Developers are scaling back a project planned near D.C.’s historic Eastern Market after key tenants backed out, a move met by praise from residents who worried the project was too big for the neighborhood.
The Stanton-EastBanc team is cutting out roughly 13 percent of it project, or 85,000 square feet, after two nonprofit companies backed out of their planned relocation to the development. As a result, developers are removing parking spaces, adding more residential units and breaking up the project’s main building into three smaller ones.
The development, planned on the site of the former Hine Junior High School off Pennsylvania Avenue and Eighth Street SE, is now a little more than 555,000 square feet.
Joe Sternlieb, EastBanc’s head of government relations, said the Virginia nonprofit International Relief and Development — which would have accounted for 62,000 square feet of office space — will not relocate to D.C. as planned.
In addition, the Shakespeare Theatre Company is not consolidating its operations to the new development, which takes out roughly 70,000 square feet of office and theater space. The company still plans to house actors and students in the residential portion.
“Everyone in the nonprofit world has been hit harder than everyone else,” Sternlieb said.
Because the development’s design included specific needs for those tenants, it was essentially back to the drawing board when they pulled out. Now, the focus is more on residential and retail with some office space. And a hotel is back on the table more than a year after some community members voiced their preference for one in the new development.
“We have been approached by a couple [hotel] groups,” Sternlieb said.
Barbara Riehle, president of the Eastern Market Metro Community Association, said developers seemed to have taken residents concerns about traffic congestion, building sizes and retail planning to heart. But the lack of any anchor tenants makes her nervous.
“They have absolutely nothing that they started with and that’s absolutely scary,” she said. “But they seem confident that things are going to move forward.”
Even without a major tenant, Sternlieb said the development team’s financing through equity partners is still secure, although no one has signed on the dotted line. He said the project’s positioning in an historic neighborhood near a Metro station is a key asset.
“We have an A-plus location in the number one market in the country,” he said.
