The 818-unit Willoughby apartment complex just outside the District line in Friendship Heights, Md., will be converted to condominiums, tenants in the project were notified yesterday.
In a series of transactions, The Willoughby has been sold by its present owners, a partnership headed by New York real estate magnate Harry Helmsley, to a company controlled by Washington developer Milton A. Barlow.
Barlow in turn will resell the project to First Condominium Development Co. of Chicago. First Condominium Development then will sell the individual apartments.
Barlow took over the project last week, paying a reported $35 million. How much First Condominium will pay him has not been disclosed. Estimates are the final sale of the apartments will bring upwards of $70 million.
Under Montgomery County law, tenants in rental apartments that are converted to condominiums have a legal right to buy their units. Willoughby tenants will be given a chance to buy their apartments for 15 percent less than prices charged to outsiders, said Aaron Michaelson, president of the Chicago condominium conversion firm.
Michaelson said his company will not take title to The Willoughby until February of 1982, or perhaps later, depending on market conditions. He said the plan is to begin offering individual apartments for sale in the next few months, with those sales to be closed a year from next month.
Completion of the sale is being deferred for a year, Michaelson said, in the hope that mortgage interest rates will come down. Currently, rates are averaging 14 percent to 15 percent; the developer said he hopes to be able to offer financing at around 12 percent.
The project consists of two 23-story towers -- The Willoughby North at 5500 Friendship Blvd. and The Willoughby South at 4514 Willard Ave. -- and a connected six-wing, two-story building.
Designed by Washington architect Vlastimil Koubek, The Willoughby project was built in 1965 by Barlow, a Marriott Corp. executive who retired and became a developer. When Barlow ran out of funds during construction, the project was taken over by Riggs National Bank, which held the construction mortgage.
Helmsley's group, which acquired the property later, sold it to Phoenix Associates, an affiliate of The Barlow Corp.
Barlow said he plans to spend about $4.5 million on repairs and renovations on the project before it is sold to tenants, including work on the lobbies, the two swimming pools, saunas and other recreation facilities. Although its rents and amenities qualify The Willoughby as a luxury building, the facilities have deteriorated because of lack of maintenance in recent years.
Weaver Bros., the Washington real estate firm that handled the sale, will manage the project for Phoenix until First Condominium takes over.
First Condomimium's chairman is Harold L. Miller, a prominent Chicago real estate attorney who arranged the first condo conversion in Illinois and arranged the biggest condo sale ever, the 2,600-unit Carl Sandberg Village in Chicago.
The Willoughby will be the firm's first project in Washington. Miller has been negotiating to purchase Columbia Plaza, a luxury project near the Watergate, and convert it to condominium ownership. Columbia Plaza tenants have been fighting that move aggressively.
Michaelson said prices to the public at The Willoughby will start at $35,000 for the smallest studio apartments. Some of the other 140 one-room apartments will sell for as much as $55,000. The 323 one-bedroom units will sell for from $85,000 to $112,000; the 173 two-bedrooms from $111,000 to $145,000; and the 74 three-bedroom units from $160,000 to $180,000. $1
A small commercial complex in the buildings will not be sold, Michaelson said, and instead will be given to the tenant's association which will be able to rent it and use the funds to reduce operating expenses for the project.