- The Washington Times - Sunday, March 5, 2000

Residential developers are spending millions of dollars in apartment and condo renovation and construction around a P Street grocery store near Logan Circle, as a wave of professionals moves into the area.
"Logan in particular is an up-and-coming area," said Jim Abdo, a developer so bullish on the area he moved his company within a block of the circle nine months ago.
The developers' interest in the neighborhood is a reflection not only of the good economy, but of how the city is developing its fringe areas.
"The city is beginning to expand away from its core," said Kurt Stout, an analyst with the real estate brokerage Grubb & Ellis. He said it was "only natural" for the development to move north of downtown since it was already happening on the East End, the triangular "NoMa" corridor north of Massachusetts Avenue and east of Mount Vernon Square, and around the Navy Yard.
Residents and brokers said the key development near Logan Circle is the Fresh Fields grocery store being built by developer John Gerstenfeld on P Street near 14th Street NW.
Across the street Mr. Gerstenfeld has a contract to buy the Lighthouse for the Blind. He plans to find retail tenants and raise an apartment building on the vacant lot behind it, he said.
Other developers are equally active. Mr. Abdo, who just finished building condos at 16 Logan Circle, plans to start in December on the Manhattan, a $20 million, 135,000-square-foot building with about 80 loft-style luxury condos and two levels of underground parking, he said.
A bit further north, Keener & Squire broke ground recently on The Regent, a 53-unit apartment building at 16th and R streets NW.
P.N. Hoffman is building 14 condos in a $4 million project on Logan Circle, and plans to build two projects with Keener, a $9 million apartment building at 15th and O streets NW and a $5.5 million, 15-unit condo project at 1625 16th St. NW. He also will partner with Mr. Gerstenfeld on the project behind the Lighthouse building at 1440 Church St. NW.
"There's room for improvement in that neighborhood. This is a very hot market," said Monty Hoffman, president of P.N. Hoffman.
Several things are driving the move east from Dupont Circle, said a neighborhood activist.
"Demographics are pointing to more and more upscale young professionals moving into the neighborhood," particularly dual-income couples making lots of money to spend, said Wayne Dickson, a founding member of the Q Street Citizens Association. The association hired two firms to study local demographics, which they later used to sell Fresh Fields on moving into the neighborhood, he said.
"We have a tremendous influx of these power couples. Georgetown is filled up, the West End is filled up. This area is a natural," he said.
Many of the same things appeal to developers, said Mr. Abdo.
"It's access to downtown, the historic nature of the neighborhood," he said. "There's a lot of charm. We're seeing a tremendous number of empty nesters, yuppies, gay couples anxious to get into this area," he said.
The presence of theaters on 14th Street such as the Studio Theatre, Source Theatre Co. and Woolly Mammoth Theatre Co. adds an arts flavor as well.
"I think of it as the Washington equivalent of SoHo. There's just a huge influx of high-end residential," said Eric West, a broker with West, Lane & Schlager Realty Advisors.
The problem is lack of retail, they agreed.
"We've seen tremendous gentrification of the housing here, but support services along 14th and P streets are lagging," said Mr. Abdo, who is trying to bring retailers to the area. "We've got an abundance of check-cashing and liquor stores. We need legitimate retail."
Now the grocery store and the rising income tide is beginning to attract retailers, real estate officials said. Mr. Abdo has lined up a CVS for 1418 P St. NW. Starbucks and Banana Republic are rumored to be looking, and the Gap is looking for about 10,000 square feet on 14th St. NW, real estate officials said. Zoning leaves room for growth as well, said one broker.
"There's enough density to allow restaurants and retail and plenty of apartments on top," said David S. Crowley, a retail broker with D.C.-based Randall H. Hagner Co. He wouldn't identify his clients, saying both national and neighborhood retailers sign their brokers to secrecy because they don't want to tip off competitors.
Smaller offices are beginning to scout the neighborhood as well, including Internet start-ups, law firms and architects, said one developer.
"You're not going to get major players," Mr. Abdo said. "There aren't major office buildings here, but for smaller firms, this is a nice alternative to K Street and its big glass office buildings," he said.
One unidentified start-up that just received $5 million in venture capital is negotiating with him for a lease, said Mr. Abdo, refusing to identify the start-up.


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