Breaking Down D.C.'s $50B Development Pipeline
The skyline of the nation's capital has been dominated by cranes for the last several years, with development rapidly spreading to new parts of the District, and a new report detailing D.C.'s pipeline shows it is not expected to slow down any time soon.
Developers have completed 622 projects in D.C. since 2010, totaling roughly 76M SF of commercial real estate and $27B of cumulative investment, according to the Washington D.C. Economic Partnership's annual development report. D.C. had 162 developments under construction totaling 27M SF and $11.2B in investment as of August, the report shows, and the city's future pipeline is even larger.
The report breaks down D.C.'s pipeline by developer, property type, estimated delivery, cost and other metrics, shedding light on how D.C.'s built environment will change in the coming years, and who will be responsible for that transformation.
Of the 162 projects under construction as of August, 63 are expected to deliver by year-end, 71 are expected to deliver in 2019, 25 have an anticipated 2020 delivery, and three are expected in 2021 and beyond.
The vast majority of the cranes in D.C.'s sky today are building residential developments. There are 94 residential projects under construction totaling 14.3M SF, or roughly 15,600 units.
The four largest multifamily projects under construction all sit within 1 mile of each other in the Nationals Park-Buzzard Point area: the 485-unit River Point project, JBG Smith's 465-unit West Half, Douglas Development's 453-unit 1900 Half St. SW and Jair Lynch's 439-unit project near the ballpark.
The office sector has the second-most space under construction in D.C., with 31 projects totaling 6.2M SF. D.C.'s largest office project, Douglas and Brookfield's 655 New York Ave. NW, is expected to deliver before year-end. The second-largest, NoMa's Sentinel Square III, is pre-leased to the Federal Communications Commission, while the third-largest, Capitol Crossing's 250 Massachusetts Ave. NW, is being built on spec and has yet to announce a pre-lease.
The hospitality sector has 15 projects under construction totaling 1.8M SF. The largest hotel under construction is the 360-room Conrad Washington DC at CityCenterDC, expected to open in February. The hospitality sector also includes museums, such as the 140K SF International Spy Museum at L'Enfant Plaza, expected to open in Q1.
There are 75 retail projects under construction, including mixed-use developments with retail components, totaling 1.5M SF of upcoming retail space. The project with the most retail under construction is Skyland Town Center, with 117K SF of retail expected to deliver in 2020.
The most active developer since 2013, measured by number of projects, is JBG Smith, with 18 projects completed, five under construction and 10 more in its pipeline. Since the report focuses exclusively on D.C. proper, that total does not include the large pipeline of projects JBG Smith plans to deliver around Amazon HQ2 in Northern Virginia.
The second most active developer is Douglas Development with 29 total projects, followed by WC Smith with 19, Forest City — acquired by Brookfield after the numbers were tallied — with 18 and Jair Lynch with 17 developments.
Clark Construction Group is by far the most active general contractor, with its 56 projects more than doubling second-place Hamel Builders. Whiting-Turner, Grunley Construction and Turner Construction round out the top five.
Beyond the projects under construction, D.C. has another 427 developments in its pipeline totaling roughly 124M SF of real estate and $38.4B in projected investment. The city's pipeline is almost evenly split between the 212 near-term projects and the 215 long-term projects.
The near-term pipeline is also expected to be dominated by multifamily development. The report classifies 144 residential projects as in the near-term pipeline, totaling 17,721 units. It also includes 101 retail projects, 46 office projects and 32 hospitality projects.
Several of the largest residential projects in the near-term pipeline will be built in northeast D.C., including JBG Smith and The Boundary Cos.' 695-unit Eckington Yards, MRP Realty's 490-unit first phase of its Bryant Street project, Perseus Realty and Four Points' 472-unit Storey Park in NoMa and Foulger-Pratt's 356-unit Press House at Union District.
The largest project in the office pipeline is the $1.2B second phase of The Wharf, which is planned to include 547K SF of office space and deliver in 2022. The Wharf's Phase 2 is also expected to deliver 120K SF of retail, 345 residential units and 116 hotel rooms.