WASHINGTON, DCS

Real Estate Pipeline Trends

A Data-Driven Analysis of Development

May 2017
TABLE OF Executive Summary | 01

CONTENTS About Recity | 02

DCs Real Estate Pipeline | 02

Average DC Projects | 03

Development Patterns | 04

Conclusion | 09

Appendix | 10
 EXECUTIVE SUMMARY
Real estate in Washington DC is constantly changing. Population growth
and increased construction activity continue to influence the cityscape,
often surprising the Districts own residents. Whether you are an investor
or informed citizen, real estate pipeline information is significant for many
reasons. In addition to influencing market economics and investment
opportunity, the citys pipeline of residential and commercial projects will
shape how we live, work, and socialize in our future city.
Using Recitys database of real estate development data and analytics,
our team has synthesized important findings in the Districts real estate

pipeline. Among our trends, we find:

DC will add more than DC will add more than 15.5 million square feet of real estate in 2017.
15.5 million square feet Upcoming residential buildings have on average over 60,000 more
square feet than those recently completed.
of real estate in 2017.
The average upcoming commercial renovation contains nearly 100,000
more square feet than those recently completed.
Out of all of the upcoming projects in Washington, DC, 64% have a mix of
uses, with 12% having a mix of office and residential.
Recity is tracking over 18 million square feet of current and future
development along the Anacostia and Potomac waterfronts.
Just over twenty projects in DC account for over a fifth of all square feet
in development.
Over 80 million square feet of upcoming development is located within a
half mile of a Metro Station.
 Washington, DCs Real Estate Pipeline | 02

ABOUT RECITY
Recity is a real estate analytics company that provides data-
driven insights and metrics around real estate development and
investment activity in urban markets. We collect data about recently
completed, under construction, planned, and even unannounced
construction projects to empower real estate professionals and
their clients to make better informed decisions. With Recitys web
and mobile applications, customers can access reliable, real-time
insights anytime.
Recity collects over 70 data points from hundreds of sources
to create a comprehensive database that shows the state of
the market and upcoming pipeline. Collecting and maintaining
development data in a quickly changing market is challenging and
inefficient for an individual. Recitys technology-enabled research
team combs building permits, zoning documents, industry content,
and more to identify the most relevant and real-time information
for real estate professionals. The depth of the data we collect and
maintain allows us to show the impactful investments being made in
each city.
To see detailed information about Recitys data collection, research
process, and specific methodology for this report, please see the
methodology section in the appendix.

DCS REAL ESTATE PIPELINE

Walking down the streets of Washington, DC, it may seem
impossible to go a block without passing by a construction site. DC
is experiencing the same trend as much of the rest of the urban

United States: rapid growth and escalating real estate prices.

The District will add more than 15.5 million square feet of real
There are over twice
estate in 2017 alone. As it stands today, there are over twice as
as many projects in many projects in the pipeline than were completed in the past five
the pipeline than were years. Thats over 23,000 residential units and close to 15 million
square feet of commercial space added to the city since 2012, but
completed in the past nearly 50,000 residential units and over 23.5 million square feet of
five years. commercial space still to come.
Real estate in the nations capital is influenced by many factors. For
instance, DC has a notorious height limit, incentivizing the largest
floor plate possible on all stories of the building. Likewise, the local
zoning code adds layers of complexity. After almost a decade long
process, DC updated its zoning code in 2016. The new code makes
it easier to create accessory dwelling units and corner stores
and decreases parking minimums in many parts of the city. The
update also solidifies the affordable housing rules governing new
development. As these zoning changes are implemented, they will
shape DC real estate trends.
 Washington, DCs Real Estate Pipeline | 03

AVERAGE DC PROJECTS
In DC, both the average building size and overall project size are
increasing. We are able to calculate this and more from Recitys
comprehensive pipeline. For the ease of comparing data sets, we
split projects into two categories, completed and upcoming. All
projects completed by the end of the first quarter of 2017 are
considered completed and those still under construction or planned
are considered upcoming. Using these two categories allows us
to easily show the changes the market has seen over the last five
years.
Residential:
Comparing upcoming to completed residential buildings reveals
several interesting trends. Residential buildings are getting
larger, both in terms of square footage and unit count. There is
also a growing preference to construct apartments over condos,
contributing to an imbalance in the city of renting versus owning.
Nearly every aspect of residential buildings, besides the units

themselves, is getting larger. Upcoming residential buildings are

Upcoming residential planned to have over 60,000 more square feet than completed
structures. The average building has also increased from six stories
buildings are planned in completed buildings to seven in upcoming ones. The floorplates
to have over 60,000 are on average over 5,000 more square feet in upcoming residential
buildings while lot sizes have increased by over 20,000 square feet
more square feet than as well. Although larger buildings may be more complicated to
completed structures. construct, they can lead to higher returns for developers.
More units are being squeezed into residential buildings. Upcoming
projects are expected to have over 50 more units than completed
buildings.You might expect these units to be decreasing in size, but
they are maintaining about the same square footage. The average
unit size in upcoming buildings has decreased by less than 50
square feet compared to completed buildings. More units means
a higher rate of return for developers and a greater resistance to
issues surrounding vacancy.
DC has and will continue to have a large imbalance between
apartments and condos, stemming not only from the limited number
of condo building coming online, but also from the relatively small
size of those condo buildings.The average apartment building in DC
has 196 units, while the average condo building only has 53. This
has led to an acute imbalance in the pipeline, with over 45,000 new
apartment units slated to come online in the coming years but only
just over 4,000 condo units in the pipeline. This imbalance has huge
implications for the cost of home ownership and apartment rents in
the District.
 Washington, DCs Real Estate Pipeline | 04

Commercial
Commercial office buildings are on the rise again, with almost double the
developments planned for the next five years than were completed in the
last five years. Commercial buildings are seeing many of the same trends
as residential. Office buildings in DC are getting larger, both in terms of
total square footage and parcel size, and renovating buildings is becoming
much more popular. Commercial buildings have adopted the mixed
use mantra as much as residential buildings. All of these factors come
together to change the shape of commercial buildings we see in the city.
Commercial buildings are increasing in size. The average upcoming
commercial building is over 75,000 square feet larger than completed
buildings. However, the average building has remained the same height
at eight stories. This means floor plates and lot sizes have grown
correspondingly by just over 8,000 square feet and 25,000 square feet,
respectively. New construction is only accounting for a small increase in
these sizes, with renovations responsible for the large increases.

The average upcoming Commercial building renovations are becoming significantly larger.
Whereas upcoming new construction commercial buildings are around
commercial renovation 50,000 square feet larger than completed buildings, the average upcoming
commercial renovation contains nearly 100,000 more square feet than
contains nearly
completed buildings. Large renovations and additions, such as Alexander
100,000 more square Court in the West End, are contributing to the increase in the average size
of renovations.
feet than completed
Commercial buildings have also increased their mix of uses. Retail
buildings.
was already a popular inclusion in the case of commercial buildings,
but hotel and entertainment inclusion is increasing, albeit slightly, as
well. We are tracking a three percent increase in the inclusion of hotels
in office buildings, as well as an eight percent increase in inclusion of
entertainment establishments. Entertainment includes businesses like
theaters, bowling alleys, and nightclubs. These mixed-use trends bode
well for creating successful urban neighborhoods.

DEVELOPMENT PATTERNS

The prevalence
of mixed-use
buildings, waterfront
Compiling complete development data presents us with a unique
perspective to see the real estate trends in Washington, DC. The
prevalence of mixed-use neighborhoods, waterfront development,
megaprojects, and transit-oriented development stand out as
important trends to follow.
development,
Mixed-Use Neighborhoods
megaprojects, and
The rise of mixed-use developments has transformed the real estate
transit-oriented
development formula. Whether they are being favored because of their
development stand out. ability to better weather financial crises or because they offer more
amenities to tenants, it is clear that mixed-use developments are here to
stay. Out of all of the Upcoming projects in Washington, DC, 64% have a
mix of uses, with 12% having a mix of office and residential.
 Washington, DCs Real Estate Pipeline | 05

An even more interesting trend to follow is the rise of mixed-use

neighborhoods. It was not that long ago that cities were imposing stringent
land use codes trying to separate uses. That left a city where few
residents could walk to work or recreational activities. The rise of mixed-
use neighborhoods, or neighborhoods with a mix of housing, office, retail,
and light industrial spaces, mirrors the national trend of people striving to
be able to walk to get their everyday needs.
Many neighborhoods in DC have increasingly embraced this successful
trend. NoMa and Navy Yard are exemplary cases. New development
in NoMa is nearly half residential and half commercial, cementing the
neighborhoods place as a mixed-use leader. Out of the planned 13 million
new square feet in NoMa, 7.5 million square feet will be office, less than
a half a million square feet will be retail, and the rest will be housing.
Navy Yard boasts a similar mix of uses. Navy Yard will see over 2 million
square feet of office, over 10,000 residential units, and over half a million
square feet of retail. Mixes of use are propelling some of the most popular
neighborhoods in DC.
The Central Business District (CBD) has now been almost entirely
encircled by mixed-use neighborhoods, but has yet to adopt the mixed-use
neighborhood model itself. Our data shows that the majority of mixed-
use developments are being constructed in Chinatown, NoMa, Navy Yard,
and even the West End and Foggy Bottom, all around the CBD. With an
older, more entrenched building stock, the CBD is ripe with opportunity for
housing conversions.

Spotlight: Mixed-Use, Cathedral Commons

PROPERTY TYPE: Mixed Use
One of the most successful examples of mixed-use is the
combination of housing and grocery. Cathedral Commons, a
development by the Bozzuto Group in Cathedral Heights is proving
that the mixed-use model can work outside of extremely dense
neighborhoods. Located near the National Cathedral along Wisconsin
Avenue NW, the mix of 146 residential units and nearly 125,000
square feet of retail produced a lively center of the neighborhood in a
space that used to house a suburban style grocery store.

STATUS: Completed
COMPLETION DATE: May 2015
SUBMARKET: Cathedral Heights
DEVELOPER: Bozzuto Group
Cathedral Commons is not only successful because of the location,
but also the mix of uses provided within the development itself.
The renters in the apartments provide patrons for the retail
establishments.The amount of retail the development is supporting
is significant compared to a slightly older grocery development a few
blocks away built without housing.

ARCHITECT: Maurice Walters

NUMBER OF UNITS: 146

The mix of 146 residential units and nearly
NUMBER OF FLOORS: 5
125,000 square feet of retail produced a lively
PROJECTED COST: $130M
center of the neighborhood.

Recity is tracking over
18 million square feet
of development along
the DC waterfront.
PROPERTY TYPE: Apartments
STATUS: Completed
COMPLETION DATE: 2013-2015
SUBMARKET: SW Waterfront
DEVELOPER: Urban Atlantic, JBG
ARCHITECT: Wienecek & Assoc.
NUMBER OF UNITS: 530
NUMBER OF FLOORS: 11
PROJECTED COST: $120M
Washington, DCs Real Estate Pipeline | 06
Waterfront Development
Washington, DC, has long turned away from its waterfront heritage.
Decades of freeway projects and urban renewal left some of the most
valuable real estate in the city underdeveloped. In recent years, concerted
efforts and reinvestment have transformed DCs waterfront into something
nearly unrecognizable. Public projects like the Clean Rivers Project have
put a focus on cleaning up some of the most polluted waterways in the
country, adding to the reasons for new growth along the rivers.
Recity is tracking over 18 million square feet of development along the DC
waterfront. 7.3 million square feet of that is along the Potomac, while 11.8
million square feet is along the Anacostia. Projects such as The Wharf and
The Yards have added 2,800 residential units and 2.2 million square feet
of commercial space to the area. The changes these developments, and
the many more in the neighborhood, have brought cannot be understated.
Comparing pictures from 2007 to today shows two completely different
neighborhoods.
The government is also investing heavily in the area, with two sports
stadiums being built along the waterfront. Nationals Park was finished in
2008 and has led to a development boom in the Navy Yard neighborhood.
You will be hard pressed to find an unimproved site around the ballpark
that does not have a planned or unannounced project. Looking at the
assemblages of developers, or what we call unannounced projects, shows
the future is just as bright. The new Audi Field, which broke ground in
February 2016, will uphold the trend. There are already five developments
planned for around the new soccer stadium, and another five unannounced
projects hold much promise.
Spotlight: Waterfront, The Lex & Leo
Conversions of office space to residential uses have become
a popular trend in Washington, DC. The glut of aging office
space in the DC region makes conversion an appealing option.
Conversions offer the opportunity to build new residential
units at a fraction of the cost of new construction. A pair of
old EPA office buildings in Southeast were met with just this
fate. The City granted a variance to allow the wider floorplates
to be used for residential purposes, and the new facade with
floor-to-ceiling windows allow for more light. The Lex and Leo
at Waterfront Station are now a mixed-income community
providing over 500 residential units next to the Waterfront
Metro Station.
This process will be an important one to maintain as large
development sites become more scarce and buildings in the
city begin to reach the end of their usable life. Not only do
complete renovations and conversions help cut project costs,
but they are also more environmentally friendly than new
construction.
 Washington, DCs Real Estate Pipeline | 07

Megaprojects
Projects in Washington, DC, seem to be getting bigger and bigger, so
much so that they can now be small neighborhoods in their own right. DC
projects are getting larger in building size and the amount of land they
encompass. Projects such as the Wharf and Capitol Crossing are so large
they have the power to affect average sizes across the city, even when
they are broken into their various construction phases.

Megaprojects are Recity is tracking more megaprojects than ever. There over twenty
projects greater than 1 million square feet that have been recently
over a fifth of all the completed or are planned to be constructed. Those twenty projects, if fully
development in DC. built out, will add over 38 million square feet of space. That is over a fifth
of all the development in DC. This small handful of projects add nearly
20,000 residential units and over 10 million square feet of office space.
Big investments and large assemblages are allowing developers to
radically transform the neighborhoods in which these megaprojects are
being built. The Southwest Waterfront is unrecognizable from what it
used to be just a few years ago. Downtown DC has a new shopping and
restaurant destination on what used to be parking lots. Megaprojects
allow for developers to tightly control their vision, many times producing
stunning results in terms of architecture and leasing strategy.
This trend shows no signs of stopping anytime soon. There are more
megaprojects planned for the near future than were recently completed.
If just the planned projects were built, that would add over 15,000
residential units and over 4 million square feet of commercial space.

Spotlight: Megaproject, New City DC

PROPERTY TYPE: Mixed Use
STATUS: Planned
COMPLETION DATE: 2018
SUBMARKET: Arboretum
DEVELOPER: Douglas
ARCHITECT: Antunovich
NUMBER OF UNITS: 440
NUMBER OF FLOORS: 2-5
Washington, DC has seen its fair share of neighborhoods
come out of developers visions. Go back to some of the
greatest building booms in this citys history, and many of the
neighborhoods we love today came out of developers grand
plans. Row-home or single family-centric developments might
have looked different from 10-story apartment buildings, but
the impetus was the same. These developments bet on having
the critical mass to support themselves, and New City DC is so
large that it just might.
Adding over 400 residential units and nearly 350,000 square
feet of commercial space, Douglas Development will transform
a fifteen acre parcel of Ivy City into New City DC. With a mix of
big box stores, smaller retailers, restaurants, and apartments,
which the developer expects to be completed by the end of
2018, the former block of auto body shops and gas stations
will be turned into a walkable development with many more
services for the surrounding neighborhood.
 Washington, DCs Real Estate Pipeline | 08

Transit Oriented Development

A prevalent theme we have seen is the location of development near
transit. Some of the largest projects we are tracking, especially in the
fastest growing parts of town, are within walking distance to hard transit

infrastructure such as the Metro or the DC Streetcar. This is the effect of

Over 175 million transit-oriented development (TOD). In DC, over 175 million square feet
square feet of recently of recently completed, under construction, and planned development
projects are within a half-mile of a Metro Station. Thats 65% of all the
completed, under projects we are tracking in the city. Breaking these totals down more,
shows us 72% of all the residential projects we track, 82% of office space,
construction, and
and 58% of retail are within a half-mile of a Metro Station. Transit systems
planned projects are are what make the density of the city possible.
within a half mile of a Look no further than NoMa, one of the largest TOD successes in recent
memory. The neighborhood took off after the completion of the NoMa -
Metro Station.
Gallaudet Metro Station in 2004. Property owners in the neighborhood
realized the value a Metro Station would bring to their properties, and
agreed to a special tax for properties within a half-mile of the station to
pay for part of the construction. The result has been the radical addition of
the mixed-use density we see today.

Spotlight: TOD, Burnham Place

PROPERTY TYPE: Mixed Use
STATUS: Planned
COMPLETION DATE: TBD
SUBMARKET: NoMa
DEVELOPER: Akridge
ARCHITECT: Shalom Baranes
NUMBER OF UNITS: 1300
NUMBER OF FLOORS: 12
PROJECTED COST: $1.3B
Washington, DC, is already home to one of the largest TOD
project in the nation at the Wharf, but another project is
poised to take TOD to new heights. Burnham Place will fill
in the gap in the citys fabric created by the rail yard north of
Union Station. The project will create 1,300 residential units,
1.5 million square feet of office space, 500 hotel rooms, and
100,000 square feet of retail space. All of this is being built
with the developer only owning the air rights, meaning the
development will need to be built on stilts over the rail yard.
Not only will Burnham Place add a significant amount of space
to one of the hottest neighborhoods in DC, but it is also building
on some of the most valuable but underutilized land in the city.
Union Station is not only a local and regional transportation
hub, but a national one as well. The station is home to a
multitude of transportation options, including local bus, DC
Streetcar, Metro, Amtrak, regional rail, and intercity busses.
All of these come together to create one of the busiest
transportation hubs in the country and the busiest Metro
Station in the system. Burnham Place is poised to take
advantage of all of these options to produce a development
with few rivals in terms of transportation options.
 Washington, DCs Real Estate Pipeline | 09

The other half of the picture is just now coming into focus. Even though
the half mile around the NoMa - Gallaudet Metro Station has already
added over 3,000 residential units and nearly a million square feet of office
space, there are still over 10,000 residential units and over five million
square feet in our pipeline. This is an incredible amount of density that is
largely reliant on mass transit systems servicing the neighborhood.
TOD is not all about Metro either. Despite the DC Streetcar only being open
for a year, it is already possible to see the effects the investment in hard
infrastructure has had. Since the DC Streetcar opened in February 2016,
over 750 residential units and nearly 150,000 square feet of commercial
space have come online along its route. The future pipeline is even more
impressive. There are nearly 2,000 residential units and over 1.75 million
square feet of commercial space planned to be added along the streetcar
route in the next five years. The pipeline is focused on H Street NE, with
the majority of the projects happening there, but Benning Road NE will
see some development as well. With three Planned projects and one
Unannounced, there will be over 500 residential units and nearly 20,000
square feet of retail added to the Benning Road portion of the streetcar
route.

CONCLUSION
Washington, DCs skyline of tower cranes reveals just how much and
how quickly the Districts real estate market is changing. Recitys data
tracks the rate and nature of this change. Buildings, both residential
and commercial, are getting bigger. Apartments are being built at more
than ten times the rate of condos. The fabric of neighborhoods has been
altered as mixed-use increasingly dominates development trends, both
in buildings and in neighborhoods. The District is turning back to its
waterfront--neighborhoods along both the Potomac and the Anacostia
have transformed in recent years and will continue to do so. Much of the
DCs development is focused around mass transit corridors, emphasizing
transits importance in facilitating the citys increased density through
large-scale development.
The real estate landscape of DC has been changing at breakneck speeds in
recent years. According to our data, the rate of change is poised to speed
up even more in the near future. The pace at which new development
is coming online can be overwhelming, even for market experts. With
innovations in technology and Recitys deep understanding of how
development comes to life, a real-time picture of the evolving pipeline in
DC and other major markets is finally becoming more accessible.
 Washington, DCs Real Estate Pipeline | 10

APPENDIX
Methodology
Below is a detailed outline of the data, timing, procedures, and considerations that apply to Recitys pipeline
database as well as research nuances for this particular paper. The figures reported in this paper are
representative of the following parameters:
Data & Timing
Project Type: Recity tracks new construction in all major project types, including multi-family, retail, office, hotel,
and entertainment. We also use public data to track where renovations and additions are taking place. We do not
currently track public service or educational use projects such as parks, libraries, or schools.
Project Status: Recitys pipeline database includes all real estate development projects that are in one of the
following status categories:
Recently Completed - real estate developments that have been completed in the last 5 years.
Under Construction - projects that have broken ground but have not yet been completed.
Planned - developments that are planned for some time in the future and have corresponding permits, zoning
cases and/or have been announced by the developer.
Unannounced - real estate or land that has been recently acquired and has a high likelihood to be developed
in the near future.
Timing: For the ease of comparing data sets, we split recently completed, under construction, and planned
projects into two categories, completed and upcoming. All projects completed by the end of Q1 2017 are
considered completed and those still under construction or planned are considered upcoming.
Project Size: Considering project size, Recity tracks all new residential developments with eight units or more and
new commercial developments at or over 20,000 square feet. For renovations, we track residential projects with
at least 20 units and commercial projects over 50,000 square feet. In some instances, we will include a project
below the minimum size if there is a meaningful change of use or substantial historic restoration that could be
considered new construction.
Research Procedures
Our research team carefully inspects a variety of sources to populate our technology. The majority of our data
comes from three areas:
Data from cities: including permit records, zoning cases and variance hearings.
Industry content: such as news outlets, developer websites and real estate blogs.
Property sales information: ranging from developer acquisitions to public auctions.
This information is proactively collected by our in-house research team. New projects are added to Recity daily
and any existing projects in the system are updated during a weekly maintenance sweep. We have proprietary
alerts to ensure project details and timing are adjusted for any development that might need to be updated.
Maintaining data quality and keeping the information updated is crucial for ensuring Recitys database is both
reliable and useful.
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