Foulger-Pratt Plans $62M Adaptive Reuse Project in DC
The company has acquired the office property at 1425 New York Ave. and plans to redevelop the asset into a 255-unit, class A multifamily community.
WASHINGTON DC – Real estate investment and development firm, Foulger-Pratt has acquired a 287,000-square-foot office building at 1425 New York Ave. N.W. in Washington DC. The company plans to convert and redevelop the 13-story asset into a class A multifamily property.
Once complete, the property will feature 255 rental units across 280,000 square feet. It will be the closest residential property to the White House.
The adaptive reuse project will cost a total of $62 million, including price paid, design and redevelopment permits.
The project has secured $31.4 million in sponsor and investor equity, including $14 million from 300 CrowdStreet investors. For the property, Fougler-Pratt additionally obtained a $30.6 million acquisition loan from Eagle Bank.
The project will be recapitalized before construction begins.
Located in the East End of the city’s central business district, the property is situated near two Metrorail stations. The location of the project is highly supply constrained, with only four class A residential properties located within a half-mile.
“The (central business district) submarket was built out years ago with heavy office uses, with few sites available now for redevelopment, which creates a high barrier to entry,” says Cameron Pratt, managing partner and CEO at Foulger-Pratt. “This building has a unique floorplate with window heights that lays out well for residential conversion, plus ample below-grade parking.”
The designs and building permits for the adaptive reuse project are expected to be obtained and finalized in the next 10-12 months.
Pratt adds, “We’re pleased to have investors on CrowdStreet participate. We believe in the retail investment model and consider a role for individual investors on a project-by-project basis. In this case, investors are coming into the project in its infancy and will benefit from the value created during the initial design and permitting phase of the project. We expect to fully capitalize the project and start construction in late 2022.”
“By CrowdStreet’s investment thesis, the Washington D.C. metro area ranks highly overall and as a top market for multifamily development in the U.S.,” says CrowdStreet managing director, David Govshtein. “Investors on CrowdStreet responded very favorably to this offering, which was oversubscribed by $10 million in less than an hour. It’s a testament to the sponsor’s track record and the fundamental appeal of this project, which is exceptionally well located in the heart of Washington D.C.”