When we reported the formation of the JBG Urban portfolio last August, it was impressive enough: a $2.5 billion equity pool contributed by MacFarlane Partners (80%), Morgan Stanley Real Estate, and JBG family and friends, leveraging $10 billion in development for 93 existing JBG properties at 42 sites around the region. Now it seems positively miraculous, a huge recapitalization just in time to beat the late summer credit crunchproving once again JBGs storied knack for timing. We dropped by their Chevy Chase headquarters for an update.
Even though the firm was started in 1960 (co-founder Ben Jacobs and 25-year vet Mike Glosserman are still going strong), Investment Officer James Iker, left, and Chief Development Officer Dean Cinkalatwo of JBGs current partnersshow the youthful depth of the 500-employee firms bench. Dean, from the Berkshires in Western Mass, came to Washington in 1989 after his Darden MBA, pretty much because thats where he could find a job in real estate (for those of you whove blotted out the memory, it was an inauspicious time). He was at Bethesdas Stonebridge 12 years, coming to JBG in 2000 and now leading its development efforts from the point of raw land through the regulatory, design, and construction processes. James, from Oklahoma, is a Wharton grad more involved in the capital structure and acquisition side. As for Bisnow Factoids You Could Not Live Without: Dean is an avid skier; James is known for a clean desk.
About $1.3 billion of JBG Urbans $2.5 billion of equity has already been invested. An example, pictured above, is a 225-room addition which doubles the size of JBGs Bethesda North Marriott, started in June and due to be completed in January 09, with possible future additions for office and retail. Most of the portfolio sites (25 in Annandale, Arlington, Falls Church, Reston and Vienna; 13 in Bethesda, Bowie, Gaithersburg and Silver Spring, and four in DC) are in some phase of design and engineering, regulatory approval, or construction; in total they represent the potential of 8.5M SF office space, 2.2M SF of retail, 13,200 residential units, and 2,500 hotel rooms. Many might have been underwritten by JBGs opportunity funds but for typical 2-3 year capital commitment windows which are often shorter than development cycles. The recap makes investment funding simpler and more predictable, and also provided capital reinvestment alternatives to JBG investors. JBGs $600M Fund VI that closed in February can be used for additional new property acquisitions.
Is this company that wouldnt go home after a Redskins game? Close: its Cassidy & Pinkards James Cassidy, Lowes Harmar Thompson, and MRPs Zach Wade in James basement a couple weeks ago apparently testing the efficacy of a new shoe deodorant. (For those whose olfactory senses are easily offended, dont look at what weve circled.)
We always knew the Forrester Brothers (David, Scott, and Rick) were good guysand here they are literally getting the award last month at DCs Hyatt Regency for Character Under Construction from the National Capital Area Boy Scout Council, which cited Forrester Construction for its contributions to the Boys & Girls Clubs, YMCA, and Imagination Stage. All three Forresters were Boy Scouts, and one was even an Eagle Scout (we wont tell you which one, to maintain brotherly harmony).
What’s this picture all about? Stephanie Gallagher, a partner at Banner Associates recruiting, has been writing daily emails to a JBG Lead Engineer, Sean Smith, who she placed back in 2005 and was called up for military duty in Iraq. Shes also been sending him coffee, biscotti, browniesand dri-fit tee-shirts for him and his friends. Sean sent Stephanie the picture above of one of his fellow soldiers in a Banner Associate tee shirt and wrote “The guys loved the shirts and you’ve got advertising in Iraq! We thought for such a good deed, wed give them a bit of advertising stateside as well.