Carr Properties Trades Northern Virginia Property

By Keith Loria, Contributing Editor 

Julian Etches, Transwestern

A Washington, D.C.-based investor has acquired the Atrium Building, a 138,507-square-foot office property in Alexandria, Va., for $53.5 million from Carr Properties.

Transwestern represented the buyer in the transaction.

“Our client’s goal was to increase the size and value of the company’s real estate portfolio. The first step was to sell an iconic retail asset the client had in its portfolio for a number of years,” Julian Etches, Transwestern’s managing director, told Commercial Property Executive. “After selling that property for a sub 5 percent cap rate, our client then looked to acquire a quality asset inside the beltway at or above a 7 percent cap rate. The Atrium presented an appealing opportunity with its location inside the beltway and 90 percent occupancy, providing a little bit of upside potential through the vacancies.”

Located at 277 S. Washington St., the building is just one block south of King Street and seven miles south of Washington, D.C.  Ronald Reagan Washington National Airport is close by, as are U.S. Route 1 and other major thoroughfares such as the Capital Beltway/Interstate 495 and I-95.

“The Atrium is located just off South Washington Street, which serves as the main artery for the Old Town Alexandria area,” Etches added. “Alexandria also faces high barriers to entry because there is a lack of new development opportunities. Tenants can also take advantage of the numerous amenities nearby.”

The five-story building features an expansive lobby with patterned Italian marble floors, cherry paneling inserts and brass accents. On-site amenities include Society Fair, a full-service restaurant and market; a two-level, underground parking garage with 232 parking spaces; and access to Old Town Alexandria’s central dining and shopping corridor.

James G. Davis Construction Corp. renovated the property in 1998 adding new stone, glass, and finishes, including high-end millwork in the lobby. The elevators were also modernized and a new elevator was added to the atrium area. Work also included the addition of an emergency generator and updated bathroom fixtures and finishes.

The Atrium was 90 percent leased at the time of sale, with its anchor-tenant having a long-term lease in place.

“We knew by selling the iconic retail asset, our client could take advantage of a down cycle in suburban office,” Etches concluded. “Between the stable tenancy, the physical location with high barriers to entry and the 7 percent cap rate, the Atrium presented an ideal acquisition for our client.”