When It Comes To Multifamily, It's All About The Extras
Want to get a jump-start on upcoming deals? Meet the major players at one of our upcoming national events!
Multifamily projects are continuing to grow within the region as quickly as demand dictates. And with that demand comes a requirement from customers to have strong amenities. Our DC Multifamily Forum will address all issues related to that market on April 26 at the Mayflower Hotel at 7:30am.
Jair Lynch VP Kevin Roberts leads development for the firm at Capitol Riverfront. Their two-building multifamily project, a total of about 400k SF with 440 apartment units, will break ground this fall. Groundbreaking begins on that project this fall. Those units will average about 725 SF. It will also add 60k SF of retail right next to Nationals Park.
Kevin envisions a building that uses its proximity to its ballpark neighbor to create an energetic vibe. This project will be named "Joule"—inspired by the unit of energy.
"It's going to be a young, active crowd with an athletic/sports aesthetic," Kevin told Bisnow. "I believe this whole area is an athletic, active, refreshing place to live."
Overall, Kevin is impressed with the multifamily market in the Capitol Riverfront and throughout the city. But he also said the city has room to grow.
"In general, we're still under-delivering housing," he says. "When you consider projected job and population growth, and we're also not delivering enough housing to satisfy the demand for walkable, livable, sustainable communities."
On the other side of town, Mark Rivers, managing director at Lowe Enterprises, talks about the multifamily evolution in Mount Vernon Triangle. His CityVista, a 900k SF, 441-condo, 244-apartment project sitting atop a Safeway, catalyzed the area more than a decade ago.
After it dropped anchor, the building at 475 K St NW began to spur similar multifamily growth within its radius. For example, standout Meridian at Mount Vernon Triangle, a two-phase development from a JV of Steuart Investments and Paradigm, yielded 783 total apartment units.
Lowe's multifamily reach recently stretched all the way to Connecticut Avenue. Its latest project, The Hepburn, is an ultra-luxury, 195-unit apartment JV with partner National Real Estate Advisors that sits adjacent to the Washington Hilton near Dupont Circle. It's scheduled to deliver this summer.
One common theme for Lowe's two projects: strong amenities. Mark says customers now insist on them. He says not including them could be a deal-breaker.
"There was a time when folks thought the city is the amenity. You can build buildings without amenities. That’s proven to be untrue," Mark says. "Folks are looking for the amenities, and particularly at the price point they're paying, they're saying 'if I can get a great fitness center in my building, I can save the club membership and put that effectively in my rent.'"
Johnny Moseley, president of Moseley Construction Group, also understands the importance of amenities and Millennials are driving the demand.
From rooftop decks to barbecue grills, Johnny says the desire for those extras has boomed in recent years.
"Amenities have become as critical as anything else," he says.
With the demand for better amenities comes a higher cost to install them. Johnny attributes much of the higher cost to build to the more expensive tastes of the customers.
He said new styles like European-style design schemes for cabinets are often the culprit for higher prices.
"We're definitely seeing a cost increase across the board for multifamily deals," Moseley said. "Anywhere from 5 to 15%."