The Daily Record: National Harbor Getting Apartments
December 15, 2010
The Greenbelt-based Bozzuto Group is teaming up with fellow D.C.-area developer Peterson Cos. to bring a 350-unit apartment complex to National Harbor, the first planned rental property at the Prince George’s County mixed-use development.
Stuart Prince, the residential development director for the Peterson Cos., said his company had achieved enough of a permanent community to move ahead with plans to add rental units to the 300-acre waterfront development. He said 75 percent of Peterson’s 423 condominiums at National Harbor have been sold, while nearly 50 percent of the 46 townhouses and four single-family homes at the development have been sold.
“Rentals are fundamental [to the development of National Harbor], with the rental market strengthening in our area, and we’ve always wanted to bring apartments to National Harbor,” Prince said. “Now that 75 percent [of our condominiums] have been sold, we thought now was the right time [to move ahead with rental units]. With the for-sale and condo building products, we thought it was important to get people vested in the development before we brought out the rental product.”
And Toby Bozzuto, president of the Bozzuto Development Co., said it’s important for a mixed-use development to offer all forms of housing.
“When you’re trying to create a new mixed-use environment, the more mixes of use that you have the better it will be for living, for the way it feels and for the intangibles of the way it works,” he said. “The mixture of housing types in that equation is very important. Different people have different needs, so the first rental apartment community in National Harbor provides people who want to live there for a year or two or whatever they want to do the option to experience the National Harbor environment.”
Christine Espenshade, senior vice president for capital markets at the Mid-Atlantic Multifamily Group at Jones Lang LaSalle in Baltimore, said rental housing could be a real asset to National Harbor as a whole.
“I think having good options for people is going to drive further retail and office growth there,” she said. “A lot of people want to live in that area, but need to be more mobile because of their jobs, or are not ready to buy. It’s a terrific location for employees that need to be in both Virginia and Maryland.”
Espenshade added that rental units were the one thing missing from making the development a truly mixed-use environment.
“[National Harbor] is one of the best master-planned developments on the East Coast,” she said. “It brings people who want to live, work and play all together in one of the best locations in the country, D.C., so it’s really genius. This additional [housing] option really makes this a destination not only for tourists but residents of the city as well.”
National Harbor has 2,700 rooms across five hotels, along with 250 time-shares and 22 restaurants. Two more restaurants are scheduled to open this month, and Disney has purchased a 33-acre piece of land where it intends to build a hotel.
Prince said the development has approval to reach a total of 2,500 residential units and 4,000 hotel rooms, although how the total will split among apartments, condominiums, townhouses and single-family homes hasn’t been decided yet.
Prince added that it makes sense to invest in rental properties, given the state of the rental market in the metropolitan D.C. area and the down housing market.
“With renter nation [on the rise] and homeowner rates on the decline, we want to meet the market, especially since D.C. is one of, if not the largest, apartment market,” he said. “The rental apartments are yet another product type, along with the offices, time shares, hospitality and the marina [that are already in place]. So it’s another product type we can deliver to our users out there.”
Bozzuto said it’s important for mixed-use developments to evolve, rather than the owners simply choose what offerings should be available to consumers.
“I think the best way to approach something that massive [like developing National Harbor] is to think about what uses would be viable in any given location, so you don’t add a use just to add a use, you do it because it will be viable,” he said. “You need to determine what the customer needs and wants and evolve around that, rather than dictate what people need and want. It really is an organic process.”
Montez Anderson, senior advisor on economic development to Prince George’s County Executive Rushern Baker III, said the construction of rental apartments at National Harbor will both improve the “town center” atmosphere of the development, as well as fulfill the wishes of county residents.
“We want to have a ‘town center’ type of environment in National Harbor,” he said. “I think there’s a desire for nice quality rental units in that part of the county. And with the community having a coffee shop, dry cleaning services [as well as retail and entertainment], you can really live, play and eat in your community, and that’s something that people desire.”