DC Selects Georgia Avenue Developer

Washington DC Mayor Fenty arrived by Smart Car today to announce that the District of Columbia has selected Donatelli Development and Mosaic Urban Partners as the development team for three parcels of land on Georgia Avenue. The lots are located one block north of the Petworth Metro station, at 3813, 3815 and 3825 Georgia Avenue. Development plans have not yet been finalized, but Mayor Fenty said today he expects the final product to include retail, restaurants, and market rate and affordable housing. Echoing his oft-repeated calls to fire up development on the neglected corridor, the Mayor insisted today that DC has "gotta have economic development on Georgia Avenue" for the benefit of the whole city, and that the project would complete by the fall of 2010. The city has not yet reached purchase terms with the development team. Donatelli Development has an extensive track record with the city, and, with DC-based Gragg & Associates, is nearing completion on Park Place, a 161-unit residential and retail building almost across the street. Donatelli also owns an adjacent vacant lot, on which it plans a 49-unit condominium building, though timing remains uncertain said Chris Donatelli. This will be a first for development partner Mosaic, a firm based in DC. Mosaic partner Calvin Gladney, a former NCRC staff member, said that partnering with Donatelli allows them to "integrate retail strategy," and "achieve a better end result for the community." Gladney was a bit more circumspect than the Mayor regarding timing, quickly noting that "there are so many variables", including financing, though partnering with Donatelli will certainly streamline the underwriting process. The project will convert two small neglected buildings and a vacant lot, all District owned, into a mixed use project on two separate sites. Architect Bill Bonstra, partner of Bonstra Haresign, the ubiquitous firm chosen to design the project, said that the project would feature a green roof and locally based retail, and that there was "a real push to do a community-minded project." 

The new building on the now vacant lot will rise three stories at street front, stepping back for a fourth and fifth floor. The selection of developers was unusually swift, with the District having solicited bids at the end of April, with a due date of July. Two teams submitted bids for the project. The mayor's office hopes the project is well timed, coming as the Petworth neighborhood struggles to fulfill the expectations of a revitalized mixed-use corridor. On May 23rd the Mayor stood nearby to announce that Georgia Avenue development was finally taking hold, highlighting Donatelli's Park Place, and Jair Lynch Development Partners' 130-unit apartment building at 3910 Georgia Avenue. But Park Place will not complete until next year, and Jair Lynch has encountered financing, title, and zoning hurdles with its project, and has been reluctant to even give a start date. And while the Neighborhood Development Company is also well underway on its own apartment building just to the north, many of the expected success of Georgia Avenue have yet to be initiated, and a bevy of apartment-turned condominium low-rises that expected to benefit from the retail surge that never happened remain unsold. But the prospect of five new developments all rising within a few blocks is undoubtedly a new direction for Petworth, and an event that may make an honest man out of the Mayor.

Washington DC commercial property news

Shaw Housing Project Gets Rebirth

Just a block away from the future O Street Market re- development site, Metropolitan Development is planning to weed out the wilted Kelsey Gardens apartment community. The 54 subsidized apartments will be replaced with a mixed-use building that they hope will blossom into 282 mixed-income rental units, 14,400 s.f. of retail space, 237 underground parking spaces on 7th street, and 7 townhomes on P street. Developers hope to break ground by this time next year, and finish in late 2010, provided zoning approval happens this year. Rachael Preston, Financial Analyst for Metropolitan, said the company has been working on the redevelopment of Kelsey Gardens on 7th Street, NW, between P and Q Streets since 2004, and that the new development is consistent with the redevelopment of the larger Shaw area. "When redeveloped, the Kelsey Gardens site will offer important progress for the Shaw community as well as continuity. Shaw is on the brink of a renaissance, driven by the addition of new residences, commercial activity, and the preservation of important landmarks," Preston said. The developer also said the project's inclusion of both townhouses and rental units is key to preserving the neighborhood's appearance and integrity while improving its design. The new townhouses, designed by Lessard Architectural Group, will be "historically sensitive", but will include "traditional and modern architectural styles to break up the length of the building on 7th Street." And as for the apartments, Preston said, "Metropolitan Development sees demand for rental housing in Shaw driven by access to public transit and proximity to DC's traditional downtown locations to the south and west, and the emerging employment zone of NoMa to the north and east." 

Metropolitan stressed that Shaw residents are part of the neighborhood's identity and will be encouraged to return. According to the developer, "The residents displaced at Kelsey Gardens for construction are guaranteed the opportunity to return to their former home once redevelopment is complete. Shaw is a community of many long time residents who give the neighborhood much of its character. By ensuring that these residents are not displaced permanently, Metropolitan Development is able to participate in preservation of the neighborhood as well as change." Metropolitan did not comment on how its former residents would be accommodated. Though currently known as Kelsey Gardens, the project is listed on Metropolitan's website as "Addison Square." Though some locals have objected to the name, suggesting that a final name may be part of the inevitable negotiations, it is unlikely that many area residents will mourn the loss of the drug and crime plagued housing project. Metropolitan acquired the land last summer and retained the previous owners, The Deliverance Church of God in Christ, as a partner in the deal.

Washington DC commercial real estate

Half Street's Hole Story

Washington DC's Monument Realty seems to be on top of their game at the ballpark, delivering a 275,000-s.f. office building by the end of the year, owning several other parcels of prime real estate near the stadium, and now having settled their lawsuit with WMATA and Akridge to acquire even more - namely, much of the Half Street real estate they don't already own. So why has Monument left its most visible site empty for 18 months? Monument began digging the nearly 2-acre hole across from the ballpark entrance, at the corner of N and Half Street, SE, back in January of 2007. The cavity is the future home to the residential portion of Monument's Half Street project - a 340-unit residential development. According to the developer, financing for the project is still, well, in a hole, but will soon get built. Russell Hines, Executive Vice President of Monument Realty, said the timing of the dig had to coincide with Monument's adjacent office building. "When we excavated the hole, we did it as part of the office building. It was more efficient to dig both at the same time. We knew we weren't building the residential portion at the time because we weren't done with design or pricing. So we got GMP pricing bids earlier this summer and have been working with and talking to lenders. We are still working on financing for the residential buildings. We started construction but haven't advanced it; we are down at the bottom of a hole. We are looking to be back under construction this year and then complete the project 20 months out," he said. 

Half Street, however, is just one part of the developer's ballpark holdings. The developer has three other sites. Monument owns 50 M, on the Northeast corner of M and Half Street, across from the metro, a site which they are marketing as a build-to-suit or a free lease development. "We have been getting interest from tenants on that - smaller buildings and smaller associations," he said. Monument's other holdings are the product of their June settlement with WMATA. The developer will create two more large office buildings on the hotly debated sites that will replace the old Domino's on the corner of M and South Capital Street and the BP gas station at the corner of N and South Capital Street. According to Hines, Monument will soon begin the zoning process for these buildings. "One of the things it (the settlement) did was finish off a puzzle; there were a bunch of pieces we owned that have come together. Over the next year, we'll be taking both through the zoning commission approval process and that process takes from 6-10 months, maybe as long as a year," he said. Hines added that the developer will spend most of next year designing and marketing the properties, but will keep an eye on the market. "At that point when we have zoning, we will see where the market is and what we want to do. We have no immediate plans. We have a whole office building to lease on the Metro - we wont run out and build another until we get the first one going." Half Street's office building is "nearing completion," but has not yet signed any tenants. The entire 775,000 s.f. Half Street project, being built by Clark Construction, will ultimately deliver a 200-room hotel, 50,000 s.f. of retail space, and about 340 residential units designed by Shalom Baranes. 

Monument has remained steadfast that despite some challenges, the company is overall healthy. Founder Michael Darby recently told the Washington Business Journal, which had published an article highlighting financial setbacks of the developer, such as its conversion of several condominium projects into apartments, that "we are not in trouble," and that "we have not had trouble finding construction financing for the residential building in the first phase at our Half Street project." (WBJ, June 6, 2008). But with so many impecunious developers stung by the twin evils of lower consumer expectation and heightened financing restrictions, many industry watchers are spooked by any apparent sign of distress. Not so, Monument insists; the show will go on.

Washington DC commercial real estate news

BZA Approval for Armenian Museum

The DC Board of Zoning Adjustment recently approved plans for the development of the former Federal-American National Bank at 615 14th Street, N.W. into the Armenian Genocide Museum of America. The board unanimously approved plans for a complete restoration and renovation of the five story 50,000 s.f. landmarked bank into 18,000 s.f. of exhibit space in what will be, "The premier institution in the United States dedicated to educating American and international audiences about the Armenian Genocide and its continuing consequences."

Designed by Martinez & Johnson Architecture, the museum will be two blocks from White House, within walking distance of the Smithsonian and down the street from the US Holocaust Museum, a location that symbolically fuses politics, genocide, and education.

Exhibits will be constructed in the two-story banking hall as well as the fourth floor. According to the architect's plans, the exterior will also get a face lift that will include masonry work, general cleaning, and the reconstruction of first floor storefronts. The museum is scheduled for a 2010 opening and will include interactive exhibits, "state-of-the-art" technology, online programs, and places of reflection.

The museum's website compares the Armenian Genocide, which started in 1915, to that of the Holocaust, Darfur, and Rwanda.

Cluster Luck?

The Department of Housing and Community Development has issued a solicitation for developers to bid on four clusters of land in the Southeast, Northeast, and Northwest quadrants of DC, in the hopes of turning underutilized property into affordable and market rate housing. The Property Acquisition and Disposition Division (PADD) of the DHCD is offering the sites in an effort to dispose of properties in its inventory while maximizing the city's profit from their sales. PADD will base its selection on proposed development plans, pricing proposals, the amount of affordable housing offered and the potential community and local business benefits. Developers must present evidence of complete funding for their proposal; the developers selected will take title to their respective cluster on which all existing non-historic structures will be razed.

The clusters are:

Site Cluster #1 (Anacostia)
1700 W Street, SE
1704 W Street, SE
1708 W Street, SE
1712 W Street, SE
1716 W Street, SE
1720 W Street, SE




Site Cluster #2 (Old City)
4540 Kramer Street, NE
1613 Kramer Street, NE







Site Cluster #3 (Old City 2)

4 Q Street, NW
6 Q Street, NW
8 Q Street, NW
10 Q Street, NW
14 Q Street, NW
14 Florida Avenue, NW
16 Florida Avenue, NW

Site Cluster #4 (Old City)

1621 Kramer Street, NE
1627 Kramer Street, NE
1629 Kramer Street, NE
1631 Kramer Street, NE
1632 Kramer Street, NE
1633 Kramer Street, NE

The solicitation encourages proposals to include a mix of uses including family-style affordable dwelling units with two or more bedrooms so families can "grow in place". As usual, the District wants to see evidence of community outreach, complete financing that requires minimal financing from the City, and proof that the units will remain affordable for 15-24 years.

Proposals should specify the type and number of housing units offered, and the scope of new construction and renovations by providing floor plans, site plans, and amenities. In keeping with the Fenty affordable housing pledge, 30% of all proposed housing must be affordable with preference given to those who exceed the requirement.

The lucky developers selected must "participate in a transparent and collaborative process involving the District, PADD, and community stakeholders", and, as with any good business deal, the winner will offer the greatest economic benefit to the District and require the lowest amount of subsidy.

Submissions are due by September 17th; the District will select a winner on November 3rd.

MacArthur Boulevard Townhouses

An old psychiatric hospital on MacArthur Boulevard may be replaced with for-sale townhomes as early as next year, if all goes well for the developer. Willco Residential and the New York-based Athena Group, LLC, which owns the property, are in the PUD process for Canal Parc, a 37-unit development at 4460 MacArthur Boulevard, NW. A partnership between the two companies, if approved, the project will yield "higher end" townhouses and break ground in the spring. Designed by the Vienna-based Lessard Group, the project in the Palisades neighborhood was originally planned as 41 units but has since been scaled back to 37 three and four-story townhouses. Under the new plan, the developer will demolish the old Riverside Hospital and change the site's use from institutional to residential. According to Jack Rosenfield at the Athena Group, the project is the biproduct of a friendship between the two developers. The team submitted an application for a raze permit for the old hospital on August 6th; the city has not yet responded. In proximity to the 120,929 s.f. development are Canal View - single family houses, Foxhall Mews townhouses, and rowhouses along Lingan Road. Rosenfield said, "Even through prices have softened, this is a great location." The Lessard Group also designed The Monroe at Virginia Square in Arlington and JPI's Kings Crossing in Alexandria. The Athena Group developed the Grove at Arlington. Willco Residential developed Jefferson Row in Dupont Circle. You'd almost have to be crazy not to buy here.

Washington DC commercial real estate news

Plans for West End Library Renovations

The District will soon write the next chapter of its library tales when it issues a solicitation for developers for Square 37, home of the West End Branch of the DC Public Library, sometime this fall. Though the West End's story does not have a plot as dramatic as that of the Tenley Library, efforts to redevelop the site on the corner of 24th and L Streets, NW have still faced traditional District-neighbor conflicts. A year ago, the DC Council passed "emergency legislation" to sell the site to EastBanc Inc., only to rescind it at the opposition of the community. Foggy Bottom, West End, and Dupont Circle ANCs, community groups, residents, and business representatives have since taken the reigns and held vision sessions, distributed surveys, and conducted studies of who uses the library, how the catalogue can be improved, and what amenities should be included in the branch's redevelopment. West End Library Friends Stakeholders Committee released their "Guidelines for a New or Fully Renovated Branch Library" mid July. In it, the group calls for a coffee shop with an outside entrance, attractive, well-landscaped grounds and accessible inviting sidewalk space and entrances, office space for local ANCs and community organizations, and an architectural team that is familiar with library design. Robin Diener, director of the DC Library Renaissance Project, an organization founded by Ralph Nader to improve the DC Public Library system, said the report is consistent with what her organization wants to accomplish on the site. She also stressed that the District should do a better job of including the community in the planning process. "We think that planning should be dealt with early on by the community and that we should see a more comprehensive planning process. We had our own vision session that was shorter than the Friends of the Library, but still very comprehensive, and then the Office of planning had a meeting in which they read back to us what we had put forward. It was a standard question and answer and they were very generous in answering our questions, but it wasn't much of a program. 

The second meeting that they hosted was more of the same. There will be two more in September but my impression from what happened is that they will be more of what was already done," she said. Diener said that under current procedures it seems that the District cares more about which developer is interested in the site, than what the community would like to see. "DC is missing a critical piece of planning that should happen before there are discussions with developers. In DC, what we do is we talk to developers and see who might be interested in the project and then talk to the community, it should be driven the exact opposite way. Now it seems like they (the City) have got an idea, and they're trying to put an idea out there in a way that people can be respond, but that plans have already been determined," she said. Many of the redevelopment suggestions for the parcel at the corner of 24th and L Streets, NW are related to the large homeless population that congregates in the library. 

A survey issued to 348 self-selected respondents by the Friends of the Library showed that the homeless population's use of the library is "a deterrent to greater use by other patrons." The report recommends fewer reading tables to deter homeless people from congregating, removing parking meters in front of the building so that bags can not be tied to them, limiting the number of bags each person can bring to the library, and adding stand-up computer-only tables. In addition to interior and exterior design guidelines, the report calls for a revamped collection that better reflects the demographics of the users. "Those who do use the library are older, wealthier, better educated, and less racially diverse than the general population of the District; and, therefore, the collection, programs, and services for this particular branch, like all branches, should be tailored to the population it serves." EastBanc developed the Georgetown and West End Ritz-Carltons.

Washington DC retail and commercial real estate news

Old Town Storage Site Development

After changing hands and changing plans, "The Security Storage Site" at 621 North Payne Street in Alexandria will now be developed into mixed-use development, a design that will bring more than 200 residential units to Old Town. Hoping to break ground next year, the developer is not yet committing to for-sale or for-lease units, but condos seem unlikely with financing of condominium construction so limited.

Erkiletian Construction Corporation bought the site, currently occupied by a warehouse, from Security Storage at the end of June, altering the plans presented to the Alexandria Planning Board back in 2007. The prior development plan, submitted by K. Hovnanian Homes in February of 2007, included 146 condominium units in the form of townhouses, live-work units, and low rise building.

Erkiletian will instead develop a three-story, 12,000 s.f. building designed by Rust Orling Architecture. According to Tom Woodhouse, Project Manager, the building will be consistent with the appearance of the surrounding buildings. "It won't be a contemporary high rise because they don't like that in Old Town, we're going with traditional design - brick and glass with cornices. The building is designed to harmonize with those that are already present in Old Town, those from time periods starting around 1725 and going through the present day. So you have all kinds of architectural achievements."

Woodhouse said the developer has not yet filed for permits for the site two blocks from the Braddock Metro Station, but hopes to do so in the near future and begin construction in Spring of 2009. Erkiletian is also responsible for Alexandria's Carlyle Towers and Northampton Place.

The End of Howard Theatre Blues

Since it first closed in 1970, the Howard Theatre's fate has been as unpredictable as Cab Calloway's scat. After being named a historic landmark in 1973, the theater opened and closed several times, its stage finally going dark in the early 1980's, seemingly for good. Now, after years of work by Howard Theatre Restoration, Inc., a nonprofit organization, along with the District of Columbia, private developers, and DC residents, the curtain will go up again just in time for the theater's 100th birthday.

A representative at Howard Theatre Restoration told DCMud that the organization is in the midst of a fund raising effort that, if successful, i.e. if they raise the $28 million necessary to fully renovate the theater, will allow construction to begin this time next year. The District already gave $8 million to the project, and the organization can collect $6 million more through historic and additional tax credits. The District's contributions are part of a deal to improve the neighborhood, a commitment that will also bring African American-Owned Radio One to the District. Fenty signed a $144 million deal with Broadcast Center One Partners in January, the Radio One Headquarters will sit on the same block as the theater.

Built in 1910, the theater near the corner of 7th and T Streets, NW could seat 1,200 people. It was made specifically for African American performers, but was known as "The Theatre for the People" and hosted crowds of all races and performers such as Duke Ellington, Buddy Holly, James Brown, and Redd Foxx.

HTR's interactive website says, "Together with the City, HTR and its partners will reestablish the historic U Street/Shaw and LeDroit Park neighborhood as an art and entertainment destination where residents can live, work and play."

Pattern Shop Lofts Underway

Construction is now underway on the Pattern Shop Lofts, the redevelopment of an historic Navy Yard warehouse. A piece of Forest City Washington's larger The Yards project, the former pattern store was part of the old Navy Yard Annex, but will be converted into a 170-unit "loft" apartment building with 10,000 s.f. of ground floor retail space. The six-story building is being redesigned by Bethesda-based SK&I Architectural Design Group , including 33 two-level penthouse units with private terraces and views of the Anacostia River.

The mixed-use retail and residential Pattern Shop Lofts will be completed and begin leasing units in fall of 2009, according to the developer. The overall project, surrounded by the Anacostia River, U.S. Department of Transportation Headquarters, the Washington Navy Yard, and the new Nationals Park, will deliver 2,800 residential units, 300,000 s.f. of retail space and 1.8 million s.f. of office space by 2013.

The retail space will likely host a restaurant, though Vanessa Lopez-Isa, marketing manager at Forest City said the developer is currently focusing on leasing the Boilermaker Shop across the street, a retail building which will also deliver next fall as part of Phase One. "There has been a lot of interest in restaurants and some really neat tenants that I can't disclose yet," she said of both buildings.


Lopez-Isa said the developer acquired the property through a federal grant and that the development is consistent with Forest City's portfolio of historic adaptive reuses. "We obtained control of the 42 acres directly adjacent to the ballpark after we went in for a proposal with the federal government in 2002 and were awarded site through that proposal process. Pattern Shop Lofts was originally Pattern and Joiner Shop in 1918 and it was part of the Navy Yard Annex...the area we are redeveloping. It was a large-scale wood and pattern house and it is one of five historic buildings on our site." Forest City has experience in other adaptive re-use projects, as at Tobacco Row, its historic project in Richmond.

Douglas' Plans at Cheverly Metro

Douglas Development received partial approval last week for their plans to create Addison Row at Cheverly Metro, a mixed-use residential and commercial development southwest of the Cheverly Metro Station. The Prince George's County Planning Board approved the developer's conceptual site plan, which proposed two scenarios, the first of which would offer 121,900 s.f. of retail space, 940 residential units, 650,000 s.f. of office space, and a 25,000 s.f. recreation center. The second, larger plan is for 121,900 s.f. of retail space, 2,000 multifamily residential units, 14,000 s.f. of office space, a 25,000 s.f. YMCA-like recreation center, and a 178,000 s.f. hotel. The project will be developed on 34 acres that is currently occupied by a large vacant warehouse and distribution center that the developer will eventually raze.

According to the Zoning Hearing Examiner's report, 60,000 s.f. of the project's retail space will be used for a grocery store, but the final selection of retail vendors is a long way off as the Board asked the developer to clarify the structure of the retail and residential components. Staff Reviewer Susan Lareuse reported, "It is not unusual for residential living to be located above retail uses on the first floors, but the plans do not clearly provide the amenities required to assure stable functional relationships between the uses."

Located at the intersection of Addison Road and North Englewood Drive, the project is close to both the Cheverly and Deanwood Metro Stations. WMATA said they support the development and all mixed-use development near stations as they promote the use of Metro. A letter from Joel Washington, Director of WMATA's Office of Station Area Planning and Asset Management, read "WMATA would like to see as many steps taken as possible to improve the accessibility of this project to Metro at Cheverly and Deanwood stations by foot, bicycle, or shuttle bus, including wide, safe, well-lit paths." Douglas' current plans show a potential connection to the metro station, but according to the PG County Staff report, the execution of this connection is unlikely because of environmental features on property north of the site.

Phase One, which will deliver a retail building, two mixed-use buildings, and the recreation center along Addison Road is scheduled for completion in 2009. The entire project is slated for delivery in 2012.

Major Tweeking for Tewkesbury

The Office of the Deputy Mayor for Planning and Economic Development just announced that four developers have submitted proposals for the redevelopment of a vacant 1950s-built, 26-unit apartment building at 5425 14th Street NW in Brightwood.

Known as the Tewkesbury, the building has been cited for over 100 violations since it was vacated in 1980's. DC bought the property for $3 million from Vincent Abell, one of the 20 less-than-savory landlords sued in April for code violations on rental properties.

Blue Skye Development, LLC and The Educational Organization for United Latin Americans Spanish Center, Mi Casa, Inc., PML Real Estate, LLC, and 14th Street Partners, which includes UrbanMatters Development Partners LLC, Northern Real Estate Urban Ventures, and Emory Beacon of Light, Inc. responded to the District's May solicitation for the 30,000 s.f. property.

The District would like to see senior or, you guessed it, mixed-income housing for the site, but did not specify whether or not the units had to be condos or apartments. Over half of the units must be affordable.

“This property has been a blight on the neighborhood for more than 20 years,” Deputy Mayor Neil O. Albert said. “The response to our solicitation clearly shows that the development community -- just like the residents of Brightwood -- is eager to get this property back into productive use.”

Onyx on First Opens Its Doors

It's time for another ballpark area opening: The Onyx on First by Faison Development and Canyon-Johnson will open its doors Monday. The developer has been giving small tours of the fourteen-story, 266 unit apartment building at 1st and L Streets, SE for the last few weeks, but will officially open the leasing office next week. The $60 million project, near the Navy Yard metro, offers units sized from studios to two bedrooms.

Onyx apartments feature floor-to-ceiling windows, stainless steel appliances, stained concrete floors and full size washer-dryers. The community, which sits two blocks from the Nationals Stadium, includes a roof deck with a pool, WiFi in common areas, a fitness center, 24-hour concierge service and a clubroom with billiards.

Designed by Esocoff and Associates, the project was originally planned as a condominium building with prices in the high $200 and $300,000's, but went rental earlier this year. Construction began in November 2006. RAM Partners, LLC is the property management company.

Walnut Street Development Sells Mt. Vernon Site

Walnut Street Development (WSD) will be selling its Eye Street Lofts project; the sale is apparently imminent. WSD had been planning approximately 160 residential units and 4,000 s.f. of retail space for their land at 443-459 Eye Street, NW, since it purchased the land in 2004. The Mt. Vernon Triangle project had been planned originally as a condominium, to break ground in 2007, but market changes forced a shift to a planned rental building, construction had not yet begun. The purchaser is not presently being identified.

The site, a large project in its own right, is enhanced because of the adjacent District-owned property, the hotly pursued District 5th and I site for which four developers are vying. According to Jared Jablonka at WSD, the developer submitted a proposal for the 5th and I site, but withdrew when another developer made an offer on the Eye Street Lofts' parcel. Speculation points to JBG as the purchaser, though WSD would not comment on the terms of sale or identity of the purchaser.

"We had a pretty good plan, but then we got an offer from another developer to buy the land. We wanted to develop it ourselves because it would have been an exciting project, but we received an attractive offer," Jablonka said.

He added that WSD had delayed groundbreaking because they hoped to win the 5th and I site. "We had held off because the announcement of a developer for the adjacent piece of land (5th the and I) was delayed. We wanted to incorporate that site into our project, that was the idea, but then we got the offer to sell the site and it was hard to turn down. We are now under contract."

WSD's original $55 million multi-use project would have been a renovation of two 1880's row houses and other industrial buildings into an approximately 12-story structure with over 15,000 s.f. of community-serving retail space.

WSD's plans have been in the works since 2005 and have since faced several obstacles because of the historic nature of the buildings on site that include the Central Auto Works garage, a historically-designated structure. Architects HOK Group decided to incorporate the entire garage into the new edifice by piercing columns through the building and creating footings beneath the garage to support the new construction. The development would have also included the two existing row houses as well as a historic blacksmith shop.

According to the Deputy Mayor's Office, the four remaining developers - JBG, Buccini/Pollin, Potomac Investment Properties, and a group comprised of Holland Development, Donohoe Development, Spectrum Management, and Harris Development had all submitted satisfactory bids, but had subsequently been asked to submit a further "best and final" offer by this Friday to remain in consideration.

WCI Files for Chapter 11 Bankruptcy

It seems not even development giants can dodge the vicissitudes of the market. Bonita-Springs, Florida-based luxury home and tower developer, WCI, announced Monday that they have filed for Chapter 11 bankruptcy and will petition to restructure their debt and capital. They followed that announcement yesterday with news that Chief Judge Keven J. Carey of the U.S. Bankruptcy Court, "approved a package of relief designed to facilitate and ensure the continued and uninterrupted operation of WCI's business." 

WCI's closest project is The Club on Quincy (pictured, at left) at 3901 N. Fairfax Boulevard in Arlington. The project has been on hold, but is planned as a approximately 125-unit, 12 story condo building one block from Quincy Park, on the site of the parking lot of the Arlington Funeral Home in Ballston. A representative for the company said that project will remain on hold until the "market improves."

The company cites the poor shape of the market as the reason for their financial troubles; WCI accumulated a number of unsold properties because of both purchase cancellations and defaults on existing sales. Under Chapter 11, WCI will be able to reorganize their finances and come up with a plan to keep their business running and pay off their debts and blocks other companies and individuals from collecting debts owed by the company.

WCI maintains that they are "absolutely not" going out of business and will use their granted $50 million in cash collateral to meet "immediate obligations to suppliers." According to their press release, "The company said Realtors, brokers and customers will see no interruption in these (brokerage, foreclosure, and rental management) services."

Sitrick and Company, known for its work in "sensitive situations", is doing PR for the WCI while they work through their bankruptcy. WCI's website optimistically cites Delta Airlines, Macy's, and 7-Eleven as other companies that made it through Chapter 11 situations.

Arlington, Virginia commercial real estate news

Partial Approval for Armed Forces Retirement Home

The DC Armed Forces Retirement Home will move forward with the development of 77 of its 272 acres, or "Zone A," thanks to the National Capitol Planning Commission's (NCPC) partial approval. While the AFRH submitted plans for the redevelopment of four zones throughout the campus, which sits east of the Georgia Avenue Corridor and West of North Capitol Street and Irving Street, NW, the NCPC approved only Zone A; other zones will proceed on an as-needed basis. The mixed-use development, still undetermined in composition, will be the first development on the site in more than 50 years.

Zone A will host the most extensive development of the four zones and is slated for improvements to take on an "urban character with a building typology that is sympathetic to the character and scale of existing AFRH contributing buildings and landscape…" Ehrenkrantz Eckstut and Kuhn Architects (EEK) have been working with the development team, a partnership between the General Service Administration and Charlotte-based Crescent Resources, LLC, to create a mix of uses that could potentially include research, office, residential, hotel, retail, and educational uses through private leases. The maximum allowable gross area will be 4.3 million s.f. with over 6,000 parking spaces.

The AFRH is a federal agency, but relies on a trust, rather than federal funding, to operate, allowing it to use its underutilized land to generate new sources of revenue for the veterans' home. The new funding anticipates the future Iraq and Afghanistan veterans who will require long-term, specialty care.

The GSA was not disappointed by the partial approval; according to Tim Sheckler, project manager GSA, the development team knew that complete approval was unlikely. “The NCPC required that the home submit a plan for the entire site and then as part of the discussion at the meeting, it was decided the Zones B and C would be pulled back into the home's zone. That means that they will develop Zone A first and evaluate its financial return. It was always the home's intention to develop Zone A first,” he said.

The NCPC's report says Zones B and C will be "returned to the AFRH Zone", meaning that plans for a mixed use development on Zone B, and townhouse residences on Zone C, will be on hold pending the success of Zone A's development. The AFRH will continue to own and maintain the area and may even lease the property to the National Park Service.

The developers' plans include sustainable development features to, “enhance the overall design, natural environment, and quality of life of the community” by creating a mixed-use, clustered development with walkable space, bike ways, sidewalks, and parks. Zone A will likely achieve Gold LEED certification for overall neighborhood design; residential buildings over three stories, office buildings, and historic adaptive reuses will also earn LEED certification for New Construction.

Established in 1852, the AFRH services over 1,200 veterans and the DC campus boasts proximity to three metro stops; the Georgia Avenue-Petworth, Brookland-CUA, and Fort Totten Station; the master plan is the first attempt at improving the campus in over 50 years. Crescent Resources, LLC was selected as the master developer in March 2007, when they proposed the development of,"300 units of affordable housing, market-rate rental and condominium units, medical office space, a small hotel, a grocery store and other ancillary retail, as well as transitional housing for military veterans." The AFRH doesn't anticipate full build out of the zones for 15-20 years.

Marina View - New Towers Likely in Fall

Fairfield Residential will go before the DC Zoning Commission late September for approval of PUD modifications for their Marina View Towers apartment project. One of several developments along the Southwest waterfront, including Southwest Waterfront, Arena Stage and the Waterfront Mall, Marina View, at 1100 6th St., will deliver apartments, public spaces, and a restaurant at completion. Redesigned by Esocoff and Associates, Marina View will be a mixture of new construction and interior renovations on the two landmarked forty-six year-old I.M. Pei towers. Under the PUD modifications submitted July 3, Marina View will now be completely rental, a change from the developers original plan to make the South Pei tower a condominium building.

Graham Brock, Project manager at Fairfield Residential, said changes in the market led the developer to convert to rental units. "We planned condominiums for the South Pei tower because existing residents in the Pei towers wanted the option of home ownership, but then we struggled to find ways to finance that building and get those residents to qualify for loans. The market changed and the deal we had come up with wasn't as strong anymore. So we met with the residents again and I think everyone came out whole."

Work is already underway in the 128-unit North Pei tower; the developer had to bifurcate all of the systems and transfer tenants; all residents are now in renovated units and the developer is completing the opposite side of the building. Brock said they hope to start work in the South Pei tower in the coming months and complete the historic renovations in the next six months.

As for the new towers that will replace two surface parking lots and climb to 112 feet, Brock said depending on the market, condos could become a possibility, but for now, they too will be apartments. Construction will likely start in the fall on the South tower, which will deliver 156 units and is the only building of the four that will offer ground-floor retail. Brock said it will deliver 8,500 s.f. with 5-6,000 s.f. reserved for a restaurant. The 168-unit new North tower will follow once the South tower's parking garage is completed.

The project will also include amenities such as a small public park on 6th street and 12,000-15,000 s.f. amenities building that will include a pool, gym, lounge, and business center.

Washington Hilton Landmarked

Some say the aerial view of the Washington Hilton in Dupont looks like a distant seagull, some say the hotel looks like a sedentary spaceship. The Historic Preservation Review Board says it looks like a historic landmark. In a 5-2 vote at their July 24th meeting, the board designated the Washington Hilton Hotel at 1919 Connecticut Avenue, NW a historic landmark based on "Criteria D and F", architectural significance and the work of a master.

In his staff report prior to the meeting, Tim Dennee, Architectural Historian for HPRB, recommended that the Board designate the Hilton, built from 1962-1965, a historical landmark and wrote, "Its sinuous massing was a radical departure from traditional local architecture as was its use of column and slab construction throughout, and uniform, pre-cast concrete, windowed wall panels."

In addition to his praise for Architect William B. Tabler, who designed the 1,250-room full-service hotel and whom Dennee described as "no household name, but nonetheless an extraordinarily prolific and acknowledged master of hotel design," Dennee pointed out the hotel's significance as the site of the attempted assassination of President Ronald Reagan and as a venue for events attended by subsequent presidents.

But not everyone was as convinced that the hotel was worthy of landmark status, which not only puts it on the National Register of Historic Places, but also makes the building subject to preservation law, which "requires review of proposals for new construction and additions, demolition, and exterior alterations." Among the reasons the two dissenting members - and several local residents - opposed the landmark were doubts about the distinctiveness of the building, the significance of the architect, and the owner's motivation in landmarking it.

There has been some speculation that the applicant and owner, C.J.U.F. II Destination Hotel LLC, a partnership of Los Angeles-based Lowe Enterprises and Beverly Hills-based Canyon-Johnson Urban Funds, LLC, created by basketball star Magic Johnson, applied for the landmark to be eligible to apply for a parking and loading waiver in the event of future on-site construction or renovations. The HPRB can't confirm this, as the owner did not discuss it with them, nor did they officially submit future construction plans. The developer bought the hotel in May of last year and is currently working with the HPRB to come up with a residential concept that is applicable to the now landmarked hotel.

Dennee, on the other hand, said it seemed like the owner applied for the land mark to beat other applicants to the punch, "In his testimony before the HPRB, the owners’ rep seemed to suggest that the motivation was largely the fact that they recognized it as an important building and thought that someone else might nominate it as a landmark. The owners apparently wished to manage any risk and the timing by forwarding the nomination themselves," he said.

"We have the zoning and development right to build, but now that we had the hotel landmarked, we have to have any building concepts approved. We want to work with the community and the HPRB to come up with a concept that works with the landmarked building. We felt that if we landmarked the hotel ourself, we were opening doors to the community to have a good rapport. We want to set a precedent that developers should be landmarking their own buildings rather than fighting it," said Sarah Hubbard, Development Manager at Lowe Enterprises.

"We want to be proud of the fact that it's recognized as a historic site. There were things left out of its original design and now we want to bring the historic site into the 21st century, so any addition would not only be a modern addition, but it would fix some urban design problems like open space and pedestrian access," said Hubbard.

According to William B. Tabler Architects' website, the sprawling form, a result of the District's height restriction, "gave every guest-room a view with light, space and air. The curve allowed for an efficient double loaded corridor while breaking the endless vista that usually occurs in such long buildings." The landmarking process is intended to protect the physical fabric and appearance of historic structures. We think Jody Foster will be impressed.

West End Retail and Architecture Get Boost

The Board of Zoning Adjustment approved Tuesday NH Partners Holdings, LLC's plans to redevelop DCD America's eight-story office building at 1200 New Hampshire Avenue, NW into an improved office building with more accessible ground floor retail, a handicapped-accessible entrance, and a new lobby. Designed by Bonstra Haresign Architects, the addition will feature modern glass, stone, and metal detailing and "establish an appropriate modern/current architectural language" rather than the existing 1970's-style brick and glass ribbon facade. The renovated office building will also include a single story glass-faced building addition, green roof, and new space for a "high-end white table restaurant or retailer".

Bounded by New Hampshire Avenue, 21st, M, N and 22nd Streets, NW, the 48,589 s.f. site is located between the central business district and the West End neighborhood and is home to Grillfish and Meiwah restaurants, a dry cleaners and a wine shop. The current building was developed in 1978 and includes an approximately six-foot arcade that the developer hopes to enclose, making ground floor retail more accessible to pedestrians and to increasing the floor area by 4,494 s.f.

According to the BZA report, "The location, size, and depth of the open plaza combined with the building design have created retail spaces that have little to no relationship with the adjacent street and are not easily visible, accessible, or marketable," thus, over 6,000 s.f. of the existing ground floor retail space is being used as back office space. The developer's plan would reduce public space from 4,806 s.f. to 313 s.f., but would create larger sidewalks and move retailers closer to the street.

According to David Haresign, Project Architect, the project has faced little opposition from neighbors or the government. The project team, "received support for the design and variance from the full spectrum of stakeholders - tenants, residential, neighbors, and officials from the DC office of Planning, and a neutral vote from the Advisory Neighborhood Commission," Haresign said.

Construction is anticipated to start in mid 2009. The renovated building will still include 165 spaces of below-grade parking. Houston-based PM Realty Group is managing the property. The building is surrounded by renovation, including the just-finishing 22 West, Tiverton condo conversion, and renovation of the Marriott next door.

Washington DC restaurant and retail news

Avera Station Condos Now Apartments

The Avera Station condominiums in Falls Church has joined the long and growing list of condos that have been converted to for-lease apartments, and has been rechristened as Carmel Vienna Metro. Built by Atlanta-based Beazer Homes, the 245-unit Avera Station was fully completed in mid June, and sold to Denver-based Carmel Partners on July 1. The project had been selling as condominiums since early 2006, and had been advertised as "No. Virginia's Fastest Selling Condos." Carmel, which purchased the project free of the previous condominium contracts, would not disclose the sale price. According to Carmel, none of the pre-construction contracts went to settlement.

The project is located outside the beltway, nearly adjacent to the Vienna Metro station. Carmel, which owns and manages 45 apartment buildings nationwide, says it has already leased 50 of the units over the past month, with rents ranging from $1705 to $2420. According to on-site Manager James Mann, Carmel Vienna Metro is maintaining the "luxury homes" branding, offering "concierge services" and a flat-screen television to all tenants.

Falls Church real estate news