Tuesday, February 02, 2016

Toll Brothers buys 8008 Wisconsin from Douglas Development in Bethesda

Development giant Toll Brothers has concluded there is plenty of demand in Bethesda for its City Living brand of urban luxury condo living. The company has just acquired its second downtown Bethesda site, 8008 Wisconsin Avenue, from Douglas Development. Toll Brothers City Living's first Bethesda project, Hampden Row, is currently under construction at Arlington Road and Hampden Lane.

This is a significant real estate story for two reasons. First, Douglas had been pondering switching its plan for 140 apartments on that site to condos. Now we know this will be condos. And second, it's surprising that Douglas would punt on this project. Unless you think the condo market is weakening in 20814, of course.

The Toll Brothers units will clearly be larger than what Douglas planned - there will be only 100 units now, rather than the 130-140 rental apartments originally envisioned. Amenities will include a 24/7 manned lobby, concierge services, the now-mandatory rooftop terrace, a fitness center and an underground parking garage. The building's height will remain 14 stories, and there is no word yet on what the building's retail/restaurant square footage will be. Douglas had planned a restaurant for the corner of Cordell and Woodmont Avenues.

"With the strong interest we are seeing at Hampden Row, our first Bethesda Toll Brothers City Living building, we are extremely excited to be expanding our City Living brand in the highly-desirable Bethesda market, while further increasing the Toll Brothers urban footprint in the DC metro area,” Toll Brothers CEO Douglas C. Yearley, Jr said yesterday.

And Toll Brothers may not be done yet in Bethesda. The company's City Living and Apartment Living divisions have several projects underway in the region, and Toll says it is eager to acquire additional sites. "With significant capital on hand, we are positioned to close quickly on deals in primary urban locations,” Thomas Mulvey, President of Toll Brothers City Living said Monday. “The new acquisition on Wisconsin Avenue is a prime example and we are actively looking for more development sites to complement it.”

Toll expects construction at 8008 Wisconsin to begin in the summer of 2017, with the first sales of units to begin that winter. Douglas ran into numerous delays with its original development plan for this site, previously home to a venerable surplus store and the "beer house" at the corner of Cordell and Woodmont. The holdup was the bizarre and arbitrary attempt by Montgomery County to take part of the 8008 property to create right-of-way for a proposed Bus Rapid Transit line along Wisconsin Avenue.

The problem is, a right-of-way of that greater width (which the County claims would run from Battery Lane to Bethesda Avenue) could never be built! It is not only blocked by recently-constructed residential and commercial buildings on Wisconsin, but also the historic Bethesda Theatre, which is currently operating as the Bethesda Blues & Jazz Supper Club.

How about the downtown Bethesda condo market?

JBG's new 7770 Norfolk building recently switched back from condos to apartments and will begin leasing this month. The Lauren, Stonehall and Cheval Bethesda are all under construction now, and Redfin shows 10 units available at The Darcy. And there are more to come.


Anonymous said...

That army navy store was a blight on our progressive community. Would love to see it replaced with tasteful condos and maybe a Pret a Manger next to a Vineyard Vines.

Anonymous said...

Dunmor's Beer & Wine store has been at that location for decades, but Dyer can't be bothered to mention their name. I guess they declined his "polite request" for free malt liquor.

Anonymous said...

I just can't believe that there are enough people willing to pay for these condos that are nearly as much as a single-family home. Can they possibly all be filled? Amazing. The Army Surplus store was great by the way. There's one on Route 7 in Tyson's surrounded by high-end stores and Orvis on the opposite end of the center from them and they do well.

Anonymous said...

7:20 AM Single family homes in downtown Bethesda are $1 million+
You can buy a condo downtown for much less.

$3000+ a month is a lot to throw away in rent.

Anonymous said...

I am glad to see Dunmor's Beer & Wine aka "the beer house". I have never bought so many skunked wines (three) from one retailer over the years. Also, their prices were slightly higher than surrounding stores and they lacked a true beer selection. However, I will comment that their employees were always friendly and helpful.

Anonymous said...

@7:20am I was surprised too. Look at the Darcy and many units are $1m+, but every week I see 1-2 more sales listed in the residential sales listings.

I think it's a combination of empty nesters (older people with adult children who moved out), along with couples and never-marrieds in their 40's without children. They have relatively high income, and no children to suck up a large portion of their income.

The demographic trend in the US is that fewer people seem to be getting married, so you end up with a lot of mid-career single people with decent incomes and few expenses.

Meanwhile we pay over $70k/year in child care + preschool....

Anonymous said...

@7:20am and 8:16am

Bethesda is one of the top 10 wealthiest places in the *entire* country by median household income. No it's not Wall St. or Beverly Hills wealthy (hence Euro Motorcars' sale of their Bentley/Rolls Royce dealership), but there are a LOT of high-income-barely-millionaire households (and above) in this area.

Anonymous said...

Has Dyer ever figured out that the right of way for the BRT is much wider at this location, than along the rest of Wisconsin Avenue, and specifically because a station is proposed here?

Or will he continue to regurgitate this tired talking point?