Quality Over Quantity for New Condos Coming to DC Area

by UrbanTurf Staff

Rendering of Gaslight Square, currently under construction in Rosslyn

Regular readers of UrbanTurf know that the pipeline of new residential projects coming to the DC area is among the most robust in the country.

“Our pipeline has grown more in the last six months or so than it had in the two years prior,” Mark Franceski, director of market research at real estate sales and marketing firm McWilliams|Ballard, told UrbanTurf.

But while that pipieline is packed with rental and for-sale projects, Franceski noted that the nature of those coming projects, at least the condominiums, will be different than during the boom of a few years ago. Namely, the projects will be smaller, higher quality developments, that will likely carry higher price tags.

“The quality of new condos is going to be much better in the next few years, as quality matters much more in this cycle,” he said. “Only the projects with the best potential are going to get built — which is going to boost prices.”

Since financing for big buildings (150 units or more) is still almost nonexistent, projects will be smaller. This will in turn temper overall new condo supply and, correspondingly, the number of sales.

For a look at the many projects slated for delivery across the DC area over the next few years, check out Pipeline, UrbanTurf’s searchable database of upcoming residential projects. Here are some “quick search” links for your convenience:

See other articles related to: pipeline, dclofts, dc condo market

This article originally published at http://dc.urbanturf.com/articles/blog/quality_over_quantity_for_new_condos_coming_to_dc_area/4076


  1. Richko said at 4:17 pm on Wednesday August 31, 2011:

    What are some examples of boom-years DC condo projects that are considered of inferior quality?  Superior quality?

  1. Mark @ MB said at 8:55 am on Thursday September 1, 2011:

    It’s not necessarily a matter of inferior projects versus superior ones (although there certainly are examplesof each), but a shift away from the simple standard of granite/hardwood/stainless steel. A vast majority of the condominiums built from 2004-2008 look the same. While the quality is not bad, it is now stale.

    New projects are going to have to differentiate from the vast resale supply in order to sell a) prior to delivery and b) at a premium price. The project in the picture at the top of this article is a perfect example. Gaslight Square has private elevator access to every unit, exceptional finishes and well designed floorplans.

    While Gaslight Square is a higher end project, even more “mainstream” condos are going to have to do something to make themselves stand out. Hardwood and stainless don’t have to change, but better execution is necessary. Floorplans must be better and space should not be wasted. Things like iPod docks, remote control window shades, even biometrics are going to be interesting touches that make new units feel that way.

  1. elvis55 said at 10:07 am on Thursday September 1, 2011:

    Well, considering the poor quality of some recent condo projects, I hope that quality improves.  It is indefensible to build a condo building with thin walls and thin floors.  In my view, if you can hear your neighbors through the ceilings and walls, it is a crappy building.  Sure if it’s a historic 1800s house it’s one thing, but if it’s a newish bldg that was put up in the last 10 years, it shows how builders/contractors love to cut corners to save a few pennies.  The 80% rug/carpet requirement at some condos proves the shoddy quality.

  1. Richko said at 10:35 am on Thursday September 1, 2011:

    iPod docks are so 5 years ago, and 5 years from now we probably won’t have need for such things at all.

    I say that with a bit of a wink but while such a thing may be a nice feature (now), it wouldn’t affect my decision to buy a place.

    I would’ve thought it’s more about a condo building’s construction that determined its “quality” than interior finishes. The “quality” of interior finishes is to some extent in the eye of the beholder, and in most cases can be, and would be, redone eventually to the owner’s preference, and in my opinion are not essential to whether a development is “superior” or “inferior” quality.  And out of the gate, if the target market of a development is the entry-level buyer, and the finishes are chosen / costed accordingly, does that mean it’s an inferior development, compared to one that has nicer finishes but is $100/s.f. more expensive?

    I do like your point about better, more efficient floorplans. We can all appreciate that!

  1. Mark @ MB said at 11:39 am on Thursday September 1, 2011:

    Those are all very good points, but I would place you in particular group of condo buyers/observers. Construction quality matters, but currently, it is simply too expensive to build a concrete condo building and charge a fair price. Concrete don’t make financial sense. There are hybrid methods that are cheaper and slightly better quality than wood, but even a wood-construction building can be built to a very high standard. I think that buyers who won’t buy in a stick built building certainly exist, but are a minority. Also, I would say 90% (or more) of condo buyers will never renovate their unit so they choose to live with the finishes they are given.

    I think you underestimate today’s condo buyer, even at the entry level. Yes, interior finish is in the eye of the beholder, but there are also distinct, objective levels of quality. The next wave of new condo buyers are going to be a lot of entry level people who have lived in Class A apartments and expect higher levels of finish. They will know what a good condo should look like and will be able to tell the difference between a resale and a new unit.

    Sure, an iPod dock in itself may not make your decision for you, but a package of similar touches such as that that cannot be found in 5-10 resales is going to be very important.

  1. Spike said at 1:30 pm on Thursday September 1, 2011:

    I respectfully disagree that the new condos that sell will be higher priced.  It is the lower priced new construction that will move in this new market:  Lenders have gone back to expecting 20% down payments and limiting loans to home values that match approx. 3x household income. Buyers may want highest quality but fewer can afford it.

  1. Mark @ MB said at 2:02 pm on Thursday September 1, 2011:

    I was more referring to specific new projects that are coming on the market. Some of the most high profile new condo projects coming down the line are:

    District Condos - expected to be near $700 psf
    CityCenter DC condo component - expected to be over $700 psf
    Gaslight Square - premium pricing (although Abdo projects always are)

    There are many other projects in planning that will come to the market at prices above where new condos were when they left the market. I absolutely agree that developers who can build more affordable new condos will be much more successful, but we’ll have to see just how many of those there are.

  1. former Georgetowner said at 5:03 pm on Thursday September 1, 2011:

    hmmmm.  Did Abdo build those beautiful apartments on Queen St in Rosslyn? http://gables.com/find/apartment/1111-gables-12-twenty-one-arlington-va

    That rendering above totally reminds me of the place.  I hope they do a better job with these condos.  The Gables are gorgeous but my friend’s unit overlooks an ugly highway and a sea of HVAC equipment.  Like every other unit there.

  1. Rob said at 5:29 pm on Thursday September 1, 2011:

    I’m very skeptical that condos in DC will sell for over $700 psf, but I guess we’ll see.

  1. Mark @ MB said at 7:36 pm on Thursday September 1, 2011:

    You and me both, Rob. My fear is that your average condo consumer will return to the market in 2012 after renting/occupying their current home since 2007 when things went sideways and see new condo prices are higher than when new condos left the market. I think it’s a bit overly ambitious, but hey, it ain’t my money.

  1. SWDC said at 7:56 pm on Thursday September 1, 2011:

    No more condos in Washington DC! Condos are poor real estate investments because condo fees steadily increase and unlike a mortgage on a single family home, one will pay a condo fee forever and least not forget the surprise extra special assessment condo fees. Ask any condo owner about that and then there are the changes to the original condo “by laws” to be very wary of. No matter high end, mixed use, affordable housing, low income, condos are not selling well in Washington DC and the glut of unsold condos is obvious and only getting worse as unsold condos in NY are being converted into homeless shelters, in Md. condo building turned into low income rentals and others are just renting cos no one is buying em. Living packed in like rats in high density buildings in urban environments is not livable walkable or all that much fun. Just takes one noisy neighbor and or friends and or family to annoy everyone in a high density building and new construction unfortunately does allow most to hear very intimate details like flushing the toilet and or using the toilet. And the old condos have old infrastructure problems from not being up to fire codes to dilapidated failing sewer and storm drains to old failing telephone lines. “Friends do not let friends buy a condo.” Rent it for a while and see if it is what you want and remember there are plenty of new condos being built and more are on the way../

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