Schoppmann oversees six offices in Virginia, Maryland and Washington, D.C., as well as the performance and strategic growth of business in the mid-Atlantic region for CBRE, a $30.8 billion commercial real estate giant with more than 115,000 employees.
A graduate of Duke University and the University of Michigan, she has more than 20 years of experience in sales strategy, training and professional development. She also is active in CBRE’s Global Executive Inclusion Council and is a board member for the Economic Club of Washington, D.C., and a founding member of Chief’s Washington chapter, an organization supporting women executive leaders.
IF I HAD A TIME MACHINE, I’D MEET: Marie Curie. She was a pioneering woman in science, which was a field dominated by men at that time.
HOW I CHOSE MY CAREER: I originally followed in my father’s footsteps and studied civil engineering. The analytical skills I learned have served me well throughout my career, including my first jobs in sales at Dow Chemical and consulting at PricewaterhouseCoopers and IBM. My transition to real estate and CBRE is a culmination of all the skills and knowledge I gained in prior roles.
Molivadas’ career in commercial real estate spans more than 30 years, and he directly oversees JLL’s brokerage business in Washington, D.C., Maryland and Virginia, providing strategic leadership to more than 1,000 employees.
In the 1980s, Molivadas began working as a construction project manager, then became a broker with Spaulding & Slye Colliers before the firm was purchased by JLL in 2005. A graduate of Southern Methodist University, he worked as a concert venue security guard during college, “holding back crazy fans of Boston and Whitesnake.”
At JLL, Molivadas implemented a diversity, equity and inclusion program that became a model for other markets, and he was named head of DEI initiatives for JLL’s eastern region. In 2021, CREW Network’s D.C. chapter presented Molivadas with its Game-Changer Award, recognizing an executive who consistently demonstrates commitment to advancing DEI and belonging.
MOST RECENT BOOKS READ: “So You Want to Talk About Race,” by Ijeoma Oluo; “Developing the Leaders Around You: How to Help Others Reach Their Full Potential,” by John C. Maxwell; and “Good Strategy, Bad Strategy: The Difference and Why It Matters,” by Richard Rumelt
After joining Monday Properties in 2005, Helmig has led the company to capital investments of more than $16 billion, an expanded multifamily portfolio of 5,300 units, and executed transactions totaling more than 35 million square feet.
Helmig’s brother-in-law, Anthony Westreich, founded Monday Properties and acquired a 2.5 million-square-foot Rosslyn portfolio of buildings in 2007, two years after Westreich’s father, the late Stanley Westreich, sold them to Beacon Capital Partners for $960 million. In June, news outlets reported that Monday Properties defaulted on a $150 million mezzanine loan on a seven-building Northern Virginia office portfolio, and Eastdil Secured was hired to seek a loan buyer.
Today, Monday Properties owns 1812 N. Moore in Arlington, home to Nestlé’s U.S. headquarters, as well as residential and commercial buildings along the East Coast.
Prior to joining Monday Properties, Helmig was a partner at Westfield Realty, co-founded by Stanley Westreich, where he oversaw approximately $5 billion in transactions. He is a graduate of American University and is vice chairman of the Rosslyn Business Improvement District board.
Lawson’s president and CEO since 2016, Hardee has been with the company for more than half of its 51 years. He oversees a 190-employee real estate development, construction and management company.
In June, Lawson held a grand opening for Market Heights, a 164-unit apartment community in Norfolk, and the company is near completion of 80 units at Miller’s Rest Apartments in Lynchburg. It also has large residential projects under development in Woodbridge, Roanoke and Richmond.
A Gulf War Army veteran, Hardee graduated from Virginia Military Institute in 1987. He serves on TowneBank’s Portsmouth board, as well as Southeast Virginia Community Foundation’s board and Virginia Housing’s Rental Advisory Board.
WHAT I’VE LEARNED: Life is more about giving than receiving. We are where we are in life because people in our past believed in us and gave us an opportunity — it is our responsibility to prepare the future generations to lead.
In addition to serving as Kastle Systems’ executive chairman, Ein is now a new limited partner in the Washington Commanders as part of the group led by majority owner Josh Harris that purchased the Ashburn-based NFL team for a record $6.05 billion in July.
Ein also helps run the Citi Open tennis tournament in Washington, D.C., and owns the Washington Justice esports team and the Washington City Paper, an alternative weekly publication.
Founded in 1972, Kastle Systems is a building and security systems provider that employs more than 700 people, including more than 100 Virginians.
Ein is co-chairman of Lindblad Expeditions and founder, chairman and CEO of Capitol Investment. He previously worked for the Carlyle Group and Goldman Sachs and is a graduate of Harvard Business School and the University of Pennsylvania. In February, Ein was nominated by President Joe Biden to chair the President’s Export Council. He also chairs the DC Public Education Fund and is board member for Soho House and Custom Truck One Source.
NEW RECENT LIFE EXPERIENCE: Went to a remote bear camp in Alaska
Gannon joined Colliers International in his role as executive managing director and D.C. market leader in 2019. He is responsible for the strategic direction and performance of Colliers offices in Washington, D.C., Northern Virginia and Maryland, totaling more than 50 real estate professionals.
He had spent the previous five years at Paramount Group, leading leasing efforts for the company’s 1.8 million-square-foot Washington, D.C.-area office portfolio.
Prior to Paramount, Matt Gannon spent 15 years at Vornado Realty Trust, rising to the position of vice president of leasing, a role in which he oversaw an office portfolio composed of about 6 million square feet.
Gannon serves on the board of the Commercial Real Estate Brokerage Association of Greater Washington, D.C., and is a graduate of Fordham University in New York.
Colliers, an international commercial real estate and investment management corporation, operates in 66 countries, with $99 billion in assets under management and 2 billion square feet managed.
In Alexandria’s Old Town North, a collection of three brick office buildings built in the 1980s is being transformed into Tide Lock, a community of 234 luxury apartments and condominiums featuring Potomac River views and space for retail and a nonprofit music school.
And last summer in the city’s Alexandria West neighborhood, tenants began moving into two, 14-story former office buildings that have been converted into Park + Ford, a 435-unit modern apartment complex with 115,000 square feet of office space.
Faced with a glut of vacant office space generated by a mix of high inflation and low post-pandemic return-to-office rates, some real estate developers in Northern Virginia have begun turning to office-to-multifamily (OTM) adaptive reuse projects.
This year, the inventory of U.S. office space shrank for the first time in recent memory, going back to at least 2000, according to data from Jones Lang LaSalle (JLL). Ground has been broken for less than 5 million square feet of new offices as of late July, while 14.7 million square feet of office space was removed from the market, as aging and vacant buildings are demolished or repurposed.
Meanwhile, in April, the amount of available office space for lease across the nation hit a high not seen since the 1980s savings and loan crisis, according to CoStar Group, a Washington, D.C.-based provider of real estate data and analytics. And with more than half of leases signed before the pandemic not yet expired, office vacancies are expected to increase. The national office vacancy rate is projected to rise from 13.2% to over 17% by late 2026, according to CoStar.
And while leasing of new office spaceincreased from 57.4 million square feet in the second quarter of 2020 to 97.5 million square feet in the second quarter of this year, according to CoStar data, the amount of space being leased has shrunk significantly. Due largely to hybrid work policies, companies’ needs for space have shifted dramatically. The average U.S. office space leased in the second quarter was 3,275 feet, nearly 20% smaller than before the pandemic.
Empty office buildings in city centers mean fewer customers for downtown businesses ranging from food trucks and restaurants to urban transit systems. The typical office worker now spends $2,000 to $4,600 less per year in city centers, according to research released in April by Stanford University.
One silver lining, according to Dallas-based real estate services firm CBRE, is that there are “new opportunities for restaurants in growing office markets and the suburbs of many major coastal cities.”
The main reasons for these high vacancy rates, according to a report by Curtis Dubay, chief economist for the U.S. Chamber of Commerce, are that “workers just don’t want to go back to the office, and employers can’t make them because of the tight labor market.” Plus, “interest rates have risen sharply in the last 18 months, and they won’t be going down soon,” which puts a damper on commercial real estate demand.
Virginia Realtors Chief Economist Ryan Price agrees with that assessment. “As companies are coming back to work, occupancies are coming back up, but slowly. The hybrid model is pretty sticky,” Price says. Additionally, amid inflation and fears of a 2024 recession, some companies are reevaluating “their space needs and looking to downsize,” Price says.
Adding to the problem, nearly $1.5 trillion in commercial real estate debt will be coming due by the end of 2025, according to commercial real estate data and analytics provider Trepp. Many of these mortgages are interest-only loans for which borrowers have been making only interest payments during the life of the loan, with the principal due at the end. And CoStar estimates that as much as 83% of outstanding securitized office loans won’t be able to refinance if interest rates remain at current levels.
This has led to a landscape some media outlets have deemed a “commercial real estate apocalypse,” with communities, financial institutions and commercial real estate businesses all seeking solutions.
‘The hiccup’
Northern Virginia, like the rest of the Washington, D.C., region, has been hard hit by these trends.
The outlook for Northern Virginia’s economy and office market remains “heavily dependent on and intertwined with the nation’s defense budget” and the government contracting industry, according to a JLL report: “While defense contract awards are up significantly year-over-year, [office] absorption remains negative, ending a 20-year correlation. This trend is expected to continue into next year as leasing remains subdued, particularly large-block leasing.”
Of the office activity that does occur, the research finds that the corridor “stretching from Old Town through National Landing and Rosslyn Ballston corridor, out to Tysons and the toll road, is expected to capture a disproportionate share of demand.”
When completed, Tide Lock, located in Alexandria’s Old Town North neighborhood, will include 234 apartments and condominiums featuring Potomac River views, as well as space for retail and a nonprofit music school. Rendering courtesy Community Three Development
Tide Lock and Park + Ford are among the OTM conversion projects developers have taken up in the region in recent years in response to the office space glut.
Real estate investment company USAA Real Estate (now Affinius Capital) and national real estate developer Lowe joined to convert the former Park Center office complex at 4401 Ford Ave. in Alexandria into apartment community Park + Ford, a project that started just ahead of the pandemic.
Drawing on its experience with a prior office-to-residential conversion, The George in Wheaton, Maryland, Lowe capitalized on the brutalist buildings’ 10-foot ceilings and large floorplates to create larger-than-usual apartments, along with remote worker-friendly amenities such as coworking common space and a pet spa. Maryland-based Whiting-Turner handled construction, with design from D.C.-based Bonstra | Haresign Architects.
Park + Ford was developed in response to “growing interest among young professionals … for an apartment community with more room for working and family, along with style and convenience,” says Mark Rivers, an executive vice president at Lowe. “As we began welcoming residents, we found that the pandemic only fueled demand for precisely the environment
and residences that we have created at Park + Ford.”
The cost of OTM conversions varies considerably, according to CBRE, ranging from $100 to $500-plus per square foot, depending on the original layout, existing conditions and scope of work.
Conversion usually calls for reworking of plumbing and electric, and distribution of HVAC throughout the building. But lighting — or the lack of it — is often the biggest challenge.
“A lot of offices have a lot of interior space, where with residential projects, you need to have window access. You need to have daylight without compromising the structure,” says Mwangi Gathinji, vice president of Community Three Development in Washington, D.C., which is building Tide Lock. The company has also completed OTM conversions in D.C. and Maryland.
The answer can be to “cut an atrium in the middle of the building,” Gathinji says, but “you’re always trying to mitigate the amount of chopping. That’s usually where the hiccup is” — cost. With OTM conversions, “there’s a lot of stuff in there that is not known, as opposed to starting from scratch. You have to know if the back-of-the-napkin numbers work.”
Creative reuse
Despite the widening gap between office and multifamily vacancy rates, OTM conversions are up only slightly, and there’s no evidence they’ve significantly increased, according to a March 2023 CBRE report. “Construction costs and regulations on residential construction will continue to limit conversions to smaller, older office properties,” the report states.
Still, about 45,000 of the 122,000 apartment conversions in the pipeline nationally are redevelopments of office buildings, according to RentCafe’s Adaptive Reuse Report, released in July.
In response to these trends, Arlington County has been promoting office space repurposing through rezoning and other tools, but Arlington hasn’t seen many conversions to multifamily, possibly because the floorplate in the county’s office buildings aren’t easy to convert to multifamily uses, says Cara O’Donnell, Arlington Economic Development’s director of media relations.
Instead of multifamily projects, the county is seeing rezoned office spaces being adapted creatively, O’Donnell says. “There’s big push for alternate uses — everything from indoor recreation [or] mini-fulfillment space to ghost kitchens and R&D labs. There’s been a lot of rezoning since the beginning of this year.”
Opened last year in Alexandria West, the 435-unit Park + Ford apartment complex is an adaptive reuse of the former Park Center office complex. Photo by Shannon Ayres
In April 2022, the county launched its Commercial Market Resiliency Initiative to modernize county regulations in response to economic shifts. The initiative “gives AED a new tool to chip away at our record-high office vacancy rate,” director Ryan Touhill said in a blog post. “But even more than that, as we move forward in this post-pandemic era and office tenants are trying to determine an in-office vs. hybrid environment, we want to create places in which people want to be. Got a pandemic puppy? Fluffy could be right next door at doggy daycare while you’re at work. Need some produce for dinner? The new urban agriculture business downstairs is the perfect place to pick up microgreens. These are all types of businesses that are already seeing success in other areas of Arlington; we want the flexibility to allow them to succeed in our commercial corridors as well.”
Trophy case
The Washington, D.C., office market reached a record high office vacancy rate of around 20% in July, but 60 buildings, mostly older structures, accounted for 41% of the vacancies, according to JLL.
Over the past five years, the office market nationally has seen “a flight to quality,” with newer trophy office buildings and Class A buildings featuring modern amenities and technologies faring far better than older Class B and Class C office buildings where “the vacancy is extremely high,” says Brent C. Smith, a real estate professor at Virginia Commonwealth University’s School of Business, who is also the CoStar Group endowed chair in real estate analytics.
This pattern holds at the state level, especially in Northern Virginia, according to Price, who says, “newer, good locations near amenities are performing better than Class B or C buildings in suburban, lower-rise office parks.”
The Northern Virginia office market “remains bifurcated,” with vacancy in trophy buildings at only 8.2% during the second quarter of 2023, according to a July report from JLL. Class A buildings had an 18.4% vacancy rate, and Class B/C buildings were 23.8% vacant.
“Real estate has become more aligned with human resources. There’s a direct correlation between recruitment and retention and top-of-the-market amenities,” says Michael Hartnett, JLL’s mid-Atlantic head of research.
For example, a location that is walkable to a Washington-area Metro station “checks a box” for employees who are also interested in mixed-use places where they can live and work, he says.
Northern Virginia’s struggles with office vacancy aren’t mirrored by the rest of the state, however.
Richmond, which has the second highest vacancy rate in Virginia, has only about half as many office vacancies as Northern Virginia, according to Alvin Abston Jr., a senior market analyst with CoStar. With entities like the state government mandating more time in office, “there’s not as much space being thrown back onto the market,” he says.
In Hampton Roads, where land is at a premium, some older office buildings dating to the 1970s and 1980s are being torn down to make way for more in-demand uses such as hotels or convenience stores, according to Robert Wright, a Virginia Beach-based senior vice president with Cushman & Wakefield | Thalhimer.
Scrapping an old, tired building “is the easier path,” he says, but a conversion can work “when the value of an office building is really low.”
Virginia Beach particularly doesn’t fit the picture of a city overstocked with office space, according to Lou Haddad, president and CEO of Armada Hoffler, a real estate investment trust with Class A office properties in and around Virginia Beach’s Town Center.
“You can’t paint it all with same brush,” Haddad says. “We are seeing near-record demand for our office space. Headquarters [space] is over 99% leased. … Portfolio-wide, over 97% is leased.”
A plus for Armada Hoffler, according to Haddad, is that the company has concentrated on the trophy market sector, which typically attracts tenants such as Fortune 500 companies and high-end professional firms “that need that top address” to attract employees and clients.
“It had better be a top-quality property to attract the top people and ask them to work back in the office. B- and C-quality buildings are struggling. Top assets are staying full,” he says. “You have to have a good human environment. It sets the tone.”
Richmond and Norfolk don’t have much Class A space, something that is “a blessing and a curse,” according to Abston. Tech is able to drive office values, and without Class A space, “you aren’t enticing people to these midsize markets. There are fewer tenants related to the tech industry.”
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A portfolio of four regional shopping centers in Prince William County’s Dale City area has sold for $52.8 million, the joint venture of buyers announced Monday.
Located less than 3 miles apart along Dale Boulevard, the 1970s-era shopping centers — Center Plaza, Mapledale Plaza, Forestdale Plaza and Glendale Plaza — total 470,000 square feet on 70 acres. Combined, the centers are 90% occupied, with tenants including Advance Auto Parts, CVS, Dollar General and Truist Bank.
Affiliates of the Ideal Realty Group, Rock Creek Property Group and The Sigmund Cos. bought the centers from an Interstate Management affiliate. The new owners plan to begin renovations in the first quarter of 2024, including new paint, sealcoating and re-striping for parking lots, as well as adding gathering areas for shoppers and new landscaping.
The owners have chosen KLNB to handle retail leasing and The Shopping Center Group for property management.
Reston-based Bowman Consulting Group has promoted Brad Glatfelter to manage its Fairfax County branch, the company announced Wednesday.
Glatfelter joined the company as a project manager in 2014. As branch manager, he will oversee day-to-day operations, execute strategic business plans, drive utilization goals and maintain recruitment initiatives. He will also spearhead the diversification of the office’s project portfolio by exploring opportunities in the public and renewables sectors and focus on expanding the office’s regional reach.
“Brad’s promotion to branch manager is a testament to his outstanding contributions and demonstrated leadership,” Scott Delgado, executive vice president and regional manager at Bowman, said in a statement. “We have complete confidence in Brad’s strategic vision for our Fairfax office and in his ability to further elevate our standing in Northern Virginia.”
Glatfelter received a bachelor’s degree in civil, environmental and infrastructure engineering from George Mason University in 2008, according to his LinkedIn account, and previously worked in the school’s facilities department until joining Bowman.
“I am truly eager and honored to embrace this new role as branch manager,” Glatfelter said in a statement. “With a team of dedicated professionals standing behind me, I have unwavering confidence that we will not only meet but exceed our goals as we seize new opportunities in the region.”
Bowman has 1,700 employees in more than 70 offices across the country and provides planning, engineering, geospatial, construction management, commissioning, environmental consulting, land procurement and other technical services. It acquired Maryland engineering firm Richter & Associates in April.
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