Friday, September 28, 2007

Douglas Jemal's Upcoming Developments....

Thanks to Jeff Parke of lifein.mountvernonsquare.org, my impression of the future of development of Washington DC is once again reaffirmed. Doug Jemal, of Douglas Development Corportation has been developing in the city for years and has been the front runner for many of the cities most popular areas. From revitalizing Cleveland Park's historic retail row in the early '90's to Historic Row on the 800 block of F St NW to Wonder Plaza at 2301 Georgia Ave NW, also known as the shops at Howard University, Jemal has worked just about everywhere. Now I might be a bit forward in saying this but I predict Jemal's pinnacle of growth is yet to come. Many of his 279 properties (which have his name on the tax record) are still undeveloped. Included in his portfolio are several six acre sites across the city that have yet to become profitable ventures.

Call me weird but on the wall of my office I have a map of DC which marks every property that Jemal has or will have his hand in over the next few years.

This afternoon I ran a search of the 279 properties just mentioned and calculated the total amount of land that have Jemal's golden touch. His total ownership in DC alone equates to just over 38 acres of land even after his previous developments. Someone correct me if I am wrong but that would make him the single largest shareholder of land in our city outside of government agencies. Is that control or what? Between Maryland, DC and Virginia, Jemal owns over 215 acres of prime retail space just waiting for revitalization.

Whats next on his list?
Hotel, Office and Residential Buildings along New York between 6th & 7th St NW
Harris Teeter Grocery in Adams Morgan at 17th & Kalorama NW
Uline Arena at 3rd & M NE
Broadcast Center One in Shaw at 7th St NW & S St NW

Shocking: Mar '07 Sold at $2.7 Mil - Sept '07 Listed at $6 Mil

The Address...2216 Wyoming Ave NW

Todays blog comes more of a shock than anything else. Back when I was working with Long and Foster my associate Juan Antonio listed an 11,000 sq ft home in Kalorama. I was usually the one holding the Open Houses but it was an absolute mansion...and if I may say, quite possibly one of the most incredible private residences I have come across in the city. At the time it was a disheveled mess. Before we listed the previous owner had ratified with a buyer outside without the use of a Realtor. Before settlement the buyer had begun gutting the home and removing all fixtures as well as the kitchen . As Murphy's Law goes...what can go wrong will. And it did. Settlement fell apart and the house was left a mess. This is where we came in. After ratifying a contract on the home was sold to a Jessica Mccann, of 4818 Yuma St NW, who after six months of what I am sure was a tedious renovation, just relisted the home for a whopping $6 Mil two days ago.

The old listing stated: Ovr 11K sqft of mixed use prop. w/an amazing structural design (10+ ft. ceilings, oversized bedrooms). The xterior boasts a spacious rf deck, and sizeable car garage. Located in the most coveted rsidential nghbrhood of the Nation's Capital. Modest interior enables design to your liking. Golden opportunity in Kalorama!

The new listing states: Masterful renovation with utmost regard for Mediterranean Revival heritage. Substantial Kalorama residence with the finest finishes & modern technology. Embassy-sized entertaining spaces, 5 car pkg, chef's kitchen, service kitchen, all new baths, 1500 bottle wine cellar, expansive roof patio, private back garden, fabulous lower level easily convertible to home offices.

WOW. What are your thoughts?

Wednesday, September 26, 2007

The Metropole: "Goodbye Glen, Hello Foulger-Pratt"

This morning while returned from my ever repetitive daily walk to the Starbucks Coffee on P St NW between 14th St NW & 15th St NW I passed a new sign on the site of the Metropole, a new condo building at the corner of 15th St NW and P St NW. The Glen Construction sign was gone and in its place stood a new sign reading "Foulger-Pratt We Build to Last." While this wouldn't usually be something I would write about I thought it would be something interesting given the press release two days ago by Glen Construction in the Washington Business Journal.

Apparently Glen Construction, a company who has been around for nearly half a century, is going to be "closing" its doors come winter and is now down to a workforce of 12 employees, from an estimated 300 in its heyday. Locally, Glen Construction can be best known for their projects known as Rainbow Lofts and Georgetown Heights, two projects which epitomize quality in the construction industry. Recently, however, it seems like they have made some very big mistakes on their three current projects; 1010 Mass sold by McWilliams Ballard, Madrigal Lofts sold in-house, and the Metropole sold by DCRealEstate.com. The two greatest contributing factors to their demise was the slowdown in the high-end condo market and no having subcontractors ready to begin construction upon signing contracts with the developers. The latter of the two cause them to become victims to rising construction costs and slower construction scheduling, delaying both payments and project completion.

At the current moment, 1010 Mass is near completion and the project has been taken over by Faison Construction, who is suing Glen Construction for breach of construction and damages. Glen was not insured on this project. Fortunately they were on the Metropole, nearly 50% complete, and Madrigal Lofts, nearly 85% complete. Foulger-Pratt has taken over both projects in Glen Construction's place determining that "it was best to have another contractor complete the work."

The results of such poor planning will only cause turmoil throughout the chain of parties involved. From the sales companies, to the clients, a catastrophe like this is sure to lose a few clients for the developers and sales companies.

VIDEO UPDATE

5/5/08 "The Market & The Metropole"

Monday, September 24, 2007

Guess Who is the Newest DCist.com Writer?!? Take a Look!

CLICK HERE TO SEE THE ARTICLE

Old Soldier's Home Changes Development Plans

What if I said there currently is 272 acres of undeveloped land smack in the middle of Washington, DC. Its true! Soon there might only be 147 left. Its the land belonging to the Armed Forces Retirement Home, located in Wards 4 and 5, directly to the Northwest of the Washington Hospital Center. That huge plot of land fenced in by the six foot high iron fence. In a press released from the Defense Department, original plans for 9 million square foot development has been downsized to 6.5 million square feet, taking up nearly half of the available space on the lot.

Recently, the AFRH has seen significant financial troubles and is in a major need of renovation to the living quarters for the resident army Vets. Unfortunately, with the departments resources completely tapped out for other uses, it seems like developing the land might be the easiest and most profitable choice to maintain the home for Vets and soldiers returning from Iraq and Afghanistan.

The new plan includes 4.3 million square feet of mixed use development, 880,000 square feet of residential units with some retail and 750,000 square feet of residential and office space in a separate development. An existing 398,000 square feet will continue to be occupied by the retirement home.

This release comes just months after the approved plans for McMillan Reservoir, a 25 acre site on the exact opposite side of the Washington Hospital Center, approved for townhouses, condo buildings and retail/commercial. More info on this development HERE.

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Sunday, September 23, 2007

Marriott Approved for 1150 Room Hotel Across from Convention Center


This past Friday, negotiations between the DC Government and the partnership of Marriott International and RLJ Development was finalized and the redevelopment of two lots across 9th St NW are soon going to be an 1150 room Marriott Hotel.

So why is this so significant? For the past several months the partnership has been negotiating with the city to determine whether or not the hotel was as cost effective an investment as the parties had initially determined years ago when the idea was first proposed. Now, with construction costs skyrocketing and the hotel boom nearly ending, the once overly profitable venture didnt seem as bright. At first, the proposed 1400 room hotel was budgeted at $540 million dollars for total construction, including nearly $140 million dollars in tax increment financing. Currently, however, with the increase in construction costs and land aquisition both parties had to renegotiate their respective interests to compensate. Their current budget only allows for the new room quantitiy.

As an aside, tax increment financing is a tool used by governments to loan money on the basis of future collections for current development. The anticipation is that the loaned money will increase the property values of the surrounding areas thereby increasing taxes which will pay for the allotment of the loan offerred.

Additionally, the new agreement will offer the Washington Convention Center Authority over just about 80% of the availble rooms, which the city fought for as a tool for revenue generation. Additionally, one of the two lot owners where the hotel will be built has agreed to a land exchange and will receive a portion of the former convention center site, also known as the HUGE parking lot in the middle of downtown.

Construction is set to begin in two years, 8 months of which will be just in rezoning the two lots to its necessary code.

Deanwood & Development....Surprising Revitilization



video

Wednesday, September 19, 2007

Pricing for the market....

This morning I came across a thought out and accurate depiction of the real estate market in a CNN article by staff writer Les Christie and I had to post the link for everyone to read....

Trapped by the mortgage meltdown

Tuesday, September 18, 2007

DC Ranks 14th Among Nationwide Job Markets

According to the Washington Business Journal, DC Ranks among the top 15 strongest job markets across the country, behind some very unexpected cities. Among them is Tucson, Las Vegas and Orlando...three of the cities and states most responsible for the real estate meltdown over the past year.

At 14th, DC experienced private sector job growth of 38,200 in 2006 and its expected to grow to over 50,000 in 2008. A phenomenal feat for such a small city...think of the real estate demand :-)

The stats can be seen HERE.

20005

Considering Postponing Purchasing? This may be the best time.

As many of you have read in the past, most of the statistics available show the DC Metro area as one of the growth leaders for the upcoming year. From home values increasing 4% between July '06 to July '07, condo market maintaining sales and over 50,000 jobs coming to the region over the next 14 months, there is no cause for the local market to shutter the way much of the rest of the country has done over the past 12 months. On top of that, I am expecting the Fed to reduce interest rates another .25% today, thereby enticing purchasers to jump on the bandwagon. What I will say is I have noticed a slowdown in the market, back to what I hear it was like before the real estate boom, homes sitting for longer, and investors pulling out unless margins significantly in their favor.

With that in mind, these next 3 months may be the best time to purchase. I am expecting a strong spring market, at least stronger than what we have right now and declining inventory on the market. If we look at the following chart I created this morning, based solely from the stats available on MLS, we can see that historically October and January have the lowest number of sales.

(CLICK THE IMAGE FOR CLEARER RESOLUTION)


Taking the month of settlement into account and, generally speaking, the settlement day occurring 45 days after ratification, or contract acceptance by both parties, it would be logical to assume that buyers will have the most leverage in September and December and the least in February. Compare this to the rule of thumb when negotiating on a car....always negotiate the last 5 days of the month...it may be the perfect time to buy.

20005

Sunday, September 16, 2007

Tale of Three Cities - DC Real Estate March 07

A great video on the local real estate market.

Friday, September 14, 2007

Alexandria Follows Suit with Trolley System

Just yesterday Alexandria's city council approved the initial budgeting for King St.'s newest attraction, a trolley system. The trolley marks the beginning of the development of the areas newest 300 acre development just across the river, at the National Harbour.

The proposed trolley system will run ever 15 minutes at no charge as a hope to increase traffic and spending in the old towne area as the Harbour development begins to take shape. To make even more sense, the line will run between the metro station in Old Towne and the marina at the end of King St, to a recently approved ferry system between the marina and the National Harbour, just across the river.

At nearly $700k in operating expenses a year, all paid for by the city, the anticipated infrastructure had better work.

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Wednesday, September 12, 2007

I came across a post this morning...

Thanks to Sellsius' blog I could help by laugh my - - - this morning. Rudy and Joe, the writers, happen to have some wonderful and wonderfully creative ways of looking at the real estate market.

Here is a look at their post this morning...

10 Marketing Tips You Can Learn from a Prostitute

1. Attract the attention of your target market. You must do what you can to stand out from the crowd. A short skirt and high heels work to attract a prostitute’s client. (It may also help a blog post get read)

2. Market in the places your audience can be found. Whether it’s street corners or specialty publications and websites, get in front of your prospects’ eyeballs. Pros don’t attract clients in church pews.

3. Upsell. After getting a ready and willing customer, expose them to options they might not have considered. Turn a downtown trip into an around-the-world adventure.

4. Have a clever or catchy brand name. Call girls marketing under Fantasy and Desire usually attract more calls than Fanny and Mabel.

5. Offer a product or service people want or need. ‘Nuff said.

6. Make the transaction easy. The less forms and red tape the better. A simple in and out procedure works best.

7. Promise quality and good customer service. The promise may get you a one-time sale but good customer service will have them coming again back again.

8. If you want to charge more, offer something they can’t get anywhere else. Just like fruit, the rare and exotic always sell for more.

9. Have a call to action. Ask for the date. Be persistent.

10. Market happiness. Every client wants to walk away satisfied. Give them a happy ending.

Bonus Marketing Tip: Sex sells.

Caveat: There is, however, one thing you should avoid in marketing and sales: Screwing your customer.


The blog can be found HERE.

Tuesday, September 11, 2007

ADU showcase

video
A special thanks to Sam for hosting todays Appliance Distributors Unlimited showcase today, our newest developer resource partner.

ADU can be contacted at
729 Erie Avenue
Takoma Park, MD. 20912
301-608-2600
Ask for Heather

Shaw: The New Entertainment Hub for DC?


Broadcast Center One

In a publication released by Express Newspaper, word has it that the Shaw area, right near the Howard Theater, may be in talks to be the cities newest entertainment area, complete with window front news broadcasting, radio broadcasting and theatrical performances. So where does all this land needed come from...who else but Douglas Jemal, owner of the vacant Wonderbread Factory at the intersection of 7th & S St NW. According to the Washington Post writer, Dana Hedgpath, a renowned local developer, Chip Ellis, wants to revitalize an area know for "black culture and commerce."


The Facts:
Purchase Price of Building.......$21,400,000
Development Cost....................$100,000,000
Office Space...............................100,000 sq ft
Retail Space...............................23,000 sq ft
Condominiums..........................182 units
Lot Size (Just Factory)............(.51) acres
Current Total Tax Bill...............$73,098
Estimated Completion Date....Late 2010

Dana's Article can be found here.
The Express Article can be found here.

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Saturday, September 8, 2007

Coming This Week...HOW TO DRAW AGAINST YOUR DEVELOPER'S BOND MONEY AT DCRA

While this isn't the usual blog, I have recently been in communication from a past buyer who purchased at the Basilica Lofts, by Macy Development. My client has had nothing but trouble having Macy come back to fulfill their punch list items as agreed at settlement and in my opinion has had nothing but patience in dealing with the matter.

As a result I am going to be publishing a link on my blog this week describing EXACTLY how to file a draw against the bond money on file with DCRA. As a point of reference, the money is only available for the first two years after the initial purchaser settles on the condo as the first owner of the unit and the bond transfers to new owners.

Stay tuned, at some point I can only foresee that many of you out there will be needing this information.

As an aside, we never UNDER ANY CIRCUMSTANCES stand for a client with such disregard for not only their consumer base but for buyers who have purchased units in their building. What has been going on with Macy should not be stood for by anyone, anytime.

20005

DevelopersAgent.com Expands...New Features


This afternoon I, yes I, built the input tags for developers, home buyers and sellers to submit their real estate needs to myself and Ken Taylor Real Estate. Since it is so new I would love your feedback from the links to help improve my ability to respond to client needs.



Lets hear those thoughts!

Friday, September 7, 2007

8th St SE Commercial Strip Striving for Big Business

According to a release this morning by the Washington Business Journal, the local property owners of the 8th St Corridor are looking for new national retailers to help boost traffic to the so called "Barracks Row" while still maintaining the local presence of sole proprietors and restaurateurs from Capitol Hill.

According to Gillian Gaynair, a staff writer for the WBJ, many of the property owners and businesses are in search of a mainstream clothing retailer such as J Crew, the Gap, Ann Taylor or American Apparel to occupy one location on the streets 5 blocks of dense commercial blocks. Why these types of companies? Barracks Row businesses feel companies of this caliber would satisfy the local consumers need for a clothing retailer where one currently does not exist and keep revenue generation closer to "home." Currently the next closest location for clothing is 15 blocks away at Union Station, which may not sound like much but for someone looking to walk to everything and who may not own a car, a trip to Union Station may be quiet a trek. To continue the thought, imagine where this city will be in 5 years. Traffic is going to be horrendous, taxi's may be more difficult to come by, and for someone considering the trip to Union Station to be too far, consider the difficulties in 5+ years. Think of where New York City was 20 years ago compared to where it is today. If there isn't a drug store & a Starbucks within 2 blocks, you may as well live in New Jersey.

20003

Reversal in Positions in Tri-'state' Area in Foreclosure Rates

According to data released yesterday, the local DC area is finally feeling the effects of the sub-prime fallout, though marginally compared to the rest of the US. As reported in a previous blog titled "Local Housing Market Stable" reports initially suggested that home prices were up 4% between July '06 and July '07 however the new report proves otherwise for the month of August.

Here are some examples the report offered...

In NoVa, including the cities of Arlington, Alexandria, and Fairfax, home sales (settlements) were down 5% from the previous August, still much better than the states decrease at 11%. Surprisingly, average settling home prices are UP from $476,450 last July to $480,000 this year. Not bad for a downturn in the market.

In DC, prices have come up from $417,000 to nearly $431,000 in the same time frame. (Refer to the above blog link for more details)

Additionally, for the three 'states' foreclosure filings and delinquency rates were as follows
.............Foreclosure Filings.........Delinquency rates
DC...........0.59%.......................2.2%
VA...........0.51%.......................1.9%
MD...........0.66%.......................2.0%


Keep in mind that if you ask any experienced real estate agent, August happens to be the slowest month of the year for buyers. With the collaboration of the school year starting, to the new year at college and the ending of summer vacations, external factors may have contributed to the recently released statistics.

20005

A special thanks to David Francis of the Examiner for bringing the studies to our attention and to Mario Gabalda at FBW for sending me the link.
HERE.

Thursday, September 6, 2007

Wednesday, September 5, 2007

Mortgage Rates for the past 30 years


I just got an interesting image from my good old friend Mario Gabalda, from Ferris Baker Watts. I thought I would share this graph of the history of mortgage rates for the past 30 years. As you can see we are close to historical lows.

Dupont Down Under to REOPEN its Doors, er Staircases!!!


This past week a great friend of mine & I decided its about time someone committed to reopening that HUGE retail space right underneath Dupont Circle. For those of you who have no idea what I'm referring to, there is 28,000 sq ft of retail space right underneath the Dupont Circle streets, extending from the building foundations at the outer edge of the circle to the fountain in the middle, of which two halves are split by the Connecticut Ave underpass. Next time you are in the area take a look at the 7-8 stair cases boarded up by green boards that somewhat resemble metro entrances, located at nearly every corner of intersecting streets at the circle. As a point of reference, there is one located right next to CVS.

...back to the opening of Down Under...

About 11 years ago two city inspectors shut down the retail space due to health violations and several illegal practices taking place by the vendors in the space and it has been shut ever since. Those inspectors were the head of zoning, Vincent Ford, and former code inspector Jim Delgado. As an advocate for the development and improvements for the city, I have decided to commit to the reopening of the space under Dupont myself...which got me thinking...who better to enlist to help reopen the area than the two gentlemen that shut the area down. Nobody knows the violations of Dupont better then Delgado and Ford. Its simply impossible. I called Delgado this past week and he's in! I'm not sure how far we will get but what I can say is that if anyone is going to reopen Down Under, its going to be us.

For more info on the space, read a previous blog of mine HERE.

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What we do not know is what would be the best use of space. Have ideas? Post your comments below.

Barry Shuns Fenty in Rejection for Poplar Point Bid by MacFarlane


In an article released by both the Examiner and WUSA9.com, apparently Ward 8 Council Member (and former Mayor) Marion Barry shunned Fenty for his rebellious actions in submitting an RFEI, request for expressions of interest, globally for developers to submit proposals for the development of Poplar Point. As mentioned in two previous blogs, Poplar Point is a 150-acre site, of which 130 acres are available for the RFEI and 110 acres are able to be developed. For years the site has been set to be turned over to the owner of DC United and nationwide developer based out of California, MacFarlane Partners, until recently. According to both articles, neither Barry nor Ward 8 (where the lot is located) will support anything but the new DC United stadium on the site, which was previously believed to be at a total development cost of nearly $150 Million. Recently, however, Fenty has had a change of heart when he released the RFEI, requesting developers to submit proposals totaling no less than $200 Million, which will include at least 30% affordable housing units and 20 acres of protected park land.

The Poplar Point project is part of a $10 Billion project named the Anacostia Waterfront Initiative.

Poplar Point also happens to be just 2/5ths of a mile from Stuart Kushners proposed project on Pomeroy Rd SE, known for his recent condo conversion at 1817 24th Pl SE. The proposed project will most likely include 12 duplex 2 bedroom condos at 1000 sq ft each with parking. Plans will be upload soon.



For more information about the Poplar Point Project click HERE.

20020

Monday, September 3, 2007

Gentrification: DC Could Lose is Black Majority Status

Over the weekend a report was released stating that if the population in DC continues its current rates, blacks may no longer have the majority of the city in 10 years time. One source, William Frey of the Brookings Institute, said that DC is one of the few cities noticing such a rapid change, and with reason. If we take a look at the past two census surveys released we will see the dramatic change that Frey mentions in his report. I found the surveys online at census.gov, who's studies show that between 2000 and 2005, the black population of the city decreased by 3%, from 60% to 57%, while the white population increased at 1%, from 31% to 32%. If we assume that the ratio of growth for both loss and gain will increase on an annual basis we can see that my estimates for the year that there may longer be a majority in the city will fall somewhere in between 2014 and 2018.










Its seems like gentrification may be inevitable for this city.

The census data can be found HERE.

20005

Sunday, September 2, 2007

The Secret is About to be Revealed!!

This past week my broker, Ken Taylor, or the man known as KTRE, came up with an incredible idea about marketing our team and helping our developers sell more property faster. Too good to be true? We might just have the draw of first mover advantage on our side. On top of our streaming web-cam developments being introduced around the city over the next 4-6 months on all of our upcoming projects, Ken's newest idea should put us on the map. Our target? Nothing but the biggest developers across the city. Influenced mostly by a very good friend of mine, Nick O'Neill, developer and owner of allfacebook.com, who is about to go after his first $5,000,000 investment, I too am pushing toward success.

As the site says, this is all about developers, development, investors and those interested in the city, our city, and harnessing the future potential to the fullest. In meeting with developers, besides the constant need to stay in touch, I find myself making references to newly publicized and newly permitted development projects across the city and I cannot help but question why none of my clients (and soon to be clients) usually have no idea what I'm talking about.

Why is this? My theory is that once put in a direction, most developers are so focused on their own projects that they seldom have time to venture outside of their path of travel. Which leaves the position of their real estate agent(cough!) to help guide them through the process of development. As weeks have gone by and meetings with clients become more frequent as we become more involved with projects, I cannot help but create solutions to gain more market share of developer's projects or ways to contact more developers faster.

As a result, I am having DC's first ever Developer Seminar this November. It is planned for the second week in November and we are expecting quite a panel. From former code inspectors to heads of zoning, to real estate attorneys and banks, our forum should allow for direct access to some of the most influential & most respected individuals in the development field. More info on the panel later but if you have interest in attending the seminar, please notify me via email at jkaye@ktrealestate.com.

20005