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January 3, 2011  

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Bisnow has learned that DC newcomer Redbrick Development Group closed a land purchase last week that paves the way for ground-up mixed-use on a Fairfax County lot that’s been vacant since the early ’80s.


William Passmore, Tim Mulcahy, and Tom Skinner on Jan. 3, 2011

Redbrick president Tim Mulcahy, center, snapped this morning with managing partners Tom Skinner and William Passmore, tells us Phase 1 of the $68M Heights at Groveton (at the Groveton Elementary site at Route 1 and Memorial Street, across from the grocery-anchored Beacon Center) will be 290 units of market-rate apartments and 10k SF of retail. It’ll break ground "as soon as Mother Nature allows," he says. Phase 2, still awaiting approvals, is another 10k SF of retail and 50k SF of office. The original plan was for one building, but the spec office would never have gained financing. The land purchase from MDP Groveton, arranged by HFF’s Dave Nachison, was three years in the making, as HUD rules became slippery and Redbrick switched its focus to conventional loans. Meanwhile, multifamily improved, Ft. Belvoir’s place in the BRAC annals has solidified, and Walter Reed is now on its way to the area.

Heights at Groveton from Route 1 in Alexandria, Fairfax County, VA

JPMorgan is lending 60% of the land purchase and development costs and CBRE Investors and Wood Partners 40% in equity. Shuttle service will take residents the one mile to the Huntington Metro stop, and it’s a five-mile reverse commute to Ft. Belvoir, which is expected to create 40,000 public and private jobs (and plenty of potential tenants). Retailers have expressed interest but will want to kick the tires first (Tim expects service retail or a store that wants visibility for the 100,000 daily cars that will have the view above, from Route 1), and the office will likely draw a government or hospital contractor. Redbrick also has its eye on three District properties and two each in Fairfax and Montgomery counties, hoping to start another project in 2011 and one a year beyond that.

Heights at Groveton at Route 1 and Memorial Street in Alexandria, Fairfax County, VA
Heights at Groveton will offer 65% one-bedroom and 35% two-bedroom units to ride the affordability wave, but they’ll be high on amenities, including island kitchens and walk-in closets, targeting $2,250 rents. It’ll also have a fitness center, conference room, community center, game room, WiFi, parking garage accessible from Route 1 and Groveton Street, and swimming pool. According to Delta Associates, DC metro rents climbed 8% in 2010, and growth is expected to continue.


Jim Fetgatter

72% of Association of Foreign Investors in Real Estate members, who hold a total of $627B in CRE ($265B of that in the US), plan to invest more capital here this year than in 2010. The James A. Graaskamp Center for Real Estate (Wisconsin School of Business) survey found that investors are narrowly targeting NY and then DC, among global cities, says AFIRE chief Jim Fetgatter, above. The US ranked four times as high as second-ranked UK as an investment target (if we can convince Prince William to have his wedding at the Hay-Adams, that would really rub it in), and 60% of respondents said the US has the best potential for capital appreciation (54% more than China). Multifamily remains the primary target, hotel and retail moved up to second and third, and office and industrial dropped to fourth and fifth. According to a CBRE report this morning, though, DC office vacancy fell from 12% in Q1 to 9.8% in Q4, the area absorbed 4.3M SF for the year, and 2010 investment sales rose a not-too-shabby 175% over 2009. And suburban Maryland had positive absorption for the first time since '05.



New Wuin apartments at New Hampshire and Georgia avenues in Northwest DC

Urban Investment Partners and The Infinity Group of New York acquired the 99-unit, rent-controlled New Quin apartments at New Hampshire and Georgia avenues in Northwest DC for $8.2M from CC Dudley, which was repped by Marcus & Millichap’s Stacey Milam. UIP General Contracting will begin a $4M renovation this month. Another deal while most were sleeping off holiday weight: The Equal Employment Opportunity Commission leased 27k SF in Sentinel Square's 90 K St. (owned by Trammell Crow, Crow Holdings, and Cottonwood Partners), Trammell Crow’s Tom Finan told us last night. It'll take occupancy in Q2, adding to its existing NoMa space at 131 M St. The federal government has been a big taker in the building: This summer, Homeland Security leased 85k SF for Customs and Border Protection and the Parole Commission took 36k SF. And in November, Veterans Affairs signed for 52k SF. 90 K is now 50% leased, with most of the remaining availability at the top, Tom says.



Tom McGuire in WorkSpaces' Georgetown office on Dec. 31, 2010

While you were all preparing to party Friday afternoon, we were impressed to find our sponsor, WorkSpaces founder Tom McGuire, toiling away in his G’Town office. Oh, we were there because he was (kindly) working on our own furniture order. Now that “Bisneyland” has pretensions of looking like the Google-plex, we gotta get some fun furniture. So he’s helping us figure it out. Amazingly he has time, given his firm’s dramatic growth—it just got an order from a government agency for 16,000 filing/storage cabinets.

Tom McGuire in WorkSpaces' Georgetown office

No, Tom doesn't change clothes between pictures—we just visited him twice last week. Here, he shows us another reason he smiles so much, pointing to a pic of the new Baltimore office they’re launching in the historic Bagby Furniture Building. They’re placing seven staff there and, among other projects, zeroing in on BRAC opportunities. And they’re planning a NY office.




No, our subhead doesn’t refer to land on the fancy Caribbean island of St. Barts, where property is indeed valuable and your publisher snapped this last week of yachts too big to pull up to the dock. The record belongs to the biggest private yacht in the world, Eclipse, 536 feet long yet “only” 24 guest cabins, built at a cost of $1.2B and delivered less than a month ago to Russian billionaire Roman Abramovich. What else does it have? Reportedly two helipads and its own missile defense system. Not even 2200 Penn. or 1225 Connecticut has that (we believe).



Dan McGrain and Pam Patenaude

On Dec. 23, dedicated Bisnow subscriber Dan McGrain, principal of Columbia-based McGrain Realty Advisors (hooking up equity investors in the residential market), did his homework and read all the way to the end of the last issue of 2010, where he saw the following note: “Hello? Anyone still out there? E-mail amanda.metcalf@bisnow.com.” (In case you haven’t noticed, a few DC CRE folks took a couple days off.) Dan cracked us up with his e-mail asking if he gets a prize for reading to the end. Well, you’re reading his reward. Above is Dan and ULI Terwilliger Center for Workforce Housing exec director Pam Patenaude. This one’s on us, Pam.

What did you do on your winter vacation? E-mail amanda.metcalf@bisnow.com.
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