JV Secures $23M Loan for DC Office Condo

In December of last year, Monument Realty and Angelo, Gordon & Co. bought 2055 L Street NW in Washington, DC in an all-cash deal; this month, they've secured a 23.2 million senior loan commitment from PCCP LLC for the acquisition and re-development financing of the property. With this loan in place, the joint venture will now commence a six-month rehabilitation to the owned 102,000 square foot condominium office portion of the 237,000 square foot building.

"The owner plans to renovate the property to position it as a quality Class A asset," said John Randall, senior vice president at PCCP, LLC. "The overall competitive vacancy rate in the CBD is approximately 6.4 percent. Once the renovation is completed, its quality and key location will be desirable to high-profile law firms, lobbyists, and non-profit organizations and associations."

Verizon sold the property, represented by Cushman & Wakefield, to the JV for $12.75 million. The JV plans to move forward in the coming months with a full renovation of 2055 L that will improve the now Class B building’s common areas, facade and building systems and add ground-floor retail space.

For more news and information visit Blumberg Capital Partners.

Wells REIT Purchasing DC Office Complex for $615M

Wells Real Estate Investment Trust II, also known as Wells REIT II, announced this week that it had signed a purchase and sale agreement for a 679,710 square foot office complex in Washington, DC for approximately $615 million excluding closing costs according to a National Real Estate Investor article. The deal is expected to close early this month as Wells takes ownership of the property from an affiliate of Beacon Capital Partners.

Built in 1990, the thirteen-story office property known as Market Square is a class A office property located on Pennsylvania Avenue between the U.S. Capitol and the White House. The property is certified LEED silver and is ENERGY STAR rated, and serves as headquarters of leading global law firms, Fulbright & Jaworski, Shearman and Sterling and Mintz Levin. Renowned FORTUNE 500 companies represented on the tenant roster include Procter & Gamble, Novartis, AstraZeneca, Bayer Corporation, Florida Power & Light and Waste Management.

Jones Lang LaSalle’s Scott Homa noted of the DC marketplace that "...year-to-date, the Metro DC market has tallied 21 transactions for $1.5 billion. Twelve of these deals accounting for $1.25 billion were concentrated in Downtown Washington, DC. In 2010, it took the metro area as a whole until June 2010 to reach the $1.5 billion it has registered in the first two months of this year."

For more news and information visit Blumberg Capital Partners.

EU Property Investment Expected to Rise in 2011

The new Global Market Perspective report out from Jones Lang LaSalle observes that a broad range of investors are targeting prime European real estate, and that volumes on investments are expected to rise in Europe to be around €130 billion in 2011, a 30% increase from 2010. An excerpt from the report:

The large, liquid and transparent markets in the UK, France and Germany will attract the majority of funds, with their focus being on London and Paris. Nonetheless, investors will widen their geographic search, and we will see increased trading in the Nordic markets, Central and Eastern Europe and Moscow.

Transaction volumes could be held back by a lack of lending and continued low levels of trading in secondary assets which, in most markets, are still considered too risky at current pricing levels. That said, we may see pricing expectations on secondary assets shifting to become more realistic, in large part driven by disposals from the banks (or from former bank stock held by NAMA). This will boost trading volumes.

For more news and information visit Blumberg Capital Partners.

WSJ Examines New HK Property Duties

The Wall Street Journal published an article title "New Rules Hit Hong Kong Property" which takes a look at the current climate of and regulations on real estate and property development in Hong Kong. Irina Fan, senior economist at Hang Seng Bank, said "despite the recent measures to cool the property market by the Hong Kong government, the rises in the private rentals will likely continue until the middle of next year as rental movements are lagging property prices." An excerpt from the article:

On Friday, the Hong Kong government slapped additional stamp duties on properties that are resold within two years and raised down-payment requirements on high-end home purchases. On Monday, government inflation figures showed Hong Kong property prices were up 15% in the January-September period, after a 30% surge in 2009.

Unlike previous measures enacted by the Chinese territory to cool prices, the new ones are considered more likely to have an immediate effect. DBS Vickers said it expects transaction volume could shrink 30% to 50% in the next three months as short-term speculators are driven out of the market. Other prospective home buyers, including genuine home seekers, are likely to adopt wait-and-see approach in anticipation of lower home prices.

For more news and information visit Blumberg Capital Partners.