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Morning Notes

RCA Building Redevelopment Nixed — Plans to tear down the aging RCA office building at 1901 N. Moore Street in Rosslyn and replace it with a 24-story residential tower have been placed on hold “indefinitely.” Instead, owner Weissberg Investment Corp. is now seeking to lease up vacant spaces in the building. [Washington Business Journal]

New County Board Clerk Announced —  “The Arlington County Board today named Kendra M. Jacobs the Clerk to the County Board. She will join the County Board Office in her new role on Monday, July 9. Jacobs comes to Arlington County Government from the City of Alexandria, where she has managed the Department of Planning and Zoning’s Boards and Commission Unit since 2003.” [Arlington County]

LWV to Host Gerrymandering Forum — The Arlington League of Women Voters is hosting a forum entitled “Gerrymandering in America and the Future of Popular Sovereignty” on Thursday, July 12 at 7:30 p.m. at the Arlington Mill Community Center. [League of Women Voters, InsideNova]

More ART Mechanical Issues — The bus serving the ART 43 route today “died on [Route] 50 right before the Crystal City exit,” a rider reports. Per the transit agency, which has been plagued by problems recently: “Due to mechanical issues ART 43 to Court House Metro from Crystal City Metro at 8:51 AM will not operate. We apologize for your inconvenience.” [Twitter, Twitter]

Flickr pool photo by Eric

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Photos: Ballston Quarter Construction Coming Along

Construction on the renovated Ballston Quarter mall is coming along.

Signs up at the site still point to a fall 2018 opening for the redeveloped and rebuilt space, formerly known as the Ballston Common Mall.

Recent weeks have seen the announcement that several “experiential tenants,” like cooking class company Cookology and live action adventure venue 5 Wits, have signed on as tenants.

The 360,000 square foot retail space will also include a 25,000 square foot food hall, which reportedly will have 18 restaurants, including Timber Pizza Co. and Buredo. Trendy D.C. spots Himitsu and Gravitas are also said to be considering opening up eateries at the mall.

At least 400 residential units are being constructed as well, though leasing will begin next year.

Ballston Quarter is just one of a number of major construction projects currently underway in the neighborhood. Crews were seen working on Friday directly across the street from another construction site, Liberty Center, at 4040 Wilson Boulevard.

The mixed-use residential, retail, and office space is scheduled to open for mid-2020 and will be the final piece of a five-building development. VIDA Fitness, a “high end fitness center and spa,” is set to open its first non-D.C. location in the building.

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Ballston High Rise AC Unit Fire Shuts Down Street

Updated at 3:21 p.m. with additional details.

Updated at 9:41 a.m. with additional photos: A high rise AC unit caught fire this morning (Thursday) in Ballston, shutting down the 800 block of N. Quincy Street.

The fire was reported around 8:30 a.m., prompting a large response of Arlington County firefighters as well as units from Fairfax, Alexandria, and Fort Myer. The fire was extinguished quickly after units arrived on scene, according to Capt. Ben O’Bryant, Arlington County Fire Department spokesman.

O’Bryant confirmed that the Fire Marshal’s Office is investigating the cause. The fire comes a day after record-breaking February warmth.

The building, at 801 N. Quincy Street, is home to the soon-to-open restaurant Urban Tandoor, along with numerous office tenants.

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Two Rosslyn Office Buildings Chat Via Post-it Notes

 

One smiley face made of Post-it notes turned into a conversation between the occupants of two Rosslyn office buildings in this week.

Allison Krumsiek, a government contractor, said her office has considered making contact with the office across the street — the new CEB office tower at Central Place — ever since people began moving into the space a few weeks ago.

Before the new office moved in, Krumsiek said she and her coworkers had a straight-on view of construction workers putting the building together. Then on Monday, people in the new office placed a Post-it smiley face on their window, and the intra-office communication was on.

“So we thought time was perfect to respond! We put up the ‘Hi!’ And when another floor of their building responded with ‘Hey’, we added ‘Welcome!'” wrote Krumsiek in an email.

After that Krumsiek said she heard another floor in her building put up “5 o’clock yet” to which the opposite building responded “sum where.”

“As you can tell from the picture, they had to use at least 3 colors of Post-it. Those things last forever when on your desk but go in a heartbeat when sending messages on windows,” Krumsiek added.

Photos courtesy of Allison Krumsiek

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Two Local Companies Set for Economic Development Grants

Two Arlington-based companies are set to receive incentive-based economic development grants as they expand in the county.

Rosslyn-based technology company Higher Logic and Clarendon-based media firm Axios are both in line to receive $60,000 each under the county’s incentive-based Gazelle Grant program. The program, administered through Arlington Economic Development, encourages businesses to move into or stay in Arlington.

Under the terms of the grants, both companies must commit to leasing a certain amount of office space and creating more full-time jobs. If they do not fulfill the terms as of December 31, 2020, they will be required to pay back at least some of the grant.

For its grant, Higher Logic must lease at least 31,000 square feet of office space, maintain its existing 107 full-time jobs and create 133 new full-time positions.

Founded in 2007, Higher Logic had been exploring a new location for its headquarters, having expanded to take up 15,000 square feet by 2015. It will move to 1919 N. Lynn Street in Rosslyn and occupy an entire floor of the building on a 10-year lease.

Axios, meanwhile, must lease at lease 15,000 square feet of office space, maintain its existing 60 full-time jobs and create 60 new full-time positions.

Having initially located at the MakeOffices coworking space at the office building at 3100 Clarendon Blvd, Axios is set to expand into the 13th floor at the same address and sign a 10-year lease.

The Arlington County Board will vote on whether to award the grants at its meeting Saturday (January 27). Staff recommended approval of both.

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Nestle Employees Expected to Finish Rosslyn HQ Move By Month’s End

Employees at Nestle’s USA headquarters are expected to finish moving into its new Rosslyn office by the end of January.

In an interview with ARLnow earlier this month, Rosslyn Business Improvement District President Mary-Claire Burick said the moving process is expected to be complete soon.

Burick noted that Nestle has worked hard to help any employees relocating from its current home of Glendale, Calif., and helped them settle into Arlington County.

“They’ve done a magnificent job with acclimating the employees, doing a resource fair and just making sure that those employees are well acclimated, not only to the neighborhood of Rosslyn but of Arlington in general,” Burick said.

Ahead of that move, Nestle has worked closely with building owner Monday Properties to prepare its new headquarters. It will include spaces for employees to collaborate, and Burick added the building will have a new open stairway to promote “walkability between floors.”

Nestle will be the first tenant in the building, which was completed in 2013 after being built “on spec” and had remained vacant since.

“I think Nestle was really creative about their office space and how it would support their culture,” she said.

And a major catering company will provide food and drinks to the new Nestle headquarters in Rosslyn, according to permit and ABC license applications.

According to applications, Compass Group, Inc. will provide the catering for Nestle’s USA headquarters at 1812 N. Moore Street, on the 33rd floor. Compass serves “award-winning restaurants, corporate cafes, hospitals, schools, arenas, museums, and more,” per its website.

A county permit application notes that the new cafeteria will require an inspection by the Department of Health before it can be used.

As of the time of writing, a spokeswoman for Compass Group had not provided any further details.

Disclosure: Monday Properties is an ARLnow advertiser.

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Rosslyn-Ballston Office Vacancy Rate Expected to Keep Dropping This Year

The office vacancy rate in the Rosslyn-Ballston corridor continued to recover in 2017, with new tenants moving in this year expected to maintain that recovery.

Commercial real estate firm JLL found that the recovery continued for the third straight year, after tenants moved out in droves from 2009 to 2014 following BRAC and sequestration at the federal level. That contributed to Arlington County’s total office vacancy rate being at 22.7 percent in 2017.

And this year, JLL said the arrival of Nestle in Rosslyn as well as the redevelopment of the Ballston Exchange — formerly known as Stafford Place and the previous headquarters of the National Science Foundation — and Ballston Quarter Mall will help drive down that office vacancy rate.

Rosslyn is set to add occupants in 500,000 square feet of vacant office space this year, including the likes of the Grocery Manufacturers Association, which is relocating from D.C. Although with a 29 percent office vacancy rate at the extremes of the corridor, it is not all good news.

A previous JLL report found that office rent is highest on Wilson Blvd in Rosslyn and increasing, due to new high-end “trophy class” offices coming online, as well as the unobstructed views of Washington, D.C. and the Potomac River.

And locating close to Metro stations is still pushing rent up on office space across Northern Virginia by up to 34 percent, according to JLL. It also found that all of the new office space being constructed is close to Metro.

But despite the positives, the Northern Virginia region as a whole is still struggling, with a 20-year historical high for office vacancies and not much improvement forecast in the coming years. Fairfax County’s office vacancy rate of 21.1 percent is second behind Arlington, followed by Alexandria (19 percent), Loudoun County (16.6 percent) and Prince William County (15.6 percent).

The lowest vacancy rate close to D.C. is in Frederick County, Maryland, which has a 9.1 percent vacancy rate.

“The forecast broadly is not likely to shift greatly from today as slower demand caused by limited near-term lease expirations, limited economic diversification outside of the core government and contractor drivers and a dysfunctional Congress will keep supply-demand fundamentals relatively flat,” John Sikaitis, managing director for research at JLL, wrote in a presentation on the findings.

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Report: Office Rent on Wilson Blvd in Rosslyn Highest in Northern Virginia

Northern Virginia office space is most expensive to rent on Wilson Blvd in Rosslyn, according to a study.

Commercial real estate firm JLL found that rents on the street in Rosslyn average between $56 and $65 per square foot, and that those rents are increasing.

The study found that average rent increase is due to new high-end “trophy class” offices coming online, as well as the unobstructed views of Washington, D.C. and the Potomac River. Those “trophy” offices include top amenities, good views of their surroundings and are connected to transit options like Metro and bus routes.

“The new trophy buildings not only deliver high-end modern office space, but will help transform Rosslyn from a sleepy 9-5 business district into a vibrant live-work-play neighborhood,” Michael Hartnett, senior research manager in JLL’s Northern Virginia office, said in a statement.

Across the region, average rents on office space remain high even as jurisdictions battle with a high vacancy rate. Arlington County’s office vacancy rate is just over 17 percent, even with the likes of Nestle moving to Rosslyn.

“Despite the U.S. office market posting 81 million square feet of net absorption the past 24 months and posting rent growth of 8.2 percent, the Metro D.C. market has posted nearly 700,000 square feet of occupancy losses and a rent decline of 6.9 percent,” John Sikaitis, managing director of research at JLL, said in a statement. “In this challenging market, there are an equal mix of winners and losers and on the demand side, these nuanced high-priced corridors at the intersection of Main and Main have attracted the most demand and been some of the more resilient segments of the market.”

Photo via Monday Properties

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Apartment Developer AvalonBay Moving Headquarters to Liberty Center in Ballston

Two years after being put on hold, construction will resume next year on the Liberty Center’s final building in Ballston after it signed an office tenant.

AvalonBay Communities, a publicly-traded apartment developer and real estate investment trust, will relocate its headquarters to 4040 Wilson Blvd, which is set to be a 22-story mixed-use building with offices, retail and residential. It will be Ballston’s tallest building.

AvalonBay, which is already in the neighborhood at 671 N. Glebe Road, signed a lease for 73,000 square feet of office space on three floors — the eighth, ninth and 10th as well as a portion of the seventh — at the site owned by developer The Shooshan Company and Brandywine Realty Trust.

It joins VIDA Fitness, which will open its first non-D.C. location at the building. With this new signing, the building’s office space is 50 percent pre-leased.

Construction is now expected to start in the first quarter of next year. AvalonBay is projected to move in around mid-2020.

“When we decided to amend 4040 Wilson to a mixed-use building consisting of roughly a 50/50 split of office and residential and increased retail last year, we did so in an effort to adjust to the recent market trends which consisted of more prospective tenants in the [around] 75,000 [square feet] range, and more retail demand along Wilson Blvd.,” Kevin Shooshan, leasing director at The Shooshan Company, said in a statement. “Just about a year after county approval, we’re honored to have executed a pre-lease with a company as prestigious as AvalonBay, securing their headquarters location here in Arlington County for years to come.”

Previously, Shooshan told ARLnow that construction had been paused during a period of high office vacancies in Arlington and the rest of the D.C. region.

Image No. 1 via The Shooshan Company

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Co-Working Company TechSpace to Expand into Ballston

A new co-working space will move into Ballston next year, across the street from the under-construction Ballston Quarter mall.

TechSpace will move into the eighth floor of Two Liberty Center (4075 Wilson Blvd); its 10th location in the United States. It expects to open in June 2018. TechSpace already has similar co-working spaces in New York, California and Texas.

The new 20,000-square-foot Arlington office will include 56 private, interconnecting office suites with 198 workstations as well as open co-working desks and spaces for working. That will include fully-equipped conference rooms and lounges. Members who work in the space will also have access to building amenities like a rooftop terrace, bike storage, locker rooms and showers.

“Our new Arlington location extends TechSpace’s heritage of delivering extraordinary flexible, modern office space and technology services to all businesses as well as enterprise companies,” said Victor Memenas, Chief Executive Officer for TechSpace, in a statement. “We’re excited to bring our model of creative flexible office space and collaborative social experience combined with our exceptional customer service to the Arlington community.”

More from a TechSpace press release:

TechSpace Arlington will be prominently positioned along the Rosslyn-Ballston Corridor within easy reach of Washington DC, The Pentagon, Tyson Corner, Maryland Suburbs, the Ballston-MU Metro, I-66 and Route 50. The campus is also close to retailers including Sweetgreen, Taylor Gourmet and celebrity Chef Mike Isabella’s 3 concept restaurants, Kapnos Taverna, Pepeita and Yona. This campus will join nine existing TechSpace locations in New York City, Los Angeles, Orange County, San Francisco, California and Austin and Houston, Texas.

“TechSpace Arlington will allow us to expand our outstanding customer service and highly flexible, low-commitment model to many more companies seeking to grow their businesses without the burdens of long-term leases and unnecessary capital investment,” said Memenas.

TechSpace will complete with a number of existing coworking spaces in Arlington, including the soon-to-open Spaces in Rosslyn, MakeOffices in Clarendon and WeWork in Crystal City, among others. There is demand for coworking space in Arlington: latter two offices are both at or near capacity.

Photo via Shooshan Company.

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UVA Business School Expanding in Rosslyn High-Rise

The University of Virginia’s Darden School of Business is expanding into two floors of a Rosslyn high-rise office building.

The new “state-of-the-art learning facility” will occupy the 30th and 31st floors of 1100 Wilson Blvd — owned by Monday Properties — with administrative, conference and classroom space taking up approximately 40,000 square feet. The school already has regional staff offices in the building and holds executive MBA classes at 1000 Wilson Blvd and 1919 N. Lynn Street.

“We are pleased to continue building Darden’s presence in Northern Virginia and the metro DC area at this premier Rosslyn location,” Darden School of Business Dean Scott C. Beardsley said in a statement. “Rosslyn’s proximity to major spheres of influence in D.C., including Capitol Hill and the White House, played a significant role in our decision, with the support of the University of Virginia.”

Local architects are designing the space, which will include tiered classrooms, flat classrooms, learning team rooms, open study areas, a board room, conference rooms and office space. A large ballroom will serve as a food service and conference space.

At its meeting last month, the Arlington County Board took up the issue of Monday Properties converting office space in the building to educational use. The business school is scheduled to move into its new location next spring.

Another change coming to 1100 Wilson Blvd next year is the opening of a 5,000-square-foot rooftop deck for tenant use. The indoor-outdoor space, touted by Monday as “one of the most expansive rooftop deck amenity offerings in the DC-metro market,” will be able to accommodate events and conferences.

Disclosure: Monday Properties is an ARLnow.com advertiser. Photos via Google Maps and Darden School of Business.

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APS on Track For Sequoia Plaza Move, Clearing Way For Ed Center High School

A $13.8 million plan to move Arlington Public Schools’ offices from the Education Center to prepare for its use as a high school is set to begin later this year.

The Education Center, which houses various APS offices as well as the Arlington School Board’s meeting rooms, will be used as part of a “hybrid option” alongside the Career Center to add 1,300 high school seats for APS. The Education Center is adjacent to Washington-Lee High School.

APS’ offices are set to relocate to Sequoia Plaza Two at 2100 Washington Blvd, which already houses the School Health Bureau that provides health programs and services, as well as the Parent-Infant Education and Environmental Health programs.

Separately, the county’s Department of Human Services consolidated more than 80,000 square feet of facilities into three buildings at its headquarters at Sequoia Plaza in 2014.

As part of a plan approved last December, the School Board agreed to amend its lease at the property and add just under 80,000 square feet of new office space. In May, the Board approved a design for the office space, which will be spread across four floors.

At its meeting Thursday, August 17, the School Board advanced a construction contract for Sequoia Plaza Two, and will vote to approve the contract as an action item at its September meeting.

Under a timeline presented by APS staff, construction would begin in September and take until April 2018. The first phase of moving would begin in December, with the second phase to begin in April once construction is complete.

Jeff Chambers, APS’s director of design and construction, said that first moving phase would be to move APS staff already based at the building elsewhere to accommodate construction. Chambers said the project will not require any more funding than the $13.8 million already budgeted.

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Police Investigating Crystal City Office Burglary

A man of short stature walked into a Crystal City office building, stole a purse, and almost immediately starting using the victim’s credit cards, according to police.

The Arlington County Police Department is investigating the burglary, which happened Monday at the Consumer Technology Association in Crystal City. The department released surveillance camera images of the suspect at ARLnow.com’s request.

“At approximately 2:30 p.m. on August 14, police were dispatched the 1900 block of S. Eads Street for the report of a grand larceny,” said ACPD spokeswoman Ashley Savage. “Upon arrival, the victim reported that between 11:30 a.m. and 1:15 p.m., her purse had been stolen from her cubicle and her credit cards had been fraudulently used.”

“During the investigation, several employees reported seeing a suspicious male subject in the building,” Savage continued. “The subject is described as a black male, between 40 and 50 years old, approximately 4 ft tall and weighing 130 lbs. He was wearing dark clothing at the time. The investigation is ongoing.”

An employee who works at the association said the man “walked right into our building and stole a purse from someone’s desk,” then “immediately began using her credit cards at a gas station on Route 1 and then later in D.C.”

“It is very frightening that someone is going around to different office buildings like this!” the employee said.

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Morning Notes

County Opts to Acquire Hospital Site — Arlington County Board members on Tuesday voted to formally seek a large tract of land along S. Carlin Springs Road in a land swap with Virginia Hospital Center. In exchange, the county is offering to VHC county-owned land next to the hospital, which would allow it to expand. [Arlington County, InsideNova]

Bike Thefts Up in Arlington — Bike thefts were up for the first 6 months of 2017, compared to a year prior. No one seems to be safe from the prolific bike thieves, who often target high-end bikes parked in garages and bike lockers; among those reporting recent thefts were Henry Dunbar, the director of BikeArlington and Capital Bikeshare in Arlington, and an ABC 7 employee. [WJLA]

Gondola Project Not Dead — Though Arlington County has moved on from it, D.C. is still budgeting money to advance the proposed Rosslyn-to-Georgetown gondola project, including $250,000 for an environmental review of a potential gondola site near the C&O canal. One other intriguing factor: should the gondola run north of the Key Bridge, as shown in renderings, it may reach Arlington at the Key Bridge Marriott property, which is in the early stages of a potentially large-scale, mixed-use redevelopment. [Bisnow]

County Buys Office Building — As expected, the Arlington County Board has voted to purchase a low-slung office building at 2920 S. Glebe Road, to house Arlington’s head start program. The program is currently housed in the Edison Center next to Virginia Hospital Center, which is slated to be transferred to VHC in a land swap (see above). Arlington is paying $3.885 million for the Glebe Road property, nearly $1.5 million above its assessed value. [Arlington County]

JBG Has Big Plans for Crystal City — JBG Smith, the newly-formed combination of JBG and the Washington properties of Vornado, says repositioning and enhancing its 7 million square foot portfolio in Crystal City is a “top priority.” Among the changes in the works for the Bethesda-based firm: expanding the vacant office building at 1750 Crystal Drive, converting it to residential, and adding an Alamo Drafthouse Cinema and a grocery store. [Washington Business Journal]

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Coffee Bar Coming to RCA Building in Rosslyn

A coffee bar is moving into the RCA building in Rosslyn, in place of an English language school.

Permitting applications indicate that Central Coffee Bar — also known as Cities Coffee and Bar in county filings — will replace part of the Inlingua English Center in the first floor of the building at 1901 N. Moore Street.

Workers will convert the 2,212 square feet of office space back to its original retail use. As of Friday morning, work is underway to tear up the floors and ceilings.

Inlingua will remain in the building, but with a reduced footprint.

The building is set for demolition in the next few years, to be replaced by a residential tower. The Washington Business Journal reported last month that a 407-apartment building with 12,709 square feet of ground-floor retail space has been proposed in its place.

No word yet on an opening date for the new coffee bar.

Hat-tip to Chris H.

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