DC Development Report: 2012/2013 Edition

DC

DC Development Report 2012/2013 edition
Development Report
2012/2013 edition

Rendering: 655 New York Avenue, NW

DC Development Report
2012/2013 edition

Image courtesy of Douglas Development

Square 450 | 655 New York Avenue, NW | Douglas Development

a publication of the in partnership with

About
The DC Development Report
The DC Development Report is a summary of the major
development and construction projects in the District of
Columbia. The Washington, DC Economic Partnership
(WDCEP) began tracking development activity in 2001 with
the hope of creating a comprehensive database that would
answer a number of questions in regards to the construction
activity in the city. The Report summarizes our entire database
of projects, highlights major projects and what lies ahead
for development in the District of Columbia.

This update of the DC Development Report is an overview of
development activity and of the expansion occurring in the
District of Columbia. As a resource book, it is a compilation
of nearly 12 years of data collection and research that
provides an overview of an ever-changing development
and construction cycle.

The WDCEP performs an annual “development census”
in the month of August and receives contributions from
more than 120 developers, architects, contractors and
economic development organizations. This outreach results
in updates to more than 300 projects. While our database
of projects is constantly being updated, for the purposes
of this publication all data reflects project status, design
and information as of August 2012.

This year the WDCEP partnered with CBRE to provide an
executive summary on the overall construction market and
in-depth analysis of each development market.

Although every attempt was made to ensure the quality of
the information contained in this document, the WDCEP
and CBRE make no warranty or guarantee as to its accuracy,
completeness or usefulness for any given purpose.

For more information please see our Methodology section.

© Washington, DC Economic Partnership, 2012

2 © 2012 Washington, DC Economic Partnership

Table of Contents

1 Development Overview
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . 6

Summary of Projects . . . . . . . . . . . . . . . . . . . . . . 10

Most Active Developers, Architects & Contractors . . . . 12

2 Development by Sector
Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Residential . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Hospitality . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

3 Development Hot Spots
Anacostia . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68

Capitol Riverfront . . . . . . . . . . . . . . . . . . . . . . . 72

Mount Vernon Triangle . . . . . . . . . . . . . . . . . . . . 74

NoMa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

Shaw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

4 Appendix
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . 84

Acknowledgements . . . . . . . . . . . . . . . . . . . . . . 87

DC Development Report 2012/2013 Edition 3

ment Overview
1
Executive Summary | Summary of Projects || Summary of ProjectsDevelopment
Executive Summary Most Active | Green | Description
Most Active

Development Overview
Executive Summary

The educated workforce, nationally-ranked universities, world-renowned museums, tourist attractions and high quality amenities
that attract residents and visitors have made the District of Columbia a top tier investment market. Despite the uncertainty
surrounding the national economy, DC’s economy has continued to thrive, adding an estimated 8,200 jobs in the past year1.

Recent college graduates, “twenty-somethings” and baby boomers are moving into the city at a greater level than seen in
recent years, as these groups demand a “24/7” environment, walkable neighborhoods, and easy access to neighborhood
services. This has translated into new jobs, new retailers and restaurants, diverse transportation services and have created
demand for new development.

Through August 2012, 6.7 million square feet had broken ground in 2012 across all major development markets. By the end of 2012 we
expect that figure to top 7.8 million square feet as several mixed-use projects are anticipated to start construction by the end of 2012.

Residential
Since 2000, the population of DC has grown by 8.0% and now is home to 617,996 residents. 2 The interest in urban
living spurred a boom in residential construction, as over 42,000 residential units have been built (or underwent major
renovations) since 2001. More significantly is that DC has grown by 43,592 people in the past four years (2007 – 2011) and
now has more than 10,350 residential units under construction—the highest activity in the past 10 years. More than 90%
of the units under construction are rental and with many new residences now in the 500 – 600 square foot range, these
market-rate units are targeting the “young professionals.”

Office
While the total number of jobs in DC has now surpassed 736,6003, the historic drivers of DC’s office market (law firms and the
federal government) have stopped expanding and becoming more efficient with their existing space. When looking at the largest
25 leases in the past year, nearly half were renewals or renewals with expansion, well above the historic average of 30% and thus
limiting demand for new office development.4

Through August, 2012 saw 1.1 million square feet of office construction/renovation starts in private projects with more than 50,000
square feet of office. By the end of 2012 that number could reach 1.4 million square feet with two additional projects expected
to start in 4Q 2012. Of the 1.4 million square feet, approximately 40% of the space is preleased. While the total 2012 expected
groundbreakings is on the lower end of the past 12 years, it is about 15% higher than in 2011 and 120% higher than 2010—a year that
saw only 636,000 square feet of private office projects with more than 50,000 square feet of office space start construction/renovation.

REtail
2013 will see major mixed-use developments such as CityCenterDC (185,000 sq. ft. of retail), 360 H (41,200 sq. ft. Giant),
Monroe Street Market (50,269 sq. ft. of retail) and the Wonder Bread Factory (39,741 sq. ft. of retail) contribute to the more
than 434,000 square feet of new retail project deliveries.

The following year will see major mixed-use projects such as 77 H (76,000 sq. ft. Walmart), CityMarket at O (75,000 sq. ft.
Giant), Louis at 14th/U (Trader Joes) and Twelve12 (50,000 sq, ft. Harris Teeter) open and with the recent groundbreakings
of Cathedral Commons (56,000 sq. ft. Giant Food) and Safeway’s Petworth redevelopment (new 63,000 sq. ft. store), 2014
is expected to deliver an additional 587,000 square feet of retail space.5

2014 will mark the most retail deliveries since 2008, a year that delivered more than 867,000 square feet of retail, which included
the opening of the Target-anchored, 500,000 sq. ft. DC USA project in Columbia Heights. However, unlike 2008, 2014 will see
major retail deliveries in more neighborhoods such as Capitol Riverfront, Brookland, 14th & U/MidCity, NoMa, Shaw and Petworth.

Hospitality
2014 is shaping up to be the most significant year in hotel deliveries in the past 12 years. If development plans stay on
schedule 1,357 new rooms will deliver with the total potentially increasing to 2,361 rooms if several pipeline projects break
ground in the next few months. This would surpass 2008’s total of 2,159 new/renovated rooms.

1. DC Department of Employment Services Office (9/2011-9/2012, preliminary estimates) 2. Census (2011) 3. DC Department of Employment Services Office (9/2012, preliminary estimates) 4. CBRE Research 5. Cathedral Commons and
Safeway’s Petworth are still listed as near term in the report since both started construction after data was collected


Executive Summary

The largest project to deliver in 2014 will be the new 1,175-room Marriott Marquis (Convention Center Hotel) followed by
the 182-room Cambria Suites Hotel. The 1,000+ rooms that are currently planned, but may deliver in 2014, include a Hilton
Garden Inn (2201 M Street, NW), Hyatt Place Hotel (New York Avenue & North Capitol Street, NE), Hampton Inn (1729 H
Street, NW) and Homewood/Hampton Inn (501 New York Avenue, NE).

Education
Through August 2012, more than 1.7 million square feet of education space is under construction1. This represents the
highest total since 2008 (1.9 million sq. ft.). This development activity corresponds to 43% college/university projects, 39%
public high schools and 17% medical space. The new Dunbar Senior High School and modernized Cardozo High School
make up the 689,000 square feet of public schools under construction. Expansion plans by George Washington University,
American University and the University of the District of Columbia are mainly responsible for the 759,000 square feet of
college/university projects under construction.

By the end of 2012 New York University’s 75,000 sq. ft. Constance Milstein & Family Academic Center (September 2012
delivery) and E.L. Haynes’ 36,000 sq. ft. Kansas Avenue Public Charter School will also open.

Industrial Market
While not a focus of the DC Development Report, the industrial sector plays an integral role in the makeup of the DC real
estate market. It differs from most other regions because DC is not known as a manufacturing hub. High land value within the
city limits has historically lent itself to higher-revenue office or residential space. Developers, looking to maximize the return
on their investment, tend to steer clear of erecting new industrial product with a DC address as they explore development
opportunities in the city’s core areas.

The highest concentration of large warehouse space in the city lines New York Avenue, NE. The industrial parks that surround
this major thoroughfare utilize the transit advantages it offers in a high traffic urban setting. The majority of large warehouse
buildings resides in this area and is generally older, Class B and C product. Another concentration of smaller product in
Northeast DC follows the CSX rail line north of Union Station and fronting the Anacostia River in the Capitol Riverfront.

The availability of mid-size blocks of space has tightened across the District, but tenant demand remains as businesses in
the public sector need to operate within DC. This space is “needed to house those quasi-industrial functions such as waste
hauling and transfer, street cleaning and plowing, road construction and repair, water and sewer construction and repair,
and police, fire, and parking enforcement services that are essential to the business of city government.”2

Tenants with flexibility have found attractive options in industrial-laden Prince George’s County, Maryland, which neighbors DC and
has newer product, cheaper rents and more large blocks of space. This trend, coupled with revitalization projects in the works and
little industrial development in DC in the last decade (360,000 sq. ft.), will continue to constrict an already strained environment.

10 Largest Industrial Leases Since 20113
Sq. Ft. Tenant Address Date
92,286 DC Government 2850 New York Avenue, NE 1Q 2011
30,400 Solo Furniture Installers, Inc. 3525 V Street, NE 2Q 2012
25,541 Crane Services 3335 V Street, NE 1Q 2012
24,399 Ideal Electrical Supply Corporation 2230 Adams Place, NE 3Q 2012
23,633 Forever Blossoms 3150-3160 V Street, NE 4Q 2011
20,000 Verifone 3300-3390 V Street NE 2Q 2012
19,262 Pitney Bowes, Inc 3300-3350 New York Avenue, NE 3Q 2012
19,200 District Food Vending 1901 Fairview Avenue, NE 3Q 2012
17,500 GSA 3015-3055 V Street, NE 1Q 2012
15,000 American Medical Response 2825 V Street, NE 4Q 2011

1. including medical space 2. Industrial Land in a Post-Industrial City, DC Office of Planning (2006) 3. CBRE Research


Executive Summary

Project Management1
Statistically speaking, the beginning of 2012 has seen a slightly positive growth period for the commercial construction
industry in the District. The District’s average is 5-6% more costly than Baltimore or Annapolis as selling prices have been
increasing faster than material prices, escalating now 3%-4%.

The DC market was essentially modest to flat in general construction activity (i.e., tenant build-outs/interior construction)
with exception to on-going builds such as CityCenterDC. The new activity was attributed to the steady flow of releases.
In most of these situations, clients look to have minor changes to the space such as paint and carpet improvements. As it
relates to the private sector, most building owners of commercial office buildings continued to hold off on making major
investments in their building’s infrastructure. They have instead focused on specific aesthetics and this trend continues to be
compounded with little demand from end users as a competitive negotiation tactic when seeking an aggressive lease rate.

Similar to the beginning of 2012, the moderate to flat construction activity will continue. As we glance to the future, we
notice the overall construction costs appearing to remain steady with no major fluctuations. Individual project costs are
generally averaging around $65 per square foot for general office space. Furthermore, expect moderate labor shortages
in the near future to push prices at least another 1% higher, with escalations estimated at 4%-5%, in 2013.

The major contributors to cost impacts on a per trade basis are in millwork, glass and metals. One positive influence to the
cost of materials and products are those considered to have a “sustainable” focus. As demand remained constant by end
users, manufactures and services providers have incorporated sustainable practices and materials into their deliverable as
a matter of practice. This trend had a major positive impact on the area by creating more efficient facilities that combine
to create an overall attractive market in competing with other markets in the U.S., ultimately creating the environment of
positive construction activity.

Moving into 2013, little movement in non-residential construction will yield flat prices. The anticipated cost of labor increase
by June 2013 will be negligible as material costs follow the same trends, unless a major world event/conflict triggers the
markets.

Green Development
DC has a total of 316 LEED certified buildings/projects with another 1,054 LEED registered projects2. With DC’s public and
private push towards sustainability, DC now ranks second in the U.S. in combined registered and certified buildings3. While
the Green Building Act of 2006 and Clean and Affordable Energy Act of 2008 requires LEED certification and encourages
sustainability, tenant demand for “green” features was a driving force for developers and landlords to incorporate green
elements into their projects before these legislative deadlines. This is evident in the 256 ENERGY STAR labeled buildings
and that more than half of the LEED certified buildings/projects are Gold certified. Furthermore, Platinum buildings are
becoming more common.

In addition, 16 residential projects that are participating in the Enterprise Green Communities have been completed since
2007, with another eight under construction.

Total Number of Certified LEED Building/Projects2

35 87 160 34 316

Certified Silver Gold Platinum

1. tenant build-outs/interior construction 2. District Department of the Environment (3Q 2012) 3. District Department of the Environment (5/4/12)


Summary of Projects

DC Development Deliveries ($ in billions) Completed Under Construction

$4.78

$4.39

$4.13

$3.71
$3.60

$3.05

$2.76
$2.67 $2.67
$2.51
$2.39
$2.32
$2.22 $2.19
$1.02

$1.65

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20121 20131 20141

DC Development Projects By Status (August 2012) DC Development Projects By Type
# of Projects Sq. Ft. Estimated Cost # of Projects Sq. Ft. 2 Estimated Cost

New Construction 871 210,644,223 $67,501,700,154
Completed 940 120,976,506 $34,931,352,284
in 2001 79 10,863,811 $2,224,531,829 Renovation 478 58,269,466 $12,410,654,877

in 2002 85 9,189,374 $2,190,473,500 Infrastructure 46 n/a $3,603,466,000
in 2003 95 11,409,328 $3,053,046,485
in 2004 97 11,591,945 $2,761,862,000 DC Development Projects by Use3
in 2005 87 10,180,302 $2,390,115,944 # of Projects Sq. Ft. Units/Rooms
in 2006 102 12,933,180 $3,705,380,585
in 2007 73 11,621,355 $3,599,389,760 Education 186 16,820,763
in 2008 81 12,154,851 $4,128,790,000 Medical 27 4,115,190
in 2009 86 12,248,868 $4,390,058,073 College/University 51 5,228,948
in 2010 52 7,977,660 $2,508,795,163 Other Education 108 7,476,625
in 2011 57 5,944,403 $2,324,623,945 Hospitality 225 23,289,143 18,720
in 2012 (YTD) 46 4,861,429 $1,654,285,000 Community 91 2,256,081
Entertainment 26 4,236,932
Under Construction 113 21,526,569 $9,479,543,000
Hotel 83 12,900,180 18,720
2012 delivery 37 3,703,786 $1,015,849,000
Museum 39 3,895,950
2013 delivery 50 10,627,553 $4,775,916,000
2014 delivery 22 5,913,412 $2,669,141,000 Industrial 7 953,192

2015+ delivery 4 1,281,818 $1,018,637,000 Infrastructure 46
Office 349 99,130,123
Pipeline 342 127,371,932 $39,104,925,747
Near Term 87 11,512,628 $3,123,993,747 District Government 7 1,553,500
Medium Term 106 17,792,058 $4,575,279,000 Federal Government 41 18,588,461
Long Term 149 98,067,246 $31,405,653,000 Residential 679 104,608,559 101,243
Total 1,395 269,875,007 $83,515,821,031 Retail 457 13,419,915

1. projections based on targeted delivery dates of projects under construction as of August 2011 2. total by type may not sum to totals by status due to incomplete information about infrastructure projects
3. all projects (completed, under construction & pipeline); mixed-use projects may be reflected in multiple uses


Summary of Projects

Office Retail Residential Hospitality Education

Projects Completed (2001–August 2012)
# of Projects Sq. Ft. Units Rooms

Office 207 45,198,447
Retail 232 4,523,952
121.0M Sq. Ft. Completed
Residential 435 43,903,233 42,268
Hospitality 142 14,747,778 10,583
Education 139 11,078,438
Total Estimated Value of Projects: $34.9 billion

Projects Under Construction

Office 29 6,324,827
Retail 46 1,162,038
21.5M Sq. Ft. Under Construction
Residential 53 9,580,027 10,357
Hospitality 16 2,029,418 1,667
Education 14 1,751,000

Projects Near Term

Office 15 2,403,834
Retail 44 1,788,372
11.5M Sq. Ft. Near Term
Residential 52 6,129,389 6,438
Hospitality 15 960,880 1,295
Education 7 883,000

Projects Medium Term

Office 23 4,921,621
Retail 49 1,065,075
17.8M Sq. Ft. Medium Term
Residential 70 9,566,610 9,015
Hospitality 19 1,032,455 1,227
Education 7 614,000

Projects Long Term

Office 75 40,281,394
Retail 86 4,880,478
98.1M Sq. Ft. Long Term
Residential 69 35,429,300 33,165
Hospitality 33 4,518,612 3,948
Education 19 2,494,325
NOTE: mixed-use projects may be reflected in multiple uses.


Most Active Developers, Architects & Contractors

The figures below list the developers, architects and contractors that have been the most active in contributing to DC’s
development activity.

Most Active Private Developers (# of projects)1 Completed Under Construction Pipeline

PN Hoffman
16 1 1 18

Douglas Development Corporation
11 2 11 24

JAIR LYNCH Development Partners
20 3 5 28

WC Smith
16 5 8 29

The JBG Companies
20 8 11 39

Most Active Architects (# of projects)1
Hickok Cole Architects
28 5 9 42

WDG
27 4 13 44

Eric Colbert & Associates PC
30 5 9 44

Bonstra|Haresign Architects
28 8 14 50

Shalom Baranes Associates
34 9 23 66

Most Active General Contractors (# of projects) 2
WCS Construction LLC
14 4 8 26

Hamel Builders
17 7 2 26

James G Davis Construction Corporation
24 5 2 31

Forrester Construction Company
27 6 1 34

Clark Construction Group LLC
34 14 5 53

1. projects completed since 2001, under construction or in the pipeline 2. projects completed since 2007, under construction or in the pipeline


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1
Office development
Description

Office Development

DC Office Market Snapshot (3Q 2012)1
Inventory 124.1M SF
Total Vacancy Rate 10.1%
Net Absorption (4Q11—3Q12) 274,248 SF
Overall Avg. Asking Rental Rate $53.24/SF (FS)

The demand for downtown DC office space continues to fall while availability rises. Due to economic uncertainty surrounding
the federal budget, many tenants opted to remain in their current locations to avoid moving costs, or relocate to reduce
space usage.

Historically, DC’s primary demand drivers are the law firms of the AM Law 100 and the federal government. Recently, law
firms began reducing workspace areas for all employees, including smaller partner offices while reducing filing/storage
needs. Simultaneously, the federal government, under intense pressure to reduce costs, continues to consolidate multiple
locations and reduce the total amount of occupied leased square feet.

As of 3Q 2012, CBRE tracked the overall vacancy rate for the city at 10.1%, a relative constant over the year, and below
the peak of 12.0% reached in 2010. The 12-month trailing total net absorption was 274,248 square feet, reflecting bright
areas in an otherwise down leasing market. New demand is being driven by smaller companies that typically experience
a recovery first, foreshadowing economic growth. In addition, several technology-related firms came to DC, beginning a
further diversification of the tenant base in the city.

The largest 25 lease transactions from the past year reflect the change in composition of transactions in the city and
the impact the economy had on companies. While the portion of renewals historically hovers around 30%, the past year
experienced tenants staying in place at a renewal transaction rate of nearly 50%.

Largest 25 Lease Transactions by Deal Type2
Sublet
Renewal +
Expansion 4%
16%

48% New/Relet
Renewal 32%

Two of the city’s largest law firms recently committed to relocating to new buildings in the expanded business core of DC.
Arnold & Porter and Covington & Burling each surprised the market with their decisions to move from the Pennsylvania
Avenue corridor to new construction in the East End submarket. Covington & Burling’s lease at City Center will take 80%
of the office space at the site, and Arnold & Porter will lease 75% of Boston Properties’ new project at 601 Massachusetts
Avenue, once NPR moves to NoMa.

New development continues to attract tenants in spite of the higher rental rates it commands. The design efficiencies of the
build-outs allow companies to lower their real estate floor plan and associated costs, one of the few immediate expenses
they can control. Therefore, many are able to upgrade the quality and location of their offices, while paying a lower annual
rent. While this has had a negative impact on the Class A relet market, with large blocks of space returned to the market,
the newly available space is in prime locations that allow new tenants to make a similar move.

Sources: 1. CBRE Research 2. CBRE Research (4Q 2011 - 3Q 2012)


Office Development

Office Development (August 2012) 133 Private Office Construction Starts1 (since 2000)
# of Projects Sq. Ft. (projects with 50,000+ sq. ft. of office)
Completed 207 45,198,447
in 2001 27 6,331,725
in 2002 23 3,013,280
in 2003 19 2,769,592
in 2004 12 3,201,153
in 2005 17 3,622,716
in 2006 25 5,903,380 16 16
in 2007 16 4,276,463
in 2008 21 3,261,473 14
13 13
in 2009 23 6,033,060
12
in 2010 10 3,408,455
in 2011 10 2,442,869 12
in 2012 (YTD) 4 934,281 11
8 8
Under Construction 29 6,324,827
2012 delivery 8 1,144,560
2013 delivery 19 4,440,249
2014+ delivery 2 740,018

Pipeline 113 47,606,849 4
Near Term 15 2,403,834 3 3
Medium Term 23 4,921,621
Long Term 75 40,281,394
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Total 349 99,130,123 (YTD)

Office Deliveries (sq. ft. in millions) Government Completed Government Under Construction Private Completed Private Under Construction

6.3

6.0
5.9
0.4

2.3
1.5 11-year Annual Average
4.0 million sq. ft.
4.4
4.3

0.6
3.6
3.4 2.1
3.3
3.2
3.0
2.8 5.6 0.7
2.4
1.2
1.2

4.4 2.1
4.1 1.2
3.6 3.7 0.6
3.0 2.7
2.8
0.5 2.3
2.0 2.1
1.3 0.5
0.3
0.4 0.3

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20121 20131 20141

1. projects with 50,000+ sq. ft. of private office space 2. projections based on targeted delivery dates of projects under construction as of August 2012


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Office Development
Development Pipeline

Top Office Projects Completed (2011 – August 2012)
Project Ward Location Developer(s) Sq. Ft. Est. Value1 ($M) Delivery

Square 54 2 2200 Pennsylvania Ave., NW Boston Properties 439,798 $213 2011
Supreme Court Modernization 6 Supreme Court Architect of the Capitol 414,289 $76 2011
1015 Half Street 6 1015 Half St., SE Douglas Wilson Companies 380,000 $180 2011
Mary E. Switzer Building (Phase II) 6 330 C St., SW GSA 329,000 $62 2011
Eisenhower Executive Office Building 17th St. & Pennsylvania Ave.,
2 GSA 213,540 $198 2011
(Phase III) NW
Department of the Interior (Phase V) 2 1849 C St., NW GSA 200,000 $58 2011
733 10th & G 2 733 10th St., NW Skanska/PN Hoffman 165,092 $85 2011
1000 Connecticut Avenue 2 1000 Connecticut Ave., NW Connecticut & K Street Assoc. LLC 370,170 $180 2012
Forensics Lab 6 401 E St., SW Department of General Services 287,000 $215 2012
U.S. Department of Commerce - 14th St. & Constitution Ave.,
2 GSA 242,961 $118 2012
Herbert Hoover Building (Phase II) NW

Top Office Projects Under Construction
Project Ward Location Developer(s) Sq. Ft. Est. Value1 ($M) Delivery

Harry S. Truman Building 2 2201 C St., NW GSA 270,000 $38 2012
200 Eye Street 6 200 I St., SE StonebridgeCarras LLC/DGS 330,000 $86 2012
U.S. Coast Guard 2701 Martin Luther King
8 GSA 1,179,550 $950 2013
Headquarters Building Ave., SE
CityCenterDC 2 9th, 10th, 11th, H, & I Sts., NW Hines/Archstone/The First Investor 515,000 $700 2013
Federal Office Building 8 2 200 C St., SW GSA 464,402 $129 2013
GSA Headquarters (Phase I) 2 1800 F St., NW GSA 387,824 $161 2013
StonebridgeCarras LLC/
3 Constitution Square 6 155 N St., NE 344,000 $140 2013
Walton Street Capital
1111 North Capitol Street 6 1111 North Capitol St., NE Boston Properties/NPR 330,000 $115 2013
Association of American Medical
6 655 K St., NW Hines 273,200 $115 2014
Colleges
Lafayette Building 2 811 Vermont Ave., NW GSA 466,818 $164 2017

Top Office Projects Pipeline (near term)
Project Ward Location Developer(s) Sq. Ft. Est. Value1 ($M) Delivery2

Akridge at Half Street 6 25 M St. & 1201 Half St., SE Akridge 370,000 $330 2014
2001 M Street 2 2001 M St., NW Brookfield Properties 285,000 2014
1200 17th Street 2 1200 17th St., NW Akridge 162,000 $110 2014
900 G Street 2 900 G St., NW MRP Realty/ASB Real Estate 103,500 $65 2014
Gallery Tower 2 627-631 H St., NW Monument Realty 72,000 $42 2014
1525 Fourteen 2 1525 14th St., NW Furioso Development 38,400 $11 2014
1728 14th Street 2 1728 14th St., NW Perseus Realty 14,534 2014
1442 Pennsylvania Avenue 6 1442 Pennsylvania Ave., SE Douglas Development Corporation 2014
601 Massachusetts Avenue 6 601 Massachusetts Ave., NW Boston Properties 430,000 $150 2015
Donohoe Companies/Holland
1111 New Jersey Avenue 6 1111 New Jersey Sve., SE 201,400 $50 2015
Development Group LLC

1. may include non-office components 2. delivery date may reflect phase I delivery or final phase delivery


Office Development
Development Highlights

1000 Connecticut Avenue 1111 North Capitol Street
Location: 1000 Connecticut Avenue, NW Ward: 2 Location: 1111 North Capitol Street, NE Ward: 6
Developer(s): Connecticut & K Street Associates LLC Developer(s): Boston Properties/National Public Radio
Architect(s): WDG Architecture PLLC/Pei Cobb Freed & Partners Architect(s): Hickok Cole Architects
Contractor(s): Clark Construction Group LLC Contractor(s): Balfour Beatty Construction
LEED: Platinum Estimated Cost: $180 million LEED: Gold Estimated Cost: $115 million
Status: Completed Targeted Delivery: 2012 Status: Under Construction Targeted Delivery: 1Q 2013
Specs: 1000 Connecticut Avenue is a 12-story, 384,000 sq. ft. office Specs: NPR’s new 330,000 sq. ft. headquarters will feature a theater/
building offering approximately 13,830 sq. ft. of retail space. The production venue, open-concept newsroom and incorporate the
building delivered in 2Q 2012 and Arent Fox LLP will occupy 236,000 sq. historic Chesapeake & Potomac Telephone Co. warehouse.
ft. of space in 2013.
Image courtesy of CoStar


1700 New York Avenue 440 1st Street
Location: 1700 New York Avenue, NW Ward: 2 Location: 440 1st Street, NW Ward: 6
Developer(s): Carr Development Developer(s): First Potomac Realty Trust
Architect(s): SmithGroupJJR Architect(s): Fox Architects
Contractor(s): Balfour Beatty Construction Contractor(s): Sigal Construction Corporation
LEED: Gold Estimated Cost: $80 million LEED: Platinum Estimated Cost: $40 million
Status: Under Construction Targeted Delivery: 3Q 2013 Status: Under Construction Targeted Delivery: 2Q 2013
Specs: Carr entered into a long-term ground lease with the Corcoran Specs: The former Class-B, 105,000 sq. ft. building is undergoing a gut
Gallery of Art and will build an eight-story, 124,000 sq. ft. office rehabilitation with the addition of two stories. Once completed the
building. Sullivan & Cromwell will lease about 58,000 sq. ft. of office Class-A building will offer 140,000 sq. ft. of space in 10 stories.
space.


Office Development
Development HIghlights

Image courtesy of KCCT
900 G Street
Location: 900 G Street, NW Ward: 2
Developer(s): MRP Realty/ASB Real Estate
Architect(s): Gensler
Contractor(s): James G Davis Construction Corporation
paho knowledge center
LEED: Gold Estimated Cost: $65 million
Location: 525 23rd Street, NW
Status: Near Term Targeted Delivery: 2014
Specs: The 93,553 sq. ft. YWCA building at the corner of 9th & G
Client(s): Pan American Health Organization
Streets, NW will be demolished and replaced by a nine-story, 110,000 Architect(s): Karn Charuhas Chapman & Twohey
sq. ft. office building with 6,500 sq. ft. of retail space. Contractor(s): Monarc Construction Inc.
Green Elements: This interior renovation optimizing
energy performance through lighting & thermal comfort
controls, HVAC, and energy star equipment. Low-emitting
Image courtesy of the AAMC

materials such as adhesives, sealants, paint, flooring, and
composite wood were used as well as recycled materials
such as carpeting, fabric wall covering and upholstery.
Status: Completed Delivery: Design-Bid-Build

The interior renovation of the former library at PAHO’s
Headquarters transformed the original circular space into a new
universally accessible Knowledge Center. The design integrates
the distinctive circular geometry of the building into three
functional areas arranged in concentric rings: conference rooms at
the center; support spaces including a library, built-in workstations,
and private offices in the middle ring; and ancillary spaces in
the outer-most ring. State-of-the-art audio-visual and video-
Association of American Medical Colleges
teleconferencing technology has been incorporated to facilitate
Location: 655 K Street, NW Ward: 6
emergency communications worldwide. The existing curved
Developer(s): Hines
Architect(s): Shalom Baranes Associates marble walls, new curved acoustical natural maple walls, new glass
Contractor(s): Clark Construction Group LLC walls and curved acoustical wood ceiling clouds define the spaces
LEED: Gold Estimated Cost: $115 million by combining elegance with functionality. Additional acoustical
Status: Under Construction Targeted Delivery: 1Q 2014 quality is achieved with the use of acoustical fabric-finished wall
Specs: The AAMC’s new 290,000 sq. ft. headquarters, located at the panels in the conference spaces and acoustical plaster ceilings
intersecrtion of 7th, K & New York Avenue, will include 14,300 sq. ft. of throughout the Center.
retail space. AAMC will move into the new building in mid-2014.

Learn More
about PAHO Knowledge Center

Office Development
Image courtesy of Stonebridge Carras LLC

3 Constitution Square Forensics Lab
Location: 155 N Street, NE Ward: 6 Location: 401 E Street, SW Ward: 6
Developer(s): StonebridgeCarras LLC/Walton Street Capital Developer(s): Department of General Services
Architect(s): HOK Architect(s): HOK
Contractor(s): Clark Construction Group LLC Contractor(s): Whiting-Turner Contracting Company
LEED: Platinum Estimated Cost: $140 million LEED: Gold Estimated Cost: $215 million
Status: Under Construction Targeted Delivery: 3Q 2012 Status: Completed Targeted Delivery: 3Q 2012
Specs: 3 Constitution Square is a 355,000 sq. ft. office building with Specs: The new 287,000 sq. ft. Forensics Lab combines police forensics,
11,000 sq. ft. of retail space. This project is part of Constitution Square, public health, a medical examiner’s office and drug-testing services. It is
a seven-acre, 2.6 million sq. ft. mixed-use development site. expected to eventually employ more than 500 people.
Image couresty of Monument Realty


Gallery Tower Progression Place
Location: 627 - 631 H Street, NW Ward: 2 Location: 1805 7th Street, NW Ward: 1
Developer(s): Monument Realty Developer(s): Four Points/Ellis Development Group/Jarvis Company
Architect(s): Cunningham|Quill Architects PLLC Architect(s): Devrouax & Purnell Architects/Eric Colbert & Associates
Estimated Cost: $42 million Contractor(s): James G Davis Construction Corp./Gilford Corp.
Status: Near Term Targeted Delivery: 2014 LEED: Silver Estimated Cost: $140 million
Specs: Plans call for a 82,500 sq. ft. building with 72,000 sq. ft. of Status: Under Construction Targeted Delivery: 4Q 2012–4Q 2013
office space and 10,500 sq. ft. of retail space (on two floors). If Specs: The new 50,000 sq. ft. United Negro College Fund HQ will be
adjacent parcels can be purchased the project could expand to part of a mixed-use project containing 110,000 sq. ft. of office space,
450,000 sq. ft. of development with retail, office and residential uses. 19,200 sq. ft. of retail space and 205 apartments (7th Flats).


Office Development
development Highlights

Image courtesy of Trammell Crow Company
Image courtesy of Shalom Baranes Associates

Square 450 Sentinel Square (Phase II)
Location: 655 New York Avenue, NW Ward: 6 Location: 1050 1st Street, NE Ward: 6
Developer(s): Douglas Development Corporation Developer(s): Trammell Crow Company
Architect(s): Shalom Baranes Associates Architect(s): SmithGroupJJR
Status: Long Term Targeted Delivery: 2016 (ph I) Contractor(s): Clark Construction Group LLC
Specs: Initial plans for Phase I (Square 450 West) call for 367,000 sq. ft. LEED: Silver Estimated Cost: $105 million
of office space with about 68,000 sq. ft. of retail space. Phase II (Square Status: Under Construction Targeted Delivery: 4Q 2013
450 East) could be a 260,000 sq. ft. office building with 25,000 sq. ft. of Specs: Sentinel Square’s four phases will eventually be able to
retail space. accommodate 1.3 million sq. ft. Phase II will be a 12-story, 278,817 sq.
ft. Class-A office building, with 13,337 sq. ft. of retail space that will
deliver in late 2013 or early 2014.

DOUGLAS DEVELOPMENT CORPORATION
enhancing communities & creating dynamic places since 1985

LEARN MORE
about Douglas
Development &
its future projects


Office Development

Visualization by Interface Multimedia
Image courtesy of Property Group Partners

Capitol Crossing U.S Coast Guard HQ
Location: I-395 at 3rd, E & Massachusetts Avenue, NW Ward: 2 Location: 2701 Martin Luther King Avenue, SE Ward: 8
Developer(s): Property Group Partners/Center Place Holdings Developer(s): GSA
Architect(s): Kevin Roche John Dinkeloo & Associates/SOM/Kohn Architect(s): HOK/WDG Architecture/Perkins + Will
Pedersen Fox & Associates Contractor(s): Clark Construction Group LLC
LEED: Platinum Estimated Cost: $1.3 billion LEED: Gold Estimated Cost: $950 million
Status: Long Term Targeted Delivery: 2016 (ph I) Status: Under Construction Targeted Delivery: 2Q 2013
Specs: Capitol Crossing will be a 2.2 million sq. ft., three-block, mixed- Specs: The new 1.2 million sq. ft. office building for the 4,400-employee
use development that will be built on a platform above I-395. Full build- U.S Coast Guard is located on the 176-acre West Campus of Saint
out will include 2.0 million sq. ft. of office space, 63,000 sq. ft. of retail Elizabeths.
space and 150 residential units.

DELTA ASSOCIATES
Photo by Freddie Lieberman Photography

Leading advisor and information provider to the
Washington-area commercial real estate industry

APARTMENTS | CONDOMINIUMS | OFFICE
815 Connecticut Avenue RETAIL | MIXED-USE

Market Studies | Repositioning Analyses | Asset Valuations
Location: 815 Connecticut Avenue, NW Ward: 2 Services Include:

Feasibility Studies | Litigation Support | Market Data
Developer(s): Alecta Real Estate Investment LLC
Architect(s): VOA Associates
Contractor(s): Forrester Construction Company CONSULTING AND ADVISORY SERVICES

Greg.Leisch@DeltaAssociates.com
LEED: Gold Estimated Cost: $36 million Gregory H. Leisch, CRE, Chief Executive

Status: Under Construction Targeted Delivery: 4Q 2012
MARKET PUBLICATIONS GROUP

Alexander.Paul@DeltaAssociates.com
Specs: The renovation of the 212,000 sq. ft. existing building includes
Alexander (Sandy) Paul, CRE, National Research Director
a new façade, the addition of a roof terrace, extension of the 11th and

www.DeltaAssociates.com | 703.836.5700
12th floors and renovation to all core spaces on all floors.


1
Retail Development
development
Description

Retail Development

DC Retail Market Snapshot
Retail & Retaurant Sales1 $10.0B
Population Growth (2010–2011) 2 2.7%
Retail SF Under Construction 3
1.16M SF
Grocery Stores Under Construction4 9

Retail development in DC has been on the upswing since 2009, when retail deliveries hit the second lowest level since
2001 at 266,000 square feet. Looking forward, it is expected that DC will see retail deliveries in excess of 400,000 square
feet in both 2013 and 2014.

Rhode Island Row with its 70,000 square feet of retail and restaurant space was the largest retail project to deliver this
year through August 2012. At the time of publication the project had leases with various retailers such as CVS, Chipotle
and Carolina Kitchen. By the end of 2012 it is expected that a total of 428,000 square feet of retail space will have come
on line. Most notably will be the new 154,000-square-foot Costco, set to open in November 2012 at The Shops at Dakota
Crossing and The Boilermarker Shops (Buzz Bakery, Huey’s 24/7 Diner, Bluejacket Brewery, Willie’s Brew & ‘Cue Sports
Bar) in Capitol Riverfront.

While food users such as restaurants and grocery stores have been the main driver of retail leases, several apparel retailers
opened or announced expansion plans in 2012. In Georgetown, Nike opened a 29,000 square foot superstore (one of
nine in the U.S.) and the Shops at Georgetown will be anchored by a new T.J. Maxx and HomeGoods (occupying a total
of 47,800 square feet) with J. Crew expanding from 8,000 to 14,000 square feet.5 J. Crew also opened an 8,625 square
foot store in Downtown DC in August and Charles Tyrwhitt opened its first DC store in the Golden Triangle in April. H&M
also announced plans to open a 21,700 square foot store at the newly renovated Chevy Chase Pavilion.

This uptick in retail development can be contributed to several factors,

1. Retailers are looking to expand into urban markets

2. DC’s population has increased nearly 43,600 residents since 20076

3. New retail projects bring modern retail space to the market

4. DC’s economy and buying power remains one of the strongest in the U.S.

5. There is significant market demand for retail in DC. DC’s ratio of shopping center square feet per person is 8.2, while
the DC metro area averages 27.87.

Grocery stores have recognized these trends for the past decade as 16 new grocery stores have opened in DC since 2000
with another nine under construction. Once dominated by Giant and Safeway, new grocers such as Whole Foods, Trader
Joe’s, Harris Teeter and Aldi have expanded into DC. Over the next two years, DC will welcome new stores from Giant,
Safeway, Trader Joe’s, Harris Teeter, Walmart, Sav-A-Lot and Costco.

1. CFO, Budget & Financial Plan (FY 2010) 2. Census (April 2010 – July 2011) 3. WDCEP (8/2012) 4. WDCEP (3Q 2012) 5. Washington Business Journal (9/24/12) 6. Census (2007-2011) 7. Delta Associates (Washington Area Retail
Outlook, 3Q 2012)


Retail Development

Retail Development (August 2012) 261 Retail Construction Starts (since 2000)
# of Projects Sq. Ft.

Completed 232 4,523,952
27 27
in 2001 18 226,178
26
in 2002 22 311,800
in 2003 19 347,229
in 2004 22 369,208
in 2005 25 706,923 23 22 22
23
in 2006 24 294,862
in 2007 22 378,658 20 20
in 2008 22 867,131
in 2009 27 265,943
in 2010 10 330,700 18
in 2011 11 312,345
in 2012 (YTD) 10 112,975
15
Under Construction 46 1,162,038
2012 delivery 14 315,082
2013 delivery 19 434,220
11
2014 delivery 11 399,736
2015+ delivery 2 13,000

Pipeline 179 7,733,925
7
Near Term 44 1,788,372
Medium Term 49 1,065,075 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
(YTD)
Long Term 86 4,880,478
Total 457 13,419,915

Retail Deliveries (sq. ft. in thousands) Completed Under Construction
867

707

11-year Annual Average 428 434
400,998 sq. ft. 400
369 379
347
331
312 312
295
266 315
226

113

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20121 20131 20141

1. projections based on targeted delivery dates of projects under construction as of August 2012


the new element of style.

Delivering november 2013 • citymarketato.com

Roadside Development salutes the Washington, DC Economic Partnership for its continued
success in attracting new businesses and opportunities to our nation’s capital.

Rapp AD V2.pdf 1 10/18/12 1:50 PM

When you think RETAIL,
think Rappaport
Retail Leasing • Tenant Representation
Property Management • Construction Management
Consulting & Receivership Services
C

Development • Marketing
M
Retail Real Estate Experts Since 1984

How can we work together?
Y

CM

MY
Henry Fonvielle, President
CY
571-382-1220 • Hfonvielle@rappaportco.com
CMY

K


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