A rendering of the planned mixed-use development (BizSense file)
With funding in hand, a major mixed-use development along Arthur Ashe Boulevard is now officially a go.
Level 2 Development and SJG Properties announced Thursday they’ve entered into a joint venture with Chicago-based investment firm Cresset Partners to finance an eight-story, 295-apartment development at 1117-1201 N. Arthur Ashe Blvd.
Construction is planned to begin in the next few weeks and last about two years.
The project – once referred to in planning documents as Leigh Addition but now dubbed “The Ace” – has been in the works since 2021 when the D.C.-based developers bought the 3.3-acre assemblage from local landlord Ed Lacy for $12.5 million. The buildings on the property previously housed businesses including Buz and Ned’s Real Barbecue and Car Pool Car Wash.
Last year the developers secured a special-use permit for the project; however, work never kicked off. In the months since, interest rates have continued to rise and drive up project costs, posing a challenge for many developers in the area. The price tag for The Ace also wasn’t immune: It was initially slated to cost $80 million, and in Thursday’s announcement the projected cost is $98 million.
Level 2 principal David Franco said the broader economic environment played a part in the decision to seek a partner such as Cresset, which is now an equity partner in the project.
David Franco
“There’s no secret it’s a challenging environment in the capital markets,” Franco said. “We were looking for a joint-venture partner for equity … and after going to the market, we thought Cresset was the best fit to achieve our goals for the project.”
He added that the fund Cresset used to invest in The Ace was specifically for projects in Opportunity Zones, further sweetening the deal. The equity from Cresset was combined with $58.4 million in construction loans from Maryland-based Sandy Spring Bank and New York-based Five Star Bank.
It’s the first deal in the Richmond region for Cresset, which according to its website has amassed over $3 billion in commitments from investors since its founding in 2018. Cresset’s director of real estate, Jason Ross, said in an email that a number of factors drew the firm to Richmond, including its proximity and affordability relative to Washington.
“We’re confident that Richmond’s recent growth is only the beginning, and look forward to being a part of that growth,” Ross said.
In addition to the 295 apartments, The Ace is planned to include 13,000 square feet of ground-floor commercial space and a two-story, 296-space parking deck.
Poole & Poole Architecture is the project designer and Georgia-based Fortune-Johnson is the general contractor.
The 3.3-acre assemblage is on the east side of Arthur Ashe Boulevard.
Many of the buildings on the plot will be razed to make way for The Ace, including the old Buz and Ned’s, while the former Sportscar Workshops building at 1209 N. Arthur Ashe Blvd. is planned to be renovated into office space. The Cort Furniture and Tilt Creative buildings at 1207 N. Arthur Ashe Blvd. are not part of the redevelopment project.
Level 2 and SJG have another major project in the pipeline around the corner.
The developers, along with Maryland-based private equity firm FCP, are planning a five-story, 375-unit apartment building at 2700 W. Leigh St., a 6-acre wooded parcel they bought from Bow Tie Partners last spring for $15.5 million. Franco said that project is still in the planning process and the design is nearing completion.
A rendering of the planned mixed-use development (BizSense file)
With funding in hand, a major mixed-use development along Arthur Ashe Boulevard is now officially a go.
Level 2 Development and SJG Properties announced Thursday they’ve entered into a joint venture with Chicago-based investment firm Cresset Partners to finance an eight-story, 295-apartment development at 1117-1201 N. Arthur Ashe Blvd.
Construction is planned to begin in the next few weeks and last about two years.
The project – once referred to in planning documents as Leigh Addition but now dubbed “The Ace” – has been in the works since 2021 when the D.C.-based developers bought the 3.3-acre assemblage from local landlord Ed Lacy for $12.5 million. The buildings on the property previously housed businesses including Buz and Ned’s Real Barbecue and Car Pool Car Wash.
Last year the developers secured a special-use permit for the project; however, work never kicked off. In the months since, interest rates have continued to rise and drive up project costs, posing a challenge for many developers in the area. The price tag for The Ace also wasn’t immune: It was initially slated to cost $80 million, and in Thursday’s announcement the projected cost is $98 million.
Level 2 principal David Franco said the broader economic environment played a part in the decision to seek a partner such as Cresset, which is now an equity partner in the project.
David Franco
“There’s no secret it’s a challenging environment in the capital markets,” Franco said. “We were looking for a joint-venture partner for equity … and after going to the market, we thought Cresset was the best fit to achieve our goals for the project.”
He added that the fund Cresset used to invest in The Ace was specifically for projects in Opportunity Zones, further sweetening the deal. The equity from Cresset was combined with $58.4 million in construction loans from Maryland-based Sandy Spring Bank and New York-based Five Star Bank.
It’s the first deal in the Richmond region for Cresset, which according to its website has amassed over $3 billion in commitments from investors since its founding in 2018. Cresset’s director of real estate, Jason Ross, said in an email that a number of factors drew the firm to Richmond, including its proximity and affordability relative to Washington.
“We’re confident that Richmond’s recent growth is only the beginning, and look forward to being a part of that growth,” Ross said.
In addition to the 295 apartments, The Ace is planned to include 13,000 square feet of ground-floor commercial space and a two-story, 296-space parking deck.
Poole & Poole Architecture is the project designer and Georgia-based Fortune-Johnson is the general contractor.
The 3.3-acre assemblage is on the east side of Arthur Ashe Boulevard.
Many of the buildings on the plot will be razed to make way for The Ace, including the old Buz and Ned’s, while the former Sportscar Workshops building at 1209 N. Arthur Ashe Blvd. is planned to be renovated into office space. The Cort Furniture and Tilt Creative buildings at 1207 N. Arthur Ashe Blvd. are not part of the redevelopment project.
Level 2 and SJG have another major project in the pipeline around the corner.
The developers, along with Maryland-based private equity firm FCP, are planning a five-story, 375-unit apartment building at 2700 W. Leigh St., a 6-acre wooded parcel they bought from Bow Tie Partners last spring for $15.5 million. Franco said that project is still in the planning process and the design is nearing completion.
Great! Another 700 units on the way surrounding the Diamond District! Taxes alone from these two developments should fund a lot of terrific projects in the City. Perhaps the City Council might consider lowering th3 tax rate a bit to make housing more affordable.
Agreed. These developments moving forward is great news and everyone would get behind a reduction in the tax rate. I realize we need new school infrastructure and we need some of the help to come from the General Assembly there (most every locality has really outdated schools).
The City of Richmond if it can fix a lot of it’s back log in infausture might end up richer in the future then Chesterfield County and Henrico County due to this new density replacing low rise who are building up a infrastructure payment time bomb with all single family homes that need water and sewer and road reconstruction. But I hope the city of Richmond does large scale sidewalk replacement along all the major roads like they did along Board Street and they do need to at least build a 100 miles of sidewalk along streets that do not… Read more »
Richmond isn’t capable of any long-term project of efficiently upgrading public works. The corruption in the city government is entrenched top to bottom and the elections are fake so no one can do anything about it. The city will keep being dragged along by competent administators in the counties and at the state level. Hoping for more is setting yourself up for disappointment.
The City runs its “credit card” the max ever five to seven years when it builds 2-3 schools. Given the limited bond abilities of cities in VA, given the call for higher wages by the unions (and the workers the DO the work deserve more pay but the excessive number of supervisors over them do NOT), given the rising insurance costs, and constructions costs the increase in revenue from new construction is keeping the city solvent. In fact the surplus only comes every year as the City has several hundred open positions that if all filled there would be no… Read more »
Many cities don’t pay their own freight, but don’t tell that to Strong Towns!!!
100 miles of sidewalk! You sound like a Strong Towns ideologue. I think Chesterfield and Henrico are doing just fine, and the problem with stretched out infrastructure the leaders of both munis are WELL aware of which is why there are ZERO affordable single family homes being built. The counties say that if you want to build single family, you have to do x, y and z — so the developers do the math and they build a subdivision that most first time homebuilders cannot afford. It is actually quite hard to build single family in Chesterfield and I know… Read more »
If the extra level doesn’t all go to patronage and graft. They have trouble keeping the litter at bay.
Not a chance from this crew — you can’t have graft and patronage without CASH.
Starting the countdown to “we must protect the collapsing abandoned cinderblock huts and historically significant parking lots that this housing will replace” from the people who are definitely absolutely not Build Nothing Anywhere Ever!
The nerve of these developers replacing these historical parking lots were will people dump trash at and were will they be able to spray piant half amount buildings at?
And what about traffic? 🤣
Thank you. There is another similar group of activists who don’t want change as well.
Why grey? A little nice color wouldn’t hurt anything.
I bet it will look better — might not even have the grey — just a stand-in color.
The parking included in the building equals the number of units! Awesome! Parking is already becoming an issue in that area. The corner of Leigh and the Blvd rents parking spaces now, and the number of cars parking on Leigh street east of Bow Tie is growing. Renters paying $2,000 per month do not want to cart their groceries 2 blocks to their apartment – in the rain…..
I think it is reasonable that this development is building one parking space a apartment so it at least doesn’t take parking away from the neighborhood.
But wait, I thought you said removing the parking minimums was going to make it so developers didn’t build any parking and ruined the City. Guess that theory was proven wrong.
I think the SUP most likely has the set number of parking spaces and that governs the parking requirements. That is the point of the SUP is you don’t have to follow standard zoning, parking, setbacks, height, etc as you negotiate it for that property. I don’t think the change in the parking requirements applies to this project and if they did want to change it they would probably have to go back through a revision process to the SUP before Council. No developer likes doing the SUP once, let alone twice on the same parcel. But I could be… Read more »
I think you are being simplistic. There are DEFINITELY some areas that need more parking. Heck, even in downtown Petersburg there are far left-wing people living in adaptive reuse residences in the retail district that are saying that the city should not allow any more residential loft type apartments put in to any more of the old buildings UNTIL the city builds a parking garage with free parking, and some of the businesses have similar concerns — no one in downtown Petersburg (or very few) think it is practical to walk or take the bus all the time even if… Read more »
PARKING! PARKING!
The Joan of Arc of Parking!
(I am the Napoleon of Parking — I will force convenient Parking upon them until I am exiled)
Like Thanos, you are inevitable… and like with the Borg, resistance is futile.
You are too kind! I am more like death and taxes and urban corruption.
I’m more like Rorshach, except less autistic.
Or, harkening back to the 1970s and the glory days of the Broad Street Bullies – death, taxes and a bench-clearing brawl at the Flyers game. 😉
I love that you think driving a car to go two blocks is reasonable. Incredible.
Huh? I love that you misunderstood. It’s not about driving 2 blocks, it’s about carrying your full backpack, gym bag, groceries, and dinner 2 blocks because your building does not have any parking. Oh, and by the way, it is raining while you are walking 2 blocks to your apartment.
I was complementing this developer for equalizing the parking spaces to the # of units.
Hey Victoria! For what it’s worth, I took your comment to be complimentary of the developer re: parking spaces vs unit number. To your first point about schlepping groceries, etc., two blocks in the rain: Yeah it’s a pain (have done it a zillion times in RVA, particularly when I lived in the Fan and the Museum District).But playing devil’s advocate, Richmonders don’t know what real urban schlepping is all about. Try lugging groceries, laundry, etc., on foot, in New York or Chicago MULTIPLE blocks not just in the rain but also in the snow – particularly with ice on… Read more »
Loading Zones are your friend. I do this just fine every week.
Also the grocery store is only 2 blocks away, allowing for frequent, smaller trips.
Is this another large apartment complex without planned green space? I don’t see green areas included with these huge new apartment buildings and real estate developments. We need new housing to be planned with nearby spaces for people to walk and gather, close by playgrounds for children, areas for pets, etc. Older neighborhoods have these for good reason. The concreting and paving presently happening in the city will increase the heat in the summer, make the winters colder and is aesthetically unattractive. There is a lack of urban and environmental planning. While the developers might make a fraction less in… Read more »
The concreting and paving of the site on the Boulevard already happened years ago. It is completely covered. There is not currently any green space on that site, but it does look like they are adding street trees.
Plans for the Bow Tie site were not shown so we do not know if they are keeping any green space on that one.
The Bon Secours Training Center Park is a block away.
But have you been keeping up with everything else being planned for that area? High density is exactly what’s needed for both quality of living and the environment.
Public parks are a public responsibility. Yes, they are a good thing and we need them. But it’s the city’s business to provide them.
Your complaints are best directed at the people responsible, ie the council and the mayor
That area would benefit from some green space – for beauty. Aesthetics matter.
One park was just completed a few blocks away in front of the Children’s museum, and another is planned for the front of the Science Museum. Most likely the Diamond District development will also have green space. A short drive away there are acres of park … Byrd Park, Maymont, Three Lakes, etc. The upcoming Sauer development will also have green space. The art and history museums just down Boulevard also have wonderful green space.
Bruce: Whenever the idea of reducing the tax rate in the city comes up it gets voted down. Even if it was slightly reduced would it really matter? It would still be by far the highest rate in the metro area.
With all of these units projected to come online in the area how will the city manage the traffic on Arthur Ashe Boulevard? Can you imagine the crunch on game day?
I wish (and think they could) reduce it down say .005 per $100. They used to go out 7 or 8 decimals to get the spending closers to the revenue. And yes Brian it would not make much difference for most but I know several seniors (even with the tax abatement) and LMI residents that struggle to pay even a $20 a month increase in real estate taxes. I have had long term neighbors have to move out because they, even without a mortgage, on a fixed income they can’t afford to maintain and pay taxes. Some people I know… Read more »
It is shameful that seniors lose their primary residence over property taxes. I don’t know the answer, but there has to be a better way.
Brian, yes, any reduction would help. Lowering our water and sewer rates, even if incrementally done, would also help a lot. We have a good number of low income seniors in areas that are gentrifying the most who have really been impacted due to rising home prices.
That’s true of every core city in the nation. This will especially be true as long as Virginia’s archaic annexation laws prevail; especially the racially motivated moratorium on annexation. Suburban growth is parasitic, destructive of the environment, and not conducive to good area planning.
Those of you down voting this comment do not go on AABlvd often, or you lack the foresight to see what impact the Diamond District, The Ace and other projects already underway will have on this area. Yes, they are all great projects. But what is VDOT (or the city) going to do to manage the traffic impact (especially for ballgames) other than split up the AAB exit off 64 between Northbound and Southbound lanes?
I live nearby. I am not at all afraid of the impact these projects will have. In fact, I’m excited by them. Boulevard could quadruple it’s traffic and still have no traffic.
Traffic and people on the sidewalks is a sign of life. People who prioritze easy driving should live in the suburbs, and not try to deaden cities.
Martha – I drive AAB everyday & yeah, unless “they” do something, that area could very easily become a traffic nightmare.
What a drab color scheme. What austere design.
khRuscheVkA 2.0 brought to you by the Hedge Fund plutocracy.
What are your thoughts on the color scheme and design of the graffiti-covered abandoned huts and weed-strewn parking lots currently occupying this parcel?
Housing is a good thing. period. Want something better? great! Build it.
I don’t see any bike lanes, either.Maybe everybody that lives in Southside pay for a few miles!
Acording to a book on Richmond history the first ever bike only lanes in the 1880’s were along this street and were paved while the rest of the street was dirt. But then the car was invented.
AHA!!!
That is some interesting history, but it seems like the Sidewalk guy has an agenda to bring america backwards.
I, for the record, am EXTREMELY for bikelanes and paths, road both in Richmond with my daughter yesterday (but brought the bikes in on the back of a minivan). But cars equal freedom, which is why some people don’t like them.
Such gross looking architecture Really hope the Sauer’s inspire future development in the city that isn’t driven by lowest cost to build.