One of Post Brothers’ D.C. Resi Conversions Headed to Foreclosure Auction

The developer behind a cadre of office-to-residential conversion projects in Washington, D.C., may wind up losing one of them to foreclosure.

Post Brothers, the Philadelphia firm which specializes in residential conversion projects, was served a foreclosure notice for 2100 M Street NW, a roughly 301,000-square-foot property in D.C.’s West End, not far from George Washington University. The Business Journals first reported the news. A foreclosure auction is now set for April 10. 

“We are looking forward to resolving this matter and pursuing development of the property,” Matt Pestronk, Post Brothers’ co-founder and president, told Commercial Observer. “Washington, D.C., is the best multifamily rental market in the country, and we are long-term bulls on the market.” 

The firm paid former owners Network Realty Partners and Meadow Partners $66.8 million in 2023 for the building, a notable discount from the $92.5 million that the JV paid for it in 2019. Post Brothers funded the acquisition with a $66.7 million loan from AllianceBernstein, but currently has an outstanding balance of $77.9 million on the debt, which matured several months ago, per the Business Journals. 

Post Brothers planned to convert the building into 400 apartment units, adding five stories and a penthouse, for a combined 100,000 square feet of additions, as well as 20,000 square feet of ground-floor retail space. 

The property for 50 years housed the Urban Institute, before the nonprofit think tank moved to 121,000 square feet at 500 L’Enfant Plaza in Southwest D.C. 

Post Brothers secured approval from the D.C. Board of Zoning Adjustment for its conversion plans in October — though, despite Pestronk’s optimism, the firm may not retain control of the building long enough to see those plans through to completion. Still, Pestronk told Commercial Observer in October that his firm saw great opportunity for conversion projects in the District. 

“Office-to-residential requires seeing a building as no longer viable for office use,” Pestronk told CO. “The office market [in D.C.] doesn’t yet have a lot of investors chasing every opportunity … but if someone can spend less [by keeping an office building as is] and get the same return, they’re probably going to do that.” 

The firm is meanwhile converting a two-building, 700,000-square-foot plaza, at 1825 and 1875 Connecticut Avenue NW, into about 600 residential units. The project, dubbed Universal North and South, is the largest office-to-resi development in the District. The Universal North and South project is also subject to D.C.’s 20-year office-to-resi tax abatement, as part of the city’s Housing in Downtown program, which Mayor Muriel Bowser announced last spring. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.