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Crystal City: The New Downtown

The desert of office buildings is on its way to becoming a place to work , eat and play.

Crystal City is getting a face-lift along with some new tenants as part of an effort by development firm Charles E. Smith to transform the neighborhood from rows of monolithic office buildings into a hip downtown destination.

"The market is here, the demographics are here," said Tony Yelamos, owner of Jaleo and Oyamel restaurants. "The culture still has to be spread out a little, and it's still in the process of doing that. It's challenging, but there's no reason Crystal City shouldn't be a major spot in this area."

Yelamos said the draw for his business in Crystal City was the sheer number of people there. According to Charles E. Smith, more than 60,000 people come to Crystal City every day.

"What we were looking for is volume," he said. "And the trend is up, our sales are up. However, the trend is slower than we anticipated."

But Crystal City is changing. Charles E. Smith — which owns 70 percent of the buildings there — already has built more than 10 million square feet of office space, 5,000 apartments and 11 hotels. Its plans for the future include more restaurants and shops and a new design for the Crystal City streetscape featuring pedestrian spaces, new electronic street signs and two-way streets to improve traffic.

"It'll be a place where people truly can wine, dine and work," said Anthony Dayyani, owner of the Cold Stone Creamery on Crystal Drive. "The long-term prospects for this area are priceless."

Dayyani said that when his establishment, an ice cream shop, first opened in 2004, business tended to slow down after about 5 p.m., when most of the people who work in Crystal City had gone home for the night.

"The image of the place has changed very rapidly," he said.

Dayyani added that recent announcements from the federal government that its offices in Crystal City are to be moved have hurt business, but as the neighborhood works to revitalize on all fronts, the pull-out could become just a blip on the radar screen.

"The worst for our business was in December, January and February of the last year, but we've gotten over that," he said. "We're seeing a gradual build back up. If anything, there's now a competitiveness among companies to get into Crystal City."

BUT WITH FEDERAL offices gone, Crystal City also has an opportunity to bring in new private tenants. PBS is slated to move its headquarters to Crystal Drive in 2006.

"As buildings open up, new opportunities become available," said Terry Holzheimer, head of Arlington Economic Development.

Holzheimer said the government withdrawal from Crystal City is not the reason for the renewed business interest there but rather a catalyst for it.

"It probably has accelerated some of it," he said. "Now that the buildings have fewer tenants, they're open for new ideas, but it all depends on market forces."

Among some of these tenants are new restaurants like Ted's Montana Grill, a chain founded by CNN owner Ted Turner, and Corner Bakery, a cafe and restaurant set to open at the end of this month.

“Corner Bakery fits perfectly with the new Crystal City urban experience,” said Mitchell N. Schear, president of Charles E. Smith.

“I can see families coming off the bike path in Crystal City to stop at Corner Bakery for a sandwich on weekends or office workers enjoying a Corner Bakery lunch in the park.”

Schear said the restaurants are an integral part of Crystal City's appeal.

“We have assembled an eclectic lineup of the hottest urban destination restaurants, all with fabulous menus, bold and inspired design — and each with the power to draw diners from around the area. Together, the sum of all these destination restaurants on a new, dynamic streetscape has created a new urban gathering place with more cool places to eat than anywhere else.”

And not every federal agency has left Crystal City; some are moving there. The FBI and the Secret Service both have plans to set up offices there in the coming months.

All Crystal City needs now, said Dayyani, is to diversify what it has.

"Retail is the part that needs work," said Dayyani. "You don't ever want to get pigeon-holed into being just a place to eat and go out at night."