Arlington’s office vacancy rate could drop below 15% next year as business continue to move to the area, according to some local experts.
Leaders of commercial real estate Avison Young and Arlington Economic Development (AED) said there is likely to be continued progress in Arlington’s long-standing struggle with a high number of empty office spaces.
However, Iams and Avison Young Principal Nick Gregorios both said they expect the office vacancy rate to drop again in 2020. If growth continues at its current rate in 2020, the vacancy rate could fall by up to 1.5 percentage points, Gregorios said.
As of Sept. 30, commercial real estate firm JLL reported an office vacancy rate of 16% in Arlington, down 5% from the county’s all-time high of 21% in 2015. This puts Arlington just below the current national average of 16.7%.
There is still about 7 million square feet of empty office space across Arlington to fill, according to Iams. Seven building vacancies have over 125,000 square feet of space apiece, leaving room for large companies, according to Iams.
Thursday’s panel itself was held on an empty floor of the Ballston Exchange office space.
“Just look around you, we’re sitting in a building right now where the National Science Foundation vacated in one fell swoop,” Gregorios said, referring to the NSF’s departure from Ballston to a new space in Alexandria.
In 2015, now-former AED director Victor Hoskins pledged to bring Arlington’s office vacancy rate down to as low as 10 percent within the next six years. That goal is thus far unrealized, but Arlington might come close with Amazon’s arrival continuing to generate interest in Arlington office space.
Shortly after helping Arlington woo Amazon, Hoskins left his position to head the Fairfax County Economic Development Authority. Since then, Iams has been left to continue Hoskins’ work, with HQ2 as a tailwind.
“[Heading into 2020] with Amazon and HQ2, we’re doing things a little differently,” Iams said, speaking to AED’s business recruitment strategy. “We’re approaching different markets with a list of 10-15 companies that we’ve identified in advance, knowing that we can get in front of them when they’re in the market for relocation and expansion.”
According to the 2019 Q2 earnings release from Amazon headquarters developer JBG Smith, since the HQ2 announcement one year ago the company has executed one million square feet of new leases in the National Landing area — Crystal City, Pentagon City and Potomac Yard — plus 400,000 square feet of renewals.
“What we used to do is go to tech conferences to get out name out there in order differentiate ourselves, but that’s not the case anymore,” Iams said. “Northern Virginia put itself on the map during the HQ2 process, and we’ll continue to work closely together for out-of-market deals with our Northern Virginia partners.”
Arlington is considering removing a planned section of road in the Metropolitan Park site in Pentagon City, the future home of Amazon’s permanent HQ2.
The Arlington County Board will vote during its meeting this Saturday, November 16 on the first step to nixing a stretch of 14th Road S. that was supposed to one day extend eastward on the lot that now slated for the first phase of Amazon’s headquarters plan.
Officials say the road no longer necessary now that Amazon is moving in.
The 14th Street segment was originally planned to “connect South Elm Street to a private court at the rear of two planned residential buildings” once envisioned on the site almost two decades ago, per a staff report to the Board.
Now that Amazon is finalizing designs for two sky-high office towers on the lot, “there will no longer be the need for the planned 14th Road segment,” the staff report noted. “The proposed new buildings have been designed to utilize S. Elm Street and 14th Street S. for their vehicular access.”
If members vote to advance the removal, the county will hold a public hearing on Monday, December 2 during the county’s Planning Commission meeting at 7 p.m. in the Bozman Government Center (2100 Clarendon Blvd.) The discussion would then return to the County Board for a final vote on December 14.
Approving a public hearing is currently listed on the Board’s consent agenda for tomorrow’s meeting — a position usually reserved for items staff expect members to pass without debate.
The Transportation Commission unanimously approved removing the road in a vote last month, per a letter of support sent to the Board.
The Arlington County Board is poised to advance the Ballston Harris Teeter project with several zoning updates.
The County Board will vote during its meeting this Saturday, November 16 on whether to approve the developer’s request to change the land’s zoning categories to permit the the many housing units as planned (732) and add retail to the buildings (83,600 total square feet.)
Georgia-based developer Southeastern Real Estate Group, LLC is planning to demolish the existing grocery store, nearby Mercedes Benz parking lot, and a single-family home at 525 N. Thomas Street. Southeastern will then build:
- a new Harris Teeter on the ground level of a five-story apartment building containing 390 housing units
- another, six-story apartment building with 234 apartments
- an 11-story building with 243 housing units, and 10,592 square feet of ground-floor retail space
- A strip of public open space fronting N. Thomas Street
The park will include a pedestrian path, a dog run, a picnic area, as well as “pollinator meadow zone” with plants selected to feed pollinator insects and birds, according to the latest plans filed with the county.
The Board previously approved a public meeting on the Southeastern’s zoning requests this summer. During the meeting, several residents asked the county to wait before approving the zoning changes, expressing concerns over too much traffic and the trees that will need to be cut down according to the construction plan.
In April, the developer bumped the number of housing units in the project from 700 to 732, cut some parking spaces, and announced its intention to seek LEED Silver sustainability certification.
The development is across the street from another site at at 501 N. Randolph Street and 4019 5th Road N. where builders envision a 10-story hotel with 240 rooms, featuring amenities like a jacuzzi, light display, and possibly home-grown herbs, as well as the renovated Ballston Quarter Mall.
The expansion of George Mason University’s campus in Virginia Square is envisioned as a gleaming glass-and-steel tower with the school’s distinctive “M” emblazoned on top.
That’s according to a new concept design for GMU’s planned Institute for Digital Innovation, released as the university announced $235 million in new funding from the state to expand the campus and develop more tech talent. The new building will be built atop the long-shuttered Kann’s Department Store, on the west side of the Fairfax Drive campus.
Gov. Ralph Northam announced the funding for GMU and ten other Virginia universities on Thursday, citing Amazon’s HQ2 in Arlington as a key reason why the Commonwealth needs more tech workers.
“Virginia will invest in the Commonwealth’s tech talent pipeline to create 31,000 new computer science graduates over 20 years, under agreements he signed with 11 universities,” the governor’s office said in a press release. “The Tech Talent Investment Program will benefit students and tech employers in every corner of the Commonwealth. It grew out of Virginia’s proposal to Amazon, which will locate its second headquarters in Northern Virginia.”
In its own press release, below, GMU said the state funding — along with an expanded Arlington campus — will help it produce 16,000 more undergrad and master’s graduates in tech fields over the next 20 years.
The press release says additional information about the new Institute for Digital Innovation facility will be revealed at an event on Wednesday, Nov. 20, which will celebrate the 40th anniversary of the Arlington campus, which currently includes includes the Antonin Scalia Law School, the Schar School of Policy and Government and other departments, mostly focusing on graduate and professional programs.
The full GMU press release is below, after the jump.
23rd Street Restaurants Worry About Parking — “Owners and operators along Crystal City’s ‘restaurant row’ are demanding changes to Roseland Residential Trust’s proposed multimillion-dollar expansion of the Crystal House complex, saying the project may irreparably harm their businesses… At issue are 95 pay-to-park spaces in a lot at South Eads and 22nd Street South, around the corner from the restaurants on 23rd Street.” [Washington Business Journal]
Juvenile Detention Facility in Question — “The City of Alexandria, City of Falls Church, and Arlington County will host community meetings in November to obtain public input for a study examining the future of the Northern Virginia Juvenile Detention Center (Center). The facility, located in Alexandria, is operated by the three jurisdictions through a regional Juvenile Detention Commission.” [Arlington County]
Wardian Was Also a Weekend Winner — “This was the first year of the MCM ultramarathon, a 50K, and MCM tweeted Sunday afternoon that Arlington marathoner and ultramarathoner Michael Wardian won that event. Earlier this year, Wardian ran the entire Capital Beltway. Wardian, whose first-ever marathon was the MCM win 1996, finished with a time of 3:11:52.” [WJLA]
Neighbors Negotiating With Amazon — “A group of neighborhood activists started discussing a unique joint effort, aiming to set a ‘livability agenda’ for the area and better bargain for the benefits they want to see… The partnership has helped community members take their needs directly to Amazon, and the company’s main developer and landlord in the area, JBG Smith.” [Washington Business Journal]
Crash at Shirlington Bus Depot — “Medics on scene of a crash between a van and a Metrobus in Shirlington. At least one minor injury reported. Not clear how the crash happened.” [Twitter]
Photo for Allison Bredbenner
Early plans for the new hotel being proposed in Ballston include locally-run bars, a rooftop jacuzzi, an artistic LED light display, and possibly an urban farm.
Vienna-based developer Schupp Companies is proposing to build the 10-story, 180-room hotel at the intersection of N. Randolph Street and 5th Road N. along with a two-story underground parking garage with space for 91 cars, as first reported by UrbanTurf.
The latest plans for the building at 501 N. Randolph Street call for a bar, restaurant, and a lounge area in the 12,829-square-foot ground floor area, according to copies of the documents ARLnow obtained by Freedom of Information Act (FOIA) request. The rooftop is also slated to have another bar with a jacuzzi surrounded with lounge chairs and plants, per the plans.
“The view lines are going to be spectacular,” said Ray Schupp, president and owner of Schupp Companies. “On the roof, a small local bar with good views would be really, really great.”
“I think local entrepreneurs do the best job there,” he said of the rooftop establishment. “The rooftop will be for sure be a local entrepreneur. We’re looking at someone who really cares about what they’re doing. We’ll just lease the space for them.”
When asked, Schupp said he was also considering dedicating some rooftop space to the growing trend of urban farming, which would make the hotel one of the only buildings in Arlington to feature a rooftop farm. Schupp added a bee hive might be difficult, but growing herbs for the bars or restaurant could be “a great idea.”
The hotel will replace long-time Italian restaurant Tutto Bene which closed in 2014. It was originally slated to have 240 rooms.
Plans lay out several aesthetic plans for the exterior of the hotel, including “multi-colored light” display on a strip of windowless-wall visible from the recently renovated Ballston Quarter mall. Schupp told ARLnow that the design will be modeled after the displays mounted on the company’s Hyatt hotel development in Courthouse, but will be tailored to fit the “high-tech” image of Ballston.
The developer is aiming to paint the Ballston hotel’s a “soft but vibrant green similar to GMU’s Arlington campus building,” per the plans. But on the panels that face N. Randolph Street, the company is considering adding a metallic, shimmering coat to the paint.
“I think a shimmering look will be good as the sun sets,” said Schupp.
Scooters May Be Allowed on Arlington Sidewalks — “The Board voted unanimously to advertise a public hearing at the Nov. 16, 2019 County Board Meeting to consider proposed regulations of shared mobility devices. The proposed revisions include allowing the [scooters] to be used on County streets, sidewalks and multi-use trails and putting in place a permit fee structure for private companies offering the devices. During the pilot program, the devices have been prohibited on County sidewalks.” [Arlington County]
Clarendon Cafe Rebrands as ‘Three Whistles’ — “CoworkCafe founder Ramzy Azar rebranded the space this week. In addition to a new name, Three Whistles (2719 Wilson Boulevard, Arlington, Virginia) has a new look and a new menu. Azar expects to roll out a menu full of Mediterranean small plates in the next few weeks. He says sharable dishes help create the feeling of a gathering place.” [Eater]
Arlington Man Sentenced for Gun Smuggling — “An Arlington man was sentenced today to 18 months in prison for his role in the trafficking of firearms to his native country of Honduras. According to court documents, in October 2018, Chris Rodriguez, 57, attempted to smuggle a firearm and 247 rounds of ammunition out of the United States, concealed in a bucket of roofing tar destined for Honduras.” [U.S. DOJ]
‘Verizon Site’ Building OKed — “Crystal City’s Verizon site will be redeveloped with a 19-story apartment tower within walking distance of Metro that will include 12 affordable housing units… The [County] Board voted unanimously to approve the vacation of a portion of the right-of-way for Old South Eads Street, a rezoning and site plan amendment for the proposed redevelopment.” [Arlington County]
Amazon Avoids Donating to Arlington Pols — “Amazon.com Inc. just sent $23,000 in campaign contributions to a total of 26 Virginia lawmakers, resuming its political giving in the state for the first time in months as a crucial statehouse election draws near… it only sent checks to six lawmakers in Northern Virginia (and did not send money to a single politician representing Arlington).” [Washington Business Journal]
DMV Select Staff Fights Fraud — “Three members of [the Commissioner of Revenue’s DMV Select office] staff (Isaac Kateregga, Ahmad Abdalla and supervisor Michelle Neves) recently were honored by the Virginia Department of Motor Vehicles in Richmond. They were presented with ‘Fraud Busters’ awards for their work in disrupting efforts to commit misdeeds… [involving] title fraud.” [InsideNova]
Reminder: Arlington Restaurant Week Kicking Off — “Arlington Restaurant Week, organized by the Arlington Chamber of Commerce, will run from October 21-28. Diners can visit a number of Arlington restaurants offering special menu items at discounted prices.” [ARLnow, Arlington Chamber of Commerce]
Flickr pool photo by John Sonderman
The Arlington County Board is set to consider a developer request to get rid of a little pathway in Crystal City to make room for a new construction site.
Developer LCOR Inc. is offering the county $125,436 to nix a small pedestrian pathway near S. Eads Street near the Crystal City-Pentagon City border. The county’s vacation of the pathway will allow LCOR’s Verizon site project on 1400 11th Street S. to move forward.
County Board members are scheduled to vote on the request during their meeting this Saturday, October 19.
The land itself is a 469 square-foot, skinny strip next to S. Eads Street on the north side of the property, where LCOR is planning to build the service and loading entrances to the apartment building, per a site map the developer shared earlier this year.
Google Maps images from 2018 show pedestrians walking the paved strip, which bisects a grassy curb between S. Eads Street and the parking lot by a Verizon telecommunications facility.
“As of the date of this Board Report, staff has not received any negative feedback related to the Street Vacation from the surrounding property owners,” a county staff report to the Board notes.
Verizon is slated to keep its facility onsite as LCOR constructs a 19-story, 306-unit apartment building with 10,908 square feet of ground floor retail on the property.
If the county agrees to sell the strip of land to LCOR, the developer would need to develop a plan for any utilities that cross the parcel. The firm bought the land from Verizon for $9.5 million last summer, and said it hoped to begin construction by 2020.
Arlington officials are asking Amazon to go back to the drawing board for its proposed headquarters in Pentagon City to put a greater emphasis on sustainability.
The 2.1 million-square-foot proposed office complex at the corner of 15th Street S. and S. Eads Street, is currently pending review by Arlington’s Planning Commission and County Board. If plans are finalized on schedule by the end of 2019, demolition is due to start early next year, according to JBG Smith’s Vice President of Development Matt Ginivan, with excavation then lasting through the end of the year.
It’s not easy being green
As part of the construction, Amazon Vice President of Global Real Estate John Schoettler announced during a Site Plan Review Committee (SPRC) meeting last night (Monday) that HQ2 would seek a LEED Platinum energy certification instead of its lower, original Gold goal.
“We are working to secure renewable energy for the campus which means our Arlington buildings will operate on 100% renewable energy by 2030,” said Schoettler.
SPRC members commended Amazon for the new goal but pressed the company for more details on how it would meet the carbon emissions reduction targets. Previously, the company’s designs were scored on the lower end of LEED’s Gold efficiency ranking.
SPRC members also asked how Amazon would avoid use of fossil fuels, particularly in its restaurant spaces.
Brian Earle, a principal at ZGF Architects, said Amazon was committed to forgoing natural gas in its kitchens and cafeterias, but admitted they didn’t “see a path towards having a life safety [electric] generator that meets the county’s requirements that does not use fossil fuels.”
Schoettler added that Amazon was planning to build off-site renewable energy facilities like solar or wind farms elsewhere in Virginia to power the buildings with renewable energy and off-set the impact of fossil fuels.
“That might make us feel very virtuous, but we have to be very cautious about how we produce that off-site energy,” she said of off-site renewables.
Another part of the HQ2 plan involves the landscaping of the site itself, which is slated to include gardens, a dog park, and terraces on the multi-step grooves.
Amazon CEO Jeff Bezos recently pledged his company would achieve carbon neutrality by 2030 and that Amazon was “going to work very hard with the community [in Arlington] to make sure our presence there ends up being a net positive, rather than a net negative.”
Arlington officials also recently passed a new energy policy committing the county to carbon neutrality by 2050.
Another protected bike lane, what about electric vehicle parking?
SPRC member and Transportation Commission Chair Chris Slatt urged Amazon to nix some of its parking spaces, saying: “I think your parking is a far greater blemish on your sustainability than whether there’s a wood-burning fireplace in the staff lounge.”
Other members of the SPRC focused on the nexus of sustainability and transit asked Amazon to expand the percentage of parking spaces reserved for electric vehicles. The recommendation follows the county’s new energy plan predicting more people will drive electric cars in the next thirty years — a trend backed by Gov. Ralph Northam’s recent investment to expand the number of charging stations available statewide.
Amazon’s current designs set aside about 2% — or about 40 spaces — of its 1,968 total parking spaces for electric vehicles.
“Why not push for 10%?” asked one SPRC member.
There was at least one big win for non-car transportation last night. Following repeated calls from activists, Amazon announced it would build a protected bike lane on 15th Street S. along the length of the Metropolitan Park development, of which its headquarters is the final phase. That follow’s Amazon’s previous pledge to build a protected lane along S. Eads Street.
A parking lot in the Virginia Square has a new owner, and potentially, a new future.
Swedish developer and construction company Skanska announced today (Tuesday) that it had bought the site at 3901 N. Fairfax Drive from an affiliate of of the Bernstein Management Corporation and intends to make long-stalled development plans a reality.
The site, near Quincy Park, once housed the Arlington Funeral Home before it closed in 2011 after 55 years in business. The property later became a parking lot for the nearby Mercedes-Benz of Arlington dealership. Today, the parking lot is enclosed with chainlink fences and hosts a billboard advertising the “trophy office” to come.
Skanska said today it will build the nine-story office building with 184,036 square feet of office space and will aim for LEED Gold certification planned for the site. The company also noted that the building will come equipped with 10,280 square feet of ground floor retail — a feature some other buildings have struggled to fill in Arlington.
The original site plan included a $3.7 million, 12,985 square-foot black box theatre, however it was removed in later revisions and replaced by ground floor retail space, per Skanska’s Mark Carroll, who works as the executive vice president for the company’s D.C. area commercial developments.
“We plan to keep the general building design but may make minor modifications,” he told ARLnow in an email.
He added that the amenities Skanska is currently eyeing in the new building include:
- A 4,000-square-foot outdoor rooftop terrace with a 1,600-square-foot indoor amenity space
- A 1,700-square-foot second floor terrace
- A state-of-the-art fitness facility
- 10,280 square-feet of ground-floor retail
- The property targeting LEED® Gold certification
- Floor-to-ceiling windows on all four sides, which will welcome ample natural light and unobstructed views into the office spaces.
“The Rosslyn-Ballston Corridor has long been the epicenter of mixed-use development in Northern Virginia, and the 3901 North Fairfax site will be a welcome addition to this vibrant, pedestrian-friendly community with easy access to public transit and a plethora of retail options,” he said earlier today in a statement.
“This acquisition is significant as the site represents one of the last ground-up, Metro-accessible development opportunities along the Rosslyn-Ballston Corridor,” said the company in a press release, noting the property proximity to the Virginia Square and Ballston Metro stations.
Across the street from the site construction is still underway for the 22-story, 330-unit J Sol Apartments complex.
Nearby, Virginia Square and Ballston is also host to several other new developments, including an affordable housing developments at the American Legion Post and a church, as well as a new YMCA and a historical cemetery with an uncertain future.
Skanska previously developed the 1776 Wilson Blvd office building in Rosslyn before selling it in 2014. It also owned an 11-story office building near Nationals Park in D.C., and another 11-story “trophy office” building on Pennsylvania Avenue, among other projects.
Image 2 via Google Maps
Common Ground and Happy Endings will both be a part of the Central Place complex at 1800 N. Lynn Street. Common Ground will be on the second floor of the residential building, while Happy Endings will be on a lower level near Nando’s and Bethesda Bagels. Happy Endings is hoping to open in late November, Eater reported this week.
A short walk away will be the third food hall at 1700 N. Moore Street.
It’s often said three makes a trend, and it’s no secret that greater D.C. has been flooded in recent years with food halls — a term which essentially refers to an upgraded food court primarily featuring local chefs and vendors. Arlington’s first food hall, Ballston Quarter, opened earlier this year and continues to add vendors.
Social Restaurant Group, the company behind Common Ground, is pushing back the food hall’s opening date for the third time to the spring or summer of 2020.
Originally, SRG co-founder Mike Bramson said he hoped it would open by the end of 2018, then told ARLnow they were pushing it to the “end of spring 2019.” Now, we’re told, construction will “officially break ground this fall.”
According to Bramson, Common Ground will feature ten food vendors and have one full-service bar. He confirmed “celebrity chef involvement,” and said that Rebel Taco, a taco food truck routinely at Clarendon’s The Lot beer garden, will be one of the ten vendors.
It will be located on the building’s second floor, “above the McDonald’s overlooking the plaza.”
Happy Endings Eatery
The two-level, 5,000 square-foot food hall with the double-entendre name is expected to open by the end of November, Eater reported.
According to Eater, the entirety of Happy Endings Eatery will focus on Vietnamese food, with food stalls sporting names like Roll Play and Pho Play. Also offered: bubble tea, Vietnamese coffee, banh mi sandwiches, vermicelli bowls and more.
Rosslyn City Center food hall
A PR rep for Rosslyn City Center’s developer said there were no updates on the new food hall, which is still on track to open in the summer of 2020.
While the food hall remains unnamed, it will feature twelve “artisanal food stalls and two lounges that extend onto an outdoor terrace overlooking the streetscape,” per a press release.
Photo courtesy of American Real Estate Partners, Google Maps