Developer Q&A: J Street Cos. Chairman Bruce Baschuk
J Street Cos. founder and Chairman Bruce Baschuk has managed, leased and developed properties in Georgetown since the 1980s, his company is based at 1025 Thomas Jefferson St. NW and he is currently the chair of the Georgetown BID. We caught up with Baschuk to hear his thoughts on how Georgetown has changed and his outlook for the future.
Bisnow: You have been working in Georgetown for decades. How is the submarket different today than it was when you first started?
Baschuk: At this point, Georgetown can and should be considered fully built out. There are only a few smaller sites that might be increased in their density. That’s different than I think any other part of town. Any other part still has additional density to add, but we’re pretty much done. It’s a mature market, and it has become a place where everybody wants to live, work and play. It’s centrally located even though it doesn’t have a Metro stop. It has access from Foggy Bottom; it’s easy to get to. It has the waterfront. Other places are starting to access the water, which is nice, but our waterfront market has been here for a long time. That’s what Georgetown has that makes it a little different.
Bisnow: Looking at Georgetown's retail market, how has it changed and what is your outlook on it today?
Baschuk: Georgetown historically was one of really two very high-end, high-priced markets in the region. The other was Tysons Corner and the mall there. That has transitioned somewhat now that you see CityCenter opening up and attracting high-end retailers into the CBD. If you were downtown 25 or 30 years ago, the only place you could go for dinner was Georgetown. There was nothing else here, nothing in the CBD, the emerging markets didn’t exist. The restaurants have a lot more choices now, but Georgetown has held onto a lot of good restaurants and continued to attract them. It has changed in that we're no longer the only player, but the type of retail is also changing. While there almost always was very high-end soft goods, in particular clothes, that’s not as prevalent now. They’re still selling clothes but are generally targeting a more modest sale price. People still come in, they love to shop here. We continue to attract good people, but they’re generally more price-conscious.
Bisnow: How do you feel about the proposal to build a gondola connecting Georgetown and Rosslyn?
Baschuk: I love the idea, personally. In addition to allowing people who currently might go to the Rosslyn market an access point, which is under 10 minutes from M Street, it’s also a means of transportation for people who don’t need to be driving into Georgetown who might be right now. I think it’ll help with congestion. If the streetcar ever arrives, that may provide some support, but right now it seems to be stuck. The only reason I think that there might be a glitch is that the Northern Virginia or Rosslyn politicians were concerned about supporting any public transportation initiatives, not just a gondola. I think the merchants over there, and the people who own real estate, are very supportive of the gondola. I would expect it will continue to get support. The environmental impact statement is being started. I think you’ll see continued momentum. A lot of cities are looking at it because of the significant reduction in the cost of transportation with a gondola as opposed to subway.
Bisnow: What does J Street's current portfolio look like in Georgetown, and do you have any future development plans?
Baschuk: Generally our assets are smaller in nature. For instance, we manage Hamilton Place, a great little mixed-use community just above M Street, a block off Wisconsin. It's one of these little gems. We're leasing excess space at the Swedish Embassy on the Georgetown waterfront. We lease up office space and have some residential. We’ve represented owners that are local and have owned real estate for generations. We’re now adding more residential properties in our portfolio. We're developing one on N Street, a 15K SF high-end condo, which is close to Georgetown on the other side of Rock Creek. We're looking at three developments in Georgetown to do as well. They're residential and we've been working on them for some time, but we're not yet in the position where we control the process, so they're still just opportunities.
Bisnow: So if you're looking to develop more property in Georgetown, it sounds like you are bullish on the future of the submarket?
Baschuk: Absolutely. The sites are hard to find, but good development sites are always hard to find. Based upon the relationships we have that go back many years and generations, we have people and clients that say, 'We know you guys are connected to the community, we’d like [you] to help us get this to fruition.' You spend a lot of time working with the community, and that’s what we do well.
The other thing I would add that separates Georgetown from other communities: It has three or four of the top hotels in the area, The Ritz-Carlton, The Capella, the Four Seasons. That’s a pretty powerful mix in one location. We attract a very high-end clientele, and there are also more budget-conscious hotels. Those are three of the top-end hotels in the city. That helps us continue to maintain the balance between office, residential, retail and hotel.