A turn-of-the-century property on the corner of Eighth and H streets NW in Chinatown that has been vacant for several years could soon be given new life.

Owner L3 Capital is marketing the property for sale, positioning it as a redevelopment opportunity for office, retail, hospitality or multifamily. The building has already gone through a renovation and expansion approval with D.C.'s Historic Preservation Office and has a building permit to expand it from 10K SF to 12,358 SF.

The three-story property is a combination of three separate buildings, two dating back to the late 1800s and one from the early 1900s, and they were combined in the mid- to late 20th century, according to documents filed with the Historic Preservation Office.

The most recent ground-floor retail tenant was Asian Spice, which closed in May 2017, according to the restaurant’s Facebook page.

The 10K SF property was fully vacant when L3 Capital purchased it in 2019 for $6M from a family. It had plans to renovate the property, with the vision of creating 2,700 SF of ground-floor retail, 1,500 SF of patio space and boutique office space on the second and third floors.

That vision never came to fruition. The investment company is looking to gain a foothold in D.C., and in doing so, it is working to "recalibrate" its portfolio, according to Feldman Ruel Urban Property Advisors Managing Principal Ian Ruel, who is representing the owner in selling the property, along with Josh Feldman and Adam Costanzo.

The approved plans call for offices over retail, but its D-5-R zoning allows for office, retail, hospitality and multifamily uses.

“Any sort of retail, any sort of F&B use, any entertainment-type use would be perfect,” Ruel said. “Some sort of office user that wants to occupy the second and third level and wants to be in that immediate area and is looking for more of a boutique office product versus a more institutional layout, I think this would be a really good fit for.”

He said there has also been interest in converting the office to multifamily, short-term rentals or hospitality. Most of that interest has come from well-capitalized owner-operators, with some also coming from investors, he said.

Mayor Muriel Bowser's administration and the DowntownDC Business Improvement District have been pushing for more office-to-residential conversions in the area. Ella Faulkner, vice president of planning and economic development for the BID, said she was glad to learn the H Street property is up for sale and encouraged potential buyers to consider a multifamily redevelopment.

"It is our hope that the purchaser might think about taking advantage of the city’s Housing in Downtown Tax Abatement program and consider going vertical to attract new residents to Chinatown," Faulkner said in an emailed statement to Bisnow. "This, along with other nearby residential projects that are planned, will help enliven the neighborhood seven days a week."

The property's listing price is $5.75M, a $250K discount from the price L3 purchased it for in 2019. The owner has outstanding debt on the property — it obtained a $3.5M loan in September 2022 — but Ruel said that wasn’t a motivation to sell.

“We're working with a sophisticated client who understands what's going on in the market right now,” Ruel said. “So they're willing to be realistic, and that's reflected in our asking price.”

The Downtown D.C. neighborhood of Chinatown and Gallery Place has struggled with its public perception and rising vacancy in recent years. The area, home to the Capital One Arena, is heavily occupied by office buildings and restaurants, many of which have closed since the start of the pandemic.

In 2021, the DowntownDC BID launched a study on the corridor, the results of which it released in February. It highlighted three challenges in the area: visible drug sales, the growing presence of people experiencing homelessness, and panhandling and disruptive busking.

This section of Eighth Street was listed as one of the “priority spaces” that the BID is targeting for improvements to revitalize the area.

Ruel said the location of this specific building has the benefit of being near a variety of uses, unlike some other parts of downtown.

“It's a good mix between residential and office, which a lot of parts of downtown are not,” he said. “The farther you get west along K Street, that’s a lot more office-heavy. This is much more of a balanced profile. So I feel really good about this location.”

Contact Emily Wishingrad at emily.wishingrad@bisnow.com