From the Ground Up

NoMa Nears a 'Mind-Shift'

Construction north of Massachussetts Avenue is taking off, yet who will move there remains uncertain, with many private companies still considering the area remote. Capitol Plaza I, shown here at 1200 First St. NE, has no tenants.
Construction north of Massachussetts Avenue is taking off, yet who will move there remains uncertain, with many private companies still considering the area remote. Capitol Plaza I, shown here at 1200 First St. NE, has no tenants. (By Alejandro Lazo -- The Washington Post)
By Alejandro Lazo
Washington Post Staff Writer
Monday, November 26, 2007

Developing the District's NoMa neighborhood has been on the minds of builders and planners for years. Now those visions are moving closer to reality with several construction projects.

NoMa -- North of Massachusetts-- sits above Union Station and between the Shaw and Capitol Hill neighborhoods. For now, it is little more than a collection of empty lots and a few scattered office buildings, but developers envision a neighborhood eventually with offices, restaurants and apartments.

"We are really one phase away from a real, wholesale mind-shift in what NoMa is," Liz Price, president of the NoMa Business Improvement District said last month, looking out from the 10th-story windows of a new building, Capitol Plaza I.

Visions for NoMa have ranged over the years from artistic haven to technology hub, but none of those aspirations have materialized as developers focused on the downtown core. With the heart of the city now a vibrant business and entertainment center, developers are looking hard at NoMa.

Yet who will move there remains uncertain, with many private companies still seeing the area as too remote. NoMa also faces stiff competition from several new projects along the Southeast waterfront, real estate brokers said.

Three major projects in NoMa have broken ground this year. New York-based Tishman Speyer has begun work on two office buildings on the corner of First and M streets NE. The Cohen Cos. started construction on 225,000 square feet of apartment buildings at 250 K St. NE. And Florida-based Finvarb Group is building a Marriott Courtyard Hotel on Florida Avenue and Third Street NE.

NoMa already has several major tenants. XM Satellite Radio has been there since 2000. The Bureau of Alcohol, Tobacco, Firearms and Explosives moved its headquarters to the intersection of Florida and New York avenues in 2006. And the U.S. Equal Employment Opportunity Commission is moving into One NoMa Station, the renovated former distribution center for long-closed department-store chain Woodward & Lothrop.

The neighborhood is considered a contender for other major deals. The Justice Department is looking to rent more than half a million square feet in the District for 1,200 employees in its criminal division. National Public Radio is also looking for a new headquarters and is considering NoMa.

Yet the law firms and other private companies that account for most of the District's commercial leasing are not ready to make the leap to the still-developing area, said Tom Fulcher, a broker with commercial real estate firm Studley.

"Well, if you just imagine being in a building there, you're not going to see too many other people," Fulcher said. "They want their employees to feel comfortable, to feel safe."

Amenities and security are issues. The area has few restaurants, shops or grocery stores, and new sidewalks, lights and trash bins have been installed only recently.

Price has begun work to combat the image of an isolated, dangerous part of the city with a neighborhood cleaning campaign, led by the BID. The organization removed 2,400 bags' worth of trash in October alone, with part of that effort providing employment for the homeless, she said.

While Price agreed that higher-end tenants were likely to wait out any move to the area, the relatively low asking rents and close access to the new Metro stop at New York Avenue made it a competitive area for others, she said.

Alejandro Lazo covers commercial real estate. His e-mail islazoa@washpost.com.


© 2007 The Washington Post Company