Arlington's Next Evolution
Is there life for Arlington after the highest vacancies in the region? Developers say in the future, neighborhoods will blend and become one. And it's already happening between Pentagon City and Crystal City.
Our first panel at Bisnow’s Arlington Summit in Rosslyn yesterday morning says merging neighborhoods are one of a few promising trends. LCOR SVP and panelist Harmar Thompson (whom we snapped with Newmark Grubb Knight Frank executive managing director Stephen Hoffeditz) says when neighborhoods like Pentagon City and Crystal City merge, the result is “a sense of place” in two communities that have struggled to attract residents. Arlington has put money into the roads connecting the two neighborhoods and with a Whole Foods that will arrive in 2017, Harmar said it’s an area to watch. A proposed streetcar project would have further connected Crystal City with Fairfax County, but Arlington scrapped the proposal yesterday afternoon.
Nearly 450 came out to hear how the county could fix its 21.4% vacancy rate. We tried to do our part by holding the summit in Monday Properties’ vacant space at 1812 N Moore. The 580k SF building is the tallest in the DMV at 35 floors, so naturally the draw is its 11-foot windows overlooking DC. Newmark Grubb Knight Frank is looking for tenants for the space and panelist and chairman Brendan Owen says rates for the building are in the low to mid $60s.
BRAC and sequestration can be thanked for the vacancy problem, of course, and Vornado SVP Mitch Bonanno, also a panelist, says it will force owners and developers to get a little creative with empty spaces. One of the most creative so far is Vornado’s deal with WeWork to convert an empty, 45-year-old, 150k SF vacant office building in Crystal City into 250 units of residential and work space for entrepreneurs. Mitch says it’s a cutting-edge idea and more like it will have to come. But if the county wants to attract more entrepreneurs (who have a new idea every hour), it will have to speed up its approval process.
Cooper Carry principal and panelist David Kitchens says adaptive reuse of Crystal City buildings was always in the plan for the neighborhood. He remembers when Crystal City was part of the multi-use development trend in the early '60s. “It was designed to be looked at and not engaged with,” he says. It’s just now that people are able to walk outside to access Crystal City's retail and see it as a destination in the south Arlington corridor. It still needs more time to attract the attention of renters though.
Millennials make up half of Arlington’s population but the empty nesters can’t be ignored. Kettler SVP Asheel Shah, a panelist, says there’s a growing population of empty nester move-down buyers who want to rent. Arlington has very few condo options except for LCOR’s future Altaire project--300 apartment units for Millennial renters, paired with 150 condo units for older renters. Harmar says it’s a risk to build such a large condo project but thinks there will be great synergy between the two buildings.
Moseley Construction just finished Arlington’s other condo project--a conversion of 85 units that’s surrounded by apartment buildings, says president Johnny Moseley, also a panelist. In keeping with the adaptive-reuse trend, Johnny says all the new apartments coming online have meant an explosion in renovations of older residential structures. Stay tuned for Part II of our Arlington Summit in tomorrow’s issue.