Grady Management of Silver Spring announced that construction will start next month on a 283-unit apartment building in Hyattsville, marking the rebirth of an ambitious mixed-use plan to redevelop the 50-year-old Belcrest Plaza rental complex.
The mid-rise building — 3350 at Alterra — is a modest beginning, compared with the original $600 million proposal floated in 2008, which called for as many as 2,750 new apartments and townhouse-style condominiums, plus 278,000 square feet of office and retail space stacked together on 25 acres. The long-range plan promoted by lead developer Percontee of Silver Spring would include a pair of 17-story residential towers and a 33-story mixed-use commercial building designed to maximize the site’s location next to the Prince George's Plaza Metro station.
But the Prince George’s County Council, acting as the District Council, balked at the massive transformation of the original unit garden apartment complex, which comprised 566 affordable apartments in 27 three-story buildings. Instead, in 2010, the council approved a first phase that would allow Percontee to build only the 283-unit apartment building, a 356-unit apartment building and 57 townhouse condos.
Grady Management is to break ground on the first luxury apartment building on Sept. 14. It will include studio, one-, two- and three-bedroom apartments. Among the amenities will be a garage parking, pool and fitness center.
“Breaking ground on our first building with its new identity brings an element of excitement to the revitalization of this part of Hyattsville,” Grady President Gary Campbell said in a news release. “We are pleased to play a part in the history of this emergent arts district and its community.”
Whether Percontee’s larger plans ever come to fruition remains an open question, as the Hyattsville market struggles to build on existing upscale projects. Grady’s groundbreaking is a rare bit of good news for the area, after a series of bankruptcy auctions and failure to win a major federal tenant at nearby University Town Center.
In the past 15 months, the 244-unit Towers at University Town Center student apartment building, the neighboring 288,955-square-foot Metro I office building and an additional 227,000 feet of retail space all hit the auction block. The town center complex also was among the losing bidders when the General Services Administration decided to keep 3,000 federal Health and Human Services Department workers in Rockville, where a new 15-year lease was awarded for 935,000 square feet of office space, worth about $450 million.
First condos delivered in Silver Spring since 2007
RST Development opened the doors on its new 46-unit Orion Condominium, the first condo delivery in downtown Silver Spring in five years.
The boutique building offers units ranging from one-bedrooms starting in the mid-$200,000s to the high $300,000s for a two-bedroom with den.
The building, at 8005 13th St., is less than a mile south of the Silver Spring Metro station on the District line, immediately north of Eastern Avenue. It is next to RST’s new apartment building, the 195-unit Galaxy, which is 70 percent leased after opening in February.
“The Orion is a wonderful addition to Silver Spring, offering excellent affordability for generously planned units with an amenity package unlike anything in the market,” RST Development principal Scott Copeland said in a news release. “We are thrilled with the response to the Orion. We are experiencing strong interest from a broad range of people who want to live walking distance from Metro, arts and entertainment venues, restaurants and a strong retail base.”
The two buildings are connected to Silver Spring’s new Art Walk and an adjacent tot lot by a pedestrian path.
The Orion seems to be arriving just as demand for condos is climbing in the Maryland suburbs, after a long period of surging apartment rental rates.
A shortage of condos is developing in the Washington metropolitan area and “traditional condo flats remain in short supply, especially in Montgomery County’s inner suburb communities of Bethesda and Silver Spring,” Delta Associates said in its midyear condominium report.
In the year ended June 30, 373 new condo units sold in Montgomery and Prince George’s counties, Delta reported. That’s a sharp rebound from the 286 units sold during the previous 12 months, when the market hit its nadir. But demand doesn’t approach the 938 units sold during the 12 months ended in June 2008 or the peak of 2,322 units in 2006.
But the backlog of unsold condos and units back on the market is steadily shrinking. In Montgomery the inventory-to-sales ratio fell to 3.77, its lowest since 2005 and down from a peak of 7.25 in 2008. Prince George’s County condo sales have followed the same peaks and valleys and the ratio now stands at 4.07, down from 12.99 in 2008.
The renewed demand has some other builders getting back into the condo market, with 319 units available in projects currently under construction in Montgomery County as of June 30.
Regionwide, Delta reported that at least “eight condominium projects started construction or were converted so far in 2012, for a total of just over 200 units.” The firm estimates that about 1,300 units will begin construction this year.
Hyattsville apartment complex sells for $48.1M
A New Jersey investment joint venture paid $48.1 million for the Villas at Langley, a 590-unit garden apartment complex in Hyattsville, according to Transwestern’s Mid-Atlantic office, which brokered the deal.
Krieger Boulevard and Krieger Skyline, headed by investor Herb Klein, paid $81,635 per unit for the apartments, which were completed in 1964. Seller Sawyer Realty Holdings was represented by Transwestern co-directors Robin Williams and Dean Sigmon.
The Langley community, off University Boulevard near the intersection with New Hampshire Avenue, is a short distance from the University of Maryland, College Park to the east, and downtown Silver Spring. The complex sits between the two proposed Purple Line stations that would connect with the Metrorail system.
The sale benefitted from the strong regional apartment market, with vacancies down 70 basis points to 1.7 percent in the Maryland suburbs of Washington, according to the 2012 Mid-Year Apartment Report from Transwestern’s research affiliate, Delta Associates.
Camden Shady Grove apartments approved
The Montgomery County Planning Board approved the sketch plan to replace a proposed office building with a 475-unit apartment building in the Great Seneca Science Corridor in Rockville
The 503,072-square-foot project, Camden Shady Grove, would sit on a 7.6-acre plot in the northwest corner at the intersection of Key West Avenue and Diamondback Drive, where developer Camden USA of Houston wants to build next to a planned Corridor Cities Transitway station.
The site originally was approved in 1997 with room for 669,400 square feet of office space. One building was constructed, taking up 367,681 square feet. The new plan calls for of 498,072 square feet of residential space and 5,000 square feet of live-work units.
The five-story apartment building would be on what now is the Danac Stiles Corporate Campus.
Morgan Properties pays $27.4M for 588 apartments
Morgan Properties, together with partner Core Properties, announced that it bought a 588-unit apartment complex in Randallstown for $27.4 million.
The King of Prussia, Pa., company paid about $46,000 per unit for the Garden View Apartments, which marks its fourth acquisition in 2012.
The community is in the Liberty Road Corridor of Baltimore County, west of the Interstate 695 beltway. The surrounding neighborhood includes Northwest Hospital Center, which recently invested more than $100 million in a major renovation and expansion. A 160,000-square-foot Walmart Supercenter is across the street from Garden View.
“The purchase of Garden View Apartments is a natural fit with our current portfolio of 15 communities, comprised of over 5,000 apartment homes located in Baltimore-Washington, D.C., corridor,” said Mitchell Morgan, founder, president and CEO of Morgan Properties.
Curtis Bay warehouse sells for $15.3 million
Industrial Income Trust of Denver bought a liquor warehouse in Curtis Bay for $15.3 million, according to broker Cassidy Turley.
Cassidy represented High Street Equity Advisors, a Boston private equity real estate investment firm, in the sale of 7621 Energy Parkway, a 222,636-square-foot bulk warehouse. The Anne Arundel property is fully leased to Reliable Churchill, the largest distributor of wines and liquor in Maryland.
“This offering received tremendous interest from the marketplace with over 15 offers received on the property,” Cassidy Turley principal Jonathan Carpenter said in a news release. “The combination of Class A real estate with strong tenancy in a favorable market produced great results for the seller.”
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