‘Embracing the Attitude of Art,’ DC Museum Anchors Multifamily

Just several blocks south of Washington’s monument- and museum-lined National Mall, the city's new Rubell Museum DC, recently repurposed from a historic landmark, comes with an unlikely site mate: a 12-story, nearly 500-unit luxury apartment building. Together, the site preserves a cornerstone of culture, while also delivering highest-and-best use to the neighborhood.

Remnants of the historic public school where Marvin Gaye learned to sing in the shadows of the U.S. Capitol had long sat obsolete amid a path of relentless urban renewal. But a developer has now repurposed the 100-year-old building as an art museum and paired it with the arts-themed Gallery 64 apartments to offset costs.

On a recent tour of the site, LoopNet learned not only what it takes to preserve a slice of history in the face of returns-driven real estate development, but also a bit more about the city in which its parent company, CoStar, is headquartered.

The former Elizabeth G. Randall Junior High School, built in 1906, was a derelict sight among all the massive multifamily towers rising up in the city’s Southwest quadrant over the past decade.

After an entire century, during which time the school graduated legendary national R&B treasure Gaye and helped champion the Civil Rights Movement, it ended up merely existing — as a shelter at best and a safety hazard at worst. By 2006, the city council agreed to dispose the site to the local Corcoran Gallery of Art for $6.2 million on the condition that the gallery’s plan involved preserving the building.

The vision had been to develop a mixed-use arts campus, but the project spun out following a dramatic dissolution of the Corcoran foundation. Another arts group, the Miami-based Rubell Family Collection, took over the site and development rights for $6.5 million in 2010, but also struggled to help the shuttered site rise from the ashes.

Then co-developers Lowe Enterprises and Mitsui Fudosan America stepped in to offer the Rubell family a lifeline. “The [‘arts campus’] project still didn’t pencil,” Lowe’s executive vice president, Mark Rivers, told LoopNet. “It needed to go back through a [planned unit development] process and it needed a public subsidy.” Lowe agreed to fund the development of both the museum and the multifamily buildings and then sell the museum back to Rubell’s nonprofit arm, while retaining the residential component to create a unified “campus” meant to both preserve culture and deliver returns.

The contemporary art museum opened in October 2022 in 32,000 square feet of the renovated school building. The family’s collection, which expanded to D.C. from its base in Miami, includes pieces from artists such as Jean-Michel Basquiat, Keith Haring and Yayoi Kusama. Free to D.C. residents and funded in part through grants, the museum wouldn’t have been possible without the 570,000-square-foot apartment building that resides across a connected courtyard on the site.

Multifamily was a homerun in Lowe’s eyes. Just blocks from professional sports stadiums Nationals Park and Audi Field, even the pandemic barely put a dent in the neighborhood’s positive net absorption amid steady development. “We started a number of projects during some of the panic of the pandemic because we acknowledged we weren't smart enough to know when the market would rebound,” Rivers said. “But we knew that it would.”

Rather than trying to time the market, he continued, the team looked at long-term trajectories. “Our interpretation of the data was that the greatest limiter to absorption in the Waterfront neighborhood was supply,” Rivers said. “The market was absorbing around 120 units a month regardless of supply.” According to CoStar data, the development team may have even lowballed that number. During 2021, when the building was under construction, the neighborhood absorbed a staggering 3,242 units, or around 20% of inventory.

In the trailing two years, around 2,500 units were delivered in the submarket, with an additional 4,500 units scheduled to be delivered in the next two and 2,100 more proposed. Average asking rent in the area is just shy of $3,000, with effective rent coming in at $2,887, and rates have still been edging up slightly over the past year. Asking rents for Gallery 64’s available one-bedroom units around the time of publication ranged from $2,219 to $3,064.

Though it’s high-end, Rivers said Gallery 64 isn’t meant to compete for the highest rents. “We weren’t going to try to outpace the market with finishes, but by having a more unique environment.” Instead of quartz and satin brass, the team opted for “concrete floors, white walls with punches of colors and a lot of exposed elements,” in an effort to extend the ambiance of the art museum experience to the apartment building.

Wooden joists from the school building that would have been destined for the dumpster were reclaimed and used as furniture and art pieces. Custom artworks commissioned specifically for the hallways and common areas of the building adorn the walls of the apartment building, and feature a specific motif that runs throughout the property: the year 1964. “So much was happening in the U.S. and D.C.,” Rivers said. “The Civil Rights Act was passed that year; the Beatles made their North American debut and stopped here in D.C.; there was a big push in contemporary art.” Able to pick any even-numbered address as one of the only buildings on the Southwest quadrant’s H Street, the developers naturally went with 64.

As the Greystar-managed building continues leasing up after opening to residents last month, “we acknowledge that some people will love it and some people will hate it,” Rivers continued. “We’re okay with that. We didn't develop a building for the masses; we developed a building for those who would value what this property offers. We’re embracing the attitude of art.”

Though it sports the usual slick amenities common in higher-end apartments in D.C., such as a rooftop pool, fire pits, expansive fitness center and pet spa, the building also leans into the creative ecosystem championed by the museum with arts-centric programming.

Residents get free passes to the Rubell museum and the nearby Arena Stage theatre, for example, and have access to a makerspace and a podcast studio in the building. It’s not just a room where people can go to tinker around, Rivers said. “We are going to facilitate a program where they can test out their inner artist and maybe get a little bit of training. We’re looking at engagement that will help them fulfill some of those curiosities and maybe expose them to others that they hadn't really thought of before.”

Another unique aspect of the property is its unobstructed views of the Capitol building and downtown D.C. Whereas a lot of residential developments in the neighborhood line the main M Street corridor, Gallery 64 is tucked away on a little-known backstreet which leads only to a low-laying, eight-acre community park. “There's this sense of space that we really don't get anywhere else in the city, let alone in this neighborhood.”