Walter Reed developers line up financing for first market-rate projects

By Michael Neibauer  – Associate Editor, Washington Business Journal

The development team behind The Parks, the overhaul of a 66-acre portion of the Walter Reed Army Medical Center, has closed on construction financing and lined up its equity partners for the first two ground-up, market-rate buildings.

Hines, Urban Atlantic and Triden Development Group, the master development team, will partner with PGIM Real Estate on The Vale, a 301-unit apartment building with 18,300 square feet of ground-floor retail fronting Georgia Avenue. PGIM is the real estate investment management business of Prudential Financial Inc. Construction financing for The Vale will be provided by McLean-based Capital One Financial Corp. (NYSE: COF), per a release

For The Brooks, an 89-unit condo building on half an acre adjacent to The Vale, Grosvenor Americas has provided financing as has EagleBank (NASDAQ: EGBN).

Both projects, the WBJ reported in 2018, are expected to deliver in 2020. The land, owned by the D.C. government and ground-leased to the master development team, has been transferred to new entities.

The whole of The Parks, a public-private partnership with the District, will total 3.1 million square feet, between new construction and adaptive reuse of historic structures. The project, at buildout, is expected to include more than 2,100 residential units of various types (432 below market rate), 150,000 square feet of grocery-anchored retail, office, hotel, an ambulatory care center from Howard University, and two charter schools.

The town center at The Parks will replace the 2.7 million-square-foot main hospital building, the demolition of which is ongoing. That project was expected to get underway this year, though the exact timeline is unclear.

The State Department largely controls the portion of the 110-acre Walter Reed campus not owned by D.C. The Children’s National Research and Innovation Campus is coming together on the campus as well, as the WBJ’s Sara Gilgore recently reported.