Slowed Down, but Planning Big
Monday, March 10, 2008
Perhaps nowhere else in the Washington region has the real estate slowdown come to roost more than Prince William County. And yet developer Robert C. Kettler continues to have faith in the slumping eastern corridor of the county.
Kettler, head of the development firm that bears his family name, won approval during the recent housing boom for a plan to transform the area into an upscale Potomac River community featuring a luxury town center, 4,000 homes and a 400-slip marina.
He's already sunk $200 million into Harbor Station to assemble the land, build roads, lay sewers and construct an 18-hole golf course designed by Jack Nicklaus -- setting the table for work to begin on actual buildings.
Then the mortgage meltdown hit. Credit markets seized up. And work stalled, another casualty of an economic slowdown that has put more homes into foreclosure here than anywhere else in the region.
Kettler has been pressing to make progress ever since.
He's still negotiating to sign a builder to put up the project's first rooftops. He's stuck in talks with Marriott to run a hotel and conference center that bears its name. He's working on bringing an upscale grocer.
One bright spot: He's secured public financing to build the Cherry Hill commuter rail station.
"The project is in a holding pattern due to capital market disruptions in investment real estate," Kettler said. "The housing and town center components will begin when we can launch several product lines simultaneously."
Like other big developers in the region with projects underway, Kettler has little choice but to ride out the slowdown and hope he can be in position to cash in when the market recovers.
"In the land business, if you look at it as short term, you are dead. This is still the single best piece of land I've ever bought with the most potential of anything I've ever bought, period," he said.
Still, he has made perhaps the biggest bet of anyone on the eastern corridor straddling Route 1, and many have retreated. Two Giant grocery stores are closing this spring because of slow sales. Indoor flea market Hi-Mart is half vacant and trying to reinvent itself.
If there's hope, it's in recently announced plans for luxury condominiums near Kettler's mega-project, by a firm involved in the development of the Watergate complex. Elsewhere in the area, a Wegman's high-end grocery is on track to open soon.