A joint venture plans to replace a pair of aging suburban Maryland office buildings with a new townhouse community.
EYA, in partnership with Bernstein Management Corp., purchased 13.76 acres in Rockville, Maryland, that houses two office buildings and said it plans to demolish the existing structures and transform the site into a townhouse community.
The future residential project is anticipated to open for sales in late 2028 and is slated to include more than 200 townhouses, EYA’s chief acquisitions officer Aakash Thakkar told Homes.com in an interview. The team is working through the Montgomery County, Maryland, planning process with an intent to make a submission in the next 90- to 120 days, he said.
“We think this is a really good reuse of land to address what the market is looking for, which is housing, and also remove something which the market has said is in too great a supply and too little demand,” Thakkar said. He added EYA believes the townhouses will cater to people who seek a low-maintenance lifestyle and want to be able to walk to nearby amenities.
Thakkar said the partnership is exploring the idea of adding a community center and pool at the for-sale townhouse project, and potentially also multifamily rental housing for the site.
EYA and Bernstein Management bought the 1980s-era office properties at 9513 Key West Ave. and 15200 Omega Drive and the land underneath them, plus the parcel at 9501 Key West Ave., for a combined $18 million, according to CoStar data.
Office-to-residential trend grows
The move comes as developers continue to look for other uses for underutilized office inventory and vacant offices while addressing demand for housing. The office vacancy rate in Rockville is 19.5%, according to Homes.com parent company CoStar.
“A reason that this site made a lot of sense for us is because the office buildings that we bought are vacant, and that vacancy is a part of a trend, that predated even the pandemic, of offices and workspaces in places moving toward more highly amenitized, denser [central business districts] like downtown Bethesda,” Thakkar said.
EYA is no stranger to transforming underutilized commercial properties into residential communities. This summer, also in Rockville, it acquired land to turn an empty shopping center into a mix of new homes, retail shopping and public open space.
Other residential options could be popping up soon in Montgomery County after its legislative body earlier this year approved a zoning measure to expedite the process for office-to-residential conversions and legislation for a 20-year tax break for such projects if they include at least 17.5% affordable housing units.
EYA and Bernstein announced a partnership in 2019 to acquire and develop townhouses, multifamily and mixed-use projects in the Washington, D.C., area.