Union Market Welcomes New Wave Of Apartments, Restaurants

The popular Union Market food hall in Northeast D.C. has drawn a host of new restaurants to the surrounding area over the last year, and developers hope it will soon attract hundreds of new apartment renters to the neighborhood. 

Two apartment buildings totaling 750 units near Union Market are close to completion and preparing to welcome their first residents this spring, marking the latest wave of development in the fast-growing neighborhood. 

"Union Market is very quickly emerging with two new large-scale projects delivering within weeks of each other, so you're going to see an influx of new residents there," said Level 2 Development principal David Franco, whose firm is a partner on both projects. "It's going to be another major milestone for Union Market."

The Highline, a 318-unit project from Level 2, FCP and Clark Enterprises at 320 Florida Ave. NE, will move in its first tenants next month, Franco said. The development team last month signed Orangetheory Fitness to occupy 3,255 SF of its 10K SF ground-floor retail space. 

The Batley, a 432-unit development from Level 2, Trammell Crow Residential and Edens, is also expected to welcome its first residents next month. The project's retail space will be anchored by La Cosecha, a 20K SF Latin market featuring over a dozen food, beverage and soft goods retailers opening in June. 

Edens, which declined to comment for this story, opened its adaptive reuse project at Union Market in 2012 and controls several other planned retail, residential and office projects in the neighborhood. The two upcoming deliveries represent the second and third new apartment buildings to open since Union Market debuted. 

The first apartment delivery came in September 2017 when LCOR completed The Edison, a 187-unit building at the corner of Florida Avenue and Fourth Street, in between the two newer projects. Trader Joe's opened in the building's ground-floor retail space in March 2018. 

The Edison reached full occupancy last summer, LCOR's Matt Hard said. The opening of Trader Joe's helped draw residents and the neighborhood's growing base of retail amenities has made the building one of the strongest in LCOR's portfolio for retention rate and rent growth, he said. 

"We've experienced some pretty good rent growth enjoying a temporary monopoly within Union Market," Hard said. 

In the less than two years between the completion of The Edison and the next two apartment deliveries, at least 10 restaurants and retailers have opened their doors in the blocks surrounding Union Market:

• Pluma by Bluebird Bakery opened in The Edison in February 2018.
• Blue Bottle Coffee opened at 1250 Fourth St. NE in March 2018.
• Trader Joe's opened in March 2018.
• Israeli fast-casual concept Shouk opened in The Edison in May.
• Japanese restaurant O-Ku opened at 1274 Fifth St. NE in June.
• Bookstore Politics & Prose opened at 1270 Fifth St. NE in June.
• Restaurant and bar St. Anselm opened in September at 1250 Fifth St. NE.
• Union District Oyster Bar & Lounge opened in September at 501 Morse St. NE. 
• The Village Cafe opened at 1272 Fifth St. NE in October.
• Stellina Pizzeria opened in The Edison this week.

The new arrivals add more offerings to a neighborhood that already includes the dozens of retailers within Union Market, plus Michelin-starred restaurant Masseria. The retail mix around Union Market has been carefully curated by Edens and other property owners in the neighborhood, Franco said.

"It's not just anybody who wants to move in there, it's: How is this new retailer going to speak to the lifestyle that the residents of this neighborhood want to live amongst and create something that's really unique and special?" Franco said. 

Two blocks south of the Trader Joe's, Red Bear Brewing opened its doors last month in the Uline Arena redevelopment next to the flagship REI store. The Third Street corridor between the Union Market neighborhood and Uline Arena has developments planned on both sides that will bring ground-floor retail, and developers see it becoming a cohesive community. 

"When we embarked on [Uline Arena] four or five years ago, just think about the state of Union Market then versus what it is today," Douglas Development principal Norman Jemal said. "We're very fortunate to be at the crossroads of three markets with Union Market, H Street and the right side of the tracks in NoMa."

JLL Executive Managing Director Evan Behr, who brokered a 40K SF office lease at Uline Arena this week, said the growing base of retail offerings has made the neighborhood more attractive for office tenants. He said the gradual nature of the area's development and the repurposing of historic buildings gives the neighborhood a distinct character that can be difficult to manufacture. 

"When you think about comparing this neighborhood to attractive emerging markets like The Wharf and the ballpark, this neighborhood will have an authentic, very original, very homegrown cultivated feel to it that doesn't happen overnight," Behr said. "It's more like aging a nice fine wine." 

The increasing number of retail offerings will need a growing population of residents living in the neighborhood to support them, developers say, making next month's deliveries well-timed. 

"The two buildings are going to have a huge impact. You're going to see a lot more street traffic," Franco said. "We've seen over the course of the last year the spillover from the market building itself onto Fifth and Fourth streets and the connection between Union Market and Trader Joe's. You're starting to see more of that now and once these two buildings open it's just going to be a seamless, continuous flow of pedestrians."

Hard said he thinks the two new buildings will complement The Edison, which he sees as a boutique offering with smaller amenities that will rent at a discount to the larger, amenity-filled buildings next door. And he thinks the surge of new residents will make it a more appealing neighborhood for everyone.

"The Edison proved the concept that we could deliver a successful residential project [near Union Market], but I do think 187 residential units can only do so much as far as supporting retail," Hard said. "I do think once there is more of a critical mass of residential folks being home at night, that's really going to boost the nightlife around Union Market."