Developers central to the remaking of downtown Bethesda see the area splitting in two: A luxury southern section anchored by Bethesda Row and a cheaper, “more funky,” neighborhood coming up in Woodmont Triangle.
Representatives from StonebridgeCarras, Duball, MRP and the architect who helped design the landmark Bethesda Row development spoke at a Bisnow Media event Thursday morning at the Bethesda Blues and Jazz Supper Club.
Much of the conversation on the business outlook for Montgomery County focused on redevelopment in Bethesda, where roughly 5,000 rental and condo units are projected to be built in the next decade.
“We believe strongly that there’s sort of a seachange,” said Marc Dubick, president of the Reston-based Duball development company. “[Bethesda Row] is not going anywhere, but it’s like Yogi Berra said: ‘It’s so crowded that nobody goes there anymore.’ We see the Triangle maturing as part of the next cycle.”
Duball will break ground on a nine-story, 46-unit condo project at Battery Lane and Woodmont Avenue late this year.
Across the street, Bethesda-based StonebridgeCarras is building 8300 Wisconsin, the Harris Teeter-anchored apartment project at the northern point of Woodmont Triangle.
“What we’re seeing is a two-tiered pricing market in Bethesda,” said StonebridgeCarras principal Doug Firstenberg.
The developer is also building The Darcy and The Flats, separate apartment and condo buildings on the old Lot 31 across Bethesda Avenue from Bethesda Row’s Barnes & Noble store.
Firstenberg said the cheapest rent at the Lot 31 rental building will probably be $2,000 a month for the smallest studio unit, putting it at a more expensive level than most of the rental buildings delivered or in the pipeline for Woodmont Triangle.
“I find the Triangle area far more funky than Bethesda Row,” said David Kitchens, an architect with Cooper Carry who helped design Bethesda Row for Federal Realty. “There was a time when the Triangle was the only place to go. Bethesda Row was basically a lumber yard. The ability to attract a younger demographic actually kind of could be in northern Bethesda because of the price issue that we may have.”
There are eight rental projects either completed, under construction, in the development approval process or planned for Woodmont Triangle. The first of Donohoe’s Gallery of Bethesda buildings, a 17-story, 235-unit building on Rugby Avenue, is finished and has welcomed its first tenants.
The growing division between the Triangle and Bethesda Row, what some refer to as old and new Bethesda, has been a major talking point in early discussions of the Bethesda Downtown Master Plan rewrite.
Jane Fairweather, a realtor and prominent Bethesda civic leader, moderated the panel discussion.
“I hope that we don’t end up with a young side of Bethesda and an old side of Bethesda,” Fairweather said. “I hear that a lot.”
Woodmont Triangle rents might end up cheaper, but that doesn’t mean the rents will be cheap. Some rentals will start with the typical entry market rates of $1,800-$2,200. That translates to a salary of roughly $65,000 a year.
Gallery of Bethesda (a BethesdaNow.com advertiser) is listing studio units for $2,067 a month.
Fairweather asked Steve Silverman, director of Montgomery County’s Department of Economic Development, where those making $65,000 a year will come from.
“Everybody talks about big companies, big corporations. Sorry, they’re not coming to the Washington area. That is just a reality. The job growth as we continue to move forward is going to be smaller companies. The job growth is in those companies that are five years or less in age,” Silverman said. “The data shows those companies are in life sciences, green economy, cybersecurity and IT. Those are our sweet spots, given the spinoff of federal agencies and the academic institutions we have. That’s where those jobs are that are going to be paying $65,000 and up.”
Ryan Wade, a principal at D.C.-based MRP Realty, said his company made its entry into the Bethesda market with its $200 million purchase of the Air Rights Center because it sees change to a younger, more millennial-friendly area.
The county started a Nighttime Economy Task Force last year to examine ways to attract the millennials who are flocking to D.C., which at times over the past few years has exceeded an oft-cited 1,000 new residents per month pace.
“Bethesda’s really coming back. It’s becoming more 24/7. It’s great that we have four or five residential buildings under construction. It’s great that you have a high-rent district but you still have the Triangle,” Wade said. “People are moving into D.C. because it’s cool. The great thing about Bethesda is it’s cool enough.”