing for the building. This past month was the last of many times the building had fallen into foreclosure; in 2009, Wong was given a notice for this property as well as 801 7th Street for $13,491,471 plus attorney's fees. Wong bought the two properties in 2006 for $10 million dollars.

This isn't the just the first or second try at developing this corner. DRI, a Transwestern Company, had slated 675 H Street as a two-building project: one that would restore the corner space and rise nine stories over the arch, the other a Class A office building behind the main storefronts. The total project would have yielded 110,000 s.f. of office space and 50,000 s.f. of retail. McCaffrey owns Georgetown Centre, leased by Barnes & Noble, and Mazza Gallery, which it bought in 1997. Douglas owns pretty much everything else.

Update: Alex Cooper Auctioneers states that the lot was purchased for $9.1 million.

Douglas Scales Back Tenleytown Plans

Weeks after floating a plan for increased density at the Babe's Billiard site, Douglas Development has told the local ANC that it has scrapped plans for a multi-family development in favor of a single-story restaurant. Originally purchased at auction for $5 million in 2009, Douglas Jemal voiced his intention of reestablishing the former Babe's Billiards site as a viable retail corner in the center of Tenleytown. Jemal's aggressive bidding on the property had some speculating that the fix was in for a big name retailer. But nothing materialized, and more recently it was understood Jemal's ambition for the site had grown. Just last month the Washington Business Journal ran a headline reading "Tenleytown warms to higher density developments," citing Jemal's aims to construct two floors of residential atop three floors of commercial/retail. But attendees of ANC 3e's most recent meeting witnessed the presentation of Jemal's "radically reduced" plans, reports the local ANC's Secretary Jonathan Bender.

Indeed, the proposal has reverted back to a simple retail project, likely "a restaurant with lofty twenty foot ceilings," says Bender. Shalom Baranes will trash their sketches of a multi-story addition but continue to work with Jemal on the design aspects of the now much smaller development plans. While the dream of increased density at the site is dead, the shrinkage is reportedly financially-driven, not a result of the perceived difficulty of earning community support, as many may assume. Tenleytown has earned a formidable reputation for harboring a relatively small but vituperative group of NIMBYs, routinely cited for extinguishing developer's hopes of high-density development in the area. The group's most recent victims include the currently stalled seven-story Akridge development at 5220 Wisconsin Avenue (deceased) and the Tenleytown Safeway development, which remains indefinitely motionless in planning approval-limbo. Surely, American University students, faculty, and staff are trembling at the thought of receiving the reaction from the Tenleytown ANC when they explain their 2011 Camps Plan and their wish to relocate their Washington College of Law to Tenley Circle.

But according to Bender, Jemal's plans for a six story mixed-use development had not drawn the ire of Tenleytown residents. In fact, the project had the ANC's support, he says. But the necessary PUD approval process, sometimes costing developers upwards of a million dollars, was not financially feasible, compelling Jemal to pursue a more modest project. While the rumors that Tenleytown now has a more nuanced and friendlier attitude towards development may be true, the economy remains decidedly less charitable.

Washington D.C. Real Estate Development News

Jemal Presents Plans for Another 14th Street Residential Project

After receiving support from ANC 1B, Douglas Jemal and his team at Douglas Development hope that the Historic Preservation Review Board (HPRB) are equally kind to their concepts to demolish a forlorn auto shop and build a six-story, 30-unit "apartment house" at 2221 14th Street, NW (see map, left). The development will feature ground floor retail and one level of below grade parking, with spaces for only ten cars and several bicycles.

Courtesy of architects at the relatively new DC firm R2L, the bright and busy concept design draws from a contemporary assortment of glass, metal, brick and terra cotta panels. Sharply angled bay windows protrude from the facade offering apartment dwellers views down both the historic 14th Street and Florida Avenue corridors. Long glass shop windows front the ground floor facade, which will eventually house retail. The environmentally friendly rooftop will feature green landscaping, a lounge deck, and possibly decent views. Architect Sacha Rosen, a principal with R2L, explained that "the massing, form, and rhythm are in the Washington historic tradition, but the details are contemporary." Being located within the Greater U Street Historic District, HPRB will offer feedback shortly, as the project is likely to be included on the Board's next meeting agenda for the 18th of this month.

In early 2009, Jemal, under the guise of "Jemal's Hookers, LLC," was in the process of acquiring raze permits for the vacant auto lot to make room for a new 10,000 s.f. retail development designed by George Myers of GTM Architects. Clearly those plans were scrapped, and this time the metrics are grander. Rosen described the project site as "wonderfully prominent...as one of the historic entrances to the District's core." But given the site's small and irregular shape,

Rosen said his team was presented with the difficult task of designing "a very efficient building that can support an exterior that will do justice to the community's expectations."

Interestingly, a large mural has been proposed for the back wall of the building, facing southwest. The development team has been in contact with G. Byron Peck, a locally based and nationally respected muralist about commissioning the mural's creation and installation. Peck is responsible for the "Black Family Reunion" mural which has been on the wall

of the adjoining property for many years. He also painted the portrait of Duke Ellington located on the wall of Mood Indigo at the corner of 13th and U Streets NW since 1997.

The often painstaking approval process should be finished by February 2011, with design documents complete in late Spring 2011, and developers are optimistically planning for a Summer 2011 groundbreaking.

Washington D.C. Real Estate Development News

Two Year Extension Given to Uline Arena Redevelopment Plans

Like many developments around the city, Douglas Jemal's plans for the vacant Uline Arena and Ice House will remain stalled for the foreseeable future. But that won't stop real estate development fiends from fantasizing about the day Jemal's unique redevelopment vision for this historic NOMA property are finally realized. On Tuesday that day seemed pretty far away, as the BZA granted Jemal and his development team a two year extension of their plan approval and setback and parking variance relief approvals. In 2008, both the Historic Preservation Review Board (HPRB) and Zoning approved the preliminary plans of Douglas Development, in partnership with the Wilkes Company, to

transform Uline Arena into a state of the art mixed-use complex featuring 290,000 square feet of commercial office space, 75,000 s.f. of ground-floor retail, and 225 residential units.

Bounded to the north by M Street NE, and situated on the northern half of the block between 2nd and 3rd Streets NE, the Uline Arena, also known as the Washington Coliseum, is best known as the first concert venue in the United States to host the Beatles. Over the years it featured sports teams like the Washington Lions (American Hockey League) and the Washington Capitals (American Basketball Association), as well as famous musical acts like Bob Dylan and the Temptations. Most recently the facility was used as a trash transfer station by Waste Management Inc. Originally constructed in 1941, HPRB placed the building on its National Register of Historic Places in 2006, preventing any future demolition plans.
GTM Architects have penned the design plans that see the historic coliseum restored, renovated, and expanded. Designers are excited about the historic preservation aspect of this project, describing the structure and its thin shell concrete vaulted roof as one the earliest examples of "structural innovations in modern industrial design in the United States." As part of the renovation, existing masonry facades will be improved and restored. A 2-story addition of glass and steel will be constructed above the Ice House, highlighting the industrial character of the structure.

A spacious, multi-level atrium will be constructed inside the domed Arena. Decisions on who or what will occupy the retail space are up in the air: big box retail, an entertainment center, a mix of small and local restaurants and cafes, it all remains on the table, according to developers. The streetscape will be improved with planters and transitioned into a new landscaped entry plaza at the northeast corner of the block. Developers intend on extensively incorporating sustainable design strategies so to warrant LEED certification upon completion.

Executive Paul Millstein of Douglas Develpoment says of the hold up: "We have a really cool design to bring this property back to life, but right now we're still searching for the construction money." It's a tough market for anyone to secure financing in, but especially so for a development team used to doing spec projects. With times still uncertain, no one is willing to finance

developments without prelease agreements, says Millstein. "Trust me," he explains, "this is not the place we hoped to be; we thought we'd be done by now." But he assures skeptics that they are remaining flexible on the future of the office and retail space, and "are plowing ahead, more bull-headed in our efforts than with any other property."

But Douglas Development promises not to sacrifice quality for speed. At the initial approval hearing he told the BZA that the building was going to have "cool tenants." "They're going to be innovative. They're going to be environmentally correct. They're going to be public transportation oriented. They're going to be neighborhood friendly," he elaborated. But what and who are these "cool tenants"? Greenpeace, who currently resides in another of Jemal's buildings, was initially mentioned as a possible tenant, but have decided to remain in their current location. And that's really too bad, because what's cooler than Greenpeace? Well, except for Paul McCartney playing a gig at the groundbreaking ceremony, just a thought. Hurry up Jemal, while he can still sing.

Washington D.C. Real Estate Development News

Douglas Buys Time for Waffles

Last night, Douglas Development's plans for the former Waffle Shop at 1000 F Street received a time extension, saving his "Up Against the Wall, LLC" from an expired zoning approval. Along with architect Shalom Baranes, Douglas received approval in April 2008 to relocate the historic eatery now just two blocks from Metro Center, and in its place construct a large office building. Since that time the art deco 1950s Waffle Shop closed and recently reopened as a tourist's delight, filled with "I heart DC" shirts and Obama memorabilia plates.

Douglas's planned 11-story building would bring 91,000 s.f. office space with 6,000 s.f. of ground-floor retail to an L-shaped amalgamation of lots. Plans also include the renovation and relocation of the two-story Waffle Shop now on the site - reassembled on another site. HPRB had initially granted Douglas's request to destroy the eatery, despite the dearth of retail downtown and the vacant storefronts downtown at the time, but later reneged on that offer thanks to community outcry. The developer committed to moving the shop to a new location intact within five years of the approval; two years, down three to go, an alternate location has yet to be publicly announced.

During their 2008 testimony at the Zoning Commission, the project team said it had been pursuing a project at the location for nearly nine years, finally convincing the property owner to sell in 2005 and closed in 2006. Douglas development's Paul Millstein described the importance of F Street and its continued renaissance to the firm, "we have a passion for F Street...this building represents much more than just a building to us."

Architect Shalom Baranes explained that his design was emphasizes the "verticality" of 10th and F Streets. The facade is planned to feature two surfaces - a "masonry curtain wall" and a "transparent, more prismatic form" to articulate the volume of the building. The property contained two historically contributing buildings, the Waffle Shop and 1000 F Street, which will be the corner structure of the development. The extension expires May 16, 2012.

Washington, DC real estate development news

Shaw Main Streets Development Woes

At the annual Shaw Main Streets (SMS) Development Forum Wednesday night, representatives from developers were invited to present the current status of their plans for major renovation and new construction in the area. The status, unsurprisingly, was "more of the same," leaving community members to resign themselves to continued hopeful waiting. SMS Executive Director, Alexander M. Padro, made excuses for several invited developers who were unable to attend. Quadrangle Development was a no-show because of the recently publicized litigation over their Marriott Marquis Convention Center Hotel deal, though Padro said Quadrangle indicated that financing is now secured. Banneker Ventures, slated to build The Jazz on Florida Avenue, declined to attend as their Land Disposition Agreement with WMATA has not been finalized. And Hines-Archstone, developers of the planned City Center cited scheduling issues. 1. Paul Millstein of Douglas Development, certainly does not sugarcoat anything. About the Wonder Bread Factory development Millstein said it was a "victim of the times...stuck in a trench" and "could be stuck for a while." As for Squares 450 and 451 on the 1100 block of 7th St, Millstein announced that though the original plan was to redevelop the site, the group will now remove window boards, put some lipstick on them, and lease them out for the time being. On the positive side, Douglas secured a NY-based restaurant, Carmine's, to fill the 18,000 square feet of their Penn Quarter property near the Clara Barton Condos and Wooly Mammoth Theater. As for their 7th and Florida Ave. project, Douglas is seeking tenants, but according to Millstein the group is being picky, refusing to go the "fast and ugly" way of cell phone stores or fast food. Neighbors gave a round of applause for that one. 2. Next came 1501 9th ST NW a smaller development by a small business, Inle Development. According to the property owner/developer, the space will be leased to a single tenant, Mandalay Restaurant and Cafe, a Burmese restaurant currently based in Silver Spring. Mandalay will have a ground floor restaurant with outdoor seating, a second floor bar and the remainder will be residential space for the restaurant owner and family members. The developer cited a few financing "hiccups" but estimated the project should break ground in three to four months, delivering late 2010. The project takes up a single lot and will likely be 50 ft in height. 3. On their Addison Square project Metropolitan Development had hoped to be into the ground by now, but it's looking more like summer 2010, at which point the 4-5 weeks of demolition will commence, followed directly by construction. The group received their final PUD two weeks ago, and a few changes mean the 54 units of affordable housing will be distributed among the 224 market-rate units, for a total of 278 rental units in the main building. The ground floor retail plans are largely unchanged with the group looking to have both a white table cloth restaurant as well as a faster, less formal restaurant. 4. Ellis Development Group and Four Points, erstwhile developers of Howard Theatre and Media Center One, formerly Broadcast Center One, said the financing for the projects, which have been repeatedly punted down the road, hit a "road bump," but the group expects the project to move forward, breaking ground on Media Center's 300,000 s. f. mixed-use development on 7th and S Streets NW before the new year. Construction will take approximately 24 months for Media Center to finish and, as the developer noted, they are one of the few lucky projects to actually have a tenant secured. Over at the Howard Theatre, demolition of the 1940s facade has already begun, ground breaking may still happen this year, and the developers are, of course, talking with prospective tenants. 5. Roadside Development's City Market at O finally has some legs and a timeline. In an agreement with several DC Council members, Roadside received a $2.5 million grant, enabling them to "put the architects back to work." The big day will be September 3, 2010, when the group starts work on stabilization of the historic market. The next big date is January 15, 2011, when the current Giant will close its doors and from which date Roadside will have 24 months to finish construction of the new Giant location. The takeaway from the evening, with projects stuck in trenches, hitting road bumps or just plain falling victim to the economic climate, was that Shaw developers seem to be in a regular war zone these days. With so many groups blaming the current "financial situation" for development and construction delays, we are beginning to wonder what they'll blame whenever the financial situation improves...

Washington DC commercial real estate

Jemal's Retail Trick on 14th Street

Douglas Development is in the process of acquiring the necessary permits to raze a vacant auto lot at 2221 14^th Street, NW. According to Douglas Jemal, President of Douglas Development, his corporation acquired the bafflingly named "Latino Auto Sale" five years ago; now, under the creative title of "Jemal's Hookers, LLC," he’s planning to scrap it for a new retail development intended to service the increasingly crowded 14^th and U Street corridor.

Though Jemal has yet to set a timeline for when the diminutive brick auto shop and adjoining parking lot will meet the wrecking ball and shovel, he has already taken on George Meyers of GTM Architects, Inc. to design a two-story 10,000 square foot retail development for the site.

"We’re getting permitted and getting it designed, so that, hopefully, when this market does turn around, we can get something done,” said Jemal. Understandable, but just what’s the story behind the tasteful moniker of his limited liability company? “Long before you were around,” laughed Jemal, “there were always hookers on that corner [at 14^th and Florida Avenue].”

These days, the intersection is decidedly more family friendly, with PN Hoffman's Union Row project just a few doors down, both Jair Lynch’s Solea Condominiums and Level 2 Development’s View 14 are currently under construction directly across the street. Damn you, gentrification.

Washington DC commercial property news

Babes Goes Back to Retail?

Last week's auction winner of the Tenley condo site will build a new retail venue, according to the new owner. Douglas Jemal of Douglas Development Corporation tells DCMud that he will pursue retail usage at the Tenleytown storefront once home to Babe’s Billiards, but more recently as an aborted residential project called the Maxim Condominiums. Jemal picked up the 12,661 square foot parcel at 4600 Wisconsin Avenue, NW for a reported $5 million at auction last week, after the Maxim’s original developers, Clemens Construction, bowed out.

There is no word on when Tenleytown will see the property open for business, but Jemal contends that his company will repurpose the shuttered pool hall at the site, instead of aiming for new construction. With underwriting for residential projects increasingly wanting, residential development was never likely, at least in the short term. More distantly, project approvals for the Maxim, as well as project plans by Cunningham & Quill Architects,’ transfer under the terms of the sale, leaving a clear path toward residential development for one of DC's few developer that seems capable and inclined to buy and hold.

But at least one executive of a prominent developer that examined the site thinks the only real strategy is a long term retail plan. "The problem with the site is that anyone picking it up needs to carry it for a long time. Doug Jemal, more than anyone else in the city, has a greater ability to bring in high profile retailers...You can't pay that amount ($5m) and get a short term lease; I think in a way it could be good for the site. The FAR price was high by any standard, [Jemal] was bidding like a guy who had an idea for how to utilize the site; its certain to remain retail for at least a decade." And with the tax rate on vacant property jumping from 5% to 10%, Douglas has an obvious disincentive to idling the property.

Other current Douglas projects in some phase of development include the former Wonder Bread factory at 641 S Street, NW, a mixed-use development at 9^th and N Streets, NW, the redevelopment of a Pennsylvania Avenue, NE site that neighbors the proposed Hill East project, and the Addison Row at Cheverly Metro just over the District line in Prince George’s County.

The Shaw Redemption

Five metro area developers came together last night to highlight their major (and we mean major) plans for the District's Shaw neighborhood. Hosted by the Shaw Main Streets initiative, the developers on hand included Douglas Development (Wonder Bread Factory), Marriott Hotels (Washington Marquis Marriott), Roadside Development (City Market at O), Metropolitan Development (Kelsey Gardens) and Hines Interests (CityCenter DC).

Douglas Development
The keynote of Douglas' presentation was the long-gestating revitalization of the former Wonder Bread Factory at 641 S Street NW. Contrary to initial plans, the building will not be razed. The developer has obtained the original plans for the facade and will, to the best of their ability, restore the building to its original 1922 appearance. An additional story will be added to bring the building up to 5-stories and 150,000 square feet. The project has been summarily approved by the Historic Preservation Review Board (HPRB) and is aiming for groundbreaking in approximately 7 months, following permit approval. The developer expects construction on the GTM-designed facility to take no more than a year. Once completed, the former Wonder Bread facility will neighbor the proposed Radio One development (the outline of which can be seen in the accompanying renderings).

Several other Douglas projects underway in Shaw were also briefly touched upon. The developer’s proposed development at 600 New York Avenue NW is on hold due to the current economic situation and "lack of synergy," as is their proposed redevelopment of the Howard CVS.

Other projects, however, have had much more luck getting off the ground. The former site of Popeye’s at Florida & N Streets NW will complete its expansion and renovation in the next 3-4 months and will house a Fatburger chain restaurant, a cell phone retailer and office space. Another Douglas mixed-use development at 9^th & N Streets, NW will include ground floor retail, office space and apartments. Although poised to begin construction in the coming weeks, leases for the site will not be sought until the project is completed.

Marriott HotelsThe long-proposed (circa 2001) Washington Marriott Marquis Hotel at 9^th Street & Massachusetts Avenue, NW, long envisioned as an anchor servicing the Washington Convention Center across the street, is now slated to break ground in the first quarter of 2009. Overseen by the Quadrangle Development Corporation and designed as joint venture between TBS Architects and Cooper Carry Architecture, the building comes in at over 1 million square feet. The 13-story project will feature 1250 rooms, 2-3 restaurants, a ballroom and meeting space and a 400 space underground parking garage – all enclosed under an all-glass atrium. Additionally, the Pepco power station and AFL building currently on the site will also be incorporated into the hotel’s footprint, with the latter being converted to hold 42 hotel rooms. The Marriott representative on hand described it as “one of the most complex projects we’ve ever worked on.” The project is hoping to achieve an LEED silver certification.

Roadside Development

The City Market at O is shaping up to bring big changes to the current site of Giant Food on O Street NW. The mixed-use development will feature a new Giant store that will retain the old façade of the O Street Market and was hailed, as least by the pitchmen, as outclassing the new CityVista Safeway in both style and function. Additionally, the site will give way to a new 200 room, limited-use hotel, a large-scale fitness center, a 6000 square foot independent restaurant featuring a local chef, and 600 apartments and condominiums targeted towards “young professionals.” 8^th Street will also reopen for pedestrian use between the two buildings on the site, parking for the facilities will be moved underground. Roadside showcased some interesting architectural features on the buildings, including a 2-story projection on the residential building – currently referred to as “the diving board.” The developers are currently in negotiations with the Deputy Mayor’s Office for Planning and Economic Development (DMPED) to receive Tax Increment Financing for the project and are hoping for a September 2009 groundbreaking.

Metropolitan DevelopmentThough Metropolitan’s Kelsey Gardens has been recently covered by DCMud, the developer still had a few surprises on hand for their presentation. Architects will employ the increasingly common urban technique of breaking the 14,800-square foot, 297-unit building into five distinct facades, in order to affect the appearance of being constructed during different time periods by different architects. Roofs of the “buildings” will be 50% green and feature both private and public terraces. The development will be complimented by 2 levels of underground parking that will feature preferred parking spaces for “energy efficient vehicles” (i.e., hybrids). The project is shooting for 2011 completion.

Hines Interests
The final presentation of the evening concerned the redevelopment of the site of the old convention center, Hines Interests and Archstone’s CityCenter DC project. Designed by Foster + Partners and Shalom Baranes Architects, the 10-acre site is being envisioned as “a new neighborhood for downtown.” Comprised of 4 separate parcels centered around the now-closed (and eventually to be reopened) intersection of 10^th and I Streets NW, the ambitious project is to include 400,000 square feet of retail space, 1,074 residential and hotel units, 1,064,000 square feet of office space, more than 2000 parking spaces and a public park. The hotel on the site is envisioned as a 4 or 4 ½ star facility, while the developer is aiming to lure home furnishing and fashion retailers (possibly a department store) as well – in order to serve the needs of downtown residents and not specifically tourists. The Hines representative on hand posited that the project was 85% ready to go and would be seeking general contractor in the next few weeks.