U Got DC Condo Sales!? What Obama and Facebook Have To Do With It?

“U Got Sales?”, an intriguing article in Friday’s Washington Times magazine, discusses the relatively rapid sales of a small condo development in DC. With over “10,000 condos for sale” in the DC Metro area, it’s safe to say that this genre of housing, like in many other cities, has been hit the hardest by an un-forgiving market. Even the finest Bethesda condos have taken double digit depreciation hits over the past year. I’ll go out on a limb and say for the majority of new condos in Northwest Washington DC, you can subtract 15% (give or take). But combine a resilient area, a “brandable” subdivision, and a few other variables, and “u got sales”!

U Street Corridor in NW Washington DC, home to many historic Jazz clubs and Ben's Chili Bowl (already famous and made even more so by a recent visit by President Obama), saw massive re-development in the past 6 years (like the rest of the city!). And, like the rest of the city, sales for new condos, full renovations, or anything in between had come to a fairly screeching halt.

But the exception to this rule is a boutique condo development called The Moderno. It’s a micro-market by definition -- that is, it’s selling while other condos in the same area are not (or at least not at the same pace). So what can we learn from this anomaly where over 50% of the units have sold while the “paint is still drying”? In this market, there has to be a combination of variables…some familiar…some more progressive…a combination of doing “everything right”:

1. Proximity to the Metro:

Located near the corner of 12th and U, The Moderno is just a block away from the Metro rail, not to mention nightclubs, cafes, restaurants…

2. “It’s the finishes, Stupid”:

The developer (Lakritz )was brilliant on a couple accounts. First, he recognized his surroundings, saying: “Washington, D.C. is the, is the ‘most European of [American Cities]’ – a wonderous land of ethnic fusion restaurants, where people don’t work until 11:00 p.m.” Then he chose not just high end finishes, but went to Milan for many of his choices “including German Liebherr refrigerators-built-in-and Spanish Porcelanosa cabinetry-made of rich mocha-colored wood”. The point is that he thought outside the box and brought in something new and exciting.

3. Outdoor Space:

From what I could deduce on the website, every unit has some form of outside space, either a level terrace, a balcony or a upper level deck. Finally, a developer in the DC area get’s it. You CAN “sell outside space”!

4. The Obama Effect?:

Ben’s Chile Bowl was Obama’s “first place to eat in Washington DC”, says the Washington Times. He sat with DC’s popular young mayor and brought rock star appeal to this increasingly recognized part of town. As I played around this area on election weekend and inauguration night, I agree with The Washington Times, “U Street is Obama Street”. The area’s history, its large contingent of local Obama staffers, and its central location have created this perfect “storm” where “U Street is becoming a communal hangout”. The long story short, Obama has created a brand for this already prestigious area. There is some discussion that his administration will do the same for DC’s NoMa area.

5. Facebook:

The epitome of Guerilla marketing (and it wasn’t even intentional). Long story short is that a purchaser was so excited about his new digs that he took some pics and videos (can’t find them, sorry) and shared them on Facebook. There was never any implication that this posting led directly to any sales but it certainly created quite a viral buzz.

U guys have any similar success stories?

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