Inside Northeast D.C.’s shuttered Love nightclub, the swanky marble floors are still intact, granite still tops the sprawling bars and mahogany paneling still conveys the ambience of one of the city’s most high-end hot spots.

But the four-level “megaclub” — a former warehouse with a capacity in the thousands — was on the auction block after closing in October. Despite the luxury nightspot’s storied history, the wide range of bidders interested in buying the building expressed one common theme: Its time as a club is over.

The end of Love marks the third megaclub in a year to hit the skids amid a wave of redevelopment in which the District’s once-blighted urban landscape that provided fertile ground for the DJ and dance scene has drastically changed.

“There is a shifting tide in the D.C. nightlife arena,” said Skip Coburn, president of the D.C. Nightlife Association, noting that the popularity of larger-than-life nightclubs is waning with investors and owners.

“It used to be that an owner could lease a crappy building in a warehouse district at a reasonable rate and put a million into renovations to have a nice bar and nice decor,” Mr. Coburn said. “As development has eliminated all those crappy areas in town the problem is that everybody has doubled or tripled their leases when they’ve come up for renewal.”

Rents in once-cheap warehouse districts are increasing. Condos, apartments and hotels are sprouting up next to long-established megaclubs — creating tension between the club operators and new residents who don’t want booming bass to be the soundtrack to their lives. The heyday of the megaclub seems to be nearing an end.

Encroaching development

Love is situated in a neighborhood on the cusp of transition.

At one end of the Okie Street block the club occupies, a homeless man recently erected a fortress of cardboard and wool blankets. The surrounding pavement stinks of urine. But on the other end of the block stands the art deco Hecht Co. warehouse slated for a renovation into luxury apartments, an organic supermarket and a fitness center.

The company rehabilitating the Hecht warehouse, Douglas Jemal’s Douglas Development Corp., bought Love for $5 million in a bankruptcy auction this month.

Asked about his interest in the nightclub, Mr. Jemal brusquely responded, “I’m developing in the neighborhood. That’s my interest.”

Founded in 2001 by D.C. “nightclub impresario” Marc Barnes as a venue called Dream, the club earned a storied place in the lore of D.C. nightlife. In 2003, Dream was the site of a Destiny’s Child concert that drew a crowd estimated at 15,000. In 2007, as Love, the club hosted Washington Wizards’ star Gilbert Arenas’ star-studded 25th birthday bash featuring rap mogul Sean Combs and performances by Busta Rhymes, Lil Wayne, T.I. and The Game.

But even without celebrities or star power, the club on weekend nights drew crowds in the thousands to an isolated building adjacent to a public school bus lot off New York Avenue.

Dean Smothers, who bought Love for $7.8 million from Mr. Barnes after he filed for bankruptcy in 2010, agrees the sun might have set on the megaclub phenomenon.

“The megaclubs are basically the dinosaurs in this day and age,” he said in between breaks at last week’s bankruptcy court hearing. “We can’t just put a Band-Aid on this open-heart surgery. Better use for that location would be a different use, more community-friendly.”

Mr. Smothers said his trouble with the club spiraled out of control in October, when the D.C. Office of Tax and Revenue shut down the club on the same night Howard University homecoming festivities were planned. The city says the club owed almost $300,000 in back taxes. Mr. Smothers estimates he could have made $500,000 that weekend had he been allowed to stay open. Unable to reopen the club, he filed for bankruptcy in December.

Mr. Barnes said one reason for Love’s demise is that, like all other clubs, it faced competition from newer hot spots as it aged.

“There are so many more new venues in Washington,” said Mr. Barnes, comparing the nightlife scene now to the nine years he ran the megaclub.

Mr. Barnes capitalized on his success with Love and opened the much smaller Park on Fourteenth nightclub in Northwest.

“I built Park and it kind of cannibalized Love,” he said of the similar clientele the two ventures drew.

Mr. Barnes said there aren’t any big buildings left in the city suitable for conversion into large nightclubs, but he doesn’t think megaclubs now in operation are necessarily doomed — despite the trend.

Dying breed

Another megaclub, Fur, opened in 2004 near the intersection of New York Avenue and North Capitol Street Northeast. At the time, its neighbors were mainly warehouses and parking lots. Since then, hundreds of millions of dollars in construction projects have begun and the neighborhood was stylishly rebranded “NoMa,” for its location north of Massachusetts Avenue.

DJs at Fur dropped their last untz-untz in August, after the property and a nearby lot were purchased by Skanska USA Commercial Development Inc. for $12 million. The development company plans to build a 300-unit apartment complex where the vacant nightclub — which advertised a capacity of 3,000 people — now stands.

A similar scenario played out in 2006 along the city’s industrial Southeast waterfront, when clubs including the well-known Nation nightclub were closed to make way for Nationals Park.

Up the block from Fur, a megaclub called Ibiza that opened in 2007 is on the verge of sale after its owners declared bankruptcy. Recent court filings indicate an agreement is near for the 30,000-square-foot club.

Neither Ibiza’s landlords nor operators returned messages seeking comment about the troubled club. But recent court filings give a glimpse of its rocky financial footing, showing operators have paid amounts varying from $27,000 to $53,000 in rent in recent months. Although the club brought in more than $143,000 in revenue in January, expenses that month put it in the hole by $36,000.

Ibiza stands adjacent to newly completed hotels and apartment complexes whose operators have complained about noise — particularly from the club’s rooftop terrace.

Security at megaclubs also has been a concern.

ABRA as of last year had more than 100 investigations on file regarding incidents at Fur over the course its operation. The club also was targeted as a trouble spot after a drive-by shooting in March 2013 injured 13 people outside a nearby apartment complex around the time the club was letting out for the night. Two months later, a man was stabbed at Fur and it was closed temporarily by police.

“That’s when you start to see much more pressure placed by police and by city officials to regulate the activities,” said Jim Peters, of the Responsible Hospitality Institute, which advises businesses and governments on the nightlife industry. “Cities are not as interested in allowing these large venues to be open.”

Not just in D.C.

According to the Alcoholic Beverage Regulation Administration, 48 nightclubs are licensed to operate in the District. The number of megaclubs is far fewer. Of the clubs currently licensed, only Ibiza, Lux Lounge in Northwest, and Echostage in Northeast — which functions like a concert hall rather than a nightclub — are approved for capacities of 1,000 people or larger.

The District isn’t the only place where clubs are disappearing.

Last month marked the closure of the Roseland Ballroom in Manhattan, which had a capacity of 3,200 people.

Operators announced this month that Guvernment, a 22,000-square-foot nightclub in Toronto, would be closed because the building housing it had been sold. The closing is part of a “dramatic decline in the number of clubs in our area due to high land value and redevelopment,” said Janice Solomon, executive director of the Toronto Entertainment District Business Improvement Area.

“The megaclub scene is kind of gone,” said Los Angeles nightlife impresario turned urban planner Elizabeth Peterson, remarking on the changing tastes of young revelers.

She said young adults, like those who flooded into the District during the economic recession in pursuit of high-paying jobs tied to the federal government, are now seeking more intimate space such as restaurants or small lounges where they can interact on a personal level.

“They are very educated on the hazards of cigarettes, very organic. They want good food and the best liquor,” said Ms. Peterson, who ran nightclubs in Los Angeles from 1978 until she sold her last club, Bordello, in 2008. “They are very cognizant of their time and what they want.”

But J.C. Diaz, executive director of the Nightlife & Club Industry Association of America, was quicker to attribute the closings to ebbs and flows that are to be expected in the fleeting and at times fickle nightlife industry.

“Everybody has to evolve to stick in this industry,” he said. “The average life span of a club is usually two to five years. They renovate or they change names.”

A successful model?

Not all believe the era of the megaclub has passed.

Large clubs have proliferated in Brooklyn — where industrial space could still be scooped up — in recent years. And markets like Las Vegas and Atlantic City have been able to draw large crowds to megaclubs attached to high-end hotels by booking big-name DJs in the electronic dance music scene.

“The resurgence of the giant nightclub is ready for the taking,” said D.C.-based promoter Molly Ruland, president of One Love Massive. “There are 150 people a day moving into the city.”

Mr. Barnes agreed.

“It all depends on what type of music,” he said, noting that electronic dance music works for a megaclub while hip-hop venues don’t seem to thrive. He pointed to the success of Echostage, the 30,000-square-foot concert venue that shares an industrial block in Northeast D.C. with a notorious strip joint called the Stadium Club.

Before opening in 2012, the venue operated as nightclubs D.C. Star and D.C. Tunnel but was fraught with problems, including a lack of parking and a rash of violence.

Echostage landlord Raj Dua said current operators, longtime promoters Panorama Productions, have been able to overcome those issues in part by leasing parking lots and providing shuttles to and from the site. Echostage has also eschewed the typical nightclub format, opening only for concerts that draw heavily, but not exclusively, on DJs and electronic dance music.

The club’s capacity, which ABRA lists as 1,072 people, allows Echostage to feature acts too small for the Verizon Center but bigger than other area clubs could sustain, Mr. Dua said.

“They have one big hall that you cannot get anywhere,” Mr. Dua said.

Megaclubs still in business could also benefit from rethinking their business strategy, especially if it’s a model that relies on elements of exclusivity and pretension, Ms. Ruland said.

“Bottle service killed the nightclub,” she said, pointing to the practice of reserving well-appointed seats for patrons who purchase a bottle of liquor for their party.

“Everything became exclusive. Everything became about bottle service and what happened is long after that model stopped working they just keep on kicking that can down the road,” Ms. Ruland said, adding that many clubgoers feel both turned off and ripped off by the experience.

“It’s not 2005 anymore. This is not Miami. This is not New York. It’s D.C. And we’re urban, and we’re cultural, and we’re smart and savvy and we’re intelligent. That’s the main thing that they don’t understand,” she said. “We’re not dumb and we’re not going to fall for that.”

Robert Smith, president of Nightclub Security Consultants, a company that teaches nightlife security procedures to club employees in the District and across the country said owners may face new challenges to make their ventures profitable but that megaclubs won’t fail for good.

“We may not see as many because of the hurdles that will be there,” Mr. Smith said. “But the smart operator will get it done because there are billions of dollars here.”

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