May 26, 2006

SUMMER EXCITEMENT

THOMAS CIRCLE REVAMP COMPLETE BY JULY, reports the Northwest Current.

FOGGY BOTTOM TRADER JOE'S OPENING IN JULY TOO, reports the Northwest Current.

May 25, 2006

What's the Impact of the Stadium?

Loyal reader Read Scott Martin recently wrote and challenged DC Bubble on our belief that the baseball stadium is helping spur growth near the waterfront. Rather than pointing to the stadium and the lack of developable land elsewhere, Martin asserts that "the Anacostia is revitalizing and growing because of good-old fashioned government intervention, not baseball. The military decided in the 1990s to move thousands of white-collar employees and contractors from Crystal City to the Navy Yard," then, then DOT moved its headquarters building there.

Ten years ago less than 3,000 people worked at the Navy Yard, and by the fall that number will be north of 16,000, Martin continued. "Baseball had nothing to do with [the growth]. As for running out of developable land, the Navy Yard rebuild was underway when the neighborhood north of Mass Ave. was still an urban prairie."

But wait, Mr. Martin, what's envsioned on the waterfront is a 24-7 community with offices, yes, but also entertainment and condos and apartments. A bunch of Navy contractors could not have spurred these other types of development. Most recently, Camden Living, a Texas apartment developer, bought two lots totaling about 41K SF in the 1300 block of South Capitol St. SW at the corner of O Street, just across from the baseball stadium site.

Crystal City, where the cadets were coming from, was famous for its 8 a.m. to 4 p.m. sterility. No one living there. No one dining out, shopping or whooping it up. Without the stadium, the waterfront would have developed much more slowly and very, very differently without the stadium. In ten years, M St. by the waterfront will look more like M St. in G'town than Crystal City.

RIP, RIP ... CUT DOWN THOSE TREES

Another problem with DC is that it has too many passive parks. Nice open green-spaces that offer very little in the way of recreation. Too many spaces without amenties, such as playgrounds, benechs, tennis courts, basketball courts, dog runs etc.

Given this fact of life, DC Bubble is unsympathetic to the following headline in the WaPo: "Urban 'Oasis' to Lose 50 Trees for a Garage" near the Marriott Wardman Park hotel in Woodley Park. While the trees are without a doubt are beautiful, the real shame is that this valuable land, next to numerous apartment buildings, is going unused as "a park." If we were to lose a (insert you favorite amenity here, i.e. a playground) we would cry foul too, but this land has none of these things and is another bad example of a passive park in DC.

The hotel owner, JBG Cos., plans to overhaul the property, to build the underground grarage and an eight-story extension to the hotel that will house about 120 condos. JBG also intends to convert about 400 of the existing 1,334 hotel rooms into condos. The work should be completed by late 2008 or early 2009. The DC zoning administrator ruled that JBG can build the condo tower as a matter of right. Members of the Neighborhood Advisory Commission are challenging that decision.

Wethinks placing a story in the WaPo about the trees is really about opposition to the condo tower. NIMBY folks also complained about curbcuts too. If you can't win the court of public law, fight in the court of public opinion.

DC WILL REMAIN PROSPEROUS WITHOUT FIXING THE SCHOOLS

"Education Becoming Top Issue For D.C.," says the WaPo.

But DC has done very well over the past 20 years, reviving and gentrifying, without fixing its school problem. The trend probably will continue too, if nothing changes. There are plenty of flush empty-nesters, young professionals and gays who are ready to ride the next wave of revitalization.

Yet a great city it will never be without a strong backbone of middle-income families that send their children to public school. Raising a family in DC is a commitment to urban life that no amount of upscale retail, cool entertainment zones or office canyons can equal. If there is a problem, the commuter says: "I'll be out of here in an hour," the 20-something with no family says: "I'll be out of here in a decade," but the family man says "Fix that pothole" because my kid or spouse with kid could fall into it. Familes committed to the city have no choice but to try to correct the wrongs and make the good better.

And for real estate, vast swaths of the Northwest, Northeast and Southeast would become more valuable by multiples of two and three, if the school system could be counted on to educate its children well.

The public school system is our weakest link. Fixing it is our path to greatness.

May 24, 2006

MOST ENDANGERED BUILDINGS IN DC

Provided by the DC Preservation League:

  • St. Elizabeths Hospital - West Campus. "The current redevelopment proposal of 4.5 million high-security SF of office space with is not compatible with the historic site. ... Redevelopment of St. Elizabeths Hospital should bring meaningful benefits to the surrounding communities. The current proposal turns its back on adjacent neighborhoods, presenting forbidding security, and bringing significantly increased traffic," says the DCPL. East of the River development is badly needed, but lets be sure the develoopment has favorable impact on the community.
  • The Armed Forces Retirement Home. DCPL says: "AFRH has enlisted the GSA to prepare a draft master plan for the site, which would incorporate intense mixed use development throughout with buildings as tall as 130 ft. This development would raise much needed funds to support the care of veterans at the Home." DC Bubble sees no problem here.
  • The McMillan Reservoir.
  • Walter Reed.
  • The Martin Luther King Library. The mid-century building "should be maintained and rehabilitated with a compatible use," says DCPL. Who's gonna write the check for this one?
  • Elementary Schools -- Slater Elementary School, Langston Elementary School and Armstrong High School "In the longer term, the city needs to find appropriate uses for
    these school buildings." Condos, condos, condos.
  • The D.C. World War I Memorial. Its a shame that this forlorn and forgotten monument sits alone on the Mall. How about moving it to a more accessible spot?


    pix by RobOldfield

SHOCKER

Sales of New Homes Jump, Show Unexpected Strength in April Amid Rising Mortgage Rates, reports AP. Given all the discounting that's going on with DC condos, this is a bit of a surprise. If sales are up here as well, why would developers be cutting prices?

OUR IDEA FOR MARTINI CARS ON THE METRO...

Did not make the final cut at the Appleseed Foundation's contest for the best idea to fix DC. What a sham.

Nonetheless, they have narrowed the list to 20 and want people to vote for the best three.

Here are two DC Bubble likes:

THE BUS FAIR CAMPAIGN
To speed travel by bus, Metro should mount exterior "parking ticket" cameras on buses to ticket (with digital photos/video) vehicles illegally parked at bus stops. These tickets should be expensive enough (>$125) to reduce illegal parking and subsequent violations should be pricier.

TALLER BUILDINGS IN EXCHANGE FOR MORE AFFORDABLE HOUSING
To encourage low-income housing, let developers build taller buildig in exchange for affordable housing. Let's keep the height restriction within a respectful distance of the Mall and Capitol, such as north of U Street/Florida Ave. NW/NE, east of 15th St. NE/SE, and south of M St. SW/SE. If a developer reserves 10% of the units in a new building for the poor and working class, then let's allow that building to be one story taller than allowed under the current cap. For each additional 10% of reserved affordable units, the developer can build one floor higher.

Other suggestions on the list might be good ideas (tax-free savings accounts for housing, tax credits for transit) but are costly and unfunded; others are politically unrealistic (tolls at the DC line). A martini cart on the Metro, by the way, would raised buckets of money for the cash strapped transit system.

May 23, 2006

LANDLORDS COMMAND HIGH RENTS IN GALLERY PLACE

Bedrock Billards or some variation of it will open in Gallery Place/Downtown on 7th St. across from the Verizon Center. With the arena, Lucky Strike and the movie theater, 7th St. can really lay claim to being an DC entertainment hub.

Rent in the basement space for this poolhall will command more than $80/SF, reports WashBizJournal. That's $400K a year for only 5K SF of space. This is serious money for a below-grade retail.

Commenting on the strength of the 7th St. corridor, Transwestern Commercial Services broker Bill Miller said there's a 30K SF parcel of retail expected to become available at 7th and H Sts. NW. CVS may stay in the space, says Miller, who's negotiating with the retailer. Nonetheless, more than 20K SF feet will be available at $100 a square foot and "no one has gone, 'You're nuts'" when they hear the asking price, Miller says.

Closing The Great Chasm in NW DC

Ten years ago one would stand at the corner of 16th and U Sts. and wonder about a walk to Union Station. Given the dangers and the lack of attractions, such an urban hike would have been left to those who crave adventure for adventure's sake. With the revitalization of U Street and the construction of the New York Ave. metrorail stop, however, the divide narrows each year and the desire to see what's out there grows.

Pushing this process along, a development team fronted by Chip Ellis plans to build a $100 mil, mixed-use project next to the Shaw metro stop at 7th and S Sts. NW, reports the WaPo. The project, called Broadcast Center One, would include a 100K SF office building for Radio One, which plans to move its headquarters from Lanham. It also will feature 23,000 SF of shops and restaurants and 182 condominiums that will range in price from $400K to the mid-$500K. Construction is planned to begin by year-end and be completed in early 2009.

Ellis also would like to redevelop the Howard Theater (below) at 620 T St. NW as part of his vision. The city accepted offers from developers April 13 and expects to take up to five months to select a winning proposal, said Derrick Woody, a coordinator in the Office of the Deputy Mayor for Planning and Economic Development. More on that project here and here.



With all this activity the lines are between where its ok and where is not are fading. Though gentrifaction undeniably has some negative aspects, the positive impacts are there for all to see as well. As we once advised Dupont Circle resident not to cross 16th St., we may someday tell those same people to met Capitol Hill friends halfway, near a renovated Howard Theater.

May 22, 2006

ON SECOND THOUGHT ...

Maybe the new librarian from Brooklyn is not great afterall, according to RawFisher. Ginnie Cooper, head librarian designate, has been accused of taking a vacation of the taxpayer dollar and taking excessive vacation time to boot at her old job. Nevermind this.

DC'S HOT SAYS NYC'S COOLEST

Highlights from a recent, ok kinda old, New York Observer pieces about DC. Full text here.

"D.C. Hotter Than Brooklyn: What’s In? Plame, Foosball, Bistrot Du Coin, Celibacy!"

"In Washington ... it’s not money that matters. “It’s power,” said [one woman], to nods all around. “It’s where you work. It’s who you know. It’s what committees you’re on.”

Pulitzer for the WaPo’s Robin Givhan. "Mustn’t that mean it’s time for New Yorkers to finally learn some fashion lessons from the District of Columbia, our much-maligned and terminally lame capital city?"

"'We have swimming lessons for our son at 12:30, and genocide at 2.' One hot thing about Washington is that you can be both selfless and fashionable."

SLOWING MARKET SAYS, says the WaPo. Year-on-year numbers still positive, but not for long we bet.

May 21, 2006

DC HOUSING CHECKUP

ZipRealty lists 3193 properties for sale in DC, as of May 21. Up by 124 from last week when there were 3069 properties for sale in DC.

Of the current listings, 937 or 29.3% show price reductions, as seen in the housing beta chart below.

OLD THREADS

Suburbs unsustainable, says WaPo. ... Cool loft. ... Greenspan sees "soft landing" ... Still lots of choices at Radius condo .... Robber town. ... Library chief. ... Food delivery. ... The Anacostia River as it could be. ... School closings. ... Two head scratching listings. ... Williams endorses Cropp. ... Prices coming down. ... Jesus was no sissy, says pastor, and Mayor has had enough. ... Older Threads.

May 20, 2006

WAPO SCOLDS ITS SUBURBAN READERSHIP FOR SUBURBAN LIFESTYLE

The pot called the kettle black today in the WaPo. Here's what they had to say about suburban single-family homes:

"There is an even more critical reason to rethink the suburban lifestyle: the energy it consumes. More than 40 percent of the planet-warming greenhouse gases that we collectively produce every day are directly or indirectly tied to our buildings. Half these buildings are houses.

How are houses and global warming connected? Our houses, like our cars, are powered by fossil fuels. When burned, these produce carbon dioxide, as well as small amounts of other greenhouse gases such as methane. For heating, most of our furnaces run on natural gas or oil and the carbon dioxide vents up the chimney. For cooling, lighting and appliances, we depend on electricity. Nationwide, about half of that is generated at coal-burning plants, which are huge polluters. Twenty percent more is generated at natural gas-fired plants, which are also polluting, but not as much. "

The third piece of the suburban lifestyle that is untenable for the long term is the nearly universal dependence on automobiles, which also produce prodigious amounts of greenhouse gases. Fuel-efficient hybrid cars can reduce the emissions of individual cars, but if a growing population maintains the level of car ownership we have now, we will have millions more cars on the road and the total amount of emissions will still be high."

May 19, 2006

YOU THINK YOUR LOFT COOL?

This guy has a cooler loft, plus "its the only true loft in DC," he points out. Well, nana, noo-noo to you too.


Just north of U Street, 923 V St. NW, it's "NEARLY 4,400 SQ FT OF ARTISTICALLY AND AWARD FINISHED LIVING SPACE, IT'S THE ONLY HOME LIKE THIS WITH 1500 SQ FT OF CLIMATE CONTROLLED UNFINISHED WORK SPACE, IT'S THE ONLY RESIDENCE WITH BOTH RESIDENTIAL AND COMMERCIAL ZONING (C2B-ARTS), IT'S ALMOST A 5,000 SQ FT LOT RIGHT IN THE VERY CENTER OF LOGAN DEVELOPMENT! IT'S A FAB HOME WITH A 2100 SQ ROOF TOP DECK!"

It costs $3.2 mil. Hmmm ... at that price point one would think they buyer would crave Georgetwon or McClean, not edgey U Street.

ONE ECONOMIST WARNS OF CONDO PRICE FREE FALL

"A rising inventory of homes in the DC region could fuel a double-digit price decline if interest rates climb higher," Economist Dean Baker of the Center for Economic Policy and Research said in the the WaPo. Condo prices could fall by as much as 30 percent, and prices of single-family homes could drop by as much as 15 percent, he prediected.

But former Fed chairman Alan Greenspan echoed Federal Reserve Chairman Ben Bernanke's analysis in a speech last night to the Bond Market Association in New York. "The boom is over. We can say that with some confidence," Greenspan said. But, he added, "there is no evidence that prices are going to collapse."

Greenspan predicted that the U.S. market was more likely to follow the path set by housing markets in Australia and Britain, where "prices just flattened out."

SALES ARE SLOW AT THE RADIUS

Its been more than a month since we last checked in at the Radius. Back on March 25, there were 11 units for sale at this Logan Circle building at 1300 N St. NW.


Surprise, surprise. On May 19, there still are 11 units for sale, according to Zip Realty. Considering how fast inventory is growing in DC, this is a sure sign that the fall is going to get ugly for sellers.

Then again, this strip in Logan Circle is quite a nice neighborhood with bars, restaurants and tons of shopping just a few blocks away. Owners who have not overextended themselves can rent their apartments and wait out the glut, some would get positive cash flow and others not. Either way to our mind, if you have rentable property, the best strategy at this point is to rent, not to sell.

May 18, 2006

WILLIAMS IS NO SISSYMAN; HE FIGHTS FOR GAY RIGHTS

Mayor Tony Williams has stepped into the fray and lashed out against some biggoted and mean-spirited remarks made by a local preacher, said WTOP and the WaPo.

Among other unbelievable things, Bishop Alfred A. Owens Jr. of Greater Mt. Calvary Holy Church on Rhode Island Avenue NE in a sermon titled Fan or Follower! preached the gospel that states "real men" in the eyes of Lord Jesus are heterosexual. Owens has this to say in the WaPo today.

The mayor said he was "shocked, sad and disappointed" with Bishop Owens. "I really have to condemn remarks like that whenever they are made against any group on the basis of sexual orientation, race, class, ethnicity or anything else," Williams said.

Murder Capital Becomes Robber-Town

First the good news: Murders are down by about 13% May 17, 06 vs. May 17, 05.

Now the bad: Robberies are up. For the third consecutive month robberies were up and the year-to-date total is up almost 10 percent in 2006 compared with 2005. As of April there were 1,177 robberies year to date. And they are up almost 19 percent for the month of April year over year.

The changing crime mix from headline-grabbing, drug-driven double and triple homicides to plain-old stick ups is one bad aspect of DC becoming more affluent, which of course is a good thing.

But does the growing trend of more robberies threaten the DC revival?

If we trade, the moniker murder capital for robber-town or whatever in the headlines there is the risk that people will be scared away. Part of the reason, the DC market was undervalued all those years was the high murder rate, but a high robbery rate would be just as bad for reviving the city and for property values. Greater visibility by the Metropolitan Police Department seems like part of the answer and that means the cops have to get out of their cruisers and walk the streets.

May 17, 2006

BROOKLYN'S LOSS IN OUR GAIN

The executive director of the Brooklyn, N.Y., public library system announced will resign her $200,000-a-year position to become the new executive director of the D.C. Public Library, DC ComDom reported. D.C. library trustees have scheduled a 9:35 a.m. meeting Thursday to make the appointment of Ginnie Cooper official.

Let's hope she can create/fix our pathetic library system. NYC has a great, well-endowed system. She will be in for the fight of her life with our entrenched and backward library. We hope change is on its way.

THE MILKMAN STILL DELIVERS

In the old days, the doctor used to make house calls, someone pumped your gas at the station and best of all fresh milk was delivered every morning by the milkman. But those days are gone. Or are they?

Washington's Green Grocer will deliver on a weekly basis fresh organic produce, fruit, cheese and, yes, milk to your door. A couple of hippie chefs years ago started this service on Capitol Hill, and we salute them for providing good service. Something we in DC have learned to live without.


They deliver small and large boxes to DC and to NOVA and Maryland too. "The business idea sprouted one day when we went shopping at our local grocery store in Dupont Circle and decided that we were tired of buying "tired" produce and thought there were probably many others who felt the same way," John and Lisa Zechiel say on their website.

"Our priority and focus is to provide excellent quality produce and customer service to every customer while helping to grow, support and encourage sustainable local agriculture." Sounds great to DC Bubble.

WHERE L'EFANT WANTED TO GO EAT AND DRINK

There are lots of bars and restaurants in DC in G'town today, but comparatively few in Southwest along the Anacostia. Master planner Pierre L'Enfant would have predicted otherwise.

A very long, sometimes interesting, sometimes not piece in the Financial Times points out that L'Enfant in 1798 chose to put the Navy Yard along the Anacostia, not the Potomac. Southwest had the capitol's best natural harbor, but development failed to take root along DC's second river because the waterway silted up.

"That opened the doors for the south-west waterfront and the historic port of G'town, both facing the Potomac, to become the city's commercial centres, tilting investment west," according to the FT.

This division only deepened in the 20th century, FT went on to say. "Since [the first world war] the south-east waterfront has been inaccessible to the people of Washington because of the river being allowed to become polluted to a degree the Potomac never was; abandoned, derelict sites; and the construction of a freeway right through it," Uwe Brandes, director of planning in the Anacostia Waterfront Corp. explained.

Spurred by the Baseball stadium and the fact that developable land elsewhere is running out, the neighborhoods around the Anacostia waterfront someday could be as dynamic and vital as those near the Potomac, i.e. G'town. We'll keep our fingers crossed.

May 16, 2006

JANEY GOES NICE AND EASY WITH HIS KNIFE

School Board Chief Clifford Janey promised to cut 1 million SF of empty school space, and he propsoed closing six schools (730,000 SF) and leasing space in others to get there. A total of $8.2 million would be saved each year, said the WaPo.

Though Janey appears to have met his target, one has to think he could have cut more. Recommended for closure are Fletcher-Johnson Educational Center in Southeast, Merritt Educational Center in Northeast, Shadd Elementary in Southeast, M.C. Terrell Elementary in Southeast, Van Ness Elementary in Southeast and Walker-Jones Elementary in Northwest.

But cutting more square footage would have politically required Janey to close some schools west of Rock Creek Park. Those schools, though, are sucessful for the most part and were spared. So like a very skilled fishmonger, Janey may have filleted the fish perfectly. To ask for more would have risked sacrficing some quality.

TWO HEAD-SCRATCHING DC PROPERTY LISTINGS

Like the mythical, odd house on the corner that no one ever seemed to come or go from, here are two listing that qualify as out of the ordinary.

In Dupont Circle here is a plain-jane one bedroom that "YOU MUST SEE TO BELIEVE! COMPLETELY AND NEWLY RENOVATED," says the listing. Located at 1718 P St., the condo has granite counters. New appliances, check. New floors, check. Pool, great. Parking, nope. Price? $599K. Almost 600K?!? Yup. The seller is either dreaming, crazy or both. Or the agent entering the data has shakey fingers.

Here is something else you don't see everyday: "Began life as a garage, and now is a modest but efficient apartment." This unique space is located in Logan Circle at 1413-1415 Swann St. NW. The lot size is over 1,600 SF at a price of $649K.

Priced high for the project that it is, but out of the ordinary too.

May 15, 2006

TONY WILLIAMS TO ENDORSE LINDA CROPP for DC Mayor, says press release. Hope its not a fake or oversell. We shall see.

PRICES IN METRO DC DOWN SLIGHTLY

Maybe the sky is not falling. Prices in DC and the suburbs by 2.24% over the fourth quarter 2005 to first quarter 2006 period, reported USA Today based on data from the National Assn. of Realtors.

David Lereah, NAR's chief economist, says the market is responding to growing inventory. "With the supply of homes picking up very nicely in many areas of the country, pressure is coming off of home prices," he said. "By the time we report second quarter data, I expect most areas will be returning to normal rates of price growth in the single-digit range."

On the other hand, Lereah is overly optimistic for the DC condo market in particular. There is lots and lots of condos coming on the market and it will take more than a quarter or two for the excess supply to dry up.

PRICES IN METRO DC DOWN SLIGHTLY

Maybe the sky is not falling. Prices in DC and the suburbs by 2.24% over the fourth quarter 2005 to first quarter 2006 period, reported CNN based on data from the National Assn. of Realtors.

David Lereah, NAR's chief economist, says the market is responding to growing inventory. "With the supply of homes picking up very nicely in many areas of the country, pressure is coming off of home prices," he said. "By the time we report second quarter data, I expect most areas will be returning to normal rates of price growth in the single-digit range."

On the other hand, Lereah is overly optimistic for the DC condo market in particular. There is lots and lots of condos coming on the market and it will take more than a quarter or two for the excess supply to dry up.

SUPREMES REJECT COMMUTER TAX

What gets us is when people from Maryland or Virgina complain about the quality of roads, city services etc., but don't pay their fair share. OK DC can't tax the income commuters earn in our city, according to WTOP and the WaPo.

But how about a higher restaurant tax, which DC residents get a credit for on their income tax return? Or a downtown snack tax, since the only thing many suburbanite buy in DC is lunch?

PRAY FOR A LITTLE TOLERANCE IN DC

Bishop Alfred A. Owens Jr. of Greater Mt. Calvary Holy Church on Rhode Island Avenue NE in a sermon titled Fan or Follower! preached the gospel that states "real men" in the eyes of Lord Jesus are heterosexual.



"It takes a real man to confess Jesus as Lord and Savior. I’m not talking about no faggot or no sissy,” said Owens on a church tape recording according to CityPaper. Breeders: “You ain’t funny, and you ain’t cranky, but you’re straight."

Ownes went on to urge all the heteros to come forward during the sermon. "Come on down here and walk around and praise God that you are straight. Thank him that you’re straight. All the straight men that’s proud to be a Christian, that’s proud to be a man of God!"

Yikes! Rather than getting all in a huff about this, there is a simple response we suggest. On the church website, one can "submit [a] prayer request" as long as the request is "400 characters or less." We suggest, not necessarily in order, asking for a prayer for deliverance, salvation, a brand new car or tolerance among the congregants of Mt. Calvary Holy Church. Your pick.

May 14, 2006

OLD THREADS

Underserved high-end condo buyer. ... DC prices high, but not very, very high. ... Development scorecard for southeast DC. ... Marion, Marion, Marion. ... Parks in G'town along the water. ... Walter Reed goes to the feds. ... Citronelle vs. Cityzen. ... Other cities fear the bubble more than DC. ... Anacostia looks better and better. ... Last minute historic preservation hi-jinks. ... Invest in real estate; we'll throw in the baseball team ... Dogs run amok in park. ... Last week's real estate data. ... Older threads.

PROPERTY INVENTORY

ZipRealty lists 3069 properties for sale in DC, as of May 13. Up by 92 from last week when there were 2977 properties for sale in DC.

Of the current listings, 883 or 28.8% show price reductions.



Thanks Wonkette and Goodspeed Update for the links.

May 13, 2006

THE RISE OF THE HIGH-END HIGH RISE

For the longest time, the options for the high-end buyer in DC were limited to houses and the few undivided residences in Kalorama and surrounding hoods. But more and more builders are focusing on this segment of the market.

This list includes Robertson Development and also the Fred Bahrami Collection. Below is his Q14, which is a 30-unit building at 14th and Q St. NW. More elegant than daring, the building oozes comfort and style. It features ceiling heights that range from 9 feet on the flats and 19 feet for the penthouse units. As usual, stainless steel and granite abound.



At this point there are only three units left. The studio is around $400k. A fifth-floor two-bedroom goes for close to $1 million. The "penthouses" must have sold well into the seven figures. Even a larger three bedroom with an office sold.

Given the prices and the state of the market, the success of Q14 shows how badly underserved the high-end condo buyer in DC was.

May 12, 2006

DC OVERVALUED, BUT SKY NOT FALLING, SAYS ANALYST

Michael Youngblood of asset-backed securities research at Friedman Billings Ramsey & Co. in BizWeek interview:

What makes you more optimistic than other housing experts?
"I look at two economic indicators that I think drive the housing market: the growth in employment and the growth in personal income. Getting a job or a salary increase is what motivates people to buy their own home."

Do you think the housing bubble argument is overblown?
"Absolutely. It's overblown because there is no national housing market, so there can't be a national house-price bubble. However, there are bubbles in 75 of the 379 markets I studied. A bubble exists when the ratio of the median existing house price to per capita personal income exceeds 6.8 times. This definition is based on historical data of when other markets, like Houston and Boston, had bubbles."

Where are the bubbles?
"Most of the bubbles exist on the East and West coasts in such markets as New York City, Los Angeles, Washington, Phoenix, Honolulu, and Tacoma, Wash. Only 12 of the 75 cities are located inland: Boulder, Colo., Coeur d'Alene, Idaho, Flagstaff, Ariz., and Las Vegas among them."

NIGHT OWL MARION BARRY IN TRAFFIC ACCIDENT, reports the WaPo. Barry (D-Ward 8) pulled his car out of a parking space into the path of an oncoming vehicle shortly after midnight this morning, police said.

The reporting officer checked off a box on the report asking whether the at-fault driver appeared to be impaired. But police did not charge Barry with driving under the influence, and they allowed him to drive his car from the accident scene. Police were not immediately available to explain the discrepancy. It is possible that Barry underwent a sobriety test, and passed.

Hmmm. Barry is one of those unfortunate souls, like Kieth Richards, who always seems to be under the influence of something.

May 11, 2006

NO NIMBY-ISM IN SOUTHWEST DC

"A Sleepy Neighborhood Faces Titanic Development," says the HillRag in a broad overview of the history of Southwest, as well as the impediments to and possibilities of development.





For decades, the Southeast-Southwest Freeway, designed to ferry members of Congress back to Virginia as quickly as possible, cut off Southwest from the rest of DC. Unless this is fixed, Southwest will continue to be disconnected, not matter how great the baseball stadium and other development.

HillRag reports that efforts are underway to connect the southeast with the rest of the city. For starters, there's "an ambitious initiative to revitalize South Capitol Street Corridor," plus build a new bridge. Also, the Overlook at L'Enfant Plaza is the subject of "a controversial redesign," which features a grand staircase that would provide a pedestrian corridor from the Mall to the Southwest waterfront. Water taxis and a new metro stop are also envisioned.

As for development, much is happening:

  • The Anacostia Waterfront Corp. is working on a plan that calls for a series of twelve-story buildings hugging the Washington Channel. These would be interspersed with smaller construction and vistas from Maine Ave. to the water,
  • The Waterside Mall is set for change too. Waterfront Associates, a joint venture between developers Forest City Washington and the Kaempfer Company, have partnered with the mallĂ‚’s owner NCRC to redevelop the site. The current deal calls for Waterfront Associates to acquire 13 acres of land outright while the NCRC retains a parcel for residential development,
  • Other smaller developments are on the way too.

Riverfront Insanity Coming To A Close In DC

Progess is being made on the effort to replace a parking lot in G'town with a waterfront park, said the WaPo. It's hard to fathom the mindset that thought it was a good idea to use the waterfront for a parking lot.



No matter. Progress is being made. The park is planned to span the area from Key Bridge to the end of 31st Street.

Phase 1 is the stretch upstream from Wisconsin Avenue to the boathouses at Key Bridge, and construction is expected to begin this summer. Phase 2 is the terminus of Wisconsin Ave., where a plaza and fountain would connect the riverfront to the street, and construction on that won't begin until more funds are raised.

The third phase of construction would create two separate paths for bicycles and pedestrians, and would install trees and benches, from the Kennedy Center to about a half-mile upstream near Thompson boathouse, where visitors can rent kayaks, canoes and bikes and where many rowers keep their shells.

Quibbles: its going to be a passive park. In other words, the park will have paths and maybe a bench or two. No playgrounds, no cafes, no dog runs etc. Baby steps are important. Once its built, the other stuff can follow.

pix from the WaPo

LOOKING ON THE BRIGHT SIDE

Turning DC's Walter Reed site over to the feds, rather than to developers, might not turn out as bad as DC officials and others fear. The General Services Administration will take 34 acres of the site for an unspecified purpose, while the State Department will take the remaining 79 acres for embassies and training and office space, said the WaPo.

Though the plan does not include tax revenue producing uses, the intensity of the government activity will increase over time. Furthermore, the State Dept. will add some cache. Once the site is built out, there will be greater interest in the residential areas around the site. Eventually.

Mayor Tony Williams and other officials fear and rightly so that these possibilities will go unrealized for years, if not decades. According to the WaPo, DC officials said that the two federal agencies' plans

"remain vague and that the federal government is holding on to the valuable land
without a clear purpose."
While a group like the National Capitol Revitalization Corp. would have really turned the site into something, the federal presence could work out fine as long as we don't have to wait 20 years.

May 10, 2006

HAUTE CUISINE 1980 VS. HAUTE CUISINE 2000

We recently has the luck/fortune to eat at Cityzen in no man's land and Citronelle in G'town on back-to-back weekends.

Let us disclose first that we never really enjoyed Michel Richard's Citronelle all that much. The service we have found to be very standoff-ish unless of course you are a DC glitteratti, i.e. a senator. Once on a birthday visit, the staff refused to alter the three-cheese cheeseplate-filled with goat cheese though one diner did not like goat cheese. All we were asking for was a little Brie, nothing special. At that price they could have accommodated us.


Anyway, the presentations at Citronelle were very nice, the food challenging but not tasty; reminds us of the 1980s. The fish I ordered was overly strong (ok perhaps a poor selection on my part). The mosaic appetizer (colorful shaved meats and veggies designed to look like a stained glass window) was great to look at, but not all that enjoyable. A lamb dish was very tasty but nothing special. Even the overly precise service felt dated.

At Cityzen, I was truly wowed. Textures and flavors were combined in new ways. Mushroom foam over truffles. Molten lobster pastry. The beef was tender and very flavorful. We still talk about the salted caramel served over the chocolate dessert. This place is extraordinary and well worth the accolades that Food & Wine Magazine ("One of the Hottest Restaurants in the World," May 2006) have awarded chef Eric Zeibold.


No doubt we are lucky to have a chef of Richard's pedigree here in DC, but Ziebold's arrival is a signal of how times have changed.

FEAR NOT DC, MIAMI AND LAS VEGAS MOST BUBBLICIOUS

Pointing his finger at South Florida, Warren Buffet said the following to CNN-Money:

"What we see in our residential brokerage business [HomeServices of America, the nation's second-largest realtor] is a slowdown everyplace, most dramatically in the formerly hottest markets. [Buffett singled out Dade and Broward counties in Florida as an area that has experienced a rise in unsold inventory and a stagnation in price.] The day traders of the Internet moved into trading condos, and that kind a speculation can produce a market that can move in a big way. You can get real discontinuities. We've had a real bubble to some degree. I would be surprised if there aren't some significant downward adjustments, especially in the higher end of the housing market."

While Fiserv Lending Solutions, a provider of mortgage and consumer lending services, warned Las Vegas real estate will tumble a whopping 8.2 percent in 2006, the largest predicted fall among the 379 metro areas studied.

For 2006, they say the DC-Arlington-Alexandria market will drop 1.7 percent and the Bethesda-Gaithersberg market will fall 2.5 percent.

May 9, 2006

GO EAST YOUNG MAN, HORACE GREELY MIGHT SAY TODAY

Cross DC's mighty, mighty Anacostia, if you dare. Bring your dollars and your sweat equitiy.

Reinforcing other assessmnets, a panel of experts predicted that property values will rise significantly in the next couple of years in Anacostia as the new baseball stadium and waterfront developments are completed.

The predictions were made at the Anacostia Economic Summit, a forum organized by the nonprofit Operation HOPE to make residents aware of business opportunities opening up in their neighborhoods. The program featured Federal Reserve Chairman Ben S. Bernanke, World Bank President Paul Wolfowitz and Washington Mayor Anthony A. Williams, who is the only one of the three that has crossed the river more than once when not very lost.

Operation HOPE CEO John Bryant estimated home values in Ward 8 would rise 20 percent when the baseball stadium is finished, which is scheduled for early 2008. "That's conservative, by the way," Mr. Bryant predicted.

Given that the rest of the market will drop at least 10%, a 20% rise would be nothing to balk at.

Ol' Easy Going Historic Preservation Board Gets Feisty

Another DC condo project has been stopped dead in its tracks at the last hour by the DC Historic Preservation Review Board, reports the Northwest Current. Castle Deveopment, which was planning to raze a Logan Circle building, to hoped to begin construction soon on condos. The Braxton Hotel, circa 1912, was set to become a 49-unit building.

Hold everything. A last-minute landmark application for the structure was approved late in April, though a demolition permit had been pending for 22 months. Quick action on one application, not so quick on the other. The unhappy developer claims the last minute change could cost him $2.5 million. Instead of building a 90 foot tower, the developer will have to save the structure and set back a smaller building on top.

Ok so what? Developer Joe Kisha loses a few of his top-shelf condos at the expense of the saving an historic structure. But, as our mom used to say, its not what the preservation board said, but how it said it. And when it said it.

Why the 11th hour dramatics? Reminds of what happened with Il Pallazo.

NOT EVERYONE CAN AFFORD TO LIVE WHERE THEY WANT TO, observes the WaPo. A beautiful little girl can't afford to live in Columbia Heights. Alas, we can't afford Kalorama. Life is so unfair.

May 8, 2006

EXPAND YOUR REAL ESTATE BIZ AND WE'LL THROW IN A BASEBALL TEAM

DC's Anacostia Waterfront Corp., four developers and a New York-based consultant soon will announce their "master development" plans for the area around the baseball stadium, said the WaPo.

Though playing a limited direct role in the development, the Lerners will help decide what is built on the 21-acre footprint of the stadium itself, city officials said. They also will have a 42 percent interest in the development of some land south of the stadium.

"We haven't had the opportunity to see all the plans and discuss with the D.C. Sports and Entertainment Commission and the [Anacostia Waterfront Corp.] all their plans," Edward L. Cohen, principal at Lerner Enterprises and one of Ted Lerner's sons-in-law, said at a news conference last week.

"We think it's a great area," Cohen said, pointing out that his company is building a 190,000-square-foot office building at 20 M St. SE and plans another building at 1000 S. Capitol St. SE.

The synergies abound.

THANK YOU FOR NOT SMOKING LETTING YOUR DOG POO ON OUR LAWN

DC has tackled the issue of smoking in bars and restaurants. But what about dog poop and urine? Some owners responsibly pick up after their dogs' poo, but many others don't. More than being unsightly and the killer of plants, dog waste can cause disease, groundwater pollution and attract rats, which eat the stuff.

But for many dog owners any talk about managing the problem leads first to denials that there is a problem, assertions that others don't understand and then just plain old disbelief.



While some might argue there is no problem, one only has to look at the small park at 17th and New Hampshire Ave. for evidence that things in some places have gotten out of hand. Back in the 1980s, this park was overrun with drunken Hispanic men who used the park as their personal urinal. So the park was "renovated" and the shubbery and benches removed to discourage this bad behavior.

Fast forward to this past Sunday, and see above how the park looks now. Lovely isn't it? Makes you long for the days when Tecante empties were strewn everywhere rather than Baby Ruth- looking turds. Barely no plant life survives this lunaresque environment. Dogs are off their leashes. No one, except dog owners and their pooches, can enjoy such a place, if enjoy is the right word given the sorry state of things.

C'mon MPD, if you are not writing traffic tickets on Sundays in Logan Circle, how about enforcing the leash and pooper-scooper laws. For that matter, how about the dog owners giving us non-dog owners a break.

May 7, 2006

OLD THREADS

New condos at 10th & V streets. ... Flea market fleeing to Arlington. ... Waterfront attracts developers ... Metro looks at retail ... Ledo pizza comingto NOMA ... No more luxury subsidies, says the Common Demoninator. ... We need meters in our cabs. ... Clues about the baseball stadium. ... Condo stirs controversey on Wisconsin Ave. ... Sinclair Skinner outed. ... NAACP looking at DC. ... Prices going up for residential rentals. ... Older Threads

PROPERTY INVENTORY

ZipRealty lists 2977 properties for sale in DC, as of May 7. Up by 96 from last week when there were 2881 properties for sale in DC.

Of the current listings, 830 or 27.9% show price reductions.


May 6, 2006

TO RAISE ITS PROFILE, THE NAACP PLANS TO MOVE to DC from Baltimore, says the WaP0. NAACP leaders complain about the commute from Baltimore to Capitol Hill. For their sake, we hope DC means DC. During the morning a rush a trip from Tysons can take longer than a trip from Charm City.

May 5, 2006

WHO THE HELL IS SINCLAIR SKINNER?

This website says he is a dirty rat and Councilman Adrian Fenty's right-hand-man on the campaign trail.

The allegations:

  • Skinner labeled Councilman Jim Graham "Gramzilla (The Black Business Killa);"
  • He supports a strip club in Columbia Heights;
  • He fought Temperance Hall for the wrong reasons;
  • He publishes the inflammatory Georgia Ave. Defender.
Sounds like a bad egg to us. But is this an anti-Fenty campaign trick?

DEPENDS ON WHAT THE MEANING OF THE WORD "IS" IS

The debate over DC's Tenleytown development is becoming Clintonesque. For instance, this post by Marilyn Simon on the Tenleytown listserve asks the question: "Is a 79 foot building shorter than a 64 foot building?"

At stake is Akridge development's proposed building at 5220 Wisconsin Ave, which is next to the Friendship Heights Metro. Proposed is a 60 to 70 unit condo with approximately 13,000 SF of ground floor retail space. Half of the building is 5 stories or lower and the other half is 7 stories. Currently there is a used car lot, an auto body repair shop and a flower store.


One might imagine the fight is over how soon the development can begin considering what's there now. But no. Simon and others argue that the building is too dense, too tall. Ackridge cried foul and said Simon is trying to mislead. Others point out that there already are buildings in the area as tall. And besides the site is next to a Metro stop.

Given the shabby state of upper Wisconsin Ave., why would anyone fight to keep what is pictured above and oppose what is pictured below? Or are we the crazy ones?

CLUES FROM ATLANTA

Wash Nats Prez Elect Stan Kasten, says the WaPo, worked on two stadiums in Atlanta including:

"Turner Field is known for its wide concourses, a brewpub that overlooks the field and small signs shaped like home plate that indicate how far fans are from home plate. The ballpark is kid-friendly: At one end is Tooner Field, a cartoon-themed interactive area, and Scout's Alley, with more interactive games, which Kasten called essential because children aren't inclined to sit still for a three-hour game.

Janet Marie Smith, an architect who worked with Kasten on Turner Field and Philips Arena, said yesterday that Kasten was innovative, stacking all the luxury suites at Philips on one side of the building in order to lower the upper level of seats.

His buildings also are designed to make money."

May 4, 2006

Here's A Tip For Ya: Get A Meter

Took two 10-block taxi-cab rides yesterday morning for $7.50 each and one this morning again for $7.50. The last cabbie did not have change for a $20 bill. He took my $20 bill, though he did not have change, and told me to call the police when I asked for my money back so I could get change. Unbelieveable.

We pay too much for cabs. We get rude service. We get dirty cars. The taxicab commission's priorities are to serve cab companies, first; dirvers, second; and passengers, last.

The policians don't care to rock the boat. The drivers don't care about passengers' desire for meters. Forget making arguments such as: you will get more business, Mr. Cab driver, if fares more closely match distance traveled as with meters because drivers don't want to hear it. Beleive us.

How to get meters? You could say "dont take cabs" but such a boycott only hurts those that need cab service. Here's what we propose: instead of giving a monetary tip, give a piece of advice: Mr. Cab Driver get us meters in our cabs. Here's you exact fare. For this to work you must have quarters in your pocket and enough dissatisfied passengers to participate.

True this is an extreme solution, but the when-are-the-meters-coming question has been outstanding for far too long. After two-and-a-half decades in DC, our patience has run out.

WHAT'S NEXT SUBSIDIES FOR CAVIAR AND CHAMPAIGN?

The Common Demoninator objects to the way public financing for housing is doled out.

"Many Washingtonians across the economic spectrum are beginning to question -- with good reason -- the definition of "affordable" being used in some proposals. Draping new projects in altruistic language about building "diverse" communities and helping residents with "special needs" may be merely disguising a scheme that continues to shovel millions of tax dollars into the pockets of wealthy developers, who have plans to build even more luxury housing with taxpayers' financial help."
To fix the problem, ComDom calls for:
  • Strengthend rent contol;
  • An end to "providing public financing and other forms of government assistance, including tax breaks, for housing developments that include expensive, luxury units."
  • Lowering the residential property "tax rate substantially to provide relief to homeowners who have suffered, in part, from government-driven inflation in the local housing market."


While DC Bubble sympathizes with the desire to keep DC ... well ... cheap, the wish flies in the face of reality. Its not that luxury housing is being marketed as affordable, it's that housing has become so expensive that what once was luxury is now merely affordable. In other words, DC now is expensive. So expensive in fact that many long-term residents arhavingng trouble just treading water. Maybe that means these people should move because they cant afford to live where they want to. I cant afford Kalorama, nor G'town. That's life.

Furthermore, more rent control leads to shabby housing ansubstantialll lower property taxes will lead DC down the road tfinancialal ruin.

Sorry ComDom turning back the clock is not the answer maybe some fresh thinking is needed. What do you think of idea #3?

May 3, 2006

LEDO PIZZA IN THE WORKS IN GALLERY PLACE/NOMA

Turning down millions for his property in the 400 block of Mass. Ave. NW, Austin Spriggs expects to sign an agreement in the coming weeks for a Ledo pizza franchise. Plans call for the pizzas to start coming out of the oven in 2007, says the WaPost.

But what could have been?

Trammell Crow offered Spriggs $2 million to $3 million in late 2003, when city records listed the peeling rowhouse's assessed value at $199,340. And Scott Frankel, a broker who represented Edenbaum, the largest single landowner on the block, also repeatedly tried to make a deal with Spriggs. He said Spriggs was offered about $1.5 million in 2003, but he wanted five to 10 times as much.

BUY YOUR LUNETTES AND UMBRELLAS IN THE METRO

Metro officials are considering allowing retail establishments — similar to the kiosks at shopping malls — inside 12 subway stations to sell merchandise to riders, said the WashExam. Though given the quality of the merchants that set up at these kiosks, DC Bubble wonders whether the change in policy is worth the trouble.

The proposal makes it clear that the sale of food and beverages would not be permitted, but asks potential retailers to indicate how sales revenue would change if food were allowed. If food would generate significantly higher revenue, transit officials said, they might rethink their stance. Hmmm ... how bout a espresso bar with ceramic cups and saucers to avoid creating trash? For that matter, how bout a martini bar with drinks served in glassware. In NYC where civilization was invented, the commuter railroads serve drinks on the platform.

One reason for easing restrictions is the amount of money these retailers could bring in for the cash-strapped agency. The ATMs already permitted bring in cash. Metro officials project that the 36 ATMs installed last year would bring in more than $1 million for fiscal 2006, officials said.

CONDOS, RESTAURANTS AND BARS BEGIN THEIR QUEUE AT NEW BALLPARK

If you think the lines for beer and hotdogs at RFK are long, you should see the queue of development companies lining up to develop the 50-acre Southwest waterfront now that the the baseball stadium has been greenlighted.

Seventeen companies from throughout the Washington region, New York, Chicago and Baltimore responded to the Anacostia Waterfront Corp.'s request for expressions of interest, said the Anacostia Development Corp.

AWC is the testing developer interest in the site, where it plans to transform a string of low-slung clubs and restaurants along the Washington Channel into a $500 million maritime-themed housing and retail district, said the WashBizJour.

AWC has left itself the option to select a developer or a series of development teams based on the content of the submissions, but officials say they could also issue a formal request for proposals. AWC used the same selection process to choose developers for an entertainment district around the planned baseball stadium.

Potential developers include: Akridge, Carr Enterprises, the JBG Cos., Republic Properties, Trammell Crow Residential, Western Development, John Buck Co. of Chicago, The Cordish Co. of Baltimore and New York-based Related Cos.

The long list in our mind proves that the stadium is/will be a sucess in driving development. There is no way the list would have been as long or as well-respected if it were not for the baseball stadium.

May 2, 2006

LIKE A TIMEX WATCH

DC condo developers are taking a licking but keeps on ticking. Architect Suman Sorg paid $3.8 million last month for the northeast corner of 10th and V Sts. NW, a block north of the U Street Metro station. She hopes to build about 45 condominiums and new offices for Sorg and Associates, says WashBiz.



Sorg's building is one of seven large residential projects within three blocks. Broadway Partners is planning 700 housing units at Eighth Street and Florida Avenue. LaKritz-Adler Development is building 65 a block away. Metro Properties' The Rhapsody is set to deliver 132 units at U Street and Vermont Avenue. And the D.C. Housing and Finance Agency wants to redevelop its sprawling Florida Avenue headquarters.

Sorg's building, to be called Logic, is "a roaring success, we'll probably do it again. If not, oh well ... I'm going to do what is logical." When confronted with the growing inventory, Sorg says people want to live in the city, and it's "still grossly undervalued."

Hmmmm ... sounds more like a hunch to us.

May 1, 2006

FLEA MARKET BECOMES A COMMUTER TOO

No longer will DC residents be able to buy their Chinese porcelin, vintage advertisements and oriental rugs on the chep at the G'town Flea market in G'town. Because of a needed renovation of Hardy Middle School, the market will relocate for 18 months or so during construction, said WTOP.

The temporary move to Arlington comes after being at the Wisconsin Ave. location for decades. "It will never be the Georgetown Flea Market. This is the Georgetown Flea Market," said one disappointed shopper. Some shoppers say they'll move with the market, though others say it the new location is simply too far away.




Vendors also offered mixed reactions, but most say they'll make the move. The market will be at its new location for about 18 months and will return when the construction at Hardy Middle School is completed.

Hard to believe that this institution could not somehow been accommodated in DC. Maybe K St. NW under the Whitehurst Freeway could be closed on Sundays for the market to give it a real Parisian feel. Adams Morgan? Dupont Circle? It's little things like the market that can and do make city life all the more interesting. It's a shame.

pix by furcafe

LIKE A TIMEX WATCH

DC condo developers are taking a licking and keeping on ticking. Architect Suman Sorg paid $3.8 million last month for the northeast corner of 10th and V Sts. NW, a block north of the U Street Metro station. She hopes to build about 45 condominiums and new offices for Sorg and Associates, says WashBiz.



Sorg's building is one of seven large residential projects within three blocks. Broadway Partners is planning 700 housing units at Eighth Street and Florida Avenue. LaKritz-Adler Development is building 65 a block away. Metro Properties' The Rhapsody is set to deliver 132 units at U Street and Vermont Avenue. And the D.C. Housing and Finance Agency wants to redevelop its sprawling Florida Avenue headquarters.

Sorg's building, to be called Logic, is "a roaring success, we'll probably do it again. If not, oh well ... I'm going to do what is logical." When confronted with the growing inventory, Sorg says people want to live in the city, and it's "still grossly undervalued."

Hmmmm ... sounds like a hunch to us.

RENTAL MARKET FLEXES ITS MUSCLE

The Washington metro area continues to perform stronger than any apartment market in the nation, Delta Associates said in its first quarter report. For D.C. with its large rental market, this could help prop up the sales market for condos, particularly one bedrooms.

The region’s stabilized vacancy rate for investment grade (Class A and B) apartments declined to 2.3%. This is less than one-half of the national vacancy rate. Rent increases continue, at 6.8% since March 2005 for all investment grade product – and even higher than that for select product types: 7.1% annually for Class A garden apartments. Net Absorption, at 4,300 Class A apartments over the past 12 months, has been running consistently 1,000 or more units higher each year than deliveries, so vacancy is declining and rents are rising.


In particular, Delta pointed to the following factors for a strong rental market:

  • A booming job market.
  • A transient work force that has produced a large pool of Class-A renters by choice.
  • A strong condo market that while moderating, continues to remove existing rental stock through conversions and switches.
  • High barriers to entry that have kept the pipeline of on-coming apartment supply in check.
  • High cost of for-sale housing that has disqualified some potential apartment renters from home ownership.

  • INVENTORY GROWING notes the WaPo.