Construction is now underway on the $1.2 billion Lakeforest redevelopment in Gaithersburg, marking a major step in the transformation of the former Lakeforest Mall site into a mixed-use urban district, the project is being led by WRS Inc.

Local officials and community stakeholders gathered Monday, April 13, 2026 to mark the project’s groundbreaking, signaling the shift from years of planning to active construction on the 102-acre property. The site has remained largely vacant since the mall’s closure in 2023.

The residential component is being delivered by multiple partners. NVR Inc. is responsible for a significant portion of the for-sale housing, while Potomac Housing Development is leading the workforce housing segment. A separate partner is expected to co-develop the rental apartment units alongside WRS Inc.

From Decline to Redevelopment

Once a regional retail anchor, Lakeforest Mall’s decline mirrored broader challenges facing enclosed shopping centers across the United States. Its closure created both an economic gap and a rare large-scale redevelopment opportunity in Montgomery County.

The new project replaces approximately 1.1 million square feet of aging retail space and expansive surface parking with a denser, multi-use environment designed around housing, commerce, and public space.

Scale and Design of the Project

Plans call for about 1,600 residential units, split between roughly 850 rental apartments and 750 for-sale homes, including townhomes, stacked duplexes, and condominiums. A portion of the housing—about 250 units—is designated as workforce housing, reflecting local affordability goals.

Retail and commercial development will total more than 470,000 square feet. Early tenants include major national retailers and entertainment uses, alongside smaller-format retail and restaurant spaces intended to support a more active, street-level environment.

The design shifts away from the traditional mall layout toward a walkable street grid, replacing large parking lots with interconnected roads, pedestrian corridors, and mixed-use blocks. More than 35 acres of green space are planned, including public gathering areas and a boardwalk integrated around existing water features.

Transit and Infrastructure Investment

A key infrastructure component is the relocation and upgrade of the Lakeforest Transit Center. The facility is expected to serve eight local bus routes and connect to the planned MD 355 Flash Bus Rapid Transit line, positioning the development as a transit-oriented hub.

Phase one construction currently focuses on site preparation and infrastructure, including demolition, road construction, and stormwater systems. Vertical construction of residential and commercial buildings is expected to follow.

Economic Impact

At full buildout, the redevelopment is projected to generate approximately $2.7 million in annual recurring revenue for the City of Gaithersburg and contribute an estimated $1.7 billion in annual economic output.

Officials see the project as a long-term economic driver, not only replacing lost retail activity but also introducing new housing and employment opportunities in a high-demand corridor within the Washington metropolitan area.

Long-Term Outlook

The project will be delivered in phases over several years, meaning its full impact will take time to materialize. Still, the start of construction marks a clear turning point for a site that has stood as a symbol of both suburban retail decline and redevelopment potential.

For Gaithersburg, the Lakeforest project reflects a broader shift in how large, underutilized commercial properties are being reimagined—moving from single-use retail toward more resilient, mixed-use communities.

The project reflects a broader national trend in which aging or underutilized properties are being cleared to make way for higher-density redevelopment, similar to recent projects such as the redevelopment of the Mandarin Oriental site in Miami.

Lakeforest Redevelopment – Project Factsheet

Location

• Gaithersburg, Maryland, USA
• Washington, D.C. Metropolitan Area
• Former Lakeforest Mall site (102 acres)

Project Value

• Estimated Cost:

Project Type$1.2 billion

• Mixed-use redevelopment
• Conversion of former regional mall into a walkable urban district

Status

• Mall closure: 2023
• Groundbreaking: April 2026
• Current phase: Infrastructure works and site preparation underway
• Next phase: Vertical construction (residential and retail buildings)

Residential Component

• Total Units: Approximately 1,600
  • 850 rental units
  • 750 for-sale units

Breakdown:

• 600 for-sale homes (various housing types)
• 600 rental apartments (joint development)
• 250 workforce housing units

Housing Types:

• Townhomes
• Stacked duplexes
• Condominiums

Retail and Commercial

• Total Space: 470,000+ square feet

Development Team

• Lead Developer: WRS Inc.
• For-Sale Housing: NVR Inc.
• Rental Housing: WRS Inc.
• Workforce Housing: Potomac Housing Development

Confirmed Major Tenants:

• The Home Depot
• Sprouts Farmers Market
• Landmark Theatres

Additional Features:

• Restaurants and small-format retail
• Entertainment district
• Flexible community event spaces

Transit and Infrastructure

• New Lakeforest Transit Center (relocated and upgraded)
• Serves 8 Ride On bus routes
• Future connection to MD 355 Flash Bus Rapid Transit (BRT)
• Phase 1 includes:
  • Road networks
  • Stormwater systems
  • Site infrastructure

Public Realm and Design

• Over 35 acres of green space
• Walkable street grid replacing surface parking
• Boardwalk around revitalized ponds
• Public plazas and gathering spaces
• Pedestrian and cycling connections

Economic Impact

• Estimated $2.7 million in annual recurring revenue for the City of Gaithersburg
• Approximately $1.7 billion in annual economic output at full buildout

Project Vision

• Shift from single-use retail to a mixed-use, transit-oriented district
• Focus on walkability, community integration, and reduced car dependency

Development Structure

• Multi-phase implementation
• Infrastructure development followed by vertical construction
• Mix of rental, for-sale, and workforce housing delivery