Council approves K Street redevelopment proposal
The proposal for redevelopment of the 700 block of K Street received the nod of approval from City Council Tuesday night, opening the way for developers to move forward with the $47.7 million project.
With close to 64,000 square feet of retail space and more than 130 housing units, the project is designed to revitalize a long-ignored section of K Street with a diverse tenant mix of restaurants, boutique shops and a live music venue.
If all goes as planned, developers expect to begin construction in late January or early February of next year.
With their unanimous vote, council members approved the environmental impact and planning commission reports, and formalized a Developer Disposition Agreement (DDA), which spells out the terms of the redevelopment deal with the city.
Bay Miry, senior associate at D & S Development, one of the project’s development companies, said they anticipate the project will create approximately 300-400 construction jobs during the building phase, and another 400-500 permanent jobs from the 14 retail spaces being built into the development.
“We’re very excited and thankful for (the) council’s approval,” said Ali Youssefi of CFY Development, the other half of the 700 block development team. “Now it’s all about completing the plans, getting to construction and getting to the day when we can go out and enjoy the finished product.”
The next steps for Youssefi and Miry will be securing the remaining financing elements, including a conventional loan and a federal grant for redevelopment of blighted neighborhoods in distressed areas.
“We’re hoping that this will put us where we consider to be very solid ground,” said Beth Tincher, a senior project manager with the city’s Economic Development Department.
Tincher described working with city planning and building officials on the project at every step as a “collaborative effort to ensure the success of the project.”
“They have indicated their willingness to work with us and help us to keep to the schedule we’ve outlined,” Tincher said.
The development team initially requested $16 million in existing city redevelopment assistance funds to go along with developers’ private investment of $1.5 million in cash equity and $18 million in conventional debt to develop the 700 block, Miry said.
As the project was being negotiated, however, the deal was revised so the city would contribute only $14.5 million, and developers increased the private investment of debt and equity to a total of $33 million.
The development team anticipates about 200 residents “living, working and playing” in the K Street area from the 137 apartments planned for the project, Miry said.
The developers anticipate the project will bring about 6,000 patrons to K Street every week.
Additionally, developers estimate about $1.6 million in annual sales tax revenue generated from the project, and another $330,000 annually in property tax.
“We really feel this project will encourage development in the surrounding underdeveloped, vacant, blighted parcels,” Miry said. “It’s a home run for the city, for sure.”