The Washington Post
August 9, 2004
By: Dana Hedgpath
Prince George's County is changing. For years the county had trouble attracting vibrant retail centers, upscale housing and other amenities that make businesses want to move or expand in a region. As a result, real estate experts say, Prince George's was an also-ran in the region's commercial real estate market. The success of Bowie Town Center shopping center, the appearance of more luxury homes and the fact that real estate still costs considerably less than in other close-in markets has brought more investors here.
As the District and its closer suburbs boomed because of steady government spending, buyers pushed up the price of office buildings downtown until they are now second in price only to Manhattan. Those pressures have spread to nearer, prosperous suburbs like Bethesda, Tysons Corner and Fairfax.
That means more tenants who might not need the sort of fancy buildings found downtown have moved out to places like Prince George's. The investors have followed them.
Bordered by the District to the south, Montgomery County to the west and Anne Arundel to the east, Prince George's was mostly farmland until the 1950s, when developers started putting up small warehouses along the county line closest to the District.
The northern part of the county, near Route 214, which runs east-west from the District toward Chesapeake Bay, had high-rise offices that sprang up in the 1980s and 1990s and spread along the Capital Beltway, which bisects Route 214. The neighborhood has grown into a 21 million-square-foot commercial market. Though small by the standards of the District or Northern Virginia, it is a start.
Much like neighboring Montgomery County, where contractors set up shop near federal institutions such as the National Institutes of Health in Bethesda and the U.S. Food & Drug Administration in Rockville, contractors and service companies came to Prince George's to be near major agencies. The National Aeronautics and Space Administration is in Greenbelt, the U.S. Census Bureau is in Bowie and Upper Marlboro, and the Agriculture Department is in Beltsville.
The building boom in Prince George's is fueled by surprisingly steady job growth. From 2000 to 2003, jobs grew 2.8 percent, faster than the region at 2.4 percent. The District grew 2.1 percent; Montgomery 0.6 percent. Only booming Northern Virginia with its tech companies and defense contractors grew faster, at 3.9 percent.
Developers such as Atlantic Realty Cos. of Tysons Corner, Buchanan Partners LLC of Gaithersburg and others plan to build this year about 251,000 square feet of new offices -- not much compared with the 6 million square feet under construction in Northern Virginia during the second quarter. But two-thirds of the Prince George's space is pre-leased, according to CoStar Group Inc., a Bethesda real estate research company. And that is, of course, a good sign.
Not surprisingly, real estate prices have started to jump in Prince George's. In the past two years, the average price per square foot for an office building rose about 20 percent, and in some cases as much as 60 percent, bringing the county closer to its neighbors.
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