Getting Serious at Howard Town Center

After years of vying for the opportunity and negotiating the development, Castlerock Partners LLC finally has plans to break ground on the 2.2 acre Howard Town Center come Fall 2010. Along with development partners AVCO Interests LLC, Hardie Industries Inc and, of course, Howard University, Castlerock secured the site a year ago. The team is still working through the design phases with architects Devrouax and Purnell. Opting not to pursue a PUD, the team added Tompkins Builders as the general contractor in November, a sign the time for waffling is through.

Tim Kissler, CEO of Castlerock, told DCMud that the design phase moves forward as the team shops around for retail tenants. "First priority is a grocery store. Once that is set, we move on to other spaces and prospects," said Kissler. The grocery store was a prerequisite of the RFP and upwards of 45,000 s.f. has been tossed around as the size. Kissler added "leasing interest is strong, despite the slow economy." The rest of the retail space could total 78,000 s.f. with the University looking to support small local businesses in some of the space.

The developer has yet to commit to firm figures on the actual breakdown of residential units, but most recently has suggested there would be 420 units with the required minimum of 8% set aside as affordable, much to the disappointment of the surrounding community.

DC real estate and development news.

Howard Scraps Plans for LeDroit Park Development

Howard University 's Community Capital Projects division (CCP) has abandoned plans for their “New Homes at Historic LeDroit Park” project, according to University officials. Nonetheless, they don’t seem too keen on telling the neighbors.

Located at the corner of 5^th Street and Oakdale Place, NW, directly behind the Howard University Hospital, CCP had been advertising on the long vacant lot by boasting a laundry list of members on their development team, including Sorg and Associates as architects, Essex Construction Inc. as “construction consultants”, Howard President H. Patrick Swygert as “development sponsor” and Riggs Bank as a co-sponsor.

Curiously, Sorg and Associates told DCmud they have never heard of any such project, Swygert resigned his post as University President almost a year ago and Riggs Bank merged with PNC in 2005. What gives?

“The lots are being marketed for sale,” said Kerry-Ann Hamilton, Howard’s Media Relations Manager. “The University is not developing the parcels in question.” Curiously enough, however, they didn’t respond to inquiries regarding the cost of the mysterious parcel, which has yet to be advertised - in any capacity - as being for sale.

Thinking perhaps the project’s fortunes were tied to the University’s once ballyhooed LeDroit Park Initiative, DCmud questioned the head of the Initiative, Maybelle Taylor Bennett of the Howard University Community Association. She declined to comment on the status of the “New Homes” parcel or the Initiative as a whole – which is the product of a partnership between the University and (hard swallow) the Fannie Mae Foundation. Suffice it to say, the Initiative’s plans for “a new mixed-use Town Center on Georgia Avenue that will include community-serving retail and apartment housing” are probably not imminent.

UPDATE: Howard has since directed DCmud to the Menkiti Group, who is currently listing the 4,420 square lot at 2025 5th Street, NW for $430,000. According to their site, it is the "last remaining parcel from the HU/LeDroit Revitalization initiative."

Insider Interview: Sean O'Donnell and Matthew Bell of Ehrenkrantz Eckstut & Kuhn Architects

While architectural firms around the region quietly rightsize their workforce, international architects Ehrenkrantz Eckstut & Kuhn have announced three new projects with the District of Columbia, including a study for the cloverleaf at North Capital Street, a master plan for Northwest’s Mount Vernon Square neighborhood and the modernization of Glover Park’s Benjamin Stoddert Elementary. Not a bad start to 2009. Oh, and they're designing the PN Hoffman-led development of the Southwest Waterfront. Enough to keep them busy for weeks. Two principals with the firm, Sean O’Donnell and Matthew Bell, took some time to sit down with DCmud.

Tell us a little about the firm and your approach to architecture.

SO: There are 35 people in this location. We also have offices in New York, Los Angeles and Shanghai. We’re an international practice and this just happens to be one of our offices. Our offices all collaborate on projects, so our work and expertise flow back and forth. I’ve worked in all four of the offices, for example, and that’s quite common. Our skill set, I think, is a little different than some of the other practices here in town. We do a lot of very large scale master planning, such as the Southwest Waterfront and on other things like Reservation 13 or Inner Harbor East. We’ve done a lot of waterfront planning across the country. That’s part of the large scale vision of the practice and we take that with us into any project, of any scale. Even when we’re doing building scale projects, like the many schools we’ve done here in the District, there’s always a larger vision of how it engages its context and the community.

MB: In DC, we’ve done the School without Walls, the George Washington University master plan, the Georgia Avenue master plan from just north of Howard, and we helped with the Wisconsin Avenue plan. We did the U Street plan and the Reservation 13 master plan that’s in development. We did the baseball stadium site study that located the stadium down where it was built. We worked with Mayor’s office on Great Streets. Right now, we’re doing the Deanwood Recreation Center over in Northeast.

You are the master planner for the Southwest Waterfront project, possibly the most prominent single development in the city. Tell us how you were chosen for that project.

MB: There was an international selection process between the Office of Planning and the developer who was eventually selected, Hoffman-Streuver. I don’t know who else had submitted, but our partner, Stan Eckstut – who was one of the founders of the firm – has made a living doing great waterfronts. He did the waterfront in Long Beach, California, the waterfront in Los Angeles and the promenade in Battery Park. We’ve all learned a lot from Stan about how to approach that kind of project.

What can we expect from the Southwest Waterfront? The only other true counterpart it has at present is the Georgetown Waterfront. What will the comparisons be once it’s completed?

SO: Well, one thing we learned from Stan about waterfronts is how important the water actually is. You need to have a plan for the water too, and not just focus on the land side of things.

MB: What happens on the water totally influences the rest of the project. I think the general feeling is DC doesn’t have, outside of the Washington Harbor, a place where the city comes right to the water. If you think about, most of Georgetown pulls back and places like the Navy Yard never really went right to the water and, for years, were industrial. And, of course, the Anacostia is silted up and never became a great port. If you go back and look at the L’Enfant plan for the city, people were originally going to come by water and then travel by canals, so it was going to be a waterfront city. It never really happened that way and the idea is to finally bring the city to the water with people living there, working there, hotels, retail, restaurants and all different kinds of activity.

How do you go about integrating those original L’Enfant designs into your plans for a modern development?

MB: We base all of our work on what works in other places, so we spend a lot of time looking at precedents. We feel very strongly that great places are made by looking at other places, taking those ideas and using them as a basis for new ideas. I don’t think necessarily we’re trying to reinvent; rather, we’re taking the best of what you have at other waterfronts across the world and trying to make something that’s unique for DC. The L’Enfant plan is one aspect of that, but there are other ideas and other places as well. There’s an idea to connect to the Mall along 9th Street, there’s an idea to make Maine Avenue a vibrant place with active waterfront uses that ties in the existing fish market in a creative way.

EE&K designed the Inner Harbor East project in Baltimore. How would you rate the success of that project, and how would you do it differently if you were to start over again?

MB: What we tried to do there was to design a network of public places. We realized that the market might change, the buildings might change, but if you have strong idea about the kind of places you’re trying to make and you preserve those in the plan, you’ll get a general network of public spaces all along the waterfront. I think a lot of what we’ve learned over the years is that though market forces do have their effect on cities, but if you have a strong idea about place, those things will work out.

SO: When you think about the timeframe that it takes to implement these kinds of plans, the dynamic changes throughout the course of it. Battery Park City has been in the marking for 25, 30 years and we’re actually doing the last two buildings right now to complete the plan. It’s taken a generation.

MB: We try to take the long view. Stan’s been working on Battery Park City for 25 years. We designed the Hill East Waterfront in 2001 and here we are in 2009. Lots of time these master plans do take a long time for their complete realization, and we understand that.

SO: Part of our approach, though, is that since these things can take time, the first phase feels intact and complete. So while there may be 60-acres of development to go, that initial project feels like it’s not a construction site. That’s critical.

The District recently selected EE&K to design a “North Capitol Gateway,” but the details were left a little vague. Can you tell us what shape that project will take?

MB: We’re working now for the Office of Planning, looking at the cloverleaf at North Capitol and Irving. They’ve asked us to imagine different options that are more pedestrian friendly, less highway-like than what’s there now and that work better with the surrounding property owners and uses – like the hospital, Catholic University and the redevelopment of the Armed Forces Retirement Home. The NCPC master plan identifies this as a place that could have more memorials and things, so we’re trying to look at this a new gateway to the monumental core. It could be much more like a parkway, not unlike Rock Creek Park. One of the challenges is that there is a lot of green space in that part of town, but very little of it is successful. They’re seeing this as potential catalyst project, but we’re just really starting it now.

You’ve both worked on projects all over the world, giving perspective about the District's development process. How would you rate the process, especially with regard to the height limit and other procedural differences that set it apart from other parts of the country.

MB: There are plenty of cities that have tall buildings that are really ugly. If the restriction was such an economic deterrent, then there wouldn’t be developers in this town.

SO: We do work across the country, but both Matt and I live in the District. Every time I come back, I always enjoy returning to Washington. And I think the process here is really quite good. It can be complicated, but, having worked in other jurisdictions, there’s a level of professionalism here with the CFA, NCPC and Office of Planning. Their interests are the same as ours; we’re both after a very quality urban environment. The public process here can actually elevate the results.

MB: I agree. Compared to other places, there are a lot of very smart people working at the regulatory agencies here. And with all the specific experiences we’ve moving projects through the regulatory process here, they only seem to get better. I can’t really sit here and say, “This is bad” or “that’s bad.” Sometimes, it’s lengthy, but it is anywhere. Once you set that aside, their concerns are always justified. It’s that kind of balance between the imperatives of the private development world and the regulatory bodies that results in a better product. Most of these bodies recognize that good development is good, and they know that there are certain kinds of development they don’t want to do. We don’t want to do them either – drive-ins, strip malls, and that kind of thing. We share the same objectives. DC is a good place to practice.

The North Star of Shaw Development

Northwest Washington's Shaw neighborhood could receive its first New Year’s batch of condominiums as soon as next month. Currently under construction at 1910 8^th Street NW, the Stella Polaris Condominiums will be bringing five upscale, 1,100 square foot units to the foot of the U Street corridor - within an earshot of popular local destinations like the 9:30 Club and Town.

The project is under the purview of Blue Sky Housing (not the similarly-named Blue Skye Development), a local developer whose last publicized project was the renovation and conversion of two Hanover Place NW apartment buildings into condominiums. Earle "Chico" Horton, a partner with the Graves & Horton LLC law firm and Blue Sky principal, tells DCmud that all of the units will feature 2 bedrooms and 2 ½ baths, in addition to amenities like “10 foot ceilings and high-end finishes.” Once completed in February, prices on ground floor units will start around $330,000, while top floor units will be "in the range of $480,000 to $500,000." Caltec Construction is serving as general contractor.

The project stands feet from the corner of 8^th Street and Florida Avenue NW – an area that has hosted vacant lots since long before developers renewed their interest in the historic Shaw community. “Whatever structures were there were probably damaged in the 14^th Street riots [of 1968] and subsequently torn down. It’s easily been over 20 years since there’s been construction at the site,” said Horton. ‘“Once people get financing, I think they’ll be a lot in store for the area. I was one of the original buyers of Harrison Square back in 2000. I’ve been in the area for a while and have seen the growth, which has been good.”

Indeed, growth is continuing unabated in the neighborhood. A few blocks away Castlerock Partners will be constructing the sprawling Howard Town Center project, while a parcel literally around the corner at the 9^th and U Streets NW – currently the site of a weekly flea market - has been slated for redevelopment by the Washington Metro Area Transit Authority. Those projects are set to join Ellis’ recently-approved redevelopment of the Howard Theater, and other in-the-works efforts like Broadcast Center One, the Wonder Bread Factory and O Street Market complex, as possible additions to the Shaw of the new millennium's second decade.

Then There Were Three at Howard Town Center

It may be slightly less exciting than the McCain-Obama matchup (only slightly), but the contenders for the on-again, off-again Howard Town Center project have now been narrowed to just three: Archstone-Smith, Armada Hoffler and CastleRock Partners. A Howard University representative yesterday confirmed that two other bidders associated with the $30 million project - Monument Realty and the Trammell Crow Company - have been ruled out by the University as potential developers.

This marks Trammell Crow's second loss of the HTC project. When the HTC was first proposed in 2003, the development company walked away with a $56 million contract - only to watch it fall through when the Duke Plan, a new zoning overlay for the area, was introduced, and some have suggested that Trammell Crow may still have an actionable claim against the university.

Development on the 2.2 acre parcel is said to include a 300-unit apartment complex, parking and 70,000 square feet of retail, which must include a grocer under the terms of the RFP. The Howard Town Center project will be built at the current site of several Howard-owned properties at 2100 Georgia Avenue that have fallen into disuse. A recent Howard acquisition at Georgia and W Street, the Bond Bread Building, is also to be utilized in the redevelopment efforts. Howard acquired the building from the District of Columbia this spring in a land swap long opposed by the tenants of Bond Bread, which had sued the city over their rights to the building. Howard issued an RFP for the project (again) last May. Group Goetz Architects will be designing the project for the winning developer, a design that is strongly encouraged to be LEED certified.

Howard’s Communications Department would not discuss a date for the selection of a development team, but construction is planned to begin in August 2009.

Washington DC commercial real estate news

St. Elizabeths Plan Envisions Massive Redevelopment

The District announced a new plan today to kickstart redevelopment of the old St. Elizabeths mental institution in Ward 8. If approved by the District Counsel, the series of projects will beef up one of DC's poorest neighborhoods with nearly 3 million square feet of mixed-use development. Mayor Adrian Fenty, Congresswoman Eleanor Holmes Norton, and Office of Planning Director Harriet Tregoning were on hand today to announce the release of the St. Elizabeths East Redevelopment Framework Plan, which recommends transforming the hospital’s eastern, District-owned flank into five neighborhoods, "each with their own character," and pushes for the Department of Homeland Security's (DHS) proposed relocation to federally-controlled St. Elizabeths West. The government transferred ownership of the eastern portion to the District in 1987, while retaining the western campus for its own use.

The Plan is sprawling in its scope – the size of the District-owned eastern half alone measures in at 173 acres. Together, construction on the two campuses - separated only by Martin Luther King, Jr. Avenue, SE - would be second only to the revitalization efforts underway on the Southeast Waterfront in terms of size and scope.

“I think what we have proposed…will not only benefit the people who live in Ward 8 and east of the river, but, just as importantly, the entire city,” said Fenty.

Redevelopment at St. Elizabeths East would create up to 2 million square feet of new mixed-use projects and 750,000 s.f. of renovated historic space. The proposed neighborhoods (pictured, below) are being broken down into the North Campus, Maple Campus, Town Square, CT Village and Metro Station; each would feature a distinct blend of commercial, retail and/or residential space, in addition to “civic and community” areas. The northern portion of the site has been reserved for DHS office space and parking – a move made to sweeten the deal for the Feds, no doubt (more on that in a bit). Meanwhile, the historic St. Elizabeths Hospital, its new 435,000-square foot secondary building and John Howard Cemetery on the grounds would be retained.

The Plan also includes provisos for a cohesive link to the two local Metro stations and MLK corridor, where the City is betting on seeing an influx of retailer and developer interest.

On the western campus, DHS’ proposed relocation would include the construction of new, secure headquarters meant to accommodate roughly 14,000 government employees. If and when the project moves forward, it would mark the first time the federal government has ever crossed the Anacostia River, according to Congresswoman Norton. DHS currently lacks a consolidated headquarters, with offices at different locations throughout the city.

The impact of such large workforce on the environment, Metro capability and local traffic is still being evaluated, while the inclusion of the site in the proposed southeast street car system is still a possibility.

The District will submit the Plan to the City Council next month with a decision to follow in December. A Request for Proposals regarding the DHS parking lots and offices is planned for December as well, the District hopes to break ground on that phase of the project in the first half of 2009. Norton described development as moving along an “unusually fast track.”

The Plan is the product of more than 5 years of parallel development by the General Services Administration (GSA) and the District. According to Norton, it's has been included in the Bush administration's budget for three straight years, but has only been able to move forward, ironically enough, since the Democrats came to power in Congress. The challenge now lies in convincing that same body that moving DHS to another, federally-owned piece of property in Southeast would be beneficial and, most importantly, cheap. It would appear that the future of both East and West hinges on a decision by the federal government; if DHS settles on another location or Congress blocks the site, it could be a deal breaker for both halves of St. Elizabeths.

“There will be great potential here if we continue to do it right. The city and the government will work closely together, as we have on projects in the past,” said Norton.

A budget for the project is forthcoming, and Norton will be holding a town hall meeting tonight from 5:30 - 7:30 PM at the UPO /Petey Greene Community Service Center (2907 MLK Jr. Ave SE) to disclose more details and listen to questions from the public. Another community meeting will be held at St. Elizabeths on October 28^th.

DC's Development Pipeline

Ever since the Fenty administration took over development of the District's publicly-owned property, merging agencies and placing them under his direct supervision, it seems development of blighted blocks has been given a new urgency, even compared to that of the Williams administration - itself a great improvement over its predecessor. But despite weekly announcements from the Mayor and the Office of Planning and Economic Development, many of the projects still have to proceed through the District's infamously thick bureaucracy. But if China can cleanse its murky atmosphere in a few short months, there is cause for optimism that change is in the air here in Washington. DCMud has prepared a rundown of the largest projects now underway, properties in need of developers, and solicitations to look for in the future.

The projects listed below are still being refined. The numbers and square footage assigned to each are conceptual and are subject to change.

Projects With Developers

Southwest Waterfront by Hoffman Streuver will offer 539 market-rate units and 231 affordable units. The $1.5 billion project will also include 350 hotel rooms, 700,000 s.f. of office space and 280,000 s.f. of retail space. On July 15th, the DC Council approved a $198 million TIF/PILOT package to finance park and infrastructure improvements. Groundbreaking is not expected any time soon, with construction lasting at least 6 years.

Waterfront, the erroneously named project at 401 M Street, SW, will deliver 800 market-rate and 200 affordable residential units as well as 1.3 million s.f. of office space and 110,00 s.f. of retail space. Mayor Fenty joined SW Waterfront Associates (Forest City Wasington, Charles E. Smith Vornado) in November to demolish the former Waterside Mall. The $800 million project will sit atop the Waterfront -SEU Metro station.

Clark Realty was selected in February as Master Developer for Poplar Point on the east side of the Anacostia. The number of residential and hotel units they will deliver has not yet been determined, however 30% of all residential units will be affordable. The District and the National Park Services held a public scoping meeting last month for the Environmental Impact Statement of the $2.5 billion project.

Center Leg Freeway on Massachusetts Ave, NW between 2nd and 3rd Streets is being developed by Louis Dreyfus Properties into 100 market- rate and 50 affordable residential units. The $1.1. billion project will cap the exposed section of I-395, and include 2,100,000 s.f. office space and 67,000 s.f. retail space.

The McMillan Sand Filtration Site on North Capital Street and Michigan Avenue will be developed into 820 market-rate units, 351 affordable units, and a 100-room hotel by EYA. The $1 billion project will also deliver 700,000 s.f. of office space and $110,000 s.f. of retail space. The project has long been worked over, but don't make plans for moving in any time soon.

In May the District reached a deal with Hines Archstone to develop a 400-room "high-end" hotel and 100,000 s.f. of additional retail space on "Parcel B", a 53,000 s.f. plot of land that is part of the larger CityCenter DC, the development taking up residence on the old convention center site. The entire $850 million project downtown will deliver 539 market-rate units, 135 affordable units, 476,000 s.f. of office space, and 266,000 s.f. of retail space.

On June 26th, Marriot International, Cooper Carry Architects and EHT Traceries presented plans for the Convention Center Headquarters Hotel to the Historic Preservation Review Board. Located on the Corner of 9th Street and Massachusetts Avenue, NW, the $550 million project will deliver 1125 hotel rooms and 25,00 s.f. of retail space. Having been scaled back from its original 1400 bed facility, the project is well past its early schedule, of construction in 2007.

O Street Market at 7th Street and Georgia Avenue will be transformed into a mixed-use development that will include 550 market-rate and 80 affordable residential units by Roadside Development. The $329 million development will replace a current Giant supermarket with a new 71,000 s.f. store and include a 200 unit hotel and 87,000 s.f. of retail space. The District reached an agreement with the developer late last month to kickstart financing. Of the dozens of projects promising to revitalize the Shaw neighborhood, this may be the first large project to actually get underway.

Skyland Shopping Center on Good Hope Road at Naylor and Alabama Avenue, SE will be developed by Rappaport Companies and William C. Smith Companies into a $261 million development with 155 market-rate units and 66 affordable units as well as 230,000 s.f. of retail space. When? Even an estimate will be fine.

City Vista, which began sales in late 2005, will bring 441 condos with 138 affordable residential units to, as well as a separate apartment building, to 5th and K Streets, NW. The project will also include 130,000 s.f. of retail space and will cost $191 million. The first condominium building completed last October, the remaining condominium and the apartment building are nearly ready for occupancy.

Early this year, Fenty signed a Land Disposition Agreement with Broadcast Center One Partners LLC, (Ellis Development and Four Points, LLC) that will bring African-American-owned Radio One to the district. The $144 million Broadcast Center One at 7th and S Streets, NW will be a mixed-use project with 135 market-rate and 45 affordable residential units as well as 96,000 s.f. of office space and 22,000 s.f. of retail space. According to Fenty's office, "the deal also sets in motion the $22 million redevelopment of the Howard Theater, a long-shuttered landmark that was the hub of black Broadway." If it gets built; the timeline remains uncertain.

Mt. Carmel (Parcel 51B) on 3rd Street, NW between K and H Streets is being developed by MQW LLC (Quadrangle and the Wilkes Companies) into $130 million mixed-use project with 267 market-rate units, 67 affordable units and 90,000 s.f. office space.

Forest City Washington is responsible for the $120 million O Street SE Redevelopment by the SE Federal Center. It will deliver 354 market-rate units, 89 affordable units and 47,000 s.f. of retail space.

The Village at Dakota Crossing in Fort Lincoln by Ft. Lincoln New Town Corporation will include 327 market-rate and 30 affordable units. It will cost $110 million.

Mid City Urban and A&R Development will bring 216 market-rate and 54 affordable residential units as well as 70,000 s.f. of retail space to the area around the Rhode Island Avenue Metro station with their $105 million Rhode Island Station project. First attempted as a condo project, developers have bowed to the market and substituted apartment buildings - at least in theory, as the project has yet to break ground.

The $100 million Shops at Dakota Crossing on New York and South Dakota Avenue, NE will be developed by Ft. Lincoln New Town Corporation into 29,000 s.f. of office space and 461,000 s.f. of retail space.

Lowe Enterprises and Jack Sophie Development have long had intentions to develop Riggs Road and South Dakota Avenue, NE (Triangle Parcel) into 208 market-rate units, 52 affordable units and 23,223 s.f. of retail to the tune of $75 million. The fate of the project is uncertain, as higher construction costs, shrinking condo prices, and more conservative lending practices - especially in low-income neighborhoods, make such projects harder to justify.

Park Place on Georgia Avenue in Petworth will be developed by Donatelli Development into 161 market-rate units, 32 affordable units and 16,000 s.f of retail space and will cost $60 million. Purchased by Donatelli, along with partners Gragg & Associates, Canyon Capital Realty Advisors and Earvin 'Magic' Johnson, will be one of the few developers delivering new condos in 2009.

In February, the District made a Term Sheet with Parcel 42 Partners to develop 95 affordable housing units and 8,000 s.f. of retail space on Parcel 42, in Shaw at 7th and Rhode Island Avenue, NW for $28 million.

In December 2007, the District selected William C. Smtih Companies and the Jair Lynch Companies to develop the $700 million Northwest One New Community that will deliver 1,600 units of housing on former NCRC parcels as well as adjacent DC-controlled and private properties in Ward 6. Located between North Capitol Street, New York Avenue, New Jersey Avenue, and K Street, the site is in an area that has "long been plagued by high crime and poverty", but is surrounded by the up-and-coming NoMa and Mt.Vernon Triangle neighborhoods. The development team, which also includes Banneker Ventures and CPDC (affordable housing provider), will create apartments, townhouses, and condos for all income levels as well as over 40,000 s.f. of retail and 220,000 s.f. of office space. The development will also offer a 21,000 s.f. clinic.

And further down the road...

The District issued a solicitation in early June for Parcel 69 at 4th, 6th, and E Streets, SW. The $130 million development will be an office and hotel project along the Southwest freeway. Proposals are due by September 15th.

In May, Fenty issued an RFEI for the Hill East Waterfront on Capitol Hill East. The District seeks a developer to create 2,100 market-rate and 900 affordable units with 2,000,000 s.f office space and 67,000 s.f. of retail space. The District anticipates a price tag of $1.1 billion for the development of the 50 acres surrounding the former DC General Hospital. Proposals are due by October 31st.

Proposals were due June 3rd for Minnesota and Benning Road, NE Phase II. The $107 million development will include 60 market rate, 392 affordable units and 40,000 s.f. of retail. No developer has been selected.

It is high time the District announced developer for Fifth and I Street, NW. After proposals were submitted in March, the District widdled the teams down to the final four including BG, Buccini/Pollin, Potomac Investment Properties, and a group comprised of Holland Development, Donohoe Development, Spectrum Management, and Harris Development. The winning team, whenever they are announced, will create somewhere around 170 market-rate units, 30 affordable units, 100 hotel rooms and 50,000 s.f. of retail space.

Upcoming Solicitations

The District would like to see 1,469 market-rate and 440 affordable units in Lincoln Heights in Ward 7 at an estimated cost of $576 million.

Barry Farm/Park Chester/Wade Road in Ward 8 will likely include 110 market and 330 affordable housing units and will cost around $550 million. The project is an effort to revitalize low-income properties in the historic Anacostia area.

The issuance of the Park Morton solicitation at Park Road and Georgia Avenue, NW is "imminent" according to the Mayor's office and will cost $136 million with 499 market-rate and 150 affordable units. Axis

Howard Issues RFP for Bond Bread Building

Howard University has issued a Request For Proposals (RFP) for real estate developers to submit bids for a "first-class, mixed-use development" at 2112-2146 Georgia Avenue. Part of the 2.2 acre site at the corner of V St. and Georgia Avenue, the Howard Town Center, was offered to Howard by the District of Columbia just two weeks ago in an exchange designed to facilitate Howard's residential development, and the University obviously plans to waste little time in moving forward with development of the neighborhood.

The project is the site of the Bond Bread Building, a property long contested by its one-time tenant, which lost a legal battle for control of the land. According to the RFP, the development "must include rental apartments, retail (including grocery store) and parking," and is strongly suggested to be LEED certified. Though the site has a maximum floor area ratio (or FAR, which limits the amount of floor space in relation to the size of the lot it is built upon) of 6.0 and a height of 90 feet, but also falls within the districts "Duke plan" (for developing Shaw and U Street), which encourages greater height and FAR allowances. The project is expected to have 300 rental units that will comply with D.C.'s formula for market rate and affordable housing. A mandatory pre-bid conference will be held at Howard on May 15th to discuss the project, the terms of which require that the real estate developer enter into a long-term ground lease with the University and undertake all development obligations. Bids are due by June 10.

Howard Town Center to Finally Take Place of Bond Bread Building

One of the District's oldest property struggles may soon see resolution, ending a dispute that began with a promise by Mayor Walter Washington, DC's first elected mayor. Last week, current Mayor Adrian Fenty signed an agreement saying the District will at long last swap land with Howard University, a deal that will give Howard the property it has eyed since beginning its LeDroit Park Initiative for redevelopment more than a decade ago.

This exchange means Howard will receive the former Bond Bread Building at 2146 Georgia Avenue, NW. The lot provides redevelopment space for the long-planned Howard Town Center: 300+ residence units, 70,000+ s.f. of commercial property, a supermarket, and parking. The District will receive in exchange, the site at Florida and Sherman Avenues, and will solicit bids for a mixed-use project to include at least 300 housing units (30 percent affordable). Both Howard University and the District have wanted to complete this seemingly simple exchange but had been foiled by a legal conundrum dating back to Mayor Washington's promise to the Peoples Involvement Corporation (PIC), a 30-year tenant in the Bond Bread Building.

PIC, a federally funded nonprofit focused on community development, was founded in 1968, the year after DC Mayor-Commissioner Walter Washington took office. Washington, who became the first Mayor of the District under home rule, supported PIC, and verbally promised the organization that if it retained tenancy for two decades and made improvements to the property, the District would turn over its ownership of the Bond Bread Building. But, as any first year law student will attest, exchanges of lands do not meet the Statute of Frauds if not in writing.

In relying on the District's promise, PIC renovated the crusty digs, somewhat, and occupied the building for the requisite term. When the District announced its intention to swap the Bond Bread Building with a property belonging to Howard University, the PIC learned that it risked losing what it had seen as a multi-decade investment. The organization sought and received from Mayor Washington a written statement from the former mayor confirming his verbal promise to give away the site. In 2003, to protect its interests, PIC filed a lawsuit with the D.C. Superior Court against the District.

If PIC won its suit, Howard University stood to lose its planned project. The university had already hired Trammell Crow Company’s subsidiary, High Street Residential, and alumna Michelle Hagans to develop the property. The Howard Town Center project had received press coverage from the Washington Business Journal and other local publications as part of its plan to transform the neighborhoods surrounding the university. But Hagans, High Street, the architects, the construction firm, and planned lessees such as Fresh Grocer were now all put on indefinite (or potentially permanent) hold as they waited for the Bread Building dispute to rise.

And rise it did, doubling in size; the District decide to instigate its own suit, and it sued PIC to establish itself as the rightful owner of the property. Legally, Washington’s verbal property promise did not pass muster with the courts. In what would make a picture-perfect law school exam over tenancy rights and verbal promises for land subsequently written, PIC lost both cases, concluding that a Mayor's verbal promises could not be relied upon (duh).

In 2006, the D.C. Council considered the issue, first in a bill sponsored by Councilmember Jack Evans that would have halted the swap, but finally approving the exchange of the Bond Bread Building with Howard University’s 63,400-s.f. property at Sherman and Florida Avenues.

As DCMud reported in June 2007, legislation sponsored by D.C. Councilmember Jim Graham was supposed to get Town Center construction moving that year, with possible completion projected for 2010. Now, almost halfway through 2008, it looks like Howard Town Center may soon get out of its jam and into the Bread Building. The Mayor has said he intends to issue the solicitation for a development partner later this year.

Industry Insight: Armond Spikell of Roadside Development

Armond Spikell started Roadside Development more than 11 years ago, after taking the reigns on a retail center development in what he likes to call "Sleepy Hollow." His projects caught many a retailer's eye, and Spikell found himself soon on his way to abandoning the brokerage business, and taking on the development world head-on. With real estate experience aplenty, and a collection of neighborhood-altering projects along the way, Spikell agreed to talk about his new projects, architecture and the pitfalls of developing in DC. 

DC MUD: What made you enter the real estate development business and how has it changed since then?

Spikell: I had been developing some smaller projects on the side while being a broker, and found one project that my partner Richard Lake had been working on for several years, a piece of land in Virginia owned by a family that was very involved in real estate, but not retail. Someone had brought them an offer to lease the land and develop something we thought was an awful project. Richard showed it to me and I said, ‘don’t let them do that, that would really be a shame. Maybe we ought to develop something for them.’ So we put together a development plan and a pro forma and brought in a fellow that had been one of Richard’s first clients in the leasing business, Todd Weiss. The three of us met with the land owners and showed them our plan and they liked it. We said, 'we’ll joint venture this and build it.' So we built this shopping center, and one of the anchors was a CVS drug store. CVS started talking about having a preferred developer program and asked if we would be interested in participating. So we met with CVS, helped them fashion a preferred developer program, and we started building drugstores. That’s when we named ourselves Roadside Development; since we were building small strip shopping centers and drugstores, we thought it was a perfect name. 

DC MUD: Have things changed much since then? 

Spikell: I guess in ten years a lot changes. One thing that changed is that the shopping center development business became a lot more competitive than it was when we started. It was a couple of companies that were driven by large investment funds that seemed to dominate that business. That wasn’t us. We’re different – some developers, their goal is to put money to work. When they look at a potential project the goal is how much can we get invested, and how much return can we get? We’re a little different. Every one of our projects that we’ve done so far, we’ve done with a different partner, and they’ve all been good partners, but we pick the partner to match the deal, not the deal to match the partner. It gives us a lot more flexibility. 

DC MUD: So would it be fair to say that you try to see where you can have the greatest impact? 

Spikell: I think our approach is more of creative problem solving. Starting with the needs of a land owner or retailer, and sometimes an investor, but in the case of our Potomac Town Center project, there an investor was anxious to make an investment in that market, bought the land along with a development plan and then brought us in to modify the plan to make it work more profitably, then carry it out. So our approach is more problem solving.

DC MUD: So how do you make decisions on what’s worth developing and what’s not? 

Spikell: We look at sites and we think ‘Is there something we can do that’s creative and productive?’ The other thing is, since we don’t have a particular product type that we feel we have to build, a lot of it is looking for opportunities to build projects that are in tune with the community. What we find is, when you go into a community, they’re your customers, and if you want to bring retail, you want to bring retail that your customers want and will patronize. And so there’s a certain synergy there that makes a lot of sense. Purcellville (one of Roadside's retail center projects, pictured above) is a great example. Maybe it would have been more productive for that land to build fast foods and gas stations, but it’s really not what people wanted. What they needed, what there was demand for, was some upscale retail, so that everyone didn’t have to get in their car and drive out to Leesburg. So, it worked out great for us.

DC MUD: Let’s talk about some of your projects; they always seem to be near or around Metro stations, that’s not a coincidence is it?

Spikell: No, we’re big believers in Smart Growth. Since we work in the greater metropolitan area, we work in Howard County, Prince William County, Loudon County, Fairfax, Arlington and Alexandria. And when you have a regional perspective, it becomes all the more clear that for our quality of life and our ecology in general, Smart Growth is very important. It’s very important to have clustered growth where we have the infrastructure in place already. Sprawl is something that should be discouraged. And if you look at retailers that serve urban communities, oftentimes they’re in locations that they secured years ago, and then everything filled in around them. Now when they need a modern facility, they don’t have the space to put their typical prototype, so you have to be very creative. And if you’re near a Metro Stop, it allows you then to build valuable residential that’ll pay for some of the outrageous costs. Like in the case of our O street project, we’re putting all of the truck loading underground. Now a retailer, by itself, could not afford to pay for that. But the fact that there’s residential in a fabulous location within walking distance to gallery place and downtown and has the metro, the residential is paying for that. It’s great synergy. Everybody wins.

DC MUD: Back to O Street Market, we got some questions from some of our readers about whether the Giant Market will be closed during the time construction. Will it?

Spikell: You know, we figured out this very clever phasing plan for Giant, where we could work around them, and then open the new store and close the old one. And they looked at the plan, and they said given the size of this project, where we’re going to be digging this very deep hole and taking out tons and tons of mud out of the ground right in front of our store, it’s not a great environment for our customers, and it’s not a great environment to sell food. So they decided that it probably would make a lot more sense to close down. So the deal we have is that we must complete the store in no greater than two years from the date they close the doors. So in the meantime, we’ll be running shuttle buses to the nearest Giant.

DC MUD: How about architecture, when you’re seeking an architect, what do you look for most?

Spikell: It depends; sometimes we look for an architect who has a lot of retail experience, who kind of gets it and understands the needs of the retailers because retail is a function of business, and the buildings have to function properly, otherwise it’s very expensive and has a significant impact on the bottom line. The other thing is having somebody who designs interesting and high quality projects. It’s a little different; some developers may look more at cost effectiveness and productivity. Those are important, but they’re not the most important things for us.

DC MUD: Are there any architects that you particularly like?

Spikell: The team that we work with most is Shalom Baranes and Rounds VanDuzer. Rounds VanDuzer is, I think, one of the best retail architecture firms in the area. They are very creative, they do attractive buildings and they are very, very experienced with retail.

DC MUD: What about the current market conditions. Do they have an affect on your operations?

Spikell: I mean if you’re talking about the Washington market on a general basis, it’s a terrific place. The local economy is healthy, it’s still producing jobs and the oversupply of housing will get absorbed, and the demand will create a market for new housing. It’s a matter of time. Now we see something very interesting happen in retail. Whenever there’s a slowdown nationally, we get more interest in Washington for retail. The reason is, retailers are driven to expand, and public companies always want to show growth. Now if you have to open stores, where do you look? Well you say, ‘what are the strongest markets, and who’s doing best?’ Washington’s always on that list, and so all of a sudden they always focus more on Washington. Retail can be a little counter-cyclical here, that’s why we get more interest when the rest of the nation is ‘soft.’

DC MUD: Why Shaw, and do you think your timing is good there?

Spikell: Yeah I think our timing is excellent. Even with the current softness of the market, I wish our building was done already – it’s a fabulous location. Already some of the great restaurants are moving in, and I think there will be a lot of new shops opening, and there will be the best grocery store in the entire eastern United States, I think. It’s going to be the biggest grocery store in the city. That being said, if you walk a block, east or west, from our location, you’re on beautiful streets that have wonderful bones. You know, Shaw had its problems with crime, but I think the way you get rid of crime is to get rid of blight. Unfortunately our market building caved in, but we’re going to fix that and I think it will have a real positive effect on the neighborhood.

DC MUD: If you could change one element of the development approval process, what would it be?

Spikell: I think it would be better if we could get the scope and density of a project entitled, separately from having to provide all of the detail and design. In a P.U.D. you’re really answering a lot more questions than I would like to answer before you know whether or not you’ve got something that’s viable. What would be best is if you could go in to a zoning commission, or whichever agency, and say ‘here’s the concept of what we want to do, here are the major elements, here’s the amount of density, here’s how tall the buildings are going to be, and here are the benefits.’ And get them to entitle that before you have to design it and show where every window and every door is, because that’s a different level of design. And I think it’s a detriment to have to go to that extent of design, just to find out whether or not the density and the height is going to be acceptable. And after spending all of that time and money and getting guidance from the Office of Planning, you could go to the Zoning Commission and then get shot down, and I think it would be better of this staged it.

DC MUD: Stage one for functionality and stage two for the design details. 

Spikell: Yeah. And in suburban life they have a site planning process, and you do that first. And once you’ve gone through the site planning process and you get entitled, then you go and you do the rest of the design. That I think would be an advantage. If it could proceed quickly and allowed for reasonable flexibility.

DC MUD: What do you think is the most important aspect in developing a successful project?

Spikell: I think it’s producing something that the market will accept. That’s got to be the most important.

DC MUD: If you had to pick one area in DC with the most economic potential, which would it be?

Spikell: Oh Shaw. Although I will say, you know Shaw is realizing its potential now, but I think there are areas in DC that are just, just beginning. I mean everywhere there’s a metro station, you look at Rhode Island Avenue and Fort Totten. Rhode Island Avenue is a good example; you’ve got industrial uses clustered around metro stations close to downtown. You know that’s not going to last. Fort Totten has major projects already underway. Same thing with Petworth is already underway, and along the green line. No question that those are the places where the greatest opportunities are. And I hope they all develop as good walking neighborhoods.

DC MUD: Your next generation of buildings, will they all be green?

Spikell: Yes. They’re going to be green to the greatest extent that we can make them green. We’re looking at doing a couple of things that are unusual, we’re trying to study new ways that we can do mixed-use. We learned something interesting with Cityline, we never took advantage of it, but I wish we had. We had a retailer there, Best Buy, who never turns on the heat. In the coldest days of the winter, they don’t need heat because they have all these electronics in the store that create heat. And I wish we had a way of utilizing that. So what we’re doing in both our Glebe project and our O street project is: the grocery stores have refrigeration systems that take heat out of the freezers and coolers. What do you do with that heat? In a typical suburban grocery store, they take it up to a unit on the roof that blows it out into the air. We’re looking at ways that we can reclaim that heat that’ll make a difference. The other things that we’re planning on doing are out there already, you know, green roofs and energy efficient appliances and lighting. Both of those grocery stores are very likely to be LEED certified, and we can’t take all of the credit for that because both of those companies, a lot of retailers, are getting on the bandwagon, because its smart. Its smart business.

Howard Town Center to Move Forward Slowly, but Surely

Redeveloping almost an entire city block at Georgia and V streets, Dallas-based High Street Residential, a wholly owned subsidiary of Trammell Crow Company, is planning Howard Town Center, a mixed-use project that will include 70,000 s.f. first-floor retail that may include a Fresh Grocer, 322 market-rate apartments, and a parking garage that will hold approximately 500 spaces at its completion. Designed by Michael Marshall and Gensler and co-developed by Michele Hagans, the $75 million project was announced by developers in April 2003, but has been on hold ever since.

According to Ed Morgan, a Principal at Trammell Crow, developers have been awaiting a final land swap of the city’s Bond Bread Building for the university’s land at Sherman and Florida Avenues. The end may, however, be in sight. Morgan said applications for permits are expected to be submitted in the spring of next year.

While Morgan did not comment on the lawsuit, the Washington Business Journal’s coverage of the suit reported that People’s Involvement Corp., a community development company filed a lawsuit against the city stating that the Bond Bread Building had been promised to the company in the 70’s. That same building was a key component of the aforementioned land swap. A D.C. Superior Court judge ruled in favor of the city in September of 2005, PIC responded with an appeal. In December 2006, D.C. Councilmember Jim Graham introduced legislation to finally begin the construction of the Howard Town Center in 2007.

If permits are obtained in a timely matter, Morgan said the project could be completed as early as 2010.