Washington Business Journal: Residential overhaul of St. Elizabeths East to begin this summer

By Katie Arcieri  –  Staff Reporter, Washington Business Journal

The first phase of the redevelopment of St. Elizabeths East campus redevelopment is expected to begin this summer with the conversion of seven historic hospital buildings into 252 mixed-income rental apartments.

The $100 million project, from Flaherty & Collins and the Anacostia Economic Development Corp., marks a major step in the effort to transform one of D.C.’s largest developable parcels into a transit-oriented, mixed-used project near the Congress Heights Metro station. Master developers Redbrick LMD and Gragg Cardona Partners have mapped out a 2 million-square-foot, multidecade plan for the 180-acre campus, to include residential, retail and office.

Full buildout costs for phase one, which is divided into three parts, could top $240 million by 2023.

The apartments will get underway this summer after nearly two decades of planning, said Ed Fisher, executive director of the D.C.-owned St. Elizabeths East campus. “People have been working on this project since 2001. We’ve come along way,” he said.

Fisher added that the city has thus far spent $58 million to upgrade infrastructure to make this initial phase possible. Those upgrades will be complete by September, right when Events D.C.’s $65 million sports arena is expected to open.

“We’re finally going to have people coming to St. Elizabeths, coming to Congress Heights to be entertained, and not too long after that, we’ll have people living here and working here,” Fisher said.

The first part of phase one will entail renovating seven historic buildings totaling 354,000 square feet into rental units situated in an oval pattern, with one central building surrounded by the remaining six, said Stan Jackson, president and CEO of the AEDC.

Jackson said approximately 80 percent of the units will be affordable to families making up to 60 percent of the area median income. Basement spaces in two of the historic buildings totaling approximately 14,000 square feet will be leased for community amenities. Parking for the site will consist of two surface lots.

The apartments are expected to be complete by the end of 2020, said Duane Miller, president of Flaherty & Collins. The project will be funded through a combination of historic and low income tax credits, he said.

As for the rest of phase one, Redbrick is expected to start construction in 2019 on between 60 and 100 for-sale townhomes, 30 percent of which will be affordable, said Stephan Rodiger, senior vice president of development for Redbrick. The homes should be finished by 2021.

That is to be followed by the construction, again by Redbrick, of a 217,000-square-foot office building, including 38,000 square feet of ground-level retail that could house anything from restaurants to local businesses and incubator space for startups, Rodiger said. Construction on that building could begin in 2021 and end in 2023, but Rodiger added that the timing is dependent on tenant interest.

“You want to get a level of at least 50 percent pre-leased before you start,” he said.