The Sur, a luxury 360-unit Class A multifamily development from Erkiletian Development, has secured funding and broken ground in the Potomac Yard submarket of Arlington, Va.
Offering views of the Potomac River and downtown Washington, D.C., The Sur will extend a dozen stories in height and include 16,503 square feet of retail space, as well as 25,000 square feet of amenities. Located on 1.67 acres at 3400 Potomac Avenue and promising an architecturally noteworthy, nature-inspired design, it is slated for completion in April 2020.
The HFF team of Walter Coker, Brian Crivella and Susan Carras arranged the preferred equity through PCCP, with U.S. Bank providing the construction loan. In total, development costs for the project top $148 million. PCCP LLC provided $35.9 million in preferred equity for the development project.
“The greatest challenge in procuring preferred equity was making sure we picked the right partner and structure for our client to be able to afford them the most flexibility while preserving the lowest cost of capital,” HFF Managing Director Coker told MHN.
“This was accomplished by going through a very competitive process as the preferred equity available for development is a very deep pocket of capital in today’s environment. Though our process we were able to get to terms that allowed our client exactly what they were looking to achieve. [That was] to align themselves with an institutional capital partner while structuring a transaction that inevitably gives them the ability to refinance the entire capital stack and preserve long term ownership.”
The Sur is inspired by the rugged stretch of California’s central coast known as Big Sur. The development will marry sustainable and rustic features to create a welcoming, sophisticated atmosphere with modern style. Ranging in size from 557-square-foot studios to 1,419-square-foot three-bedroom apartment homes, units will offer high-end finishes.
Amenities include outdoor landscaped oasis with forest trees, fire pit and distinctive seating areas reminiscent of national parks, spa with cabanas, natural landscaping and water element, fitness center and outdoor lawn for yoga, floating fireplace and lounge, dog spa and wash area and wood-and-glass enclosed conference room/business center off the lobby.
Luxury D.C. living
“We saw this as a solid opportunity to provide preferred equity for The Sur, which would enable Erkiletian to embark on construction immediately,” PCCP partner John Randall said.
“We are discerning regarding our capital investments. And this high-quality project with its strong sponsorship met our criteria.”
Said Erkiletian Development Company President Stefanie Erkiletian, “We are pleased to have secured capital resources and commenced development for this truly unique and exciting project. We believe that The Sur will deliver a highly sought-after product that will generate interest from discerning professionals seeking luxury living in a prime D.C. location.”