A long-stalled proposal to build apartments on the site of an auto shop in the Fenton Village section of downtown Silver Spring has new momentum under a new partnership between two developers who plan to build 1,250 units in Maryland and throughout the region.
Construction should start this winter on 900 Thayer Ave., a 124-unit project that is part of a $250 million building binge announced by Chesapeake Realty Partners, based in Owings Mills and Bernstein Management Corp., of Washington, D.C. The development — previously called the Adele — has site plan approval for a mixed-use building that can include as much as 5,300 square feet of retail space.
The project sits at the southwest corner of Thayer Avenue and Fenton Street opposite a Safeway grocery and four blocks south of the Silver Spring Metro station. That’s a prominent corner in the Fenton Village district, where Montgomery County planners have set the zoning stage for large-scale redevelopment of a stretch of low-slung buildings.
The development has been defaulted, sold, revamped and shrunk since the Planning Board first approved the Adele in 2006. Plans originally called for a 145,471-square-foot complex with 96 multifamily units, 15,020 square feet of retail and 18,200 square feet of office space. Now the entire project is approved for 119,691 square feet.
Chesapeake and Bernstein also have approvals for three other projects in Columbia, Baltimore and Towson, as well as in D.C. and Fort Belvoir in Virginia.
In Silver Spring and elsewhere, the partners were able to take advantage of the misfortunes of other developers who ran into a variety of difficulties thanks to the 2008 financial market meltdown and real estate collapse.
In the case of 900 Thayer, the original developer lost ownership to lender American Bank and the 1-acre property was put up for auction in February 2012. The sale of the property closed last August for $4.75 million.
Project plans include two courtyards and a 24-hour fitness club. The site is one block from the new public library under construction, where plans call for a station on the proposed Purple Line light rail connecting Bethesda to New Carrollton in Prince George’s County.
The other Chesapeake and Bernstein apartment projects in Maryland include a 320-unit community in Columbia; 153 loft units, 6,000 square feet of retail space and a garage in South Baltimore; and 295 units in Towson. Another 82 units are planned in Washington’s Glover Park neighborhood north of Georgetown and 283 units in Fairfax County in Virginia.
New York-based Meritage Properties bought a small office building for $4.1 million in downtown Bethesda, where it plans a complete renovation, according to CBRE Investment Properties, which represented the seller, T&C Equities, based in Washington, D.C.
The property, 7514 Wisconsin Ave., is a five-story office and retail building at the intersection of Wisconsin Avenue and Old Georgetown Road, which sits a block north of the Bethesda Metro station. CBRE marketed the building as a value-add investment suitable for an investor to make upgrades and improve rental income.
With 18,292 rentable square feet, the building fronts both Wisconsin and Old Georgetown. Meritage retained CBRE for leasing.
Capital One Financial Corp., based in McLean, announced that it is buying Bethesda-based Beech Street Capital, one of the nation’s largest originators of apartment loans by Fannie Mae, Freddie Mac and FHA.
No terms were disclosed in the deal, which is expected to close in the fourth quarter of 2013.
The acquisition of Beech Street marks a major expansion into multifamily financing for Capital One, which started out as a consumer loan bank and credit card firm. The company has undergone a major restructuring, including the 2009 takeover of Bethesda-based Chevy Chase Bank.
Founded in 2009, Beech Street is an originator, underwriter and servicer of multifamily commercial real estate loans. The privately held firm originated about $4 billion in loans in 2012, making the company the sixth largest agency originator in the country. Beech Street services a loan portfolio of approximately $10 billion.
Beech Street has 10 offices around the country and about half of its 130 employees work at its Bethesda headquarters.
What the deal means for Bethesda’s office market is unknown. The Washington Post reported that Capital One will not cut any jobs in the takeover and that Beech Street will remain in Bethesda.
When Capital One bought Chevy Chase Bank, it gave up the firm’s 250,000-square-foot headquarters in Bethesda and moved its operations into 2 Bethesda Metro Center, where it is leasing a 22,025-square-foot space.
Federal Realty Investment Trust announced that it signed up six new restaurant tenants to its Pike & Rose mixed-use center in Rockville, which is replacing the Mid-Pike Plaza strip mall.
The eateries will open in fall 2014, when the first phase is completed at the development, which is the first major project to break ground under the White Flint sector plan approved in 2010.
In addition to the six new restaurants, the complex will include the first iPic Theater in the region and 250-seat music venue being developed in partnership with Strathmore Hall Foundation.
The six new tenants are Del Frisco’s Grille, Protein Bar, Roti, ShopHouse Southeast Asian Kitchen, and Lettuce Entertain You, and a yet-to-be named pizzeria.
Phase One of the project includes two residential buildings, an 80,000 square foot Class A office building and 150,000 square feet of retail. Upon completion, Pike & Rose will include 450,000 square feet of retail, 1.1 million square feet of office space, 1,500 residential units and a 300-room boutique hotel, sitting a few blocks north of the White Flint Metro station.