Toronto-based investment bank RBC Capital Markets has funded a $150 million construction loan to Tishman Speyer for the redevelopment of a Washington, DC-area mall into a mixed-use multifamily and retail asset.
While it continues to be difficult for managers to line up new financings, the plans for the property are in line with the kind of project lenders are favoring right now – transforming well-located but obsolete retail and office assets into more useful buildings. The trend has been most visible in the office, hotel and retail sectors.
New York-based manager Tishman Speyer joined forces with Danish architecture firm 3XN for the project, which will see the Mazza Gallerie in Friendship Heights, Washington, DC, converted into a 320-apartment unit luxury apartment asset with 90,000 square feet of redesigned retail.
Forty of the 320 apartment units will be designated as affordable housing, and floorplans range from studio to three-bedroom offerings. Units will include two-story townhouses and penthouses with terrace spaces.
As part of the deal, Tishman Speyer will replace the existing three-story building with a seven-story asset set on top of glass-enclosed retail spaces at the ground level. The manager intends to maintain the existing 70,000-square-foot below-grade retail concourse and parking structure.
Demolition is already underway of the existing asset. The residential component and first phase of retail openings is set for 2025. TJ Maxx will remain the retail anchor on the asset. Tishman Speyer noted the firm will target boutique stores and a mix of fast casual and full-service restaurant offerings to fill out the retail tenancy.