AREP, Silverpeak Start Office-to-Residential DC Project

Bank OZK provided $61.8 million in financing.

American Real Estate Partners and Silverpeak Real Estate Partners have started construction on CityHouse Old Town, an office-to-residential adaptive reuse that will encompass some 200 luxury units in Alexandria, Va. Preleasing is expected to start next summer, with completion scheduled in 2025.

Earlier this month, the company has obtained $61.8 million in construction financing from Bank OZK, public records show. Project partners include general contractor Hoar Construction, interior designer RD Jones and Cooper Carry, which led the redevelopment design. Bozzuto Management will serve as property manager upon its completion.

The 200,000-square-foot office building came online in 1984 and was renovated in 2017. In 2022, the developer acquired the asset through its Strategic Opportunity Fund III, which closed the same year with $63 million in equity commitments. The total sale price, which also included the acquisition of all the condo units in the office building from seven owners, was $34.8 million, according to public records.

The seven-story property will feature a six-story interior atrium and will encompass a mix of floorplans ranging from 525-square-foot studios to three-bedroom apartments with a den. Amenities are expected to consist of a rooftop terrace, a private club suite, a fitness center, onsite parking and coworking spaces. Plans also call for office and retail spaces on the first floor.

The redevelopment is taking shape at 1101 King St. in the Old City neighborhood, close to numerous dining options and 2 miles from the Alexandria Commons shopping mall. Downtown Washington, D.C., is 8 miles northeast.

Northern Virginia’s multifamily pipeline

There were 42 multifamily projects under construction in the Northern Virginia market at the end of February, amounting to more than 12,300 units, Yardi Matrix data shows. A total of 30 developments are partially or fully affordable.

In September, Stonebridge Associates started construction on Oakville, a mixed-use project in Alexandria that is expected to include 572 rental units and 84 townhouses, alongside retail and medical office space. The first phase is scheduled for completion this year.