New Construction in Logan, Holm, switches from Condos to Rentals

11th and Rhode Island Ave, NW

Thanks to a reader for sending word. Originally plans for Holm were listed on the CAS Riegler website:

“A former parking lot, and home of a taxi cab stand and garage, the site has been razed to prepare for the ground-up construction of 38 luxury condominiums and 3,100 square feet of retail.”

But if you click over to the Holm website it now says:

“A collection of 38 new luxury apartments are coming to the vibrant Logan Circle neighborhood. Located just east of the booming 14th street corridor, the residences at HOLM are perfectly situated among all that city life has to offer.”

Previously Diamond Cab:


31 Comment

  • Interesting. This building has gone up QUICKLY — it’s much further along than the photo suggests. And as far as I can tell as an ultimate non-expert, it seems to be entirely constructed of wood. I wonder if quality concerns may have prompted the switch?

    • I just noticed it again over the weekend and was surprised to see how many floors were up now. I think the first level is concrete, the rest is wood.

    • It’s very weird – we own a condo very close to that, and were excited by the development…I’m perplexed!

    • It’s totally normal for buildings of this type to be built with wood frames.

      • I remember there was a discussion on this here a while back and can’t remember what the conclusions were. I assume wood construction has to be safe enough. Again, I’m a total and complete non-expert in this, but the construction of this building does look a bit makeshift to me.

        • It’s deemed to be safe/whatever up to 5-6 stories. Since wood-framed construction is MUCH cheaper than steel/concrete, that’s what you’ll see most often in parts of town where the land value isn’t astronomically high (notice how many similarly-sized new buildings on 14th proper are made of steel/concrete).

          • I don’t think it has anything to do with land value. I think it’s just a builder decision–some builders are known for more sound construction than others. There are plenty of “cheap outs” built in to those new buildings on 14th Street.

          • Really? You’re saying that developers don’t take costs/profit margin into account when planning a specific project?

          • Sorry Caleb – think I misunderstood your point. You’re right that high land value alone won’t force developers to build using high quality construction methods. (Though I’m still having trouble coming up with examples of stick construction along 14th in the past couple of years.)

        • It’s exceedingly safe and normal for this type of construction to be wood frame. Greater Greater Washington delved into the economics of building materials for mid-rise construction here:

        • It may be safe, but I will tell you that having lived in both steel/concrete and now wood-frame apartment buildings, sound travels a lot further in the wood versions. New tenants better be ready to find out a lot more about their neighbors’ personal lives than they might expect. 😉

      • Correct me if I’m wrong, but I believe that while wood construction is more cost efficient, it transmits noise much more freely than concrete buildings do. With concrete construction, noise doesn’t easily transmit from one floor to the other (though it can from side to side), but if a wood frame construction is not insulated well, chances are you’ll hear everything going on above you.

    • Also, it’s funny compared to the other two buildings down 11th St (former empty lot/former abandoned building front), which is moving at a snails pace!

  • I’m guessing they re-ran the numbers and realized that they probably can’t get the same return they once thought (there could be a large number of reasons as to why – not sure we’d get far speculating here).

    • Good point 🙂

    • well, If you consider that O Street apartments for a 2 bedroom are renting in the 4000 range….they could probably pull in 2M a year in rent. Give or take.

      • I’m guessing there’s a lot more math involved here.

      • oh, I’m sure, but the rental market around there in the larger buildings is nuts. We rent out our condo on that block for a pretty penny.

        • Well you’re missing the entire idea of immediate cash in hand versus long term payout as well. Typically for developers, immediate cash in hand is worth a helluva lot more than anything long term because it gives you immediate capital to go develop something else.

    • I will say that from my experience on similar projects that switching from condos to apartments is a sign that the developer needs to get less money out of the project sooner rather than more money later. This can be market forces or developer business forecasting. It’s not uncommon to switch, but it’s probably not the ideal venture the developer initially had in mind.

      Like you said, I know we shouldn’t speculate too much, but i’m just giving my two cents.

    • That’s basically what I was told (being one of the unit owners under contract up until two weeks ago). The developer exercised a loophole allowing it to void my contract. There was no issue with the structure or materials. It was purely for financial reasons. They wanted to take advantage of the hot rental market. I was aware of the clause in my contract, but it was written such that the developer could void the contract if they did not sell enough units by January 15th. The number of units was not specified in the contract. The seller’s agent informed me that they had enough units under contract in December and that they were passed the “pre-sale” phase, so I was not concerned. They had between 13-15 units under contract by December without any significant promotions/official launch. The release that I signed stated that the developer was going to convert the condos to rentals and referenced the clause, but did not mentioned anything about meeting any particular target. For those of you in search of condos in new developments, beware of these clauses before you sign on the dotted line. You need to determine if it’s a risk worth taking.

      • Nice insight, Anon2. I was about a week or two away from signing a contract on one of the Holm units myself. Then the sales agent notified me of the developer’s decision to change from condos to apartments. Like you, I’d assume, I really liked the development and felt that it was something unique in the area. Sorry to hear you already had a contract. Having to start your search over after you thought it was done has to be stressful.

  • This place has indeed gone up remarkably fast. I’d imagine the recent surge in rental prices in Logan/Shaw inspired the change, given I’m sure the developer can spin the whole building off to an insurance company or REIT that will happily pay more than individual condo sales would have generated. I do wonder, however, what happens to the people who bought pre-delivery units? Are they back to square one in their housing searches?

    • I was back to square one, but within a week of losing my unit, I found another condo (not new), made an offer and was under contract within 3 days of it being listed. I am paying less for this other place with lower condo fees and even locked in a great interest rate. Perhaps it was meant to be. I am a bit bitter about the whole situation, but believe in karma.

  • And people wonder why developers are chopping up and popping up row houses into condos? These smaller developers/flippers are filling a crucial niche- creating new 2 and 3 bedroom condo stock in a number of desirable centrally located neighborhoods- that big developers are reluctant to fill when they can extract high rents instead.

    • I don’t think anyone wonders why row homes are being split into condo’s – that’s pretty self-explanatory. As such, I’m not really sure what point you’re making here.

      • I see the point. If these larger buildings accommodated those looking for smaller condo units, there may be less of an attack on the existing stock of “single family” row homes. The biggest complaint I hear from friends who are on there way to a second kid, is that there really are few options for them to stay in the city to raise a family as micro-units are becoming all the rage and row homes go from single family to 3-4 family.

  • One of the new buildings on Florida Ave between 7th and 9th street also just flipped from condo to rental. This is very odd considering the number of rental units that have opened recently. The market for condos seem underserved right now.

    • Condos are no longer regularly selling for more than asking in that area. Recent example, but hardly the only one: A unit in my building (Logan area) had over 100 open house attendees and several offers, but nothing over asking. If rentals are creeping up, I an see switching to rentals–cheaper upfront costs. Also, the location, on a noisy corner just seems atrocious for ownership.

      Another unit is on the market with a painted floor (typical in lofts, not regular condos), ugly pained walls and OK appliances, countertops, etc. with little distinction and a tiny kitchen. They wanted more than the place that got 100 visitors and no one has made an offer. the willingness of people to pay ridiculous amounts for places that aren’t all that exceptional seems over.

      • “the willingness of people to pay ridiculous amounts for places that aren’t all that exceptional seems over.”

        For now, it does seem to have slowed. That said, prices are at a high in places like Logan. Decisions like this–to change codo projects to apartments–will only drive cono prices up when the existing stock becomes more scarce.

  • I’m especially intrigued to see what retail comes to the ground floor.

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