A Winning Combo

Mixing Residential and Retail

By Yardi Blog Staff on May 28, 2014 in News

The nation’s home ownership rate is on the decline as rising real estate prices and mortgage rates hold back demand. According to the latest data from the U.S. Census Bureau, the ownership rate dropped to 64.8 percent in the first quarter 2014 from 65.0 percent in the first quarter 2013 and 65.2 in the previous quarter. The rate is the lowest since the second quarter of 1995, when it was 64.7 percent.

The Census report also shows that approximately 86.2 percent of the housing units in the United States in the first quarter 2014 were occupied and 13.8 percent were vacant. Owner-occupied housing units made up 55.9 percent of total housing units, while renter-occupied units made up 30.3 percent of the inventory in the first quarter 2014.

Renting has started gaining ground mainly due to a combination of factors, including slow job growth, staggering economy, tight mortgage credit and declining affordability. In the first quarter 2014, the median asking rent for vacant for rent units was $766, whereas the median asking sales price for vacant for sale units was $139,200.

Aside from the financial considerations, a lot of people turn to renting because of the flexibility that it entails. It’s no secret that young professionals follow the job trail and seek housing that best accommodates their lifestyle needs. Often times, this means that proximity to employment cores, recreational and shopping destinations, as well as sustainability, walkability and comfort turn into powerful retention drivers. While the Millennial generation remains the key renter demographic, baby boomers are expected to give a huge boost to the rental market, particularly due to the increasing number of empty-nesters who are looking to downsize and move into more sustainable homes.

With consumer attitudes and habits on an ever-shifting path, the real estate landscape is bound to change as well. For the contemporary renter, mixed-use developments – usually retail and residential units wrapped around each other so as to offer a cohesive live-work-play environment – have become the place to be.

Yardi client The Bozzuto Group, a Greenbelt, MD-based real estate services company, builds on such principles as quality, diversity, and inclusion and strives to deliver enhanced communities to cater to today’s most discerning renters – and all of this while respecting the world in which we live.

The company’s newest mixed-use development in Washington, D.C., combines a premier location on stately Wisconsin Avenue with brilliantly designed residences and state-of-the-art retail. Dubbed Cathedral Commons, the project is a joint venture of Ahold USA, parent company of Giant Food, Bozzuto Development Company, and Southside Investment Partners of Baltimore.

The boutique style building offers 138 apartment residences and eight townhomes which will be available in fall 2014. Among a series of upscale amenities, the property will feature a hotel-style lobby; fitness center; a library and conference room for private meeting space; resident lounge for hosted community social functions; rooftop deck and private outdoor courtyards; and a 24-hour concierge offering Bozzuto’s Top Notch services.

Interiors will showcase contemporary design elements, including a chef-inspired kitchen with quartz countertops, custom oak flat-panel cabinetry, white beveled subway backsplashes and upgraded stainless appliances. Living spaces will include hardwood flooring and contemporary chrome LED track lighting, while bathrooms will boast Florentine Carrera floors and showers, chrome fixtures, and custom-designed vanities with integrated square sinks.

The retail component, scheduled to begin delivering this fall, includes Barcelona Restaurant & Wine Bar, Raku, iDoc Optical, Wells Fargo, SunTrust, CVS Pharmacy, and Starbucks, as well as the 56,000-square-foot Giant Food, which will bring a new urban prototype concept to the project. H&R Retail handles leasing at the property.

“We are excited to bring a mix of locally-based retailers and national brands to one of the most established and historic neighborhoods in the District,” said Toby Bozzuto, president, The Bozzuto Group. “Cathedral Commons and its new retail center will be vibrant, modern additions to Wisconsin Avenue and Northwest D.C. as a whole.”

Headquartered in the Washington, D.C. area, The Bozzuto Group has developed, acquired and built more than 38,000 homes and apartments and currently manages nearly 44,000 apartment units spread along the Atlantic Coast between Northern Virginia and Boston. The company is committed to providing quality housing for individuals of all income levels, producing and managing everything from luxury homes and apartments to affordable housing solutions

Check out the video below for more insights on the future of renting as explained by Bozzuto Management’s Stephanie Williams in an interview with CNBC.

Renderings of Cathedral Commons courtesy of The Bozzuto Group