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JBG Cos. boosts investment in 14th/U corridor
Premium content from Washington Business Journal - by Sarah Krouse
Date: Friday, April 1, 2011, 6:00am EDT
[http://www.bizjournals.com/washington/print-edition/2011/04/01/jbg-cos-boosts-investment-in-14thu.html]
If it wasn't the Whole Foods at Logan Circle or the organic wine bar at Ninth
and U streets NW that changed the 14th and U corridor from "up and coming" to
"arrived," a multimillion investment from The JBG's Cos. should do the trick.
Chevy Chase-based JBG, known for investing in stable, core markets, has spent
the last four years assembling and bidding on five sites ripe for redevelopment
along 14th and U streets, with an investment of more than $65 million in site
acquisition alone. It expects to break ground over the next three years on an
estimated more than 800,000 square feet of new projects.
The developer broke ground earlier this year on a $50 million, 125-unit
condominium project at the corner of 14th and S streets. Called The District
Condos, the development marked the return of high-end condos to a corridor that
saw a boom of development before the recession but then stalled.
Since assembling that site, JBG has partnered with Chicago-based Walton Street
Capital LLC to buy three noncontiguous lots ~ including the Atlantic Plumbing
Supply Buildings near Florida Avenue and V Street for $24.3 million ~ rekindled
plans for a 250-room hotel at 13th and U streets and was the highest bidder for
a group of Metro-owned sites near Ninth and U streets, offering $11.5 million.
Metro has not announced a winner.
Adding another project to the mix, JBG is planning to break ground in early 2012
on a mixed-use development that will span the south corner of 14th and U
streets, delivering 263 apartments and 30,000 square feet of ground-level retail
with its partner, Georgetown Strategic Capital LLC. JBG acquired the site
through a 99-year ground lease at the end of 2010, according to land records.
"The area has developed over the last real estate cycle as one of the most
diverse and vibrant residential and retail environments in Washington, D.C.,"
Matt Kelly, JBG's managing director of investment management, wrote in an email.
"Increasing demand has spawned a wide range of services and entertainment
options that support a continuous level of activity." he said. "The area's
diverse retail amenity base creates one of the most convenient and walkable
urban environments in D.C."
JBG's office and residential portfolio has long centered on notoriously stable
markets such as the Rosslyn-Ballston corridor, K Street, L'Enfant Plaza and
Bethesda, so its numerous investments along U and 14th streets mark something of
a coronation of the area as a new core market.
Jim Abdo, CEO of Abdo Development, one of the first local developers to see the
redevelopment potential of 14th Street, recalls conversations he had with the
president of Caribou Coffee 10 years ago when trying to lure the coffeehouse to
14th Street.
"I characterized it as a sleeping giant. If you look at where JBG is now, I
think that basically just reaffirms the vision a lot of us had 10 years ago. I'd
argue the renaissance is beyond complete," he said. "It's really fully
stabilized and seeing a big major player putting a tremendous amount of
investment dollars just reaffirms that. People at JBG look for stabilized
markets that make sense, and along 14th Street, you can check every box."
Premium content from Washington Business Journal - by Sarah Krouse
Date: Friday, April 1, 2011, 6:00am EDT
[http://www.bizjournals.com/washington/print-edition/2011/04/01/jbg-cos-boosts-investment-in-14thu.html]
If it wasn't the Whole Foods at Logan Circle or the organic wine bar at Ninth
and U streets NW that changed the 14th and U corridor from "up and coming" to
"arrived," a multimillion investment from The JBG's Cos. should do the trick.
Chevy Chase-based JBG, known for investing in stable, core markets, has spent
the last four years assembling and bidding on five sites ripe for redevelopment
along 14th and U streets, with an investment of more than $65 million in site
acquisition alone. It expects to break ground over the next three years on an
estimated more than 800,000 square feet of new projects.
The developer broke ground earlier this year on a $50 million, 125-unit
condominium project at the corner of 14th and S streets. Called The District
Condos, the development marked the return of high-end condos to a corridor that
saw a boom of development before the recession but then stalled.
Since assembling that site, JBG has partnered with Chicago-based Walton Street
Capital LLC to buy three noncontiguous lots ~ including the Atlantic Plumbing
Supply Buildings near Florida Avenue and V Street for $24.3 million ~ rekindled
plans for a 250-room hotel at 13th and U streets and was the highest bidder for
a group of Metro-owned sites near Ninth and U streets, offering $11.5 million.
Metro has not announced a winner.
Adding another project to the mix, JBG is planning to break ground in early 2012
on a mixed-use development that will span the south corner of 14th and U
streets, delivering 263 apartments and 30,000 square feet of ground-level retail
with its partner, Georgetown Strategic Capital LLC. JBG acquired the site
through a 99-year ground lease at the end of 2010, according to land records.
"The area has developed over the last real estate cycle as one of the most
diverse and vibrant residential and retail environments in Washington, D.C.,"
Matt Kelly, JBG's managing director of investment management, wrote in an email.
"Increasing demand has spawned a wide range of services and entertainment
options that support a continuous level of activity." he said. "The area's
diverse retail amenity base creates one of the most convenient and walkable
urban environments in D.C."
JBG's office and residential portfolio has long centered on notoriously stable
markets such as the Rosslyn-Ballston corridor, K Street, L'Enfant Plaza and
Bethesda, so its numerous investments along U and 14th streets mark something of
a coronation of the area as a new core market.
Jim Abdo, CEO of Abdo Development, one of the first local developers to see the
redevelopment potential of 14th Street, recalls conversations he had with the
president of Caribou Coffee 10 years ago when trying to lure the coffeehouse to
14th Street.
"I characterized it as a sleeping giant. If you look at where JBG is now, I
think that basically just reaffirms the vision a lot of us had 10 years ago. I'd
argue the renaissance is beyond complete," he said. "It's really fully
stabilized and seeing a big major player putting a tremendous amount of
investment dollars just reaffirms that. People at JBG look for stabilized
markets that make sense, and along 14th Street, you can check every box."
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