Former FINRA HQ Converting to Hotel-Apartment Hybrid
The former FINRA headquarters will be getting a new life as an apartment-hotel hybrid.
A joint venture between regional real estate operator Bernstein Management Corporation, developer Urban Atlantic and Placemakr, a tech-enabled hospitality living platform, is converting the 12-story building at 1735 K Street NW to 160 apartments offering flexible leasing options and even one-night stays.
Bernstein acquired the 97,000-square-foot building earlier this month for $15.5 million from Beacon Capital Partners.
The Financial Industry Regulatory Authority had owned and occupied the majority of the building since it opened in 2007, but vacated the space earlier this year, inking a lease across the street at 1700 K Street NW. FINRA conducted a $16.5 million sale-leaseback of the 60-year-old building last December with Beacon Capital Partners.
The partnership will convert the building into luxury apartments. Urban Atlantic will serve as the lead developer for the project, which will also include ground-floor retail and amenity spaces.
The apartments will operate under the Placemakr Premier brand, offering flexible lease options, ranging from traditional residential leases to transient short-term stays for as little as one night.
“D.C. is underserved with housing options and overserved with commodity office options,” Josh Bernstein, CEO of Bernstein Management Corporation, told Commercial Observer. “The economics of rehabilitating any office building to traditional long-term rental housing are challenging and 1735 is no exception. With the flexibility that Placemakr brings, we can offer an attractive alternative for visitors and longer-term residents at a compelling price point.”
The acceleration of remote and hybrid work environments has created significant office vacancy throughout D.C., and numerous developers are converting office space this year.
For instance, Altus Realty will redevelop an 11-story building at 1010 Vermont Avenue NW into an 89-unit multifamily building with 4,081 square feet of ground-floor retail; American Real Estate Partners plans to convert a 196,000-square-foot building at 1101 King Street into 210 units; and Foulger-Pratt acquired a vacant office building at 1425 New York Avenue with plans to convert the13-story building into 255 apartments.
The building design will be underway in 2023 with construction anticipated in 2024.
Keith Loria can be reached at Kloria@commercialobserver.com.