Q&A with Skanska's Rob Ward
Skanska EVP and regional manager Rob Ward and his team have staked out their claim in the Capitol Riverfront with their office building, under construction now at 99.
Bisnow: Describe the Capitol Riverfront market.
Rob: There are several cranes in the air and a lot more coming. Obviously, the ballpark has been a great catalyst for that. The residential market there is doing extremely well. You've got probably 3,000 residential units under construction, with another 2,500 or 2,600 slated to break ground this year. That ties really well with the activity in the market from a retail standpoint. It's feeding on itself in a good way. There’s also a strong office market there with a low vacancy rate and more office product to come. Skanska has an excellent office building that is under construction and will deliver in 2018. We think we're catching this part of town at a very good time in the cycle. Right now we're the only spec office building under construction in the Capitol Riverfront.
Bisnow: Could you give more details on that project?
Rob: The project, 99M, is an 11-story, 234k SF office building, of which 11k SF is retail, and 223k SF of Class-A LEED Gold office space. We signed a lease with Metropolitan Hospitality Group and they are bringing two restaurant concepts to 99M: Circa and Open Road, which was announced last week. We still have 2,300 SF of retail space remaining on the M Street side of the building. We're very happy with the level of activity we have. I would say there's close to 200k SF worth of tenants that have expressed interest and that level of activity is really a positive sign.
Bisnow: Moving forward, how do you view your role at Capitol Riverfront?
Rob: We think we have a great location, at the Main and Main lane of the submarket, right at 1st and M. The tenants that have looked at it so far have been very pleased with what they've seen, the efficiencies they can make in their test fits and the overall environment of the Capitol Riverfront for their current and prospective employees. And more importantly, we're really excited about the neighborhood. I know what's under construction, I know what it looks like now, and I know what that market is going to look like in 12, 24 and 36 months. I think it looks great today, and it's going to be amazing in the next couple of years.
Bisnow: Have you seen construction prices rise in the Capitol Riverfront?
Rob: The construction business is doing pretty well and that tends to drive prices up a bit when subcontractors get busy. It tends to be a regional change. With the level of construction going on, we are seeing a little rise in construction costs.
Bisnow: What do you think makes the Capitol Riverfront a desirable place to live or move into an office?
Rob: It's really the combination of a great location and access to transportation with high-quality residential, retail and open space that make the Capitol Riverfront a desirable neighborhood. We've got a good residential base there. Obviously, the Nats have created a really nice entertainment base that's drawn people to a part of town that many years ago certainly wasn't frequented. You've got great infrastructure in terms of transportation, both vehicular and Metro. Then you add in the retailers, which really look hard at the demographics—the number of people and what they'll spend on any type of retail goods, services or food. They see the critical mass and as a result there are good number of very high-quality retailers, moving to this market. When you add all of those pieces to the puzzle then it's a great place to be an office tenant. If you have a wonderful office space in a market such as this that has all these amenities and parks, access to the river and retail, great places to live and easy accessibility, it's going to be a lot easier for you to attract talented employees.
