Construction will soon start on the final pieces of Walter Reed’s Whole Foods-anchored town center
By Alex Koma, The Washington Business Journal
The developers of the massive Parks at Walter Reed project have lined up financing for two more residential buildings at the heart of its Whole Foods Market-anchored town center, clearing the way for construction to start next month.
The team working on the 3.1 million-square-foot Northwest D.C. development — a partnership of Hines, Urban Atlantic and Triden Development Corp. — said Wednesday it has closed on deals to power the construction of a 109-unit condo building and a 60-unit co-living building designed to become part of a residential and retail-heavy core of the remade Walter Reed campus. With vertical construction getting underway in October, the developers hope to deliver the buildings by early 2023.
Grosvenor Americas and Bank OZK provided financing for the condo building, dubbed Kite House, where the newly constructed portion of Elder Street NW meets Georgia Avenue NW. Santander Bank NA and Tristate Capital Bank Inc. will finance the co-living, known as 1155 Dahlia Street and located just to the south of the condos. Common, which manages other co-living units around D.C. and Northern Virginia, will run the property.
The new buildings are designed to deliver shortly after the first piece of the town-center-esque portion of the project, 323 apartments above the Whole Foods, opens in mid-2022. Newly rechristened as the Marketplace at The Parks, the developers believe it’s crucial to get this piece of the project occupied to provide a major activity center for the 66-acre site.
“This is going to be the heart of our retail center,” said Katie Wiacek, a managing director at Hines. “This is a really big milestone for us.”
Wiacek said the development team has been hard at work on the grocer-anchored apartments since earlier this year, enabling it to finish an underground parking garage that will sit underneath all three buildings. With construction on the other infrastructure surrounding this part of the property — extensions of Elder Street, Dahlia Street NW and 12th Street NW and a new “marketplace plaza” — set to wrap up by sometime next year as well, she said it made perfect sense to start construction on the condos and co-living units as soon as possible.
Those new buildings will include a combined 32,000 square feet of ground-floor retail, sitting alongside the 40,000-square-foot Whole Foods and another 20,000 square feet of space in the apartment building. Wiacek said she is “actively seeking retail tenants” for that space, with the goal of having many new shops and restaurants ready as the plaza and the grocer open to the public.
“We want to try and have as much retail open at the same time as possible,” said Jonathon Quince, a director at Hines.
While the property already has some condos available — an 89-unit building opened at the southeast corner of the property last year and is 60% sold, Wiacek said — the co-living will represent a very different sort of product for the project (and the city as a whole).
Wiacek suspects it will be one of the largest co-living buildings to open in the city, set to include 248 fully furnished bedrooms in total. Units will range between two and five bedrooms each, and 38 bedrooms will be set aside as affordable.
She said the parcel in question was a bit smaller than might make sense for a multifamily building, so they considered additional condos there instead. But with some of that product already on the property, she opted instead to pursue something that might be a match for the neighborhood’s younger residents.
“We have young professionals looking for a situation where they can live with roommates in a fully furnished building, versus a group house or something like that,” Wiacek said. “This is really an opportunity to be on the front edge of delivering this type of product here.”
With the campus’s first residents already moving in elsewhere on the property and some new outdoor space coming online too — a 10,000-square-foot dog park opened Tuesday — Wiacek believes there’s real momentum for the project, which is many years in the making. The D.C. government had to fight to gain control of the old Army hospital campus from the feds, then spent years picking a development team and lining up the project.
She expects that progress will continue next year, when the developers hope to secure approvals for additional phases of construction, including townhomes on both ends of the campus and a new apartment building where Georgia Avenue meets Dahlia Street.
“More and more residents are finally getting to enjoy the campus,” Wiacek said.
Elsewhere on the campus, Children’s National Hospital has opened some of its first buildings as part of a new research and innovation center. The State Department controls a 50-acre portion of it as well, which it envisions someday converting into new office space.
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