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Developers: Northwest D.C.'s Wealthy Enclaves Need To Allow More Housing

EYA Senior Vice President Aakash Thakkar, a residential developer who lives in a single-family home in Upper Northwest D.C., says that type of housing is far too common and the high-income area needs to do its part to allow more multifamily housing and address D.C.'s affordability crisis. 

EYA's Aakash Thakkar, JBG Smith's AJ Jackson, Urban Atlantic's Vicki Davis, MidCity's Jamie Weinbaum and United Bank's Joe LeMense

"As a neighbor and as a developer, my view is you have to do something in those neighborhoods to increase allowable development, particularly along the corridors," said Thakkar, speaking Thursday at Bisnow's Major Projects event. 

Thakkar pointed to the Wisconsin Avenue and Connecticut Avenue corridors and the Friendship Heights, Tenleytown, Van Ness, Cleveland Park and Woodley Park Metro stations as areas that should be upzoned. He said those areas are predominately single-family housing, even within a quarter-mile of the Metro stations, and neighbors and elected officials should be more willing to increase density. 

"We have discussions with council members who say, 'Friendship Heights is completely built out,'" Thakkar said. "Well, it's built out with three-story buildings, but with 11-story buildings and a 20% affordability requirement we're killing a number of birds with one stone."

He said that type of development would increase the District's housing stock to meet growing demand, provide options for people of all income levels to live anywhere in the city and provide more retail options for existing residents. In an ironic twist, Thakkar said he has seen multiple single-family homeowners who fought against the Cathedral Commons development dining in the Japanese restaurant Raku that occupies its ground-floor space. 

Appeals of developments have become far too common in the District, Thakkar said, and have stalled many projects that would help grow the city's housing stock. Among the more than a dozen projects appeals have stalled is the McMillan Sand Filtration Site development, a 655-unit northwest D.C. project EYA is partnering on that remains stuck in court today, three years after it was originally approved. 

Thakkar said preventing new housing in projects like McMillan from getting built increases prices for existing homes in the area, and allowing residential development to move forward and outpace demand would help alleviate the District's expensive housing prices. 

"In places like Upper Northwest D.C., it has great neighborhoods, good schools, places where we think people of all incomes should live," Thakkar said. "We need to lean in more and ensure places like that across the region are more open to development and push back on NIMBYism and these lawsuits to allow the private sector to do what we do well and to create more housing and more affordable housing." 

Jamie Weinbaum, then with MidCity, speaking at a Bisnow event in December 2018.

MidCity Development Executive Vice President Jamie Weinbaum, whose company has a 1,700-unit northeast D.C. project stuck in court following an appeal, noted that the District is leading the way with its Housing Production Trust Fund. But if projects that utilize the fund get stalled by appeals, he said the dollars are not spent and the housing is not built. He also said it is important to allow affordable housing to move forward in all parts of the city, including Upper Northwest D.C.

"Looking at it holistically around the whole city makes a lot of sense," Weinbaum said. "It's not that there should be one area that has affordable housing. There should be opportunities for people of different means to live throughout the region and they shouldn't be constituted to live in one part of the city and one part of the region. We think that's critical." 

Urban Atlantic President Vicki Davis, whose company is moving forward with the 66-acre Parks at Walter Reed project, said the team was able to avoid appeals by starting the community engagement process early. D.C. bought the former Walter Reed Army Medical Center Campus from the U.S. Army in 2016 and was able to shape its zoning for mixed-use development. 

"Our neighborhood planned this site," Davis said. "They decided exactly where every single building would go and how big it would be and what it would look like. That got translated into the small-area plan, and then that got translated into the Comprehensive Plan. The city actually zoned the entire site so that everything would be by-right. That avoids all these PUD delays."

JBG Smith Senior Vice President of Social Impact Investing AJ Jackson

JBG Smith Executive Vice President of Social Impact Investments AJ Jackson is leading the REIT's efforts on the Washington Housing Initiative, which aims to preserve and develop more workforce housing in the D.C. region. He thinks Upper Northwest D.C. should play a part in the strategy to address D.C.'s housing crisis. 

"There is an opportunity for more supply in Upper Northwest," Jackson said. "Whether it's affordable or not is really less of the issue because we have this housing shortage." 

He compared Upper Northwest to Arlington County, an area he also said has not built enough new housing in recent years. 

"The reason we lost 80% of the naturally occurring affordable housing in Arlington County is because of the lack of new supply in that market," Jackson said. "What that does is push high-income, market-rate people into lower-quality housing than they want but that is available in the location they want to be in, and that pushes lower-income families out." 

The need for more housing in Arlington County, and likely the number of developers who pursue projects in the area, will be increased by JBG Smith last month landing Amazon to build its second headquarters.

The GSA's Scott Anderson, Carr Properties' Austen Holderness, Baker Tilly's Todd Stokes, Perseus Realty's Bob Cohen, StonebridgeCarras' Jane Mahaffie, JBG Smith's Tony Greenberg and MRP Realty's John Begert

In addition to leasing Amazon office space and selling it land for development, JBG Smith is accelerating its plans for residential and retail development in the "National Landing" area. The REIT owns 6M SF of existing office space and 3,000 apartments in the neighborhood and has another 7M SF in its development pipeline, JBG Smith Executive Vice President of Development Tony Greenberg said.

"The goal even before we knew about Amazon coming to National Landing was to transform Crystal City, and Crystal Drive in particular, into a much more vibrant, 18-hour destination through the addition of residential and retail," Greenberg said. "The first few projects we're going to do in addition to Amazon are going to fulfill that vision."

The first residential project JBG Smith is moving forward with, Greenberg said, is 1900 Crystal Drive. The development will feature two 300-foot-tall towers totaling 750 units with 40K SF of retail and a central plaza. 

"It's really a transformative project right in the heart of National Landing near the Metro that will be visible from everywhere, from the District, and it will really signal the change we're working on," Greenberg said. 

Maryland Secretary of Transportation Pete Rahn

Another part of the region expected to see a rise in development and housing construction is the Purple Line corridor in suburban Maryland. Maryland Secretary of Transportation Pete Rahn cited the 526-unit New Carrollton project from Urban Atlantic, Forest City and Berman Enterprises, the 430-unit College Park project from Gilbane and the 500-unit Chevy Chase project from Chevy Chase Land Co. and Bozzuto as examples of developments adding housing around Purple Line stations as the 16-mile rail line is constructed.

"These are a few examples of the tremendous possibilities that are being created in Prince George's County and Montgomery County as a result of the construction of the Purple Line," Rahn said. "We know that it will create economic opportunities for those looking for places to invest."