BIZNOW // Jon Banister, DC
Bob Elliott, who grew up in Montgomery County and now lives in Rockville, joined Lantian Development from WashREIT last summer and became CEO in February. The Chinese-backed development company has a 31-acre site in Rockville and a 204-acre site in Clarksburg, both with massive projects in different stages of planning.
Bisnow: Lantian Development and 1788 Holdings recently filed plans for a $650M, 1.3M SF mixed-use development on a 31-acre site near the Shady Grove Metro station in Rockville. What are the different components for that project?
Elliott: It’s about 18 acres in the back with probably about 260 townhouses and 12 acres in the front with about 1,000 multifamily units with about 90K to 100K SF of retail, 110K SF of office and a 125-room hotel. That also includes maybe doing some medical office and some assisted living or possible senior housing.
Bisnow: What is the timeline for this project? Where are you right now and when do you expect to break ground?
Elliott: We’re in for project plan and we have had several community meetings as well as met with the planning commission. We expect to be finished with the project plan later this year. We may elect to proceed with the site plan for maybe some portion of the property concurrent with the project plan. After that we’ll complete some of the drawings and then start construction. Based on today’s conditions, I would say we may start construction on certain portions maybe late Q4 2018 early 2019.
Bisnow: Have you made any progress on finding an anchor retail tenant for the project?
Elliott: Nothing to report at this point, but we have had a lot of interest. It is progressing nicely and we continue not only to talk with anchor retailers but also potential other groups like hotel operators. We’re not actively pursuing office tenants at this particular moment because it’s still many years away. We’re talking with other user groups such as assisted living operators and groups that provide senior living. There’s absolutely interest from the townhome community.
Bisnow: What about the location makes it prime for this type of development?
Elliott: Our partner, Larry Goodwin at 1788, was the person who had this under contract. He came to us and we were excited by the property because it’s 31 acres. It’s an opportunity to create the northern gateway to the City of Rockville. The ability to have 31 acres that’s proximate to 270 as well as the Metro station is exceedingly rare. So for that reason, we were very excited by the opportunity to create something which we think will be reasonably special. We think of it as more of a neighborhood center than a town center.
Bisnow: Shifting gears to the 204-acre Comsat campus in Clarksburg that Lantian acquired in 2015. What are your plans looking like right now, do have an idea yet for what you want to do with this site?
Elliott: The philosophy behind Comsat was effectively ‘where else can you find 200 acres in Montgomery County proximate to I-270 in a very strong demographic area?’ This is a great, stabilized, long-term land play that you could really create something special. It’s got the opportunity for a future interchange off of I-270. It’s a strong residential market, you could blend that with a moderated piece of office and retail along with some other uses and create something with ease of access. We have put a tenant in place in a warehouse-like structure to grab some income and we’re just in earnest undertaking market studies. We’ve just started that process to better understand what the demand dynamic may be there.
Bisnow: How much density is the site entitled for and how close would you expect to be to the maximum density?
Elliott: In theory you could get probably over 5M SF. I think it’s unlikely we would pursue something like that because in order to do 5M SF, you’d be looking at something that looks more like a traditional town center. In order to do that, you’d have to have structured parking, you’d have to have things that don’t exist in that market. I think at the end of the day, the amount of density that ultimately gets programmed out will be substantially lower, just because of the cost dynamics with building parking. It’s very much still a surface park world. At some point in the future, we could have the Corridor Cities Transitway, which has been deferred by Maryland to at least 2023. When that arrives with the ability to have bus rapid transit, we would be the last stop before you head south. Having that on the property would allow for a future mixed-use component that might be a little different than what you could build today. But the ability to do anything that feels more like an urban town center may be more than a decade away at this point. We’d like to start studying what to do with the property sooner, but I think it’s going to have to be [a] surface park solution based on the current economics of doing something out in Clarksburg.
Bisnow: How do you like the dynamics of that Clarksburg area for multifamily and office and which component do you think you might do more of based on the market?
Elliott: Based on the current market, the townhouse market there remains incredibly strong. The townhouse market there is very much in demand, we like that mix. We look at what retail opportunities might be there. We are studying whether there’s an opportunity, there is a lot of demand for lab space. Whether or not there could be biopharma or life science use at the property. We continue to study a lot of trends, to see what might ultimately be available for us to move the development along more quickly.
Bisnow: What does the timeline look like, how soon do you think you could have a detailed project plan?
Elliott: We’re working on market studies at this point. I’m hopeful that we might be able to start some master planning in earnest certainly within the next 12 months. It’s 204 acres, so while there may be a master plan it’s going to be developed in phases. This isn’t something that can be done all at once.
Bisnow: What do you like about this Clarksburg location that makes it good for development?
Elliott: This is clearly not a Metro location, but it has the proximity to 270, and at some point there will likely be an interchange on the property, so that will accelerate your ability to get onto that road and get downtown. The demographics for that particular area are very strong. You look at very high median incomes, you look at the school system, you look at a lot of things that are positive. We see a lot of momentum in Clarksburg and we don’t see that going away any time soon. This is very much in the path of growth for the county, which bodes well for us.