New York-based real estate investment manager Clarion Partners has entered into a joint venture with multifamily developer Kettler to build a Class A apartment complex in Virginia.
According to a joint statement, Clarion and Kettler have teamed up to develop The Acadia at Metropolitan Park, a 411-unit luxury multifamily property in northern Virginia’s Pentagon City at an approximate cost of $154 million. When completed, The Acadia will join two existing luxury high-rise buildings, The Gramercy and The Millennium, previously developed by Clarion Partners and Kettler. Together, the three buildings will be known as Metropolitan Park.
“The Washington DC corridor has been one of the best performing markets in the nation over the last several years, and we believe that the fundamentals are in place to support further growth,” said Clarion managing director Marc Deluca in a statement. He noted that Clarion’s proprietary research projects annual rent growth in that market of 3.7 percent, on average, over the next five years as apartment demand continues to strengthen. Current vacancy rates in Pentagon City are at four percent, and demand for new units in the submarket is being bolstered by the region’s high concentration of educated, upscale professionals and low unemployment rates.
Robert Kettler, founder and chief executive of the McLean, Virginia-based developer, said “demand for our luxury apartments at The Gramercy and The Millennium has been sensational,” adding that he believes that “there will be continued growth in demand for high-quality living areas” in the area.
The venture anticipates construction on The Acadia to begin this summer. It expects the project to be completed in early 2015.