Friday, November 16, 2007

Harris Teeter Coming to a Corner Near You (New York Ave Metro)

Thanks to the Bloomingdale (for now) Blog, we have been informed by the ANC Commissioner, 6C05, Alan Kimber, that Harris Teeter ****MAY**** be headed to 1st & M st NE, in a recently approved PUD named Constitution Square. Currently, however, nothing has been documented in reference to a signed lease. The basis for the new location comes as the grocer backs out of a non-binding commitment they had for another location at 3rd & H st NE.

From DCist...

"Harris Teeter had originally been interested in an approx. 40,000 sq. ft. space at 3rd & H Streets NE owned by Stuart Development, but the grocery store chain has since pulled out of its non-binding agreement with the developer in favor of the New York Ave. Metro location. The PUD for the 3rd and H space was approved in part on the premise that there would be a full-service grocery store in the development, so Stuart Development has apparently been pursuing a variety of grocers, including Trader Joe's, but no company has committed to lease all or part of the space for a grocery store yet."

Harris Teeter in Adams Morgan Schedule to Open March '08

Its official, this week the it was announced that the Harris Teeter at 1631 Kalorama Rd NW will be opening in March of '08.

Refer to Whats one of the most important developments in Adams Morgan right now?

As a result the DC Dept. of Transportation will begin implementation of a new one-way street grid starting in January of 2008 in order to accomodate the ease of new traffic due to the opening of the grocer.

The new configuration will be as follows...
1600 block of Kalorama Road traveling West.
2500 block of 17th St. traveling North.
1600 block of Euclid St. traveling East.

Thursday, November 15, 2007

MacFarlane Never Stood A Chance for Poplar Point

As of last Thursday, the city received seven proposals for Poplar Point, two of which had DC United in mind (see Poplar Point RFEI Draws Seven Proposals).

This morning I had the privilege of attending Marcus & Millichap's annual Investor Symosium where, surprisingly, both the Deputy Mayor for Planning and Economic Development, Neil Albert, and a Principal for MacFarlane Partners, Bradford Dockser, were panelists, and I had the opportunity to ask, first hand, what the future held for the team and why the team did not submit a bid for Poplar Point. Originally I thought it was the pride of MacFarlane in response to the actions that were taken by Fenty against the team, however Brad's response to me was actually much clearer than originally thought. The simple fact was that in order to submit a bid, you must be a developer. MacFarlane Partners is not (however, JBG is, and MacFarlane just acquired 50% of JBG's portfolio. The acquisition could have provided a substantial option for the team but wasn't utilized).

Additionally, after meeting with Brad, I approached Neil and posed the same question about the site regarding the proposals that were submitted. His response was that they are reviewing four of the seven in serious consideration for the project and that two of the four did incorporate DC United as the main attraction for the site.

Only time will tell where DC United chooses as their new site. In my opinion, DC Government would be ridiculous not to choose to incorporate the team at the new site, risking not only losing a main attraction to the city but upwards of hundreds of million dollars in tax revenue from the ticket sales of the team itself.

Wednesday, November 14, 2007

Another Condominium Goes Rental

Donatelli Development already has seven retailers signed up for their retail spaces on the ground level. Unfortunately, thats about all of the success their recent development has had. Their newest building, Highland Park building in Columbia Heights at 14th & Irving, "features 229 luxury residential units, [222] underground parking spaces, a beautifully landscaped rooftop with panoramic city views," and was being represented for sales by Domus Realty.

Sadly, this project is the first of Donatelli's that has had to undergo the change back into rentals as they need to generate income to subsidize their loans. Their past projects, the Ellington on U St NW and Kenyon Square just across from Highland Park.

The retailers include:
Potbelly Sandwich Works
Five Guys Burgers
Fries and Pete's Apizza
CommonWealth, a British Pub
Zinnia, a Caribbean restaurant
Signal Financial Federal Credit Unio
Boundless Yoga

Tuesday, November 13, 2007

Metro Sells Land at Takoma Metro

This past week WMATA agreed to the sale of a 6.8 acre parcel at the Takoma Park Metro stop to famed developer EYA. While the project plans that EYA must be approved by both the Federal Transit Administration and the District’s Office of Planning, EYA's history of successful planning and development should prove them worthy to continue. Their plans include 85 townhouses, each with two-car garages. Under Federal Law, Metro is allowed to sell their surplus land only if the buyer's development will increase ridership and therefore income for the system.

While some local residents felt that the sale and future development will only increase traffic congestion and endanger residents who walk to the metro, others felt that the sale should improve the neighborhood and local businesses.

EYA's current, future and past projects include
Hyattsville Arts District (Current)
Centerpointe (Current)
National Park Seminary (Current)
The Brownstones at Park Potomac (Current)
Harrison Square (Past)
Capitol Square (Past)
McMillian Reservoir Development (Future)

Monday, November 12, 2007

DC's Circulator Bus Route to be Expanded

As development across the city brings resident density fluctuations of owners to new parts of the city, accommodations must begin to be made...DC is doing a fine job of adjusting. Between the addition of the Purple Line connecting Bethesda and Silver Spring (I know they are in Maryland) to the addition of the two new trolley routes in Anacostia and H St, it would seem as though most of the transitioning areas are covered. However in light of recent development projects such as the new stadium site in Capitol Hill and the Washington Convention Center, additional accommodations are in the works.

Today, WMATA announced the addition of two new Circulator lines in the city. The new routes will connect Union Station to the new Stadium site in Southeast and the Washington Convention Center to Adams Morgan. The city emphasizes that the new routes should aid the developing areas revitalize more rapidly.

They are expected to begin their new routes in Q3 of 2008.

Forget EVERYTHING I Just Wrote

The Washington Business Journal contradicts everything I just said. According to their recent report, prices this October in the immediate DC area are UP when compared to the same period of time in October, 2006.

The largest jump in prices were most notably increased in Arlington and Alexandria...cities known locally to predict the future of the DC area. Well, how can this be? In the previous blog post CNN Money predicts home prices to fall 25%, Moody's predicts prices to fall 12-14% and I expect increased losses through the end of March, 2008. WBJ's report proves us wrong. According to the article,

"The average selling price for a house in D.C. rose nearly 6 percent to $499,526 as compared with the city's prices in October 2006. Alexandria prices increased 6 percent to $490,476 and those in Arlington jumped 7 percent to $556,517. In Montgomery County, homes cost on average $317,221, up 2 percent from last year."

I don't understand it very much either...

AAAAHHHH!! When Will it End? Prices Expected to Fall 25.1%


This morning while flipping through my RSS feeder I came across a disturbing prediction from CNN Money. Actually, disturbing doesn't even begin to describe the reaction from their analysis for the price decline in the DC Market. According to a November 11th article titled "25 Real Estate Markets Poised to Fall," DC ranks number 10 out of 25. The majority (80%) of the other markets consist of California and Florida.

Now the news...
CNN Money expects DC area prices to decline another 25.1% over the next five years with the home price/rent ratios currently at 26 when they average in the 16 range. Their disclaimer under the article states: "Note: People typically won't spend more in monthly costs to own a home than they would to rent. While prices soar from time to time, sending the ratio to exceptional heights, the relationship eventually should return to its historical average."

While this may be some of the most shocking and quite ridiculous news I have heard in a while, one cannot help but to call it a complete overestimate for falling prices. In a recent Moody's study I read commissioned by Countrywide Home Loans, they predict prices will fall until quarter 2 of 2008 and bottom off, and losses may sum up to another 12-14% from this past July.

The big picture...

While I do believe that prices are a bit overinflated, there is a bit of skepticism as to how much further prices may fall. During the next 12 months...
-17,000+ soldiers are returning to Ft Belvoir from overseas
-50,000+ additional jobs will be coming to the DC area, mostly governement
-the US government will have a complete turnover of positions

This may not seem like much when compared to the area, but when compared to the population of DC, currently at 581,000+, a 9%+ increase in job growth will have a significant affect on the local market. I do realize that many if not most of those who will be employed will not live in the District, but even 20% of those new employees living within the city limits will have a significant effect on the market.

Sunday, November 11, 2007

Poplar Point RFEI Draws Seven Proposals

As many have been following the recent stories regarding the fate of one of DC's last 100+ acre sites, Poplar Point may not turn out the way many had originally thought. For three years now the owner of DC United, Victor MacFarlane, and city officials have been negotiating the price the owner would have to contribute to develop the site DC United's new stadium. At least until Fenty. Months ago, when Fenty and MacFarlane were unable to come to common terms as to the cash input MacFarlane would need to contribute to develop the site, Fenty publicly announced his intent to allow other developers the opportunity to submit their proposals for what they would do with the prime piece of property. As of this past week we have seven interested parties. According to the Washington Business Journal, those parties are:

  • Archstone-Smith, one of the developers of the old convention center site, and D.C.-based Madison Marquette
  • Clark Realty Capital, based in Arlington, which has done mixed-use developments at Fort Totten and the Vienna Metro station
  • Forrest City Enterprises, based in Cleveland, developer of the Yards in D.C. and other property around the Washington Nationals ballpark
  • A three-member team formed by General Growth of Chicago, Mid-City Urban LLC of Silver Spring and Doracon Contracting of Baltimore
  • City Interests
  • Urban-City Ventures LLC
  • Capital Area Regional Center Jobs Fund
As you can see, MacFarlane is not on the list. Now, council member (and former mayor) Marion Barry, wants his voice heard. He feels that the cities long-term negotiations with the team should continue and the new site would be ideal not only for the team but for the economy of Anacostia.

As a result of the RFEI, MacFarlane met with the comptrollers from both Virginia and Maryland in an attempt to find a more suitable site outside the city. No information has risen as to whether or not his plans to leave will continue.

A Bit Shocking at Best! 2110 11th St NW; The Beauregard

Thanks to JustNewListings.com, we have some insight on to a former Ken Taylor Real Estate development and the disappointment of one buyer. According to one reader of the blog, the recent purchaser settled on a unit at the breathtaking Beauregard Condos at 2110 11th St NW. They described their experience with Robertson Development...
" I am in need of a DC Real Estate Attorney not a settlement agent. My client purchase new construction 7-8 weeks ago and everything you can possibly think of have happened since they moved in. The unit has flooded twice because they forgot to connect the pipes in the walls in the utility room and to the washing machine, the living room ceiling is leaking even though the unit above is vacant, for 2 weeks they could not park in the space they paid, a contractor was at the unit to repair something and scratched the granite, there is a bad odor coming out of the pipes in the bath room etc……. I understand that there are a number of the units with the same flooding “pipes” problems."

The blog post goes into three more unsatisfied owners.

What makes this situation marginally laughable is the fact that when my broker, Ken Taylor, withdrew the listing contract, their representation only became worse...and they have only reduced their $500k+ prices by $2500 despite the market change.

Good luck with those sales.

Wednesday, November 7, 2007

Radio-One Profits Fall 40%



In an article released by the Washington Business Journal, Cathy Hughes, owner of the Radio One empire of 50+ radio stations may have already seen its best days.

The cause? An ever increasingly competitive listening audience may just not be tuning that dial to radio anymore, or as they put it "a challenging radio industry environment." I for one haven't listened to the radio in years. Between the music hard drive I have in my car to streaming music from Pandora or Musicovery to my laptop and bluetoothing it to the car, radio may just be a medium of the past.

Who cares!

Well, Cathy Hughes already signed a lease for Broadcast Center One at 7th & S Sts NW, that half-acre former Wonder Bread factory thats about to break ground next year. With profits down nearly 40% in one quarter, who knows what the future may hold for the lease-holder of Douglas Jemals property.

Is H St the next U St? You better believe it.

As many of you seen the articles about development on H St NE, this hot-spot of development shows more promise than most of the entertainment and shopping strips anywhere else in the city...with the exception of a few.

According to a Bisnow.com article, H St will prosper in more ways than one can imagine...
1-proximity to Union Station/Amtrak
2-proximity to Metro Rail
3-dense retail and shopping
4-upcoming trolley line in 2009
5-DEVELOPMENT (Landmark Lofts & Senate Square - Rentals)
6-DDOT "Great Streets" initiative will invest $30 Million in improvements
7-height restriction limits
8-property value

On top of what going on at H St, with in several blocks are some of the cities largest developments, including Douglas Jemal's Uline Skate Arena at 3rd & M St NE, the Marriot Hotel at New York and Florida Ave, the ATF Building, & Akridge's proposed condos at Union Station.

This is one place I would keep my eye on over the next two years.

6 Hours Left to Bid


Monday, a house began being auctioned off by Bid4Assets.com, which was seized several years ago by the U.S. Marshals for drug trafficking.

According to the Examiner, "As of Monday afternoon, there had been one bid of $235,300 placed on the three-bedroom, 1 1/2 bathroom row house located at 714 Madison St. NW. The D.C. Office of Tax and Revenue values the property at more than $460,000. Similar homes in the neighborhood have sold for as much as $520,000 in the last few months."

I would price the home a bit closer to the $380k range...so if this bidder wins at $235k (which is still the highest and only bid), the purchaser may walk away with a nice check.

The auction ends today at 2 PM.

The Rumors are TRUE


While driving down H St NE yesterday coming from Benning Rd towards Union Station I looked up to the right...to the recent development named Senate Square, but the sign I saw was not the same sign seen flying high last week. This new sign said "APARTMENTS!" What? Thats right, Senate Square Condos has gone Luxury Rental. Take a look.

And now the Senate Square site is SenateSquareTowers.com, advertising their luxury rentals. I wonder what happened to the buyers that already settled?