D.C. dealings: continued torrid pace in nation's capital With a succession of fall transactions and developments, metro Washington, D.C., continues as one of the hottest markets in the United States. First, the District office of New York-based Insignia/ESG arranged the $120 million sale of Bethesda Metro Center in Bethesda, Md. Rockville, Md.-based CRI Inc. sold the mixed-use development to a venture between The Blackstone Group LLC, New York, and The Meridian Group, Bethesda.
The project consists of a 17-story, 390,000 sq. ft. Class-A office building and a 381-room Hyatt Regency Hotel.
Also in Bethesda, Stamford, Conn.-based GE Capital Real Estate has extended $72 million to an affiliate of Washington, D.C.-based Quadrangle Development Corp. and New York-based Rockwood Capital Corp. for the acquisition and repositioning of East West Towers, a three-tower office complex. GE Capital provided $55 million in acquisition financing with an additional $17 million for tenant improvements, leasing commissions and capital expenditures during the 5-year loan. Inside the Beltway, D.C.-based Blake Real Estate has received building permits from the District of Columbia to begin redeveloping 1425 K St., N.W. Starting this month, Blake will redevelop the 12-story, 215,000 sq. ft. structure into a Class-A office tower.
Someone seems to think the market is peaking In the past two months, New York-based Teachers Insurance and Annuity Association of America (TIAA) has sold three buildings - two in the Los Angeles area and one in Philadelphia - for nearly $500 million.
In Philadelphia, TIAA, along with partner Chiyoda Life Realty of America, an affiliate of a Japanese insurance company, sold the fee interest in One Liberty Place to an affiliate of Delray Beach, Fla.-based Sunbelt Management Co. The 1.2 million sq. ft., 61-story tower reportedly sold for $245 million.
In California, New York investor Charles S. Cohen, president and CEO of Cohen Brothers Realty Corp., and a fund managed by Stamford, Conn.-based Cheslock Bakker & Associates, acquired the Pacific Design Center in West Hollywood from TIAA. The total investment value, including improvements and repositioning, is estimated at approximately $200 million. The Cheslock fund will contribute $30 million in equity, while Cohen will contribute $15 million in equity and TIAA will provide $120 million in financing.
Also in the Los Angeles area, locally-based Lowe Enterprises purchased Wilshire Bundy Plaza from TIAA for $55 million. The 14-story, 309,041 sq. ft. high-rise is 80% leased. L.A.-based Madison Partners, which represented both parties in the transaction, will be retained by Lowe to lease the remaining space.