Developer Pays $35M For Arlington Hotel, Plans Conversion
A developer that specializes in buying underperforming hotels and converting them into apartments is making its latest play in Arlington’s Courthouse neighborhood.
GoodHomes Communities purchased the 1960s-era Arlington Court Suites Hotel for $35M, with plans to reposition it into 180 apartment units, KLNB, which brokered the sale with HREC Investment Advisors, announced Monday.
The sale of 1200 N. Courthouse Road closed on June 16, according to Arlington County property records. It comes months after the previous owner abandoned its own hotel-to-condo conversion plan and put the property on the market.
The redevelopment plan is New York City-based GoodHomes' first project in Northern Virginia, Managing Partner Adam Feldman told Bisnow. It has another project in the D.C. metro area: turning the former Hotel Silver Spring on Colesville Road into 227 multifamily units, a project expected to be completed this year.
“We think that Arlington and the greater D.C. area are really strong markets to be in, and obviously have diversified economies and are growing and continue to have a really strong need for housing at attainable price points, and so it sort of checks all of our boxes that we target,” Feldman said.
GoodHomes' thesis focuses on repositioning properties into apartment units rather than ground-up development. That cost-saving strategy enables it to keep rents affordable for residents making between 60% and 120% of the area median income, the company says. Feldman said the Arlington property will be in line with that range.
Rents for Arlington apartments were the seventh highest in the country as of June, with the average one-bedroom unit going for between $2,449 and $2,601, according to Apartment List.
Because the Arlington Court Suites is an extended-stay hotel, the unit layout works seamlessly for conversion to residential, Feldman said. The property also stood out for its “very significant amount of common areas” that will be turned into amenity space for the residents, he said. GoodHomes expects to complete the repositioning in late 2027.
Conversion of the property has been on the table for years. The previous owner, Sunburst Hospitality Corp., received approval to transform the hotel into 180 residential units in 2020.
But Sunburst never started the project and put the hotel on the market last fall, Bisnow reported at the time, marketing it with KLNB and HREC as either a hotel or conversion opportunity.
Sunburst didn't immediately respond to a request for comment.
The marketing process elicited more than 20 “competitive” offers, according to Monday's release. KLNB’s Rawles Wilcox, Justin Shay and Dutch Seitz, as well as HREC’s Mark Morris and Scott Stephens, represented the seller.
