Author: Kami Kraft

Welcome to Kami’s Korner where we’ll take a deep dive into Arlington’s condominium market by focusing on what’s coming next. From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

Let me tell you about a recent rental car experience I had that got me thinking about the next generation of new construction condominiums. I recently got rear-ended, and no one was hurt thankfully, but it was an experience to say the least. I know what you are thinking. How the hell is this related to new condos in Arlington? But trust me, it is, or will be.

The accident resulted in my having to get a rental car. Once I completed my reservation at the agency, I went outside to the car lot with the agent and he asked me to pick a car. I looked at the thirty or so cars, various makes and models, and all were grayish soulless boxes. I half jokingly asked him “Do you have any that aren’t so ugly and boring? Good grief. They all look the same.” Rows of boring shades of gray, taupe, off white, white, or metallic with similar body styles. I asked him if he thought they all got together and decided to make the same hideous car. He laughed at me and said he didn’t disagree, while then steering me toward a red Tesla. As I opened the door to the Tesla it reeked of things I haven’t been around since college. I commented that at least someone was having fun in their rental car.

It got me to thinking about how we have seemingly sucked the life out of so many things since the pandemic era. So many things look the same- AI generated, Minecraft style futuristic, and terribly stark. Even McDonald’s restaurants, my kids’ favorite fine dining, is modern and minimal with mostly black and beige. What happened to the joyfully obnoxious red and yellow… where is Ronald McDonald? Even McDonald’s knew that red and yellow created emotional memory. Somewhere along the way, we forgot that lesson.

Why Design Memory Matters

Gray is now synonymous with the last generation of condos, a symbol of the gloomy pandemic era with gray cabinets, gray floors, and gray tile. That won’t work going forward and thankfully interior design is shifting toward a look that’s individually collected, warm, natural, and exhibits quiet luxury. Housing prospects don’t want to buy a new gray soulless box that looks like all the others and evokes no emotion. I’m not sure how the car industry arrived at the conclusion that they did. Cars and condos shouldn’t both suffer from soulless sameness.

Due to current economics, the next generation of luxury condos in the 2029-2032 time frame will be 30% more expensive than the last new builds. For new construction condominiums, the quality of the floor plans are of the utmost importance. I often say the true high-end buyer doesn’t compromise well. To get the pricing projected, the quality has to be world class. We can afford to make a few mistakes (slightly overpriced maybe or the views are marginal) but if the layout and the finishes are the very best in the marketplace, the condominium sales will be successful. The inside matters most. The consumer is very smart and picks the best residences first. Let’s give them some reasons to move.

For the last 10-15 years we’ve encouraged developers to include a few “memory points” in their design. This is something the consumer would not expect, shows someone with real talent was involved in the design process, and confirms that several layers of thought were given to the livability of the residences. We have fun with this, and it makes the consumer more confident in making a buying decision when the condominium has personality. (more…)

Welcome to Kami’s Korner where we’ll take a deep dive into Arlington’s condominium market by focusing on what’s coming next. From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

To understand where the market is today, let’s look at how the condo market has changed. What began as an affordable housing alternative for first-time homebuyers has become the pinnacle of true luxury urban living typical of a world-class city. Let’s explore the 20-year evolution of new condos in Arlington.

Early 2000s: Affordability Focused. Condominiums in the early 2000s were aimed primarily at first-time homebuyers. Affordability was key and this type of housing in Arlington wasn’t glamorous quite yet. The market was steady and interest rates, at just under 7% in 2001, were deemed attractive. Most buildings had 100- 200 units and the average size for a new condominium in Arlington was 950 sq ft.

Mid-2000s: Market Heats Up. In 2003 the market began to pick up speed, fueled by the abundance of financing and essentially loans that required no documentation or proof of affordability. During this time Ballston saw several apartment to condo conversions. Condo units were generally designed as apartments so unit sizes were smaller among all unit types. Finishes were acceptable but not great. This is when granite countertops became the epitome of quality.

New builds like Liberty Center in Ballston shifted the average size down while finish quality and livability of design improved. It was probably the best building of that generation. Like many others at that time there was a rush to buy and buildings were very successful in pre-sale. (more…)

Welcome to Kami’s Korner where we’ll take a deep dive into Arlington’s condominium market by focusing on what’s coming next. From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

I had the pleasure of attending the local Urban Land Institute’s Building Healthy Places Summit this week at Georgetown University. Our region benefits greatly because the ULI Global Headquarters is here in DC. More info about this fantastic organization here:  https://washington.uli.org . As a longtime member of ULI, I am continuously curious about the places that “thrive beyond the 9-5” and what is required to create active and economically vibrant neighborhoods in Arlington.

This includes a strong employment base, growing residential population, restaurants, entertainment, walkability, reliable transportation, mixed use development, safety, parks, and services that support daily life. In Arlington, we have a few of these exciting environments such as Clarendon and Shirlington, maybe Ballston, Columbia Pike, and Crystal City.

There is a new high-end condominium district emerging in Rosslyn centered on Gateway Park which will transform Rosslyn into more of an 18-hour city. As much as we like Rosslyn, it’s not there yet, but with three new communities coming, it’s the area that will see the heaviest influx of new condos in the next cycle. Residents are looking for an experience in their neighborhood.

Rosslyn is at an inflection point and with early renewed economic confidence, a micro-district surrounding Gateway Park is emerging. The condominium market has suffered a one-two punch and has yet to return to normal. The real estate development world was hit with COVID and brought the market to a standstill. I fondly call the current time period the “COVID hangover.”  Let me explain.

It takes years to bring a new condominium to market including at least 1-2 years of entitlement and financing, 1 year of design, and 2 years of construction. If you count back 5-6 years, no one local was doing any of that with any real enthusiasm.  Commercial markets then got hit with interest rates that roughly doubled, and then federal downsizing upset the situation.

Arlington is well poised for the return of luxury condos. It’s the second most educated city (behind Cambridge, Mass.) in America with 77% possessing college degrees. All the capital wealth makes 22207 the 36th most expensive zip code in the US with a median home price of $2.6M. Virginia is in the top 10 of US states for millionaires (roughly 275,000 or 8% of the residents). What do these people expect in the urban environment?

The next 3 luxury condo projects will all be overlooking Gateway Park, the new social epicenter of Rosslyn. To understand the effect this has today, just go visit Columbus Circle or Meridian Hill in DC. The parks are beautiful and safe again. Residents are visiting, smiling, taking pictures, enjoying the weather, lingering for longer, spending money, socializing, and proud to be there.

I, for one, can’t wait to witness the transformation. It will be a few years in the making and I’m here for it. Gateway Park is the connector for the next luxury condo district coming to Rosslyn in Arlington and it should produce an area that will “thrive beyond the 9-5.”

 Do send along your questions, inquiries, and design preferences for the next generation of condominiums to our market. My personal email is: [email protected]

Welcome to Kami’s Korner where we’ll take a deep dive into Arlington’s condominium market by focusing on what’s coming next. From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

Many of you have asked about best practices when it comes to buying a new condominium. Some of us only want new and are willing to pay a premium for the best in current design. There are several recommendations and insights here that will help you get what you want.

First decide what type of condominium you need… size, number of bedrooms, bathrooms, parking needs, or separate office, followed by a list of wants such as level of building service, amenities on-site, space for dining for six, balcony, open floor plan, and natural light. (Here she goes again.) Not to be sexist about it, but females generally are better shoppers and come with a preconceived set of non-negotiables.

Identify the areas you would consider living, such as Arlington or Old Town… but not wanting to go as far as Tysons, Reston, or DC. People don’t buy condominiums in places they aren’t familiar with or already spend time in, unless relocating entirely. Many upcoming communities put up signage and a website first which makes early interest hyperlocal. Register as a VIP on the website early and you will get regular communication, time to consider the offering, and learn when pre-sale will begin.

Once open, come early in pre-sale. You’ll get the pick of the litter. This is particularly important if you want something larger and are interested in the best views. Prospects are smart and pick the best floorplans first. If you have some idea of your ideal size and price point it makes good use of everyone’s time. Once you make a selection, expect to leave a 10% deposit as this is pretty standard in the industry. The developer generally has their own contract and it’s written much in their favor but not unreasonably so. Pricing this early is usually not negotiable… the price is the price. But you can purchase with some confidence since all buyers are getting the same terms and the developer has a shared interest in protecting values through delivery while sales are ongoing.

You do not need to be fully qualified for financing to come out and look but it’s wise to have some idea of what you can afford. Most builders give incentives for paying cash or using their title company and lenders. Often your contract might even offer a short financing contingency in exchange for considering them.

Once firmly under contract, a buyer might have 12- 18 months to prepare for the move. How blissful. This is one of the best parts of buying early in pre-sale. Moving is daunting, especially if you have been in your current homes for 30 years and the thought of moving seems excruciating. Decide what to take, sell/donate, and hire a proper interior designer to space plan and create a unique home that reflects your tastes. All with the time to do it properly.

Something to note. Finishes have gotten more high end, brands carry weight, and there is less customization offered these days. Gone are the days of going to a design center. If you know you are getting a Sub Zero refrigerator included you probably won’t ask if there are other options available. (more…)

Welcome to the new column, Kami’s Korner, where we will take a deep dive into Arlington’s condominium market by focusing on what’s coming next.  From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

I’d like to share some market insight. Let’s begin with a brief overview of the three upcoming Arlington condominium projects in the planning stages for Arlington…

• One Rosslyn: Approximately 70 units, Average Size 1800 sq ft, 1 Bed + Den – 3 Bed
• 1501 Langston Blvd: Approximately 90 units, Average size 1700 sq ft, 1-3 Bed
• Potomac Overlook (Formerly Key Bridge Marriott): 100 units+, Average Size 2000 sq ft, 1 Bed + Den – 3 Bed+

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All three projects will have the benefit of the extended building height afforded in Rosslyn over DC and the rest of Arlington, and therefore will be built in concrete and boast Potomac River/DC views.

Concurrently, the target market for many of these includes urbanized singles and couples as well as downsizing empty nesters. The baby boomer generation has raised their children in Northern Virginia and they want to be rid of the suburban house. They would have done it years ago but there wasn’t a for-sale option that suited due to the interruption of COVID-19. Arlington has everything they want, and they don’t have to uproot their personal or social lives to make a lifestyle change. They have significant equity in their homes, have built financial wealth, and are essentially unaffected by interest rates. They can pay cash for what they want.

Condominiums designed for this luxury group are some of the only condominium projects that work in today’s market due to several converging factors. The first is that construction costs are up 30%+, and concrete is one of the most expensive components. They skyrocketed after COVID-19, and although they are no longer rising as steadily, they are stubbornly elevated. Most existing condo stock in Arlington could not be built today for what they are currently selling for in the marketplace. (more…)

Welcome to the new column, Kami’s Korner, where we will take a deep dive into Arlington’s condominium market by focusing on what’s coming next.  From emerging developments to shifting trends, this space will spotlight the opportunities and insights shaping the future of condo living in Arlington.

Where have all the cowboys gone? Um… I mean condominiums.

For new condominiums, this last cycle has been a bit sleepy. For those wanting to own a piece of Arlington, it has been block after block of attractive new rentals, but no chance to own. If you are in the market for a new condominium, there isn’t a single new one on the market today to consider, either in presale or recently delivered with a model to tour. And it’s not for lack of demand. (more…)