By Dina ElBoghdady
Washington Post Staff Writer
Friday, March 24, 2006
The historic warehouse built by the Hecht Co. on New York Avenue NE about 70 years ago will be shut down by the department store's parent company next spring, eliminating all 250 jobs there.
Employees will be laid off or offered positions at other company locations. Those who lose their jobs will receive severance packages and outplacement services, the company said in a statement.
The decision to close the six-story, art deco warehouse is the latest in a string of cost-cutting measures at Federated Department Stores Inc. since last year, when the company purchased rival May Department Stores Co., the former owner of Hecht's and Lord & Taylor.
Since then, Federated has been firing workers, shutting down stores and consolidating operations. Earlier this year, the company said it plans to eliminate 595 jobs at the soon-to-be-closed Hecht's headquarters in Arlington.
Yesterday's announcement creates opportunity for developers interested in staking claim to property in the gritty, but some say upcoming, Northeast neighborhood. In a statement, Cincinnati-based Federated said it plans to sell the building "so it can be productively reused or redeveloped."
The warehouse -- bounded by New York Avenue to the north, Okie Street to the south and Fenwick Street to the west -- was built in 1937, expanded four times, and revamped by Hecht's to the tune of $10 million in 1992, the same year it landed on the D.C. Inventory of Historic Sites. Two years later it was listed in the National Register of Historic Places.
Federated wants to get rid of the building because it has too many distribution centers, said Sharon Bateman, a company spokeswoman. The New York Avenue warehouse "is highly inefficient" because it has many floors, making it difficult to move merchandise around, she said.
The merchandise, mostly apparel, will be moved to Federated warehouses in Joppa, Md.; Secaucus, N.J.; and Stone Mountain, Ga., when the D.C. center closes in April 2007, Bateman said.
In the District, city officials and developers said they are confident the building will find a buyer.
D.C. developer Douglas Jemal said he is already eyeing the 725,000-square-foot building, with its glazed brick facade and distinct glass tower.
"I certainly am extremely interested in it," said Jemal, who has redeveloped run-down areas near the Verizon Center. The building's appeal is "the fact that there's a limited amount of space in a city that's 61 miles square, and development has been gravitating east."
In 2002, Jemal renovated the old People's Drug Stores Inc. warehouse on New York and Florida avenues NE and converted it to office space, making him one of the first developers to risk rebuilding in the aging industrial neighborhood.
Other ventures sprouted. Across from Jemal's development, the new headquarters for the U.S. Bureau of Alcohol, Tobacco and Firearms and Explosives is under construction on a lot once used to store public works department vehicles. In 2004, the city opened the New York Avenue Metro station on the Red Line.
And now D.C. developer James Abdo plans to build mostly housing on 15 acres he has cobbled together at New York Avenue and Bladensburg Road, not far from the Hecht's warehouse.
City officials say they hope these ventures will help transform the corridor into a bustling center for government, commerce and homes and serve as an eastern entrance to downtown.