Clarendon, Courthouse Development Wave Expected To Ease Housing Market Pressure, Spur Retail Demand

The Rosslyn-Ballston Corridor, a national model for smart-growth development along suburban transit nodes, has concentrated its highest-density development in the bookend neighborhoods for which it is named. 

But as development sites in Rosslyn and Ballston have become scarce, developers have begun moving forward with a series of projects in two neighborhoods in the center of the corridor: Clarendon and Courthouse. 

One of those developers, Shooshan Cos. Chairman John Shooshan, has been one of the most active builders in Ballston for years. Six years ago, his firm began working on a plan for three buildings totaling 580 units on land long used by the local Red Top Cab company near the Clarendon Metro station. 

Shooshan in 2018 brought on a partner, Trammell Crow Residential, and earlier this year the team delivered the first phase of the project, a 330-unit building branded as Alexan Earl. The project, at 1122 North Hudson St., sits on the same block as Spider Kelly's and Don Tito, two bars at the center of Clarendon's bustling nightlife scene. 

"Ballston is, for the most part, built out," Shooshan said. "There's not as much left to go in Ballston, so we had to look at different markets, and Clarendon became a very desirable place."

He said Clarendon is an appealing neighborhood for development because of its walkable retail amenities, its transit accessibility and the area's highly educated demographic. Shooshan isn't the only developer being drawn to the Clarendon neighborhood.

Mill Creek Residential broke ground in December on a 270-unit project at 3415 Washington Blvd., branded as Modera Clarendon. 

"Even with the expansion of amenities in Ballston and the growth in Rosslyn, Clarendon is still very much the heart of the R-B Corridor," Mill Creek Managing Director Joe Muffler said. He said the neighborhood's popular nightlife scene draws people in, and its accessibility on Metro and main roads makes it an attractive place to live. 

The Donohoe Cos. is planning a two-building project with 286 residential units and 224 hotel rooms to replace Clarendon's Silver Diner at 3200 Wilson Blvd. Orr Partners is planning an 11-story project with 239 units and retail on the site of Joyce Motors at the intersection of 10th Street North and North Irving Street.

Regency Centers delivered new office space as part of its redevelopment of the Whole Foods-anchored Market Common Clarendon complex, which it rebranded as The Crossing. The developer is now planning to create a new pedestrian-only plaza in the center of the property. 

"There is a great energy to the market as a whole with a lot of great projects," Regency Centers Vice President Andrew Kabat said in an emailed statement. "The plan is to not only ensure The Crossing’s place within a vibrant market such [as]  this, but also add in a few new surprises that we believe will keep it a draw for a long time to come.” 

The St. Charles Borromeo Catholic Church is looking to lease part of its 2.5-acre Clarendon site to a developer to build apartments. 

Directly to the east of Clarendon in the Courthouse neighborhood, Greystar is moving forward with two major developments. It acquired a site in February from Carr Properties at 2025 Clarendon Blvd., where it plans a 220-unit project. On the Landmark Block site at 2050 Wilson Blvd., it received Arlington County approval in March for a 20-story building with 423 apartments and retail. 

Greystar Managing Director John Clarkson said the developer began demolition last week of the aging, low-rise retail buildings on the Landmark Block site, and it plans to deliver the project in Q3 2023. He said the 2025 Clarendon Blvd. site is going through entitlements, and he hopes to break ground on it by Q2 2022.

Clarkson said the Courthouse neighborhood has all the same attributes that make Clarendon attractive, such as its demographics, the local school system and the walkability, but it hasn't experienced the same level of growth as its neighbor to the west. 

"We really want to establish a sense of place," he said. "With some real density, some real scale it will feel like we have filled in that hole in the doughnut between Rosslyn and Clarendon, so we're very excited about [the] upside of that submarket."

Arlington Economic Development Commercial Development Specialist Kate Paine said she thinks the residential density Greystar is adding will help boost retail demand in Courthouse and make it a more vibrant urban area.  

"Greystar is creating a critical mass of development there," Paine said. "That is really going to speak to the thoughtful strategy that is put behind the ground floor from placemaking to streetscape and retail leasing. That’s going to really transform that corridor."

While Greystar's first building is designed to target the young professional demographic that is often drawn to the Clarendon area for its nightlife, Clarkson said the second building is designed with more two- and- three-bedroom units for families. 

The single-family housing market around the R-B corridor has become so expensive that many families with young children who want to live in the area need to look at renting an apartment, Clarkson said. 

"In the Courthouse-Clarendon area, houses are selling for over $1.5M, and that prices people out so they have no real alternative other than to rent," Clarkson said. "And the quality of product there is dated, so we feel strongly that a well-executed product that caters to those families both from spatial needs, as well as financial needs, I think we have great opportunity to add something that’s sorely missing."

Muffler said the way the R-B corridor was designed, with single-family housing just steps from the dense, walkable main streets, drives up prices. 

"That's some of the most in-demand housing in the D.C. region," Muffler said. "No one can afford to live in some of these houses. It's the demand in general to live in Arlington, which is why housing is so crucial and why the county is focused on increasing its housing stock at all levels of the affordability spectrum."

While there is strong demand for housing, the large number of apartment projects moving forward around the same time could create a competitive leasing environment when they deliver.  

"There is a decent amount of supply coming over the next three to five years," Muffler said. "We feel pretty good about Modera Clarendon because right now it's the only thing under construction, so it’s going to hit a good sweet spot, but there are quite a few projects percolating at various stages with the county. I think there is pent-up demand, and I think that supply will be absorbed, but it is coming." 

Shooshan said he expects to be competing with multiple other buildings when his firm and its partners deliver the next phase of the development on the Red Top Cab site, a 267-unit project slated to break ground this fall. 

"Some will be more successful than others, but in the long run you could almost throw a dart in Clarendon and the project will be successful over time," Shooshan said. "It doesn’t mean they’re going to be successful in the first year or two after they’re completed, but I think over the next five to 10 years, that will be a valuable investment for anybody with a multifamily project in Clarendon."

Paine said the county has seen significant interest from developers in building apartments on sites that had previously been planned for office. 

"An effort that Planning and AED overtook was to help developers in their pre-construction get permitting for apartments, because there is demand for it in the county," Paine said. "That’s just one indicator of the housing that is needed here and the development along this corridor will help fill that demand."

As Clarendon gains more development, Muffler, who grew up in Arlington, said he hopes the neighborhood doesn't lose the quirky charm that makes it stand out in the region. Whitlow's, one of the neighborhood's most popular bars for years, closed last month, and its space is going to be partially taken by a Five Guys, ARLnow reported last week. 

"There is a weird part to Clarendon. There’s always been kind of a bohemian quality, and I do hope that gets preserved," Muffler said. "For any of us that were in our 20s last decade, there’s been a lot of turnover in the bars and restaurants we once partied at. Whitlow's just closed very sadly last week. So that part is sad, but also the natural progression of any market."

Paine said that while some bars and restaurants have closed, it often occurs at the end of their lease terms, and the spaces typically don't remain vacant for long. The space formerly occupied by Bracket Room, for example, was leased to a new bar, Brass Rabbit Public House, ARLnow reported last week. 

"I don’t feel like there’s going to be a crunch to push out longtime retail tenants," she said. "We’re not seeing drastic increases in rents that would cause for pushing out long-term tenants to make way for national retailers. That’s one of the indicators we would see. We’re not seeing that, and we’re not seeing landlords terminate leases early. It’s tenants taking their natural span of seven to 10 years and then moving on and then the space is vacant but then backfilled shortly."

Clarkson said the Clarendon-Courthouse area is drawing some bar and restaurant operators from the District who previously haven't had any locations in Virginia. He said he has seen this type of interest as his team has begun to lease the 17,500 SF of retail in the Landmark Block project. 

"You’re starting to see good retail from D.C., Shaw-type retailers, plant flags in the R-B corridor in Clarendon," Clarkson said. "Folks I never thought would consider the R-B corridor are now interested ... Hopefully there will be some names that haven’t necessarily been seen in Virginia yet, especially on the [food and beverage] and bar side."