Bid to Buy Community Near Bethesda Aborted

A developer who offered to buy an entire neighborhood near downtown Bethesda has dropped his plans, saying that neighborhood holdouts, reluctant county officials and a weakening real estate market made it impractical to pursue the deal.

Jeffrey Neal of Monument Realty told Sacks residents he was ending his efforts to buy the 60-home neighborhood of single-family brick houses in Chevy Chase, near the Bethesda Metro station. Neal had wanted to tear down the houses and turn the 12-acre tract into a dense collection of high-rise buildings that probably would have included luxury apartments, stores and restaurants.

Neal told residents over the weekend in an e-mail that 39 homeowners had agreed to sell but that he needed more to make the deal work. He had offered about $2 million a house, with the amount depending in part on the timing and terms of the sale.

He also said the prospects of getting zoning approval soon seemed dim.

Neal did not rule out the possibility of renewing his offer in the future, but he said yesterday that it is up to the neighborhood.

"It didn't work out. We don't have 60 sellers. It is way beyond my ability to predict whether these owners would reconvene to do something again," he said.

Montgomery County officials also had been cool to Neal's proposals, saying they would require a zoning change that the county might not be eager to allow.

The tree-lined Sacks neighborhood dates to the 1930s, when sleepy Bethesda was beginning to become a Washington suburb. It is bordered by Bradley Boulevard, Woodmont Avenue and the Capital Crescent Trail. Townhouses and low-rise apartments are prevalent south of the neighborhood, and north of it are high-rises and retail establishments.

The 1994 Bethesda master plan called for the neighborhood to remain a low-density green buffer as it promoted denser, taller development near a planned southern Metro entrance. To create what Neal wanted, politicians, planners and residents of nearby neighborhoods would have had to approve changing the master plan, a process that can take years.

Neal's offer held the promise that some in the neighborhood who had lived there for decades could become millionaires. When Neal first floated the possibility of buying the neighborhood last spring, he spoke of paying residents as much as $3 million a home. Last fall, as the real estate market weakened, Neal formally offered owners less, depending on the appraised value of their homes and when they were willing to sell.

Neal's proposed development could have created another Rosslyn or Friendship Heights, where battles took place when high-rises replaced small-scale neighborhoods. Aside from residents of the Sacks neighborhood, others in Bethesda and Chevy Chase were watching warily, wondering whether their neighborhoods of single-family homes might be the next target of a developer seeking to rezone.

Alicia Wattenberg, who had helped organize Sacks residents to oppose the deal, said she was glad it was over. "I am delighted, of course, and a little bit chagrined that it took so long," she said.

Although Neal entered the picture last spring, a group of neighborhood residents who favored selling out as a group had been working for more than three years to find a buyer and put together a deal.

Marie Dray, who headed a group seeking to sell, said Neal had been put off by "Swiss cheese" -- a lack of contiguous sellers -- as well as the likelihood that getting a zoning change would be difficult. She said that some of those who had held out simply preferred the lifestyle in the neighborhood. Others were absentee owners, leaving her to question whether the neighborhood really had "the same family-friendly feeling" as it did in years past.

Many residents who decided not to sell said they relished what they called a neighborly community, in walking distance of a vibrant urban area.

"I have everything just where I need it now and just what I need. I didn't want to change it now," said Karen Diamond, an avid gardener. "There are some things the dollar can't compensate for in the quality of life."

Robert Smythe, head of the civic association, said he thought Neal had worked hard to make the deal work.

"I am sure he has bigger fish to fry. It would have been a good deal for him at the price he was offering, and a good deal for people who lived here, if they were going to move away from this expensive area."