For Other Southwest D.C. Developers, The Wharf Is A Rising Tide Lifting All Boats
October's grand opening of The Wharf has created new activity on the Southwest Waterfront, but PN Hoffman and Madison Marquette's project is also boosting development away from the water's edge in other parts of the city's smallest quadrant.
L'Enfant Plaza, the station where five lines intersect near The Wharf, has a full pipeline of new development, courtesy of JBG Smith.
In June 2016, the developer finalized a deal with the International Spy Museum to move into a newly constructed 140K SF building in L'Enfant Plaza that will be significantly larger than its current East End home. JBG Smith Executive Vice President Britt Snider said The Wharf has been "the big tide that has floated all of our boats."
"What we were trying to do was create a better connection from the National Mall to The Wharf. Given the position of L'Enfant Plaza, that’s really where we felt like we could make an impact," said Snider, speaking Thursday at Bisnow's Future of Southwest D.C. and The Wharf event. "We felt there was an opportunity there, so we said 'what can we do?' The office market wasn't great, so we said 'how can we change what's going on here and create a cultural node?'"
Following the museum deal, the developer in January landed a 121K SF lease with the Urban Institute, allowing it to kick off construction at 500 L'Enfant Plaza. JBG Smith has two remaining development sites at L'Enfant Plaza, for 300K SF behind the spy museum and a 200K SF site on the northeast parcel of the complex.
There is a chance one of those sites could be another museum. Snider said several potential museum users have approached JBG Smith about the site because of the proximity to the Metro and the National Mall. He said the developer has viewed those as office sites, but would not break ground before landing an anchor tenant. He considers the Capitol Riverfront the biggest competition L'Enfant Plaza has for office tenants.
"It was a tougher conversation before when we didn't have The Wharf here as an amenity and when Southeast had the ballpark," Snider said. "Now, we're going to be much more competitive."
Southwest D.C. has not only competed with the area around Nationals Park, it also often been lumped in with it. But CityPartners Managing Member Geoffrey Griffis said that is changing.
"For so long, really up until a couple weeks ago, you couldn’t talk about Southwest without people asking, ‘how do you like developing around the ballpark?’" Griffis said, to laughter from the 250-person audience at The Wharf's InterContinental Hotel. "It goes to [the] whole point of what’s happening and what we’re all seeing firsthand, that there’s a real identity coming here in Southwest."
CityPartners, in partnership with Potomac Investment Properties, is working on a mixed-use development at 555 E St. SW, where it recently signed European boutique brand CitizenM as the flag for its 252-room hotel. The hotel will be built alongside a 196-unit apartment building. The first phase of the project, which delivered in 2014 across the street, consisted of a 214-room Hyatt Place Hotel above a new fire station.
For the multifamily portion, CityPartners is setting aside 30% of the units for senior affordable housing. The District awarded the developer the rights to build on the site back in 2009, before Mayor Muriel Bowser's new affordable housing requirements were implemented. But Griffis said the team decided to meet the standards anyway, and he said they wanted to make them senior affordable units to create more diversity of age.
"We made it into the paper and we've already gotten calls into the office that people want to lease," Griffis said. "We told them it's still a couple years out, but it's an indication that there is a lot of excitement and interest in this area."
In addition to creating a buzz among office tenants and apartment renters, the delivery of The Wharf's first phase has also boosted Southwest D.C.'s prominence in the minds of top architects, Madison Marquette Senior Vice President Daniel McCahan said. This has allowed Phase 2 and other nearby developments to draw best-in-class designers, he said, further increasing the neighborhood's appeal.
"Going back six or 10 years, the area didn't have the same recognition that it has today broadly in the real estate industry," McCahan said. "So when we set out to plan Phase 2, we were able to attract designers and other professionals that wouldn't necessarily have been part of the mix in the first phase."
Phase 2's roster of architects, led by Perkins Eastman, includes ShoP Architects, WDG Architecture, ODA and Rafael Vinoly Architects. Additionally, Morris Adjmi Architects will design its first office building in D.C. as part of The Wharf's second phase.
While these architects are designing visually appealing buildings for The Wharf, PN Hoffman CEO Monty Hoffman said he is just as focused on the public spaces.
"The challenge with object architecture is we're fawning over the bricks and mortar, but you see object architecture from a distance," Hoffman said. "That's not what we're about. We're about people and we're about the pedestrian experience and urban theater. So co-existing the architecture with the pedestrian and retail experience and the environment is something we're going to be focused on quite heavily over the next 12 months."
