Redbrick Lands Big Loan To Build 750-Unit Phase 1 Of Bridge District
The once-stalled Bridge District has landed a major financing deal to bring 750 new housing units and 40K SF of retail to Washington, D.C.'s Ward 8.
Redbrick LMD landed a $142.5M construction loan from Citizens Bank for its first building on the site, The Douglass, the firm announced Friday. Construction is already underway, with the first units set to be delivered in late 2024 and a targeted construction completion date of mid-2025. Eighty of the units will be rented to those making no more than 60% of the median family income.
"This construction loan from our partners at Citizens during a challenging economic environment represents a significant vote of confidence in the future of the Bridge District," Tom Skinner, founder and managing partner of Redbrick, said in a statement.
The financing adds to the momentum of the planned 2.5M SF project on mostly vacant parcels on the east side of the Anacostia River, between the Frederick Douglass Memorial Bridge and the pending 11th Street Bridge Park.
Redbrick first acquired the land for the Bridge District nearly a decade ago and hoped to woo a major federal agency to multiple planned office buildings. After the site was passed over twice by the federal government, the developer pivoted, rebranding from Columbian Quarter to Bridge District in 2021 and pressing forward on multifamily plans ahead of office.
Skinner, while giving Bisnow a tour of the construction site Wednesday, said he wanted to create a campus that would represent the "future of urban living," with an emphasis on balconies, Zoom rooms and local retailers in an opportunity zone.
"What opportunity zone investors care about is, what’s the value of this in 10 years' time? That’s really the most important thing," Skinner said. "We’re underwriting rents both immediately, but more importantly, at exit in 10 years' time. That gives us the confidence to move forward."
Redbrick is a vertically integrated investment management and development business, which Skinner said gives the firm a leg up when it comes to raising capital for its projects.
He said the firm was able to attract more than 200 opportunity zone investors for The Douglass, each with a contribution "a bit north" of $1M.
"Most developers will create a concept, go out and look for capital, find a single investor that is their joint venture partner, [and] very often that partner will be an institutional partner," Skinner said. "We go directly to the end investor, disintermediating that class of investors."
Redbrick also prioritizes working directly with the community, hiring full-time Director of Community Engagement and Corporate Impact Lindsay Morton to conduct dozens of meetings to assess its needs.
At the top of the neighbors' wishlist: family-size units. Half of the affordable components' square footage is for three-bedroom units.
"Ward 8 is a ward of families, so we’re meeting an aspiration and a need," Morton said.
The property's units will feature work-from-home spaces, as well as Zoom rooms on each floor and space to work in common areas, an adjustment made to acknowledge the new hybrid work reality, Skinner said.
Redbrick is placing an emphasis on local retailers for The Douglass as well. The developer has partnered with The Sandlot to create an outdoor gathering space for events, which recently included an after-school event with pizza, soft drinks and tug of war for middle-schoolers.
The firm has also begun marketing the second phase of the property, another multifamily building across Howard Road SE from the first phase and adjacent to the current site of The Sandlot.
Early plans for that property estimate 625 to 650 units, mostly targeting younger renters, according to investor documents from July viewed by Bisnow. The project cost for that phase was estimated to be $350M.
Skinner said Redbrick hopes to break ground on that property by the end of 2023, with a timeline about 14 months behind The Douglass, but he declined to comment further.
The property sits across the Anacostia River from the Capitol Riverfront, which is quickly approaching full build-out. As the District continues to see strong demand for waterfront properties, Skinner said the Bridge District is well-positioned to absorb continued interest.
He said 80% of the units in The Douglass will have balconies to take advantage of its river views. The property also sits on the edge of Anacostia Park and Joint Base Anacostia-Bolling, which allows sightlines to downtown D.C. from many of the units.
"You go anywhere in D.C. and you have a street grid and an alley behind you, and the buildings turn their face on the alley," Skinner said. "Half those units have less good views, but ours is spectacular four sides around."
There are plans for office in the Bridge District on parcels closest to the Anacostia Metro, despite the tepid leasing market. In a previous iteration of the campus, Redbrick had pursued the Department of Labor and Securities and Exchange Commission headquarters and lost out on both.
Skinner is still a believer in office for the mixed-use campus going forward. He said tenants continue to be excited by office properties that can differentiate themselves from the competition, and he believes the Metro access, views and proximity to JBAB's 15,000 daily workers all make the area competitive for that kind of play.
"If you can deliver a product and a location that is clearly differentiated, you can still — there is still a need to come to the office, to collaborate, to create a better work product," Skinner said. "We are quite confident about our ability to bring a lot of jobs to the Bridge District."