A Transformed Neighborhood Awaits Stadium

How his co-ops will sell is a bit of an unknown. He is the first residential developer to build in the area in years. Stein said he expects to market the project to workers at the new transportation department headquarters, the nearby Navy Yard and on Capitol Hill.

"Everybody's waiting to see how we do," Stein said. "Then they'll be right on our heels."

Much more development is coming.

A half block from Stein's co-op and hotel project, Irving, Texas-based apartment developer JPI plans to put a residential and retail complex on some of the land it bought last week from Chernoff near First and I streets SE, now home to a strip club, the Nexus Gold Club. Nexus will probably be torn down in a year or so; Ron Hunt, manager, said he's looking for another location in downtown D.C.

The big Bethesda-based developer Lerner Corp. is starting on an office building at Half and M streets SE, in the midst of empty lots and run-down buildings. Monument Realty LLC of Washington is also planning a large mixed-use development on land it owns near the stadium site, on N Street between Half and South Capitol streets. And a few blocks away, on I Street SW, Centex Homes of Dallas plans to build about 300 condominiums and a new home for the Corcoran College of Art and Design in a building once occupied by a recently closed homeless shelter.

As decay gives way to dollars, tenants and landowners who once might have longed for a few neighborhood improvements are feeling more anxiety than relief. It's all moving at unnerving speed.

"This area is going to be developed, and fast," said Tony Meeks, as he locked up his fence on a rented lot across from the Nexus Gold Club. He helps his father run a firewood business there, selling oak and hickory to downtown restaurants for their brick ovens. He's unsure what the absentee landowner is thinking.

"You see them coming to do percs of the ground all around here," Meeks said, referring to soil percolation tests. "We're trying to hang in there, but I'm sure the offers are coming for here." He is looking for another location, most likely outside the Beltway.

Still, a sense of community pervades the run-down blocks. An after-school program for at-risk kids, which sits on New Jersey Avenue SE across from Valhal's large project, gets its vans fixed at a garage around the corner. And much of the news about impending development comes not from the property owners but from the neighboring tenants who lease the space and watch the comings and goings of prospective buyers. The suits are coming, they say, when developers are on the move.

Jennifer Murphy, who runs the after-school program, said she's not sure what will happen to her building and a grassy lot next to it where her landlord lets the kids play ball. The last she heard was that the property was fetching offers of roughly $3 million.

"We're getting a little nervous because it's hard to know what's going to happen around here," said Murphy, whose program serves about 70 kids a year. Many of her students, whose families make an average $15,000 a year, once lived in the Arthur Capper/Carrollsburg public housing project two blocks away.

After the project was closed, many of the residents were given federal Section 8 subsidy vouchers to move to other low-income housing projects. Housing advocates said some went to projects east of the Anacostia River, and others ended up in projects in Prince George's County.

Murphy said she now has to bus most of the kids from far Southeast to her summer camp and after-school program.

"I don't think we'll be serving too many Section 8 kids from in there," Murphy said, as she looked up at the tall, brick and glass Valhal project. "I'm crossing my fingers that we can stay here."

Newsroom intranet editor Jacqueline Dupree contributed to this report.