Macy's has found a buyer for its store in Arlington's Ballston neighborhood, and the purchaser is planning a major development.

Insight Property Group is under contract to acquire the property at 685 North Glebe Road, and it is planning to redevelop it into 555 apartments above 42K SF of retail, Insight principal Sarah Davidson confirmed to Bisnow. She said Insight hopes to break ground on the project by the first half of 2023.

The deal comes after Macy's retained Cushman & Wakefield last year to market the property for sale. The department store retailer was struggling even before the coronavirus pandemic disrupted the industry, and it announced plans in February 2020 to close up to 125 stores over three years.

Insight is seeking Arlington County's approval to demolish the Macy's and replace it with the mixed-use project, which was first reported by UrbanTurf. Insight is working with SK+I Architecture to design the project.

The 16-story development is planned to deliver in two phases of 345 and 210 units, with the northern and southern portions sharing an outdoor terrace on the third floor. The developer is also requesting flexibility for a 202K SF portion of the building to be converted into an elder care facility.

The project's retail space is envisioned as a grocery store — despite being located across Glebe Road from a new Target and down the street from a Harris Teeter. It would also have two underground parking levels with 389 parking spaces, 241 of them for residents and the rest for the grocery store, plus 222 bicycle spaces.

The Macy's property is adjacent to Ballston Quarter, the $330M redevelopment of the Ballston Common Mall that Brookfield delivered in 2019 with a food hall, a Punch Bowl Social, and a host of restaurants and experiential retail concepts. It is across the street from Ballston Exchange, Jamestown's redevelopment of the former National Science Foundation headquarters.

Insight Property Group's own headquarters is around a half-mile away at 4601 North Fairfax Drive, and the developer said that proximity was one factor in its decision to pursue the project.

"We have an opportunity to bookend and create an interesting synergy with the amazing redevelopment work that has occurred at Ballston Quarter and Ballston Exchange," Davidson wrote in emailed responses to Bisnow questions. "As neighbors, we have witnessed much of the recent transformation that has occurred in this area, and we hope to be privileged enough to be a part of it."