NGP Pays $142M for DC-Area Business Park
- Jan 14, 2019
NGP has acquired Gunston Commerce Center, a nine-building, 600,000-square-foot industrial/flex business park in Lorton, Va. I-95 Business Parks Management sold the asset for $142 million. Avison Young facilitated the deal on behalf of the seller.
Gunston Commerce Center is situated in a corridor that’s strategically important to major government agencies, making it ideal for security-conscious General Services Administration (GSA) tenants.
“The appeal was primarily location,” John Kevill, Avison Young’s principal, told Commercial Property Executive. “The properties are near Fort Belvoir, proximate to Quantico and the Pentagon, and in the geography where GSA agencies have major presences and they’re all growing.”
The property has a tenant roster anchored by the GSA and key government contractors as the Gunston Commerce Center was designed to meet rigorous government security standards. The space is being used for everything from office and warehouse to R&D and retail.
According to Kevill, there is a limited amount of real estate that can satisfy government contractor needs in both security and location standpoints, and this deal checked both those boxes. “Recognizing there appears to be some level of uncertainty from the federal standpoint right now, one thing we can be certain of is those uses will receive more funding rather than less over time and there’s going to be more of a need for people and properties to serve those missions,” he said. “There are largely single-story buildings, but they are really high quality. That gives the buyer a fairly high comfort level that retention will be strong and as those missions grow, the properties become more in demand.”
A strong and viable location
The nine buildings that comprise the property are located on Richmond Highway or Furnace Road, about 6.5 miles from Fort Belvoir, 8 miles from the National Geospatial-Intelligence Agency, and 18 miles from both Quantico and the Pentagon.
The park is also near Interstate 95, directly off of Route and is close to the Virginia Railway Express (VRE), with a shuttle service there provided as an amenity to tenants.
“We had a reasonably deep interest in the property,” Kevill said. “A lot of institutions are taking a step back from suburban office but here it was much deeper. We did have interest from buyers who are not necessarily specialists in the government space, and there was interest from funds that invest in multiple property types, which isn’t typically the case with this kind of deal.”
Joining Kevill on the deal were his Avison Young Washington colleagues Jim Kornick, Chip Ryan, Michael Murillo and Georgiana Condoiu.
In January, Avison Young represented the sellers in the sale of Collin Creek Mall and the adjacent Sears property in Plano, Texas, to Centurion American Development Grop, which plans to redevelop the 1.1 million-square-foot mall into a major mixed-use project.
Image courtesy of Avison Young