Bethesda Public-Private JV Project Moves Forward

BETHESDA, MD—Ground will break this week on a multi-party, mixed-use project in the heart of Bethesda. The $200-million project, informally called Lot 31 by the public/-private-JV participants,  will deliver 250 residential units, 40,000-square-feet of street retail and a new public-parking garage in this dense submarket. The joint venture is made up of StonebridgeCarras, PN Hoffman, Montgomery County, Northwestern Mutual and Buvermo Investments.

The residential piece, which has an affordable-housing component, will consist of the Darcy, an 88-unit condo building, and the Flats, a 162-unit apartment building. Reservations for the condos have been surprisingly strong, Douglas M. Firstenberg, a principal with StonebridgeCarras, tells GlobeSt.com. “We’re converting them to pre-sale contracts right now,” he says, declining to provide numbers for the pre-sales other than to say the project is already on track to realize 30% of its projected revenue. Negotiations for leases with retail tenants are also underway.

The first phase of the project to be developed, however, is Montgomery County’s stake—the underground public garage that will hold 950 cars. The county owns the garage, which is expected to deliver in late 2014. The residential and retail components will deliver in 2015.

StonebridgeCarras and PN Hoffman have been working with Montgomery County for the past seven years to re-develop the publicly-owned surface parking lots, called Lots 31 and 31A, where the project is being built. Montgomery County kicked in some financing for the project and the JV partners are providing about $150 million. Northwest Mutual is providing the remainder in a combination of debt and equity. HFF arranged the financing.

KNLB Retail is handing that portion of the leasing. SK&I Architectural Design Group is the architect, and the Clark Construction Group is the general contractor.