Housing Complex

Big Trades: Wisconsin Avenue Akridge Site to Pepco, H Street Murrys to Housing Developer

Basically where things are.

Today brings potentially bad news for Wisconsin Avenue and good news for H Street.

Bad news first: Michael Neibauer reports that 5220 Wisconsin Avenue, which developer Akridge had planned to turn into a mixed-use project, has sold to Pepco, which may use the site to expand its adjacent substation. Though Pepco might also incorporate some housing into the redevelopment, it's unlikely that the new plans will be as good as the old ones.

But then the (likely) good news! We heard in September that the Murrys at 610 H Street NE was under contract, and the sale just popped up in property records: An outfit called the Insight Property Group purchased the property earlier this month for ten million dollars. It's a huge site, going all the way through to I Street, and from the rest of their portfolio, it looks like mixed-use multifamily housing is in the cards.

Add that on to Jair Lynch's purchase across the street, and the 600 block of H Street will look really, really different within a few years.

  • DC Guy

    The PEPCO thing is pretty funny. All the people who fought tooth and nail against the development on a surface parking/used car lot will now get a PEPCO substation.

    Will the fight the expansion of the existing substation because of potential health hazards? Would they stand a chance of prevailing?

  • njp

    if you are doing h/ts both you & o'connell should probably give one to the neighborhood blog who broke the murrys story earlier today http://hstreetgreatstreet.blogspot.com/2011/11/murrys-property-on-600-blk-h-street.html

  • jeb

    Two thumbs way up on the substation! I would be mad if this were anywhere else in the city, but the Upper NW NIMBY'ers deserve this so much. Maybe next time we won't have to hear about a 5-story building on Wisconsin being TOO TALL, TOO DENSE!!

  • Lampredotto

    OMG, somebody call the ANC quick, make sure all those electrons don't get residential parking permits!!!!

    Enjoy your substation, jerks.

  • Anon

    Actually, the people who fought for a reasonable project (e.g. one that didn't involve 100% lot occupancy on a parcel abutting a pre-existing substation) lost and Akridge got the entitlement to build the project it asked for. The Smart Growth crew was just last week claiming this site/project as one of their victories over NIMBYism. And the consultant Akridge hired had written the saga up in the same way. So the blame the NIMBYs rhetoric is pretty funny -- scapegoating, pure and simple, with no regard for the facts.

    But hey, the first rule of RE development politics is never blame the developer for what happens at the site! Even when he doesn't deliver anything he promised you to get your support and when he makes a big profit regardless!

  • DC Guy

    Except that if the NIMBYs hadn't fought and delayed the project, the developer probably would have received funding before the market implosion.

    However, since the delay and additional costs were incurred, Akridge clearly moved on to other things. So now, the NIMBYs can enjoy the substation on the way to the Metro!

  • Anon

    The developer filed a PUD application and chose when to do so -- the timetable was set by Akridge. And thatPUD process, if anything, was quicker than usual. It's a process that is required if a developer wants to build something inconsistent with the existing zoning. It's not a "delay" or an "additional cost" imposed upon the developer by the NIMBYs. It's a built-in cost that a developer choses to incur in order to increase the profitability of a project. And this developer, as Lydia pointed out, made a handsome profit without building anything.

    If you're unhappy with the outcome, blame one or both of the property owners -- Akridge or Pepco -- not the community. And don't forget that the substation was already there and would have remained there even if Akridge had built condos next door. You'd have passed it on your way to the Metro regardless.

  • DC Guy

    Ah, but now "Anon" and their cohort can fight PEPCO when they propose building the sub-station at the rear of the property, next to the existing one, to maintain viability for street-front retail for the rest of the community.

    Anyone have some popcorn? This will be fun to watch.

  • Anon

    Everybody was pro-retail at that site.

  • DC Guy

    Except the retail option was not Matter of Right. The developer needed a PUD. Anon and their cohorts opposed the PUD.

  • Michael

    None of the parties in opposition to the PUD opposed a map amendment that would allow the inclusion of retail in the project.

    Akridge requested an increase in height of over 50% and a density nearly 3 times the density planned for that location. It was that request for increased height and density that was overwhelmingly rejected, not the request for ground floor retail.

    In fact, the petition signed by 500 nearby residents, over 90% of the households in the immediate area was quite specific. It was a petition to oppose the heights and densities proposed, and with no mention of opposition to the inclusion of retail in the project

  • DC Guy

    You can't pick and choose. It doesn't work like that.

    However, your neighbors will thank you for the substation.

  • Anon

    Right, it's the *developer* who got to pick and choose. Akridge chose to file a PUD that required significant upzoning. Had they chosen to file a PUD that requested a mixed-use residential/retail project in keeping with the scale of the existing zoning, there would have been no opposition. Again, the developer wanted more than it was legally entitled to build and if you want more, there's a government-imposed process for getting it. Akridge chose when to start the process. The process gave them the zoning relief they requested. They then chose not to build the project. Instead they sold the property, at a substantial profit, to PEPCO (who now gets to decide what to do with it). The property owners -- not the community -- have called the shots throughout the process.

    And, again, the substation has been there all along and would have remained there had Akridge built the PUD project. It's pure BS to claim otherwise.

    The irony here is the the true NIMBY position (in the classic free-rider sense) is the notion that somehow Friendship Heights is too valuable a location to host the utilities infrastructure that local residents all rely upon. And, of course, that the people who are so keen on densification don't seem to realize that growth requires more infrastructure.

  • DC Guy

    You can keep chiming in with this, but are you telling readers that a larger substation is preferred to the PUD? Are you saying that you and others won't oppose an expanded substation on that site?

    No one is opposed to having the necessary infrastructure to support the community needs, but do you think the same block as a Metro station on a main commercial corridor is the best, most economically efficient location?

    Is that really your position?

  • Anon

    The substation is already there. It would have remained there even if Akridge had built its mixed-use project. Presumably PEPCO would be in a better position than you or I to determine whether expanding the existing substation vs. building a new one somewhere else in the neighborhood is the more economically efficient alternative.

    Between the pre-existing electrical substation and the bus repair/storage lot, the block in question is predominantly light industrial, bordered by commercial at this point. Proximity to the Metro isn't the only relevant attribute of the site. And the 10 or so homes in this block were presumably bought by people who were aware of the nature of the block at the time of purchase. Arguably, from a neighborhood impact standpoint, it makes more sense to expand the existing facility than to build a another new substation somewhere in the middle of a neighborhood further away from Metro.

  • DC Guy

    So, um, it wouldn't be better to have the existing substation with some retail and housing next to it, rather than a block full of existing substation and more substation?

    And, how is to say the bus facility will be there forever? Maybe with enough impetus, both the bus area and the (new) substation area could be made into something better?

    I guess "Anon" and "Michael" will be happy because the substation and expanded substation means no new cars coming to their neighborhood.

    Too bad, it is potentially an incredible lost opportunity for the community and city.

  • brad

    I would suggest that Anon is only talking to Anon. Nobody of sound mind would actually prefer a substation to the Akridge project. The twisting of logic and ignoring the bigger picture is the signature trait of NIMBYs. Let's review: it was really the people who were in favor of having a building with vibrant retail and more new neighbors are the ones who are the NIMBYs. Man oh man.

    Another sign of this disconnection from reality is the continued repetition of the same argument in 4 different posts. We read it the first time, and knew it was twisted logic. Saying it a fourth time does not make it true. By any logic necessary to attain your ends.

    Let's hope you are as committed to opposing the Pepco substation. OR would your logic twist your thinking to believe this is a better use of the property because it will bring not one more person to live in your neighborhood? Good luck with that one.

    Of course that might mean others would not want to move anywhere near that substation, so maybe that makes sense to you as a tool to keep other people away from your neighborhood. That can truly be the only way you can sanely argue that a substation is a better use of that property. But I suppose to take any other position would mean you would need to admit you were wrong in the first place. And of course since you are the smartest person posting here, you could not have been wrong by opposing the Akridge project. That makes me sad for you.

  • Anon

    Oh, now I understand! I've stumbled into a theological debate and there's no way dogma is going to yield to mere facts. Yes, keep hating on your neighbors rather than trying to understand how development works. If only everyone was as right-thinking as you are, the bus yard and the substation would melt away and the streets would be paved with gold. Or maybe even a pie shop, bye and bye.

  • DC Guy

    But you still haven't answered the question. Do you prefer an expanded substation over the PUD as approved by the Zoning Commission?

    It is a simple "yes" or "no" response.

  • Anon

    Sounds like the revivalist is a failed lawyer....

    Seriously, you don't see the absurdity of asking an anonymous poster to choose between two development options -- one of which is not even on the table and the other of which hasn't been defined -- in a situation where the decision will be, and always has been, up to the landowner?

  • DC Guy

    And that is typical of a know-it-all blowhard who has cannot admit they were partially responsible for driving costs and time to the point that a perfectly good project was derailed and will now likely become even more unproductive space on what should be a thriving commercial area on top of a metro station.

  • Anon

    The project wasn't derailed; Akridge got the PUD it requested (in the time in usually takes to get PUD approval). The PUD didn't require Akridge to build, and Akridge was able to make a substantial profit without building anything. So Akridge sold (at a $10+ million profit). What part of that scenario don't you understand?

  • DC Guy

    The part that the opposition caused delays to the filing and process such that by the time the PUD was approved, the market had crashed. What part of that do you not understand?

    For whatever reason, they are choosing not to proceed with it, and have sold the property to PEPCO.

    I hope you enjoy the expanded substation.

  • Anon

    The delay part -- because it's a figment of your imagination. It was an ordinary PUD process, required by law given the relief requested, and the developer chose when to initiate it. 13 months from application to order is quick action on the ZC's part.

  • DC Guy

    A quick Lexis search:

    Friendship Neighborhood Ass'n v. Zoning Commission, DCCA No. 07-AA-1270, 08-AA-63

    No delay, really?

  • Michael

    You missed Akridge’s self-inflicted delay, which, along with the application date and normal time for PUD approval, clearly placed the effective date for the zoning approval well after the “market implosion.” So, contrary to your claim, even if there had been no community opposition, the developer probably would not have received funding before the market implosion.

    The original order became effective on October 26, 2007. The language in the official order followed closely the language of the proposed draft submitted by Akridge.

    The draft that Akridge submitted did not properly state two of the conditions that Akridge proffered. Akridge’s condition on residential parking permits applied only to owners of condominium units, and would have allowed renters to obtain RPPs, and Akridge omitted a condition restricting the size of trucks that could access the loading dock.

    Because the Zoning Commission used Akridge’s faulty language, the ANC had to file a motion for reconsideration to correct that error. The Zoning Commission took action on that motion, and the effective date of the revised final order was January 4, 2008.

    However, and more importantly, your claim that the project was derailed because of any delay doesn’t hold water. Before even the first zoning order was approved, condominium projects in the area were already having trouble obtaining financing and contracts on pre-sold units were being withdrawn. For example, in early November 2007, the developer of another PUD in Ward 3 requested a PUD extension. That developer was “unable to obtain sufficient project financing despite its good faith efforts because of changes in economic and market conditions.” The developer’s request was based on “changes in the residential condominium market, the prediction that housing values would continue to decline, and the lack of willingness on the part of lenders to finance speculative condominium projects.” That developer had initially pre-sold some of the residential units but those deals were withdrawn when the condominium market softened. The developer stated that this contributed to its difficulty in obtaining financing. All this occurring before the effective date of Akridge’s initial zoning approval.

  • DC Guy

    Blah Blah Blah.

    The delay tactic by the Friendship Neighborhood Association (http://fnadc.org/ - how does one become a member, and who is its leadership? Does it hold meetings?) pushed the developer off by at least 6 months. By the time the FNA decided to withdraw its appeal, the market was deteriorating. Everything posted on the internet suggests that Akridge was otherwise ready to move, except for the frivolous appeal that caused the delay.

    First, there was no delay, according to "Anon", but now "Michael" suggests that despite the delay, the project was flawed. I think most impartial readers, and anyone with access to the information can make their own judgments.

    "Michael" and "Anon" can rationalize this however they wish, but the facts are pretty self-evident.

  • Michael

    I did not speculate about the project, but pointed out that Akridge’s submission of flawed language that did not correctly state the loading and residential parking permit conditions caused a two-month delay in the final approval of the project.

    I also pointed out that the neither the 2-month delay that resulted from Akridge’s error nor the less than 5-month delay related to the appeal (during which time Akridge could have marketed units in their project, or applied for building permits) resulted in the inability of Akridge to obtain financing.

    The market had already “imploded” before the original approval (with Akridge’s conditions that allowed renters to obtain residential parking permits), and at that point, other condominium projects found that pre-sold purchases were being cancelled, and lenders were unwilling to finance condominiums in this area.

    Impartial readers can make their own judgment as to whether Akridge would have pre-sold units and obtained financing for a condominium wedged between a WMATA bus garage and a Pepco substation (with some units at risk of losing some of their windows if neighboring sites are developed), when other condominiums were filing documentation demonstrating that lenders were unwilling to finance condominiums that were not so encumbered.

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  • DC Guy

    "Michael" will note that the Wisconsin Avenue Giant has also delayed breaking ground on its project because of appeals. It is a classic stall tactic, that in this particular case, has resulted in the community getting a blank wall next the the metro station.

    Thanks all!

  • Michael

    @DC Guy, There already is a blank wall next to the Metro station. It is the back of the WMATA bus garage. We have not seen Pepco’s plans for the site, so we have no idea how that structure, further from the station, will address the sidewalk.

    Your concern about delays in breaking ground seems to be misplaced. Akridge did not need to break ground in the several months after approval while the appeal was still pending, and they would probably have not even had the permits in place in that time frame, but they could have advanced the project by beginning the process of marketing the units. They did not, nor did they begin marketing units after the appeal was withdrawn.

    At any rate, you seem to be ignoring the fact that other condominium projects were already finding that they could not secure financing, long before Akridge got its zoning approval in January 2008. Projects that had begun marketing, were cancelled, and some projects that had begun selling units found that the purchasers were unable to secure financing, with those sales falling through.

    In fact, in November 2007, another PUD in Ward 3 requested and was granted an extension, based on the evidence that they presented on conditions in the residential condominium market and the lack of willingness on the part of lenders to finance condominium projects, as well as the withdrawal of deals on pre-sold units.