Kettler, Principal Ready Plans for $250M MXD

(Read more on the multifamily market.)

WOODBRIDGE, VA-Kettler, a diversified real estate company that specializes in transit-oriented projects, and Principal Real Estate Investors are moving forward with plans to build a $250-million development in the city. GlobeSt.com reported earlier this month that Kettler had bought a class A apartment complex and adjacent 11 acres, but its plans for the site weren’t ready to release.

Kettler had acquired the 304-unit Riverside Station Apartments and adjacent land at the Virginia Railway Express Rippon Landing station for $71 million. A portion of the 11 acres is leased to VRE for commuter parking.

Richard Hausler, president of McLean-based Kettler tells GlobeSt.com that the necessary approvals to develop the 11 acres have been finalized. The firm is in the process of selecting the architectural and design team. He expects to see the project break ground in 12 to 18 months and deliver in stages over the next three to four years.

“There is still a commitment to provide parking for VRE and we are in discussions over how to meet or enhance that commitment,” Hausler says. Right now the lot is surface parking. He says more than likely a structure will be built for parking in the project.

The 11 acres are zoned as mixed residential, capable of supporting 550 high-rise units, 27,000 sf of retail space and 250,000 sf of commercial space, according to Coldwell Banker Commercial Ideal Realty Group, which represented both buyer and seller in the multifamily property sale. The seller of the 300,000-sf asset and adjacent acreage was an entity controlled by Fredericksburg-based Hazel Land Co.

Hausler stresses the exact mix of office, retail and residential has not yet been determined. “At final build-out, the new development will be roughly 850,000 sf,” he says. Kettler’s agreement with Principal includes not only developing the acreage, but also covers ownership and management of Riverside Station Apartments.

Another new detail to the original transaction has emerged: NorthMarq Capital, Inc.’s Washington, DC regional team had arranged a $75-million joint venture equity investment from Principal Global Investors for the acquisition. According to Christopher Feeley, senior vice president and managing director of Debt/Equity Investments in NorthMarq Capital, there was no debt at all involved in the transaction.