This week Grandview Estates came on the market in Southeast DC. The community, perched high on a hill and overlooking the entire skyline of DC, is filled with European design and an awkwardly refreshing exterior. The development consists of 23 row-homes, each of which contain two bi-level condos stacked on top of one another. The homes, pictured above, have been finished unlike any other homes in Southeast DC. They boast a contemporary exterior much like that of 1024 W St NW, an ultra modern end-unit row home designed by Division 1 Architects which is currently listed by Debi Fox of DCRealestate.com for nearly $1.4 million. While I hate to compare the build and design quality of the two, you must admit the striking resemblance between the facades.
Grandview Estates is selling for between $315k and $355k depending on your unit choice being upper or lower. All units feature three bedrooms and two-and-a-half baths. These prices, while extremely competitive, are marginally higher than what I would expect the units to sell for in the current market and while the finishes look superb, we will be listing similarly sized single-floor three bedroom and two bath units for the mid $200′s in the vicinity.
We’ll see how the sales go….
This morning while returned from my ever repetitive daily walk to the Starbucks Coffee on P St NW between 14th St NW & 15th St NW I passed a new sign on the site of the Metropole, a new condo building at the corner of 15th St NW and P St NW. The Glen Construction sign was gone and in its place stood a new sign reading “Foulger-Pratt We Build to Last.” While this wouldn’t usually be something I would write about I thought it would be something interesting given the press release two days ago by Glen Construction in the Washington Business Journal.
Apparently Glen Construction, a company who has been around for nearly half a century, is going to be “closing” its doors come winter and is now down to a workforce of 12 employees, from an estimated 300 in its heyday. Locally, Glen Construction can be best known for their projects known as Rainbow Lofts and Georgetown Heights, two projects which epitomize quality in the construction industry. Recently, however, it seems like they have made some very big mistakes on their three current projects; 1010 Mass sold by McWilliams Ballard, Madrigal Lofts sold in-house, and the Metropole sold by DCRealEstate.com. The two greatest contributing factors to their demise was the slowdown in the high-end condo market and no having subcontractors ready to begin construction upon signing contracts with the developers. The latter of the two cause them to become victims to rising construction costs and slower construction scheduling, delaying both payments and project completion.
At the current moment, 1010 Mass is near completion and the project has been taken over by Faison Construction, who is suing Glen Construction for breach of construction and damages. Glen was not insured on this project. Fortunately they were on the Metropole, nearly 50% complete, and Madrigal Lofts, nearly 85% complete. Foulger-Pratt has taken over both projects in Glen Construction‘s place determining that “it was best to have another contractor complete the work.”
The results of such poor planning will only cause turmoil throughout the chain of parties involved. From the sales companies, to the clients, a catastrophe like this is sure to lose a few clients for the developers and sales companies.
Over the weekend a report was released stating that if the population in DC continues its current rates, blacks may no longer have the majority of the city in 10 years time. One source, William Frey of the Brookings Institute, said that DC is one of the few cities noticing such a rapid change, and with reason. If we take a look at the past two census surveys released we will see the dramatic change that Frey mentions in his report. I found the surveys online at census.gov, who’s studies show that between 2000 and 2005, the black population of the city decreased by 3%, from 60% to 57%, while the white population increased at 1%, from 31% to 32%. If we assume that the ratio of growth for both loss and gain will increase on an annual basis we can see that my estimates for the year that there may longer be a majority in the city will fall somewhere in between 2014 and 2018.
Its seems like gentrification may be inevitable for this city.
The census data can be found HERE.
Real estate bubble burst…Mortgage fallout…is there any end in sight?
Actually if you have been following up on the blog you’ll see all of the sources of data that all point to a strong real estate market for our local tri-state(district) area despite the downturn for most of the rest of the country. Well, yesterday in CNN Money released a report for the wealthiest states across the country and two of our three made the top 10 list. Thats right, our sister states to the North and South make more than 80% of the country. According to the Census Bureau, Maryland takes the lead for the average median income at $65,144 per year and Virginia ranks in at number nine at $56,277.
IT GETS BETTER!!!!!
WASHINGTON DC RANKS FIRST FOR AVERAGE INCOME GROWTH where the average median income rose 6.4% over the year.
So I’ll ask you…where is the fallout??? It might not be coming.
The article can be found here.
As mentioned in a post this week, Dwellings on Ontario, by Forest Development Group, is going to be completely eco-friendly. As part of everyone’s homework, we will be conducting research how best to manage the cost-effectiveness of a green initiative while still maintaining a profitable project. In charge of the entire projects is a great friend of mine, the infamous Jim Delgado, former code inspector for DCRA. As such, the developer is asking all of us to contribute as much input about ideas to help maintain our eco-friendly core value set. All this month I will be debuting new ideas, research and stats about what FDG quite possibly could be doing.
Today Im going to start with one of my favorites, the Green Roof.
So what is a green roof? A green roof system is an addition on top of the traditional roof which adds a layer of organic compound with vegetation, a fairly simple drainage system and a growing system.
Why a green roof?
According to greenroofs.org there are a significant number of benefits to providing a green roof on top of an artificial structure/your home.
Economic Benefits include protection of roof membranes resulting in a longer material lifespan as well as significant cost savings on energy heating and cooling costs. Greenroofs.org estimates that a roof with a six inch thick green roof reduced heat by 95% and heat losses by 25%. Thats a huge amount considering heating and cooling costs can cost upwards to $300-$400 per month in an average DC Condo.
In addition to the economic benefits, Green Roofs also add a layer of sound protection between you and the exterior. In a city like DC, a Green Roof can be a godsend among the traffic and noise pollution in an ever increasingly dense city.
As for FDG and their project on Ontario, their eco-friendly initiative will not only help the earth but it may mean a bit of extra media exposure as well.
As for me…this winter I’m going to get LEED certified, being only the second Realtor in DC with the certification (that I could find).
To those of you who are as dedicated to this blog as we all are about DC, I must apologize for being a bit more ‘offline’ than I would have liked to have been. Recently, I have been having meeting after meeting with developers across the city lining up to get insight, recommendations and designing a course of action in everyones plan for their releases in the upcoming spring market of 2008. Currently, KTRE is undertaking what I would consider significant steps towards our growing development team and a strong, and soon very happy, client base.
From a 14 unit building in Deanwood just 100 yards to the Deanwood metro which is about to be gutted and remodeled using what I consider luxury details in an affordable housing market, to a 42 unit complex in Randle Heights, a 20 unit in Barry Farms. Next year is sure to be a killer. An exciting one at that! Whats more exciting are some of the other possible developments we are working with, from a $7,000,000 lot in Sandy Spring, to the possible acquisition of a hotel site downtown, to another project with Gotham Development and their lineup of groundbreaking ideas involving some of the most influential faces in the city. What a year!
Basically what I’m trying to say is I’ll do my best to stay on top of providing the best information to everyone across the city, but its crunch time. In the meantime, please email me if you have any questions about development across the city. I would love to help answer.
This afternoon Forest Development Group and I signed a listing agreement for their new development at 2429 Ontario. The team and I are really excited about their new line of eco-friendly development catered towards the knowledgeable consumer. Our plan is to differentiate the product by building with not only comfort but with the environment in mind as well. Dwellings will have five single floor flats and two duplexes with private rooftop decks possibly complete with gardens and an active irrigation system that not only collects water to help the gardens on the roof but the common elements in front and behind the building. Pricing is going to start at around $550 per square foot and four deeded parking spots will be available for purchase.
The parties involved in the project are:
Developer: Forest Development Group
Project Management: Delgado & Associates
Graphic Design: Joe Velasquez
Printing: Dynamic Advertising Solutions
Sales & Advertising: Ken Taylor Real Estate & ME!
Construction Loan: Builders Bank
In House Lender: BB &amp;amp;amp;amp;amp; T
Title Work & Settlement: Paramount Title
Under the current zoning FDG plans on utilizing 2000 sq ft of the lot and a total construction area of 8000 sq ft. Its going to be a wonderful project. In my opinion the key to a successful introduction and overall sellable project will be differentiation between the effort FDG is placing on their construction vs the competition. In addition we are going to be working on developing a core brand for FDG and their upcoming line up of future development. Tomorrow I’m going to put up an area map and start uploading video news about the progress of the project and our competitive advantage over the rest of the market.
The address is zoned R5B, meaning the building has no side setbacks, no minimum lot sizes and no minimum lot width. Additionally it can be up to 50 feet tall with no limit on the number of stories but can occupy up to 60% of the lot itself.
Expected Release: Spring 2008
Its about time!!! Just as predicted all along, according to John Burns Real Estate Consulting, out of Irvine, California, DC will be one of the first cities across the country to rebound despite what many of you have read in your local paper. This comes as a relief to many of the sellers out there that may have caught the real estate jitters. Among the other cities cited were San Diego and New Jersey. Refer to my original blog about my brother here.
You may be asking what all this means. My interpretation of the release, despite difficulties in the mortgage industry is all too commonplace an answer. DC’s population is nearly 40% subsidized by government funding. On top of the stability of public servants incomes as well as the general population here, the government is about to undergo a significant turnaround in their political population, thereby increasing the need for housing movement. I wouldn’t be so worried, this is still the most powerful city in the world.
The Washington, DC-office of Marcus & Millichap, a Real Estate Brokerage Firm led by its team of Matthew Clinebell, Jim Kornick, Ed Laycox and Gerald Burg, recently brokered a sale in Georgetown that ranks as one of the most expensive this year.
Manhasset, NY-based Sivan Properties purchased the 4,195-square-foot street retail property for $6.7 million, or $1,597-per-square-foot, from Rock Creek Property Group. Thats nearly the price of a condo in NYC!!!
With an address of 1329 Wisconsin Avenue NW, Jones New York tenants the two-story building with two of its shoe brands, Bandolino and Easy Spirit. The building is located in the heart of Georgetown’s elite shopping district that is a destination for Washington residents and visitors.
According to just about every source I could find, Redfin, the famed online real estate “brokerage” released their DC branch last night. Originally from California, Redfin has come quite far since their establishment in 2002. According to an article out of Washington Business Journal
The company, founded in 2002, launched its home-buying service in 2006 and is already doing business in Washington state, California and the Boston area.
While traditional Realtors typically command a 6 percent commission on transactions — 3 percent for the seller’s agent and 3 percent for the buyer’s agent — Redfin’s online brokers charge home sellers a flat fee of $3,000 upfront, or $4,000 at closing, regardless of the house’s price. For buyers, Redfin rebates two-thirds of the commission, which can be as much as 2 percent of the price. The company also provides online video tours of homes and allows customers to quickly compare home prices.
Some Realtors argue online real estate companies like Redfin should not be allowed to tap into the Multiple Listing Service, the comprehensive database of homes for sale in specific markets around the country.
Although anyone who pays the fees for access to MLS data is entitled to its contents, the D.C.-based National Association of Realtors (NAR) says online companies are essentially stealing from traditional real estate agents.
“The Internet-only businesses are not in the business of actually listing properties and selling real estate,” said Walter Molony, a spokesman for the NAR. “These companies are just skimming data, and they’re skimming off the profits of others.”
Redfin CEO Glenn Kelman declined to comment in advance of the company’s launch in D.C.
Redfin’s model hasn’t exactly been met with open arms, at least not on the regulatory side. Eleven states prohibit companies from giving homebuyers rebates on real estate commissions. The District, Maryland and Virginia, however, do not.
Redfin does have one big ally in its corner. The U.S. Department of Justice is pursuing an antitrust lawsuit against the NAR, contending that the association is engaging in anti-competitive behavior against online home brokers. The NAR policy for “virtual office Web sites,” or VOWs, contains a provision that allows Realtors to prohibit their listings from being displayed on competitors’ Web sites.”
Read the full story here.
More on my opinions tomorrow!
Newspaper Clipping. CLICK TO ENLARGE!
Several months ago I was speaking to a client of mine about where I was intending to purchase in DC and I mentioned that I would most likely be purchasing in the area between Florida Ave NE and H St NE, East of Union Station. Wouldn’t you know what DC released this past week. Marriott is building a hotel right on top of the train at Union Station.
According to DCMPED, the developer, Finvarb Group, based out of Florida, broke ground this past Friday on their new site for 218 rooms. The hotel is based in the NoMa area.
As a part of the development agreement negotiated by the District, 35 percent of the construction contracting must be done by businesses certified by the District’s Local, Small and Disadvantaged Business Enterprise (LSDBE) program and 51 percent of the new jobs must go to District residents. Additionally, the project financing includes a 20 percent equity stake from LSDBE investors.
The hotel will also be the first in the District’s emerging NoMA neighborhood, which lies between Union Station, the Florida Avenue Market, Eckington, Bloomingdale and Northwest One. The NoMA area is expected to produce more than 20 million square feet of new development, $500 million in new tax revenue and 36,000 jobs during the next 10 years.
According to BusinessWeek Online, there is new competition to Zillow.com, an online real estate service dedicated to helping consumers get an edge in real estate by providing valuable tools and information. The new site is Terabitz.com
According to Maya Roney, a writer from Business Week, “In my opinion, the coolest thing about Terabitz is its customizability (that’s a real word, I checked). Think iGoogle, but for real estate. For those without a personalized Google homepage, iGoogle allows you to add web feeds and “Google Gadgets” to the usual Google homepage so that when you go to www.google.com to search, you can also track things like the local weather, your stocks, your email or the top stories on your favorite news sites. With Terabitz, you enter a location and drag icons from the top of the page into “the workspace.” This way, you can simultaneously view maps, for-sale listings from a number of different sources, local photos, a list of restaurants or doctors offices in the area, population demographics, a mortgage rate calculator— you name it.”
Correct me if I’m misconstruing my perception of the market (which has been rather accurate so far), but with real estate as prime as what is available here, in DC, how can one consider purchasing a condo without parking???? Obviously depending on the buyers needs one may not need parking but take a look around. Seriously! This city is only becoming more dense, real estate is only going up, both literally and figuratively, and parking is going to be a strong selling point within 3-5 years if it already hasn’t affected buyers.
According to my research, deeded parking can go for as high as $75,000 as I experienced with a buyer looking in the Beekman Place community off of 16th St. Talk about prime real estate. According to DC law a legally deedable parking spot must be 9ft x 18ft. At a total of 162 sq ft, thats nearly $463 /sq ft. Condos in the same community are currently selling for $528 /sqft. Could it be a good investment? You tell me! (On Adams Mill there is a 124 sq ft spot selling for $75,000….$605 /sqft. PPPHHHHHEEEEEEW, thats as much as a luxury condo by BrookRose Development!)
I just came across an article by DCMUD, a publication by dcrealestate.com, that stated their prediction is that condo developments may be cut in half during the next two years when compared to the last two years. What does this mean? Well the simple answer is that an investment in SE DC will reap significantly more benefits than an investment in NW DC. Conisdering the article published last week, “Anacostia from Buy to Strong Buy” I cannot help but support the development of the cheapest land in Washington DC.
According to the estimates stated in the report, only 7600 condos will become available over the next 2 years, versus 13000 in the previous two. My impression of this downturn in release may come in part from a number of reasons:
-DCRA is horrible at aiding the process of condo conversion in Washington DC and based on my interation with many local developers, has scared many developers to maintain their development growth in areas outside the city.
-The real estate market has maintained steady but is unable to provide the growth rates once offered to any developer.
For those of you who are considering investing in our city or developing condos or townhomes, consider the SE Market. Even with sceduled production of unit releases, the earliest a development begun now would be sold is early spring next year. GET STARTED!
Yesterday, one of my clients asked me to see what I could find out a rumor he had heard in Friendship Heights. To my surprise there is a proposed development at 5220 Wisconsin Ave NW where there currently resides a car dealership. It turns out that Akridge Development is building their second mixed use development project, after their first at Gallery Place. I spoke with the project manager, DT who informed me that they will be looking to hire a new team to represent them in this development after their unsuccessful partnership with McWilliams Ballard on their previous Project. What seems more difficult to understand than their choice to use McWilliams is DT’s defense of PN Hoffman’s development success after speaking about the feedback I was given from clients of my own…ALL of whom have said they could have made a better choice in developments…but who am I to judge? If any of you have any feedback regarding PN Hoffman or are purchasers of Akridge’s first mixed use development please send me feedback on your purchase! I would love to post it.
More updates soon!
A gentlemen, whom I’ll call RG, was referred to me through another developer client of mine, Stu Kushner to whom I owe MANY thanks. Stu and I have been working together for about six months and have had much success on our first project together at Maricor Gardens Condominiums. Apparently, after our first meeting RG has several 12-15 unit buildings in NE DC that he is looking to develop. Talk about a wonderful opportunity! RG is looking to have a team represent him in the listing of the units, but that’s not all, he is looking for a team to help him develop, manage, oversee and design the entire development himself. Having worked with many developers before I couldn’t help but offer my team’s services to him and guess what, he accepted. After our last meeting this past Friday he is basically turning over the entire project to me! From design, to co-branding with Eagle Bank and a chair member and owner of Paramount Title, Ben Soto, for financing and title work, to project management under the possible direction of the infamous Jim Delgado, of Delgado Home Inspections (and one of my closest and most respected business associates) as well as staging and interior design by Melanie Moses, we might just have a winning project!!!!
What’s that you say? The condo market is going soft?
Well, I can’t argue that the market has slowed down a bit but soft, not so much. At least not with differentiation. Can you imagine a new generation of luxury-esque 1 bedroom condos for under $222k. How is this possible you ask? Well, here’s my proposal….
ABOVE ALL ELSE, CONSTRUCTION COSTS MUST REMAIN UNDER $100/sq ft.
In one of RG’s buildings there are 14-one bedroom units. Now, I’m sure anyone searching heavily for a new condo has seen the run-of-the-mill unit, granite counter tops, cherry cabinets, ceramic floor in the bathroom, stainless appliances, hardwood floors, neutral painted drywall, etc. Am I wrong yet? Well, quite frankly, I’m sick of seeing them. I want something different. The client wants something different. We need to differentiate ourselves from the competition. So imagine this….you walk into your unit, as you open the door to your right you glance over to the left wall and see an in-wall stereo running to speakers located in the ceilings of each room in your house. You look down, what’s that 6″ x 6″ niche cut out in the wall below the stereo…well…it’s the first generation of a fully integrated ipod dock linked directly to your entire house. YES, that’s right, FULLY INTEGRATED. Not bad eh? Well as you take your eyes off the stereo you look to the right and see a completely exposed brick wall. Not just any brick wall, but a brick wall painted with thick white lacquer, helping to brighten the unit but guess what’s hanging in the center of the wall…Your very own 42″ plasma TV. Still not good enough? So you walk across your light colored bamboo flooring to the kitchen in the far left corner of the unit and look around. What’s on the floor? It’s a new generation of flooring, deep amber colored stone filled in with tan grout? The texture is perfect and smooth enough to walk around bare-foot. As you look up you notice the white lacquer cabinets complemented by the brushed steel accents. The counter is a deep black silestone and the appliances are all stainless steel.
Back to the imagination….picture yourself 24 years old, ready to buy your first home. What would you want to bring your friends home to? I see it too! Pretty cool eh?
Update coming soon!’
An article was recently published on CNNMoney.com reporting on the top 500 zip codes across the US for the highest foreclosure rates and the only two in our metro region were the cities of Manassas and Woodbridge (Woodbridge has two zip codes, 22193 & 22191). Fortunately enough the rest of the area seems to be handling the market slowdown. What does this mean, if you are in the areas of DC, MD or VA, your home values should remain rather stable.
With all of the developer based or developer catered companies on the market and with such strong exposure to the consumer population by some other companies, you might be asking yourself ‘Why KTRE?’ Despite a somewhat limited time in the industry, I have prided myself on my ability to learn and adapt as quickly as possible to current market conditions and competition on the market. This has allowed my to strive successfully in an ever more competitive market especially with all of the blossoming companies on the market.
My impressions based on client feedback and corporate interaction!
Strengths: Great company, wonderful brokers and the right core branding strategy with extremely aggressive exposure for clients as well as a website that has been brilliantly set up to make consumers feel like DCRealEstate.com has many more clients than they actually do, driving up inquiries by potential buyers for greater business leads for in-house staff. DCRealEstate.com seems to always be the first mover in the development arena. (at this point you are probably asking yourself ‘whats wrong with them then?) Well heres where it seems like DCRealEstate.com faults…on my two interactions with them on different projects and with different members (one of which was with the broker) I was given a very poor service. Let me explain….on one of their projects, Bascilicalofts.com by Macy Development, I was the selling agent on one of their units. At first everything was wonderful, they did a great job marketing the building and staging a unit. My clients were ecstatic the moment they walked in the model and immediately after our first day showing property, were ready to write an offer. Alright…so far so good. After days of painstaking negotiations with their agent over a measley $2000 we came to terms and ratified. They used a mortgage lender, Leila Search, from First Madison Mortgage, whom I recommended & is a personal favorite of mine. Everything was perfect. Three weeks later we went to settlement and my clients were ecstatic.
A week goes by and my client moves in only to find out that Macy Dev had destroyed a Verizon router box on the property and my client was unable to get service because Verizon claimed that they wouldnt service the entire block until Macy paid for the box and Macy’s claim was that there was no box. To this day I dont have proof either way but what killed me was the agents reaction to the situation…”its not my problem now that we’ve settled, contact the developer.” What happened to commitment to service?!?!?!?!
On another development, the Metropole, a wonderful building caddy-corner to my building with incredible finishes and wonderful craftsmanship, I was working with a client interested in several of their units. Thats right, several! My clients needs are 3000+ sq ft, two car parking, outdoor living space etc. I thought I had found it. The Metropole has three units, 612, 613, and 614, priced between 650k and 750k, that my clients had the interest in combining and turning into one spectacular unit according to their needs. Well one afternoon they had the afternoon off and decide to stop in the sales office to get some information about the building. That afternoon we spoke and to my surprise they told me that DCRealEstate.com didnt seem like they were willing to accomodate any requests of my clients whatsoever regarding information about the three units. So I figured maybe they were asking the wrong questions and decide to go in for myself. Well, they were spot-on. I requested architects plans for the three units and was told I would receive them in a timely bases. A week goes by. Nothing. I call and ask. Another week goes by. I stop by and ask. Nothing. Two more weeks go by and still nothing. I go in and leave a note. SIX weeks after my first approach and my sixth time in the sales office did someone FINALLY go in and get the plans for me. What kills me even more is that my clients may have been willing to do all of the work themselves out of pocket and all we wanted were the plans.
Enough complaining….its not for me!
Urban Land Company.
A great little company with a very niche market stemming from work in the Ledroit Park & Eckington area. An area that my associate Melanie Moses happens to specialize in as well. Well the company is headed by a gentleman by the name Girard who, from my impression, has his company well under wraps and has done quite a job exposing himself to the market. My issue is that it seems to be the Girard show and their commitment towards developers is much less catered than I am hoping to offer my clients allowing them to keep me as hands-on & as hands-off as they need me to be. So where’s the room for the aspiring agent? I dont know if there is any.
Great company, solid reputation, great exposure. A little bit more into the lower priced developments than I would like to be.
Great company, wonderful reputation. I think they may be a little pompous for me though. I havent spoken with them much but my impression is that they are already too big to offer the catered services to their clients & I dont know how influential the agents are at this point to their developers. There seems to be a disconnect between the agents and their broker.
Wonderful company, solid foundation and wonderful reputation. I dont know what else there is to say. They are very well established, work with very high-end clientele but where is the room for growth. They may have maxed out their ability for dynamicity at this point.
YAY!!!! Ken’s reputation is solid, they have a wonderful reputation in the industry and his track record is impeccable. The company, partially directed by Vice President of the company, Tomas Guirola, has started its treck towards stardom. Ken is the brainchild (or should I say brainman) with 25 years experience, he is always available and has a very similar core set of values that I know I bring to the industry. Tomas is aggressive and HUNGRY, just like I am. They have their foot in the door with developers but nobody directing the show. This is where I come in! There seemed to be a position open in the company for developer liason, working on the day-to-day activities with the developers themselves that Tomas had been handling previously. Well, here I am today, and I couldnt be more confident of my choice. Ken and Tomas have been wonderfully supportive and we are already on our way to three new developments including the potential for two-nine million dollar projects in DC and an additional one in Maryland. Its on!