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July 20, 2011  
 
 
 
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COME WEST, YOUNG MEN


DPR Construction, a unique technical builder, has some impressive stats, including 5.5 acres. That's the largest green roof on the East Coast, and it's part of DPR’s project for National Audio-Visual Conservation Center in Culpeper. Learn more about DPR here.

 

We're a town of contradiction. Foreign money can topple a political candidate in DC (news junkies know what we're talking about), but that same foreign money is welcomed into DC buildings. Qatar alone has $35B allocated for foreign investment. Tops on its list are DC, NY, and LA.

 
Amin Salam at 1023 15th St., DC, July 2011

We snapped CRE/foreign Investment consultant Amin Salam of Capital Communications Group with the giant teapot he got at an embassy reception and that now sits in the Arabesque room in his 1023 15th St. office. Middle Eastern sovereign wealth funds and high-net-worth individuals love real estate because it's a tangible asset, he says. 2008's recession and subsequent drop in property values have made the US attractive. Qatar has allocated $15B more for foreign investment this year than it did in 2010, with a focus on iconic buildings. Amin tells us potential deals include the Center Place buildings off I-395 in the Mt. Vernon Triangle and proposed developments around Union Station.

 
UMD Colvin Mini
 
CityCenterDC, July 2011

We snapped the construction going on at the 10-acre CityCenterDC. Amin says Qatar's $700M equity stake in the project is unique compared to other Middle Eastern CRE deals. “There are only a few funds globally that can handle projects of CityCenter’s scale, and these funds prefer equity deals" because some apply Shari'a law, which prohibits an interest-generating financing system. Amin says investors make a profit in those deals by selling their stake to another party after a few years. (For the record, we're not talking about CityCenter; multiple sources tell us Qatar has no intention of shedding its stake in that one).

 
Porcelanosa 2 Mini
 
CityCenterDC

What's next for Qatar's sovereign wealth fund after CityCenter, above? A landmark building in New York, Amin says. (It also bought London's famous Harrods department store in May 2010.) He adds that it's important to remember the investment pipeline goes both ways. The Middle East and North Africa are consumer economies that don't compete with the US, and US companies from infrastructure to healthcare and technology are opening offices in the region, which needs expertise and services. And don't think it's just about making money: “The other thing you have to understand is that a lot of these guys love America,” Amin says. “They send their youth to schools here, they go shopping, spend vacations, and invest in premium residential real estate.”


Bisnow

THIS MORNING'S DATA CENTER EVENT

 
Fairview Park Marriott, July 20, 2011
This morning, 630 of you packed the Fairview Park Marriott for our Data Center Boom event. Industry all-stars like AOL's Michael Manos, Digital Realty Trust's Andrew Schaap, and US Army cybersecurity chief Hari Bezwada say consolidation is the name of the game for users. That means data center space is getting denser, leading to more power consumption. As for the 800 federal data centers that are getting shut down over the next four years, our panelists say most are functionally obsolete. And it doesn't mean government demand is waning: The intelligence community, in particular, needs more space, and Lee Technologies prez George Newstrom says he can't think of any agencies that have significant excess capacity on their hands. The most important criteria for site selection? Latisys CEO Peter Stevenson says power grid, fiber connection, and security considerations (say, avoiding earthquake fault lines). More coverage of the event coming tomorrow!

Bisnow

MEET OUR SPONSOR:

VIRGINIA ROOFING CORP.

 
Stafford Hospital Center

Four inventions that separate us from animals: shirts, forks, Pogo Sticks, and roofs (well, at least we do that last one better). Few companies are doing as much for humanity as Virginia Roofing Corp., which recycles 80% of its materials. Its work last year included three massive data centers for a leading online bookseller (which shall remain anonymous but use your imagination) and a state-of-the-art, four-story police station in Alexandria. The firm’s real bread and butter is topping off power plants and hospitals (like Stafford Hospital Center). President Bob Grimmett says the federal government has new pollution standards for coal-burning plants, so Virginia Roofing has installed roofing on all the new buildings at the Chalkpoint, Morgantown, and Dickerson plants. And he tells us hospitals are always growing (and never seem to run out of money); so there's always work there. Learn more here.


Bisnow

NOVA AT MID-YEAR

 
Caulley Deringer, Marty Almquist, David Webb, and Taylor Chess at the Tysons Ritz on July 19, 2011

Yesterday at NAIOP Northern Virginia's mid-year forecast at the Tysons Ritz, we snapped Transwestern's Caulley Deringer, Avison Young's Marty Almquist (who thankfully brought a splash of color to the evening), Cassidy Turley's David Webb, and The Peterson Cos.' Taylor Chess. Marty says the leasing market feels slow lately, owing to both the summer doldrums and the uncertain economy. Many tenants are “hunkering down,” she says, especially in the defense contracting sector. Which brings her to BRAC: Only 15% of the program will be completed by the September deadline, and the rest of the space will be vacated through 2015, at the pace of 750k SF/year. NoVa's paradigm thus far has been inside vs. outside the Beltway, but Marty says the Tysons Metro extension will change it to “transit accessible vs. non-transit accessible.” Submarkets that'll heat up soon (thankfully, we're not talking about temperature): locations with short commutes and access to infrastructure, like Lee Highway and Columbia Pike in Arlington.

Dante Lorenzana, Tom Regnell, Trish Jurgonis, and Chris Getz at the Tysons Ritz on July 19, 2011

Here's Wells Fargo's Dante Lorenzana and WRIT's Tom Regnell, Trish Jurgonis, and Chris Getz. Taylor says almost every type of retail tenant is getting into food (he says they're modifying their use clauses for whatever they just might sell in the future; Ross Dress for Less' latest version allows for electronics and pre-packaged food). Why? People love to eat. Outlet centers are also on the rise, which Taylor chalks up to consumer demand for both value and name brands. That cannibalization—tenants getting into too many product lines—is one of the things that keeps him up at night. Gas is another business retailers are interested in, and those that can't accommodate gas stations are offering per-gallon discounts. He also says landlords had tenants on triage during the recession, but retail site tours have picked up over the past few months.

 
Todd Rich, Tony Womack, and Brian Casey at the Tysons Ritz on July 19, 2011

We also snapped Tishman Speyer's Todd Rich and Tony Womack and MetLife Investments' Brian Casey. David says investors don't yet think multifamily pricing is getting too rich, especially considering how low Treasury rates are. That's led to the lowest cap rates he's ever seen, and the gap between haves and have-nots (location and quality) is increasing. Equity prospects are up for developers with good sites, David says, but it's difficult for everyone else. As far as debt goes, most deals lately have been at a 70% loan to cost (some up to 75%).

 
Courtney Davison, Colleen Wevodau, Erin Cole, and Angelea Busby at the Tysons Ritz on July 19, 2011

Here's Baker Tilly's Courtney Davison and Colleen Wevodau with KTA Group's Erin Cole and Charron Consulting's Angelea Busby. NoVa's 99M SF industrial/flex market is in a solid recovery, Caulley says, and the Route 28 N submarket has seen 600k SF in net absorption so far this year. There's been little net growth from government contractors, but things are getting better from two years ago, when “nearly every deal was a one-year renewal." The data center market in NoVa is the East Coast's second largest, and Caulley says many e-retailers are choosing to lease rather than buy to stay nimble.


Bisnow

SMILE FOR THE CAMERA

 
Tom Sherwood and Guy Steuart III at 360° H Street between 3rd and 4th streets, DC, on July 19, 2011

At yesterday's groundbreaking for Steuart Investment Co. and Albemarle Group's longtime-coming 360° H Street (215 apartments—
17 of them affordable—and a 42k SF Giant grocery store), NBC News4’s Tom Sherwood interviewed Guy Steuart III. Streetcars will start rolling through the area in 2013, and restaurants like the just-opened TruOrleans have launched there, too (with those and Giant, you get the feeling the secret behind CRE is less about occupancy rates and more about full stomachs). H Street is so much the next it neighborhood that we hear Tony Williams lives in a condo next door. Mayor Vince Gray grew up nearby, and District Council member Tommy Wells has been a big advocate in redeveloping the area.

 
360° H Street between 3rd and 4th streets, DC

It must be in honor of Giant's 75th anniversary that the Torti Gallas Urban rendering is black and white. Giant's first store, also the metro area's first supermarket, opened at Park Road and Georgia Avenue on Feb. 6, 1936, Giant tells us. 360° H Street also has two floors of underground parking, 22-foot sidewalks, a rooftop terrace and an elevated courtyard from Parker Rodriguez Architects, and a lobby, community room, and fitness center designed by SR/A Interior Design of New York. It'll deliver in spring 2013.


Bisnow

OUR WTC EVENT IN NYC THIS MORNING

 
World Trade Center, NYC, on July 20, 2011
This was the view out the window at our WTC event in NY this morning: The square is the footprint of one of the towers that came down on 9/11. It will be filled with water and be dedicated as a reflecting pool and memorial this Sept 11, the 10th anniversary. The new main trade center building, known as Freedom Tower, is on the right in this picture, under construction.
 
We snapped the Freedom Tower this afternoon. 3,000 construction workers a day are on the job at the World Trade Center site, putting up four buildings and a dramatic new subway station, memorial, and park. Speakers say it'll have a Rockefeller Center impact, and together with other things happening nearby (like at Brookfield Office's World Financial Center) will create a new epicenter of New York action Downtown.
 
Jonathan Mechanic, Tara Stacom, Mary Ann Tighe, Larry Silverstein, and Chris Ward at the World Trade Center, NYC, on July 20, 2011
WTC owner Larry Silverstein, with the mic, says being first out of the ground will be a big advantage in competing with several other megadevelopments slated for the city like Hudson Yards but that they're all needed for global competition. Port Authority of NY & NJ president Chris Ward, right, with superlawyer Jonathan Mechanic, superbroker Tara Stacom, and CBRE tri-state CEO Mary Ann Tighe, agreed.
 
Sandi Danick at the World Trade Center, NYC, on July 20, 2011
Macerich head of leasing for Tysons Corner Center Sandi Danick's magic carpet is in the shop. We snapped her at our NY event, sorry that she couldn't be at our data center one in Virginia.
 
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