WASHINGTON, DC-There has been little new development of multifamily product--like most other asset classes--in the DC region for the past 18 months. Indeed, new projects and the firms that are starting them--most notably AvalonBay’s commitment to building new projects--are seen as outliers.

That said, the next best thing is starting to happen: redevelopment of such properties. Urban Investment Partners, for example, has completed a $5.9-million renovation of the Policy, a seven-story apartment building in the Kalorama Triangle Historic District of Washington, DC. UIP acquired the 59-unit building at 1921 Kalorama Rd. in July 2008 for approximately $9 million.

Also, a subsidiary of UIP, UIPGC has been contracted to rehabilitate the Matheson, a large, century-old row home at 1451 Harvard St., NW, located in the District's Columbia Heights neighborhood. When the renovation is complete, the building’s seven residential units will be sold as condominiums.

Other recent examples include an abandoned apartment building at 1020 Monroe St., also in Columbia Heights, which was just acquired and is now being redeveloped into condos. Also, Valor Development, based in Bethesda, MD, acquired the former Italian Embassy in Adams Morgan with plans to redevelop the 35,000-square-foot building into an apartment building.

Eventually, such small-scale projects as these will give way to larger developments. In an earlier interview with GlobeSt.com, Marcus & Millichap’s Stacey Milam, a first vice president of investments and director of the firm’s National Multi-Housing Group in Washington, DC, said he is negotiating a few development deals for multifamily and condos that are in the hundreds of thousands of square feet range. Financing has been secured, he said. "What we are doing now is structuring the deals."