I am in that kind of reflective mood, and I would guess that between parties and large meals, you might want to think about something different than just the normal fare that I present in my newsletter.
Not that I am writing normal fare.
So maybe I don’t need to qualify it at all. So enjoy.
Let’s talk about Washington DC.
I have been going to DC for nearly 20 years, every 4-5 months on average.
Having those gaps in my visits has given me a neat perspective on what’s been going on real estate-wise, and it is shocking and exhilirating to witness.
First, I’m not the only person taking notice.
Even the New York Times recently gave some ink to their restaurants.
Most of my trips start with me in Union Station, which has undergone a series of renovations during this time.
It’s a wonderful place to “land,” once you move out from the sad innards of its railyard arrival, into the historic building.
Restored ceilings, new food court, etc, an inspiring place to walk through, not to mention seeing the Capitol building (the one time that you spell capitol with an o, that word has always made me think…) when you walk outside.
During this time, Uber appeared, making the transportation crunch, and ridiculously expensive cab situation, largely go away.
Though not the traffic.
Nor the sense that it’s the only city where I continue to feel a bit lost.
Initially, back in 2003, I actually took a Chinatown bus from New York’s Chinatown to DC’s Chinatown, and recall quite vividly how terrible the neighborhood was on the outskirts of the DC side.
The same story regarding the area all around the Convention Center, which featured a few really nice hotels, surrounded by dilapidated buildings, parking lots, and a lot of nothing.
Add to this that DC is not the walking town that New York is, and this area felt quite desolate.
So, we can fast forward to today.
To describe what has happened to the real estate situation in DC as a miracle would be perhaps a bit too hyperbolic.
We’re not talking about Dubai, Shanghai, where the proliferation is full of bizarre man-made islands, half-mile-high towers, and star architect confections.
Instead, DC has taken full city blocks, areas where there may have never been residential building at all, and planted hundreds of new apartments, thousands of condos, a new sports stadium, enormous outdoor commercial malls, multi-level restaurants.
Not only that, they have incorporated historic buildings and facades into new construction, built platforms over highways to build new office towers, and other ambitious engineering feats.
I keep saying “DC” has done this, but it is a variety of developers who are either based in DC, based in New York, or elsewhere, who have taken on this notion of the return to urban living and given it real life.
You can imagine, since I have also been actively running a residential real estate business in New York since 2003, that I might compare this DC Development to what’s been going on in New York.
Where I’m going with all of this is that you can see the culmination of the return to the cities by millienials- and really everyone else- along with what seems like an open-armed embrace of real estate development- uniquely, and more fully, than in New York City.
There are areas like Hudson Yards and Willetts Point that have been developed out of whole cloth, areas that didn’t exist or didn’t have any residential whatsoever.
And certainly some developer can pipe in and tell me that none of the development in DC, or anywhere for that matter, happens overnight, anyway.
But from where I stand, it feels like Washington DC has been more willing to allow developers to come in and “do their thing.”
This is in contracts to what I’m seeing in New York, where the pushback and fear of change has stymied even the most tame development at times.
This is not to say that I love every glass facade in DC, because I don’t.
As I ride from Union Station, you can suffer from Hanna Barbera syndrome (they did the Flintstones, Jetsons, too!), where the background keeps repeating.
It’s just like when you walk into an apartment that has been 100% furnished at the same store.
Something feels a bit too on the nose (“I’m new!”), a bit too generic (Where are we again?), a bit too the same.
There really is a generic feeling in certain parts, when everything popped up like mushrooms in the span of 2-3 years.
But in other areas, where the development integrated older buildings, and where the streets are strange and diagonal and unusual, that cookie-cutter feeling somewhat subsides.
There are other differences between the cities, and plenty of commonalities.
DC having a very different population story- a boom.
DC is a tale of people moving in, with population growth, a federal government with more and more jobs, seemingly- no matter the administration’s political lean.
In both places, there seems to be a complaint of a
massive shortage of housing for the people that are there.
For better or worse, what is financially feasible, and therefore what is being built in both places seems to focus on luxury condo or high-end rentals, and is not particularly focused on affordable housing.
NYC has probably got the edge when it comes to public transportation, whether an historic edge or one that actually has taken place recently- between the Second Avenue Subway or the 7 Train extension.
Both cities have gotten a boost from Amazon, even if only one (DC) gave a lot of tax incentives away to get these Amazon secondary/tertiary headquarters.
Both are hot and humid in the summer, though DC really takes that cake.
And they have bad mosquitoes, while NYC has its rat problems.
I understand that DC’s new construction condo situation is red hot, which is another difference.
And they are not seeing the ultra high-end glut that we see in NYC, able to perhaps build a bit more development considering the workforce that is in DC.
The point that I am trying to make is that every city, at many points, invents itself, develops.
And we have seen such a massive building boom in both cities, that it is entirely worth reflecting on the outcome at the end of a decade, at the end of an economic upswing that may or may not last for another year or two.
I think that NYC has really lost some opportunities to allow development to be a bit freer, when you see what can happen elsewhere.
In both places, what has been created in this time has been astonishing.
As a guy who likes to walk or run the streets to take in the details of what’s going on in a city, you could hardly go wrong to plant yourself in DC, or NYC for that matter, and take a look around.
See you in 2020! -Scott