Incentives Increased for $91M AT&T Apartment Project
Published April 4th, 2023 at 11:30 AM
By Kevin Collison
The renovation of the 13-story former AT&T building at 500 E. Eighth St. into 263 apartments is back on financial track after a city development agency increased its incentive package last week.
The $91 million project, which is near the potential East Village ballpark site, had its property tax abatement hiked from 10 years at 75 percent to 15 years, 10 years at 100 percent and five years at 50 percent, by the Land Clearance Redevelopment Authority.
“We’re appreciative of the LCRA working with us and look forward to delivering 243 apartment units in the near future,” said developer Phil Aftuck of Washington D.C.-based The Bernstein Cos.
Rising construction and interest costs since the LCRA approved the original incentive deal last year prompted the developer request. The agency also approved a sales tax exemption on construction materials.
The renovation of the 1973 building, which has been vacant four years since AT&T moved out, is one of the more challenging rehab projects to date downtown. Extensive interior demolition and asbestos removal has been required at the 260,000 square-foot structure.
The former AT&T office building is located on the north side of the central business district. (Image from LCRA application)
Aftuck anticipates the job will be completed by late 2024 barring any unforeseen setbacks.
He’s also excited about the prospects it would be near a potential ballpark, observing how the Washington Nationals Park completed in 2008 sparked a redevelopment boom there.
“I can tell you as being someone from Washington who saw the success of the Washington National ballpark and the success of development along the waterfront,” he said.
“It changed the nature of an undeveloped area to being one of the hottest places to live and work in Washington.
“Stadiums bring a ton of investment–office, retail and residential and retail–around them.”
The AT&T building is about one block north of the proposed East Village ballpark site, considered to be the primary location under consideration by the Royals.
“Residents will be able to walk to downtown, the River Market and maybe a future stadium,” Aftuck said.
The East Village redevelopment area occupies eight blocks near City Hall, 71 Highway borders the site on the east.
The building will include a mix of studio, one- and two-bedroom units. The building also includes an existing 600-space garage.
The studio units would average 639 square feet and rent for about $1,200 per month; one bedrooms would average 707 square feet and go for about $1,320, and two bedrooms would average 980 square feet and rent for about $1,830 per month.
No affordable units are set aside because the project predated the city’s adoption of the affordable housing ordinance. The developer expects most units will be below 80 percent Area Median Income.
The Bernstein Co. also renovated the historic 23-story Mark Twain Tower at 106 W. 11th St. into 220 apartments. That $60 million project was completed last year.
Aftuck said apartment leasing has gone well and its historic ballroom has been very popular for weddings, receptions and other events.