The owner of a large site in Brookland is looking for a new development partner after Hanover Co. backed out of plans to construct three mixed-use residential buildings.
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The Houston-based developer was set to acquire and develop the largely industrial site into 683 units over two phases, a plan the D.C. Zoning Commission approved in 2022. But those plans have fallen through, according to a time extension request the owner filed with the commission this month.
“Unfortunately, Hanover needed to exit the deal due to the unforeseeable and adverse market forces discussed further below,” the filing says.
It went on to detail several factors that contributed to Hanover dropping out and to the overall delay in the project: increases in construction costs, higher interest rates, tightening lending conditions and plateauing rents.
It said the surrounding neighborhood has seen a recent spike in multifamily development, making it harder to lease up new buildings and raise rents.
“Over the past year, several new and competing apartment buildings opened in the surrounding neighborhoods within Ward 5,” the application says. “As such, there is a notable lack of demand for additional new multi-family housing by the targeted dates of Project completion.”
The property owner, Jack Sarf, a businessman who purchased the 2.75 acres in 2018, is now looking for a replacement for Hanover. The applicant is “hopeful that a new development partner can be secured within the next year,” the filing says.
Hanover declined to comment, and attorneys representing Sarf didn't respond to requests for comment.
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The filing asks to extend the deadline for the 395-unit Phase 1 from February 2026 to February 2028 and extend the second phase beyond that.
Hanover’s plans called for 395 units in Phase 1, 96 units in Phase 2A and 192 units in Phase 2B. The project is planned to dedicate 15% of the gross floor area for affordable housing and 22K SF of makerspace, including three affordable artist live-work units.
Even though Sarf is asking the Zoning Commission for an extension, he is moving forward with demolishing the industrial buildings on the site. The owner filed a raze application in March and plans to demolish the structures by the first quarter of next year, according to the zoning filing.
The property sits just north of Rhode Island Avenue and near a Red Line Metro station. It is surrounded by two other major projects that developers have built in recent years, Douglas Development's 296-unit Brookland Press and Trammell Crow's 353-unit Rowan.
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