Washington Office Building Commands $137M in Sale to Joint Venture

By Michael Ratliff, Associate Editor

Four-year-old REIT Carr Properties has closed on a 341,433-square-foot Washington, D.C., office building in a joint-venture acquisition with Canada Pension Plan Investment Board and MetLife. The property, located in the capital’s West End submarket, fetched $137 million for the seller,  Tishman Speyer.

Developed by the Oliver Carr Company in 1983, the Floyd Akers Building has a tenant roster including the Chronicle of Higher Education, the Chronicle of Philanthropy and NERA economic consulting. Tishman Speyer acquired the property in 2007—along with 25 other buildings in the Washington market—as part of the $2.4 billion portfolio from CarrAmerica/Blackstone.

Located on 1255 23^rd Street, the Floyd Akers Building stands eight stories tall and has a three-level underground parking garage. A rooftop terrace offers views of Georgetown University and the National Cathedral.

The capital’s West End submarket has been a hotbed for condominium and hotel development in recent years.  The Ritz-Carlton, Marriott, Park Hyatt, Embassy Suites and Western Grande brands are all represented by properties in the district. 

Notable recent local deals include Donatelli Development’s securing of  financing  for a 114-unit apartment above the Columbia Heights Metro station, Bentall Kennedy’s $123 million sale of the Madison Hotel, Vornado’s $127 million sale of two office assets, and CWCapital’s provision of $90 million in construction financing for an apartment complex in a Maryland suburb.

Washington has enjoyed a solid investment market through the recession. The district was the number-one ranked metropolitan area for job growth in the country, with suburban Maryland ranking third, reports Robin Williams, senior vice president and director of the Mid-Atlantic Multifamily Group of Transwestern. Experts predict the addition of up to 8,000 construction jobs by year’s end, according to a January 31 Washington Post article quoting Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University. From October 2009 to October 2010, 43,700 jobs were added to the capital’s metro area.