Washington considering tax for downtown apartments amid building boom

Dive Brief:

Multifamily buildings — including condos associations and apartments — in downtown Washington, DC, may soon be required to join the largest business improvement district in the city, according to the Washington Business Journal.
A bill before the D.C. Council proposes levying a mandatory assessment on apartments in addition to an optional fee for condo associations with the potential to generate $780,000 annually for the BID, Bisnow reported.
The BID has added more than 5,000 residential units over the last two decades.

Dive Insight:

The Downtown BID includes the region roughly east of the White House and northwest of the U.S. Capitol Building, up to the Walter E. Washington Convention Center. This area is largely commercial, with office buildings, retail, dining and entertainment spaces forming the core of the city’s downtown.

The District, which measures five miles from its center to its farthest border, has long been known as a commuter-heavy city. But a host of downtown development, both residential and commercial, is changing that.

The city is gearing up for a 14-story, 875,000-square-foot office building — constructed on the site of the former Washington Post headquarters — that will include the new national headquarters for mortgage giant Fannie Mae. Meanwhile, Washington’s new CityCenter infill development features 2.5 million square feet of commercial, multifamily, hotel, retail, dining and public spaces across eight buildings on three-and-a-half city blocks. The first phase, which includes two 11-story apartments containing 458 luxury and two 11-story condo buildings holding 216 units, was mostly complete in 2014, according to the developer.

Washington has seen residential supply grow, exceeding 10,000 units for two of the last three years, according to Multi-Housing News, while rents have risen and vacancies have been reduced.

The biggest building boom in the city, however, is taking place in its NoMa (North of Massachusetts Ave.) neighborhood, on the city’s northeast side. This month, Skanska broke ground on Resa, a 12-story, $112 million apartment building that is part of the three-building Tyber Place development that will offer 581,000 square feet of mixed-use space, including 326 apartments. And Friday, a 52,000-square-foot store for outdoor recreation retailer REI opens, led by Douglas Development Corp, in a renovated historical building. The 2.5 acre site will also include 174,000 square feet of office space.