Commerz Real enters market in Washington, D.C. with purchase of “1900 N Street”
25,500 sqm in central business district for Hausinvest
Striking architecture designed by renowned architectural office KPF
Potential for appreciation thanks to new leases
Commerz Real has acquired the office property “1900 N Street” in Washington, D.C. for its open-ended real estate fund Hausinvest. The building is located in the so-called “Golden Triangle”, the heart of Washington, DC’s central business district. The seller of the property, which has a leasable area of 25,500 square metres and was completed in 2019, is a joint venture between the local project developer JBG Smith and the Canadian pension fund Canada Pension Plan Investment Board (CPP Investments). It was agreed that confidentiality be maintained regarding the purchase price.
“A successful entry into the Washington market with a trophy property,” says a visibly pleased Maja Procz, Global Head of Transactions at Commerz Real. “1900 N Street” stands out thanks to its striking architecture, which makes the building even more eye-catching on account of its corner location. “The lines of sight in the corner offices as well as the spectacular view from the roof-top terrace lend the building a special character,” explains Procz. The conspicuous red steel girders and the column-free, three-storey foyer ensure the building has a strong presence in the cityscape according to Commerz Real. The building’s appearance was created by KPF Kohn Pedersen Fox, one of the world’s leading architectural firms, known among other things for “One Vanderbilt” and the “Hudson Yards” in New York City, as well as “The Scalpel” in London.
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82 per cent of “1900 N Street” is currently leased to four office tenants and two gastronomy operators. Among these are the headquarters of the law firm Beveridge & Diamond, a specialist for environmental and planning legislation, the mid-Atlantic headquarters of CBRE, a global real estate services provider, and a branch office of Goodwin Procter LLP, one of the world’s leading law firms. Among the facilities available to the tenants are a fitness centre, a large roof-top terrace with indoor and outdoor event and co-working areas, as well as a catering kitchen. In addition, the property has an underground car park with 175 car parking spaces. The office complex has been awarded the sustainability certificate “LEED” in gold.
“Thanks to the outstanding urban location we see very good potential for value appreciation with the leasing of the remaining areas,” says Procz. Thus according to the relevant reports the Washington office market is on course for recovery and in the first quarter of 2022 the leasing figures once again returned to their pre-coronavirus level for the first time. In addition, many public authorities, government-related organisations and law firms on the office market in Washington, DC guarantee a highly crisis-proof tenant structure. According to the “US Bureau of Labor Statistics” more than 40% of the jobs there are to be classified as “recession-resistant”, the highest figure within the USA.
Commerz Real was advised on the transaction by Willkie Farr & Gallagher (legal matters), Bleddyn AM (commercial aspects), Arcadis (technical matters) and PwC (tax).