The land rush around the proposed baseball stadium in Southeast Washington has been thrown up in the air, as developers and investors watch to see how the D.C. Council reconsiders issues regarding its financing and whether it should be moved to a site near Robert F. Kennedy Memorial Stadium.
Some developers said new uncertainty surrounding the stadium project could slow down their plans to build on newly acquired land and also delay pending land sales.
"For us it does add a lot of doubt about the future of what that area is going to be," said Aaron Liebert, area managing partner for developer JPI of Irving, Tex. His company plans to spend around $250 million over the next few years to build residential units on land it bought near the stadium.
"If there's no baseball, it will be less of an entertainment district and more likely more office and residential," he said. "We're going to continue to develop without baseball, but we're just not certain as to how quickly."
The stadium would be built on four blocks that contain warehouses, industrial sites and nightclubs.
"Developers don't like to see vacant, unused land near their projects," Liebert said. "Baseball takes derelict properties off of the market so the entire neighborhood would evolve faster. If baseball doesn't come to the neighborhood, other development won't happen as fast."
If the baseball stadium does not come to that part of Southeast Washington, Liebert said, he wouldn't start on the second and third phases of his 900 residential units as quickly.
Executives at Monument Realty LLC, a District-based developer that has invested some $40 million buying land around the proposed baseball stadium, agreed.
"With baseball down there, when do I start? Immediately," said Jeffrey T. Neal, one of the principals at Monument. "Without baseball? We'll see."
But other developers said the council's reconsideration won't stop their plans to develop or move forward in trying to buy more land in the area.
"We're still interested in other opportunities down there," said Mary Margaret Hiller, a spokeswoman for Akridge, a D.C. developer that has bought a nine-acre parcel near the stadium. "This issue doesn't slow us down from wanting to look in that area. This is going to be the next revitalization area, like Gallery Place. It will still occur with or without baseball."
For the past six months, local and nationally known developers have been pouring millions of dollars into parcels of land around the proposed stadium near Half and South Capitol streets SE. Many have plans to turn what is mostly industrial land with taxicab companies, strip clubs and empty lots into a mix of offices, housing and retail.
"If the stadium doesn't go in Southeast, that means that there's just 25 more acres to be developed in what is becoming a very, very prominent area," said Ron Cohen, a Rockville-based developer who just recently bought land a few blocks from the stadium.
Cohen and his New York-based partner, O'Connor Capital Partners, paid $51 million for a city block at Half and K streets SE. The tenants of the property include two gay nightclubs, a catering company and a taxicab business. Cohen and O'Connor Capital said they can build about 800,000 square feet of office, residential and retail on their site, based on current zoning. They plan to invest $300 million to $500 million in the project. Construction would probably start in a year, and some buildings would be completed in 2008.
Carlyle Group is trying to lure government contractors to two new office buildings in Chantilly that will meet new federal security standards.
The District-based investment group plans to start construction next year, even without tenants signed up. The goal is to land contractors that need to be in highly secure buildings because they work closely with defense-related agencies and often have federal workers stationed on site.
The new complex, with about 300,000 square feet of office space, will have a structural system that prevents a building from collapsing if one of its five stories falls, setbacks with bollards to keep vehicles from getting too close, and extra-thick windows and walls to protect against blasts, Carlyle executives said. The buildings will be in the Westfields area, just south of Dulles, which is home to several large defense contractors.
"We're designing these to meet the various security requirements that are being put in place by the Department of Defense and the U.S. General Services Administration for the buildings where they house their employees," said Tommy Ellis, a principal at Carlyle. The buildings are expected to be completed at the end of 2007.
Deadline to Develop
Developers have until December to submit ideas to turn part of the Armed Forces Retirement Home near North Capitol and Irving streets NW into a mix of office, residential and retail. The retirement home and the General Services Administration, which is the federal government's real estate agency, put out a request for how to redevelop 77 acres of the campus. The retirement home was started in 1851 and now has about 1,000 retired military personnel living there.
A plan will be selected next summer.
TW Perry to Move
TW Perry, a hardware store and lumber yard on Connecticut Avenue near Jones Bridge Road in Chevy Chase, said it will move about two miles away in a few years when its landlord, Chevy Chase Land Co., acts on plans it announced last week to redevelop the store's current site.
The store's new, two-acre location is near Brookville Road and Garfield Avenue, backing up to Walter Reed Army Medical Center. Richard Cortese, president of TW Perry, said he bought the land two years ago, knowing the developer was planning to redevelop his current site into upscale shops.
Cortese said he expects to start building on Garfield Avenue in 2007. He said he plans to keep his business on Connecticut Avenue as long as possible. Chevy Chase Land has said it would like to start redeveloping the site in 2008, though its plans could meet with neighborhood opposition.
Cortese said the Connecticut Avenue site is good for his business, which has been there since 1911.
"We didn't want to move if we didn't have to," Cortese said. "We hate to leave Connecticut Avenue. Everybody knows where we are. It's hard to go, but our new place will be nice."
* Akridge, a District-based developer, said it closed a $150 million fund. The money is to be used to finance its projects and buy property in the Washington area.
* J Street Development Co., a District real estate firm, bought 1111 N. Capitol St. NE. The price of the 175,000-square-foot building, which is fully leased to the Smithsonian Institute, was not disclosed.
* John J. Donovan Jr., former senior managing director of CarrAmerica Realty Corp., a major development company in the District, will serve on the board of Assurance Partners Bank of Carmel, Ind., which is looking to expand its real estate dealings to the Washington area. Donovan retired from CarrAmerica this year.
* George Mason University is seeking a developer to build a hotel and conference center on its campus in Fairfax. Four development groups have submitted ideas: Centex Construction LLC of Fairfax; a division of Clark Construction Group LLC and Marriott International Inc., both of Bethesda; Noble Investment Group LLC, a Georgia-based hospitality company; and New York-based Studley Inc., a commercial real estate company.
* Western Development Corp. of the District said it bought for an undisclosed price Towson Commons, a retail and office complex of about 300,000 square feet in Towson. The developer said it plans to spend about $30 million to renovate the project, starting next year.
Dana Hedgpeth writes about economic development and commercial real estate. Her e-mail address is firstname.lastname@example.org.