Greg Dohler/The Gazette Preliminary construction has begun on The Exchange at Wheaton Station, a planned 17-story apartment complex at the corner of Georgia Avenue and Reedie Drive.

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Greg Dohler/The Gazette The MetroPointe Apartments were built above the Red Line Wheaton Metro Station on Georgia Avenue in Wheaton.
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Greg Dohler/The Gazette The MetroPointe Apartments were built above the Red Line Wheaton Metro Station on Georgia Avenue in Wheaton.

Greg Dohler/The Gazette Preliminary construction has begun on The Exchange at Wheaton Station, a planned 17-story apartment complex at the corner of Georgia Avenue and Reedie Drive.

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The office known as the Computer Building near the Wheaton Metro Station is nestled between two apartment complexes and a block from a planned 484-unit apartment tower that is expected to be completed in 2013.

But soon after Los Angeles-based developer Lowe Enterprises bought the five-story Georgia Avenue property in September, the company determined its first and only Montgomery County development should be more of the same, another apartment in Wheaton’s rapidly changing Central Business District.

Lowe officials last month announced plans to rebuild the nearly 50-year-old office as a 14-story apartment building, the strongest sign so far of a residential tilt to Wheaton’s redevelopment process.

“Generally, what happens is the residential comes first in these evolutionary markets,” said Lowe Senior Vice President Mark Rivers. “We think that the market here is likely to go through that cycle.”

County officials are negotiating a separate public-private partnership with Bethesda-based developer B.F. Saul that would bring 900,000 square feet of office space, 40,000 square feet of retail, a hotel and a town square to the Wheaton Triangle area across Georgia Avenue.

That project is years away, according to county officials. For now, a strong residential market is carrying the weight in an area developers traditionally don’t view as an office market.

“That’s why the county is involved. We feel that a viable urban center requires a healthy mix of functions,” said Rob Klein, from the county’s Wheaton redevelopment office. “You want to build on your attributes, but you also want to fill in those gaps.”

County officials said a strong apartment market is another reason for the Wheaton apartment boom. Delta Associates, a property research group, projected 11,694 new apartment units in suburban Maryland over the next three years, according to a 2011 midyear report. That’s up from 10,688 units at the same time in 2010.

Delta reported that stabilized vacancy for investment-grade apartments last year in the Washington region is 2.8 percent, compared with 5.8 percent nationally.

Washington Property Co. plans to build 221 apartments on the site of the First Baptist Church of Wheaton, two blocks south of The Computer Building. Several blocks to the north, Alliance Residential hopes to build 255 luxury apartments in place of another office building.

Wheaton had a population of 48,284 in the 2010 Census. The county council in November adopted the Wheaton Central Business District Sector Plan, which cited old buildings and a lack of growth for a population decline from a peak of about 66,000 residents in 1970.

Leonard Greenberg, chief executive officer of Bethesda-based Greenhill Capital, planned to build 600,000 square feet of shops, apartments and office space in 2004 when he bought property at the intersection of Georgia Avenue and University Boulevard. He said the county council was too slow in approving zoning changes that would have allowed for taller buildings on the property, which is now a row of retail shops with a number of vacant properties.

“To me, Wheaton should be more of an Adams Morgan, more of a village-like environment,” said Greenberg, who added the many apartment projects were an encouraging sign. “The reasons why places like Adams Morgan are popular is that they are high-demand areas where there’s lots of activity. You have young people living in accessible locations. Wheaton needs to be a place where people want to go, not just go to work and leave at the end of the day.”

Greg Ossont, deputy director of the county’s Department of General Services, said the county is evaluating moving the Park and Planning offices from Silver Spring to Wheaton to serve as one of the anchors in B.F. Saul’s project. Ossont said B.F. Saul is hoping to attract a federal tenant to its planned office building on the Wheaton Metro station bus bays.

Rivers said he is confident Lowe could begin construction on the apartments by the second half of this year. The company is exploring maintaining the first floor of the building as office space. Stacy Silber, Lowe’s attorney, said it planned to submit a sketch plan to the Planning Board by the end of 2011.

The change would leave a number of Computer Building tenants looking for new space. Rivers said Lowe is exploring keeping the first floor of the building as office space.

Stuart Cohen would have to move his Environmental & Turf Services company, which he said relies on its proximity to the Wheaton Metro station for access to Washington, D.C. Michael Trembley runs the American Career Institute, a vocational school and one of the Computer Building’s biggest tenants. Trembley said finding new office space near a Metro station would be a top priority for the school’s nearly 300 students.

Both realize that new space might be difficult to find in an apartment-heavy Wheaton.

akraut@gazette.net