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A new project is underway to turn two Alexandria office buildings into apartments, the latest in a series of office-to-residential conversion projects in the region.
The partnership of Lowe and USAA Real Estate announced Monday it began construction on the conversion of two 14-story office buildings at the Park Center complex into 435 apartments.
The buildings, at 3101 Park Center Drive and 4401 Ford Ave., sit near the interchange of I-395 and King Street. The partnership also owns the adjacent 115K SF property at 4300 King St., which it is keeping as an office building with a 55K SF fitness studio from X-Sport Fitness Club.
The conversion project, branded as Park + Ford, is expected to deliver next year. The apartments will range from studios to two-bedroom units, and the buildings will feature a variety of indoor and outdoor amenities.
The development team, which bought the three buildings in 2018, financed the acquisition and conversion project with a $128M loan from PIMCO, Lowe Executive Vice President Mark Rivers told Bisnow.
“Park Center is well-located and presents an ideal opportunity to transform the existing property into a mixed-use complex that is designed to meet the evolving demands of renters in Northern Virginia,” Rivers said in a release.
Developers have increasingly looked to convert vacant office buildings in the D.C. area to apartments, as the area has experienced strong multifamily demand and elevated office vacancy.
In September, Fairfax County approved an application from Highland Square Holdings to convert three office buildings at the Skyline complex into 720 live-work units. Highland Square in March delivered a similar conversion project in Falls Church.
Perseus TDC in 2018 launched the conversion of a vacant Alexandria office building to 520 apartments. Peterson Cos. last year filed plans to convert a vacant Fairfax County office building into a senior living facility.
In the District, Insight Property Group is converting a Foggy Bottom office building into 153 apartments, and Lincoln Property Co. plans to convert a downtown office building into apartments.
"Particularly in some of these areas where the office market has moved away from some of these suburban office parks, and in some cases urban buildings make sense that are obsolete as office for one reason or another, we really like [conversions], and this one’s a really good size," Rivers told Bisnow. "A lot of times its hard to get that kind of scale.”
UPDATE, NOV. 2, 4:05 P.M. ET: This story has been updated to include details on the project's financing and more comments from Rivers.
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