A local developer is putting together a $1 billion plan to transform a hodgepodge of junkyards, a strip club and a gas station at New York Avenue and Bladensburg Road NE into shops and housing, with a portion reserved for people on working-class incomes.

The project, proposed by Jim Abdo, a District developer better known for luxury condos at Dupont and Logan circles, would be one of the largest privately financed deals in that part of the city, according to District officials.

Other development is afoot in the neighborhood. The D.C. Council member who represents the area said he is working on a public-private project to turn the city's wholesale market into 23 acres of housing, office and retail at Florida and New York avenues, near the new headquarters of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. And a few years ago, the city helped finance a deal that brought a Home Depot and a Giant grocery store to Brentwood, across New York Avenue. But the city's long-term goal to revitalize the New York Avenue corridor has proved elusive.

"It's been a challenge for us to upgrade New York Avenue as a national gateway into the city," said D.C. Council member Vincent B. Orange Sr. (D), who represents Ward 5. Orange is running for mayor and is pushing for the wholesale market project.

"We want that area to be something that represents the nation's capital," Orange said. "[Abdo's] project does that. . . . If this can be a nice retail and residential project with good, affordable housing, that is something that would benefit the residents of the District and in particular the residents of Ward 5."

Abdo said he plans to build up to 4 million square feet on the 15-acre site. Most of it would be devoted to housing, most of it at market-rate prices. But 300 to 400 units would be reserved for middle-income earners, if Abdo wins permission for high-density development. The more he is permitted to build, he said, the more he can make affordable.

Roughly 200,000 square feet would be devoted to retail along New York Avenue. That could include a supermarket or retail stores such as Pottery Barn or Barnes & Noble, although Abdo cautioned that he has not talked to those retailers. He also hopes to integrate the project with the nearby U.S. National Arboretum, possibly with bike paths and walking trails.

Although Abdo would not disclose how much he is paying for the property, he said prices are much lower than for "15 acres in the center of Georgetown."

Cheaper land, other developers said, gives Abdo the opportunity to build housing that costs less. Still, his competitors said, the market there is unproven, and Abdo will have to persuade his financial backers to be patient if sales are slow.

Abdo has been working for the past nine months to acquire the land, which was once considered for slot machines. Though he has not yet purchased all of it, he expects to close the deals by spring. Still, challenges remain, including rezoning and offering a plan to deal with traffic that is already considered among the worst in the city.

To help navigate those obstacles, Abdo recently hired Eric W. Price, a former top aide to D.C. Mayor Anthony A. Williams (D), as a vice president in charge of the project. Price, 44, was credited with jump-starting much redevelopment in the city and helping to bring Major League Baseball to the District.

To pay for the Northeast project, Abdo said he has commitments from capital partners whom he declined to name, saying they wished to remain silent.

"We have capital partners in hand that have signed on to this deal that represent significant financial capacity," Abdo said. "We wouldn't be pursuing a project that we couldn't pay for."

Abdo helped spur retail and housing development along 14th Street NW and in Logan Circle, but he has recently begun moving east, to neighborhoods as gritty as 14th Street NW once was. Currently, he is spending $250 million to turn the former Children's Museum near Union Station into luxury condos.

"We saw 14th Street and Logan Circle when it wasn't fashionable," Abdo said. "I'm used to naysayers. It's not a pipe dream. It's something we will make happen. It's going to be a challenge to convince people to share the vision we have."

In the past few weeks, Price has met with city planners, elected leaders and community activists. Most, he said, seem to welcome the prospect of transforming blighted lots and junkyards.

"Abdo's development seems very positive," said William Shelton, a neighborhood advisory commissioner for the area. "We're excited to see affordable housing come in here."

Abdo said he began buying up land after he discovered that three brothers who owned a sizeable chunk, used for their taxi companies, wanted to sell. When the brothers' deal to sell to the group that wanted to bring slots into the District expired, Abdo jumped.

"I marked on my calendar to call him the day that deal expired," Abdo said. Shortly after, he struck a deal with the brothers, then began acquiring property with a nightclub, a transmission lot and a junkyard.

"It's a very aggressive project," said David DeSantis, who works for PN Hoffman, a competing developer. "It sounds pretty gutsy. If it works, we'll all be saying what a visionary Abdo was."

Washington Post staff writer Debbi Wilgoren contributed to this report.

From left, Toby Millman, Jim Abdo and Eric W. Price plan to convert junkyard lots on Montana Avenue NE into condos and retail.

The intersection of New York Avenue NE and Bladensburg Road NE is one of the most dangerous in the district.