Kettler is selling a portion of its planned 1.25M SF Union Market development to another big-name D.C. developer.

Carr Properties is expected to close within 10 days on the acquisition of Market Terminal's office component at 350 Morse St. NE, the Washington Business Journal reports.

The planned 10-story, 214K SF office building, with 11K SF of retail, was designed by Gensler and is expected to cost Carr a total of $135M between the acquisition and construction. It is part of Phase 1 of the major mixed-use project Kettler received Zoning Commission approval for in July.

The development's first phase is also planned to include a 453-unit multifamily building with 16K SF of retail and a 105-unit building with 9K SF of retail. Later phases could include additional residential space with retail and a potential hotel.

The development, centered around a large public plaza, sits two blocks west of popular food hall Union Market and just north of two additional mixed-use projects: LCOR's recently delivered The Edison and the under construction Highline at Union Market, a JV between Level 2, Federal Capital Partners and Clark Enterprises.

One month after Market Terminal got the green light, it was appealed in court by Union Market Neighbors, a group of activists that has appealed six approved projects in the neighborhood. The first of those appeals has been dropped, but the rest, including Market Terminal, remain in limbo.