Office to residential conversion offers innovative approach to shifts in office market.
WASHINGTON, DC – A partnership among Placemakr, a tech-enabled hospitality living platform, regional real estate investor and operator Bernstein Management Corporation (BMC), and innovative real estate developer Urban Atlantic have acquired 1735 K Street, NW in the heart of Washington’s commercial corridor, steps from Farragut Square and The White House.
The group plans to convert the 12-story office building, into luxury apartments operated under the Placemakr Premier brand. The converted building will offer flexible lease options, ranging from traditional residential leases to transient short-term stays. Placemakr has pioneered this model, offering both furnished and unfurnished apartments that can flex between residential and hospitality use depending on market demand.
Urban Atlantic will take the lead on the development, overseeing the conversion of the existing office building into a 106-unit multifamily building with ground-floor retail. The fully furnished apartments will combine hotel-style services with the comforts of home including kitchens, in-unit washer/dryers, and bespoke amenity spaces.
“This reimagining of 1735 K is exciting because it leverages Urban Atlantic’s creativity and significant adaptive-reuse expertise to bring activity and vibrancy back to downtown DC.” said Brant Snyder, Managing Director of Acquisitions at Urban Atlantic.
The pandemic-fueled acceleration of remote-first and hybrid work along with the decades-long march toward less square footage per worker has created significant office vacancy in prime locations. Flex-use housing makes the difficult economics of office-to-multi-family conversions work and provides a product to those in need of temporary housing or multi-week stays in cities with the ability to continue to shift toward a larger percentage of 12-month leases if desired.
“We’re in the early innings of what is shaping up to be a seismic shift in downtown office investment. Placemakr is highly focused on continuing to bring innovative and valuable assets to our business partners and guests, alike, and this Placemakr Premier destination will bring a unique and new experience to K Street,” said Will Hu SVP and Head of Acquisitions at Placemakr.
Placemakr is on pace to be one of the largest holders of blended apartment and hotel assets in the United States. This will be the first office-to-multifamily conversion that Placemakr has orchestrated. Urban Atlantic is experienced in office-to-residential conversions, having transformed the former 1970’s era EPA headquarters buildings in Southwest into 530 Class-A apartments. Known as Lex and Leo at Waterfront Station, Bernstein is the current owner and manager of these buildings and sees long-term value in the continued office conversion trend.
"The repositioning of 1735 K Street to allow for flexibility between housing and hospitality represents a significant and exciting evolution of the traditional multifamily model, not to mention a compelling upgrade for the K Street corridor. We look forward to seeing this project come to life,” said Bernstein Management Corporation CEO Josh Bernstein.
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