Cornerstone Sells Buildings Near White House
- Dec 01, 2015
By Scott Baltic, Contributing Editor
Acting on behalf of an institutional investor, Cornerstone Real Estate Advisers LLC has sold two Washingon, D.C., office buildings, it was announced Monday by Cushman & Wakefield, which represented the seller. The buyer was not identified, and Cornerstone, a member of the MassMutual Financial Group, declined to comment on the transaction.
The two properties, at 1501 Pennsylvania Ave. NW and 730 15th St. NW, are one block east of the White House, total 117,000 square feet and are fully leased to Bank of America. The transaction was valued at $55.5 million, a C&W spokesperson told Commercial Property Executive.
Built in 1902, 1501 Pennsylvania Ave. NW is a one-story, 5,000-square-foot Bank of America branch bank with an ornate 50-foot ceiling.
The property at 730 15th St. NW is a 10-story, 112,000-square-foot office building that connects to 1501 Pennsylvania Ave. Its top floor features a grand ballroom with wraparound windows that reportedly provide unobstructed views of the White House, Treasury Department, Washington Monument, Jefferson Memorial and portions of the National Mall.
C&W executive directors Eric Berkman and Steven Gichner brokered the transaction on behalf of Cornerstone and its client.
“This is an iconic Washington property. It is one of only two private properties facing the White House, with classic architecture and sweeping views over the National Mall,” Berkman said in a prepared statement. “No wonder we had so much interest from investors all over the world. There will always be tremendous demand for classic Washington office buildings.”
A second-quarter office report from Marcus & Millichap suggests that investor demand for well-located assets in Washington does indeed remain strong, even as construction falls off dramatically due to weak employment growth and slowly rising vacancies.
Metrowide, average cap rates have compressed 10 bp to 6.1 percent, according to the report, with cap rates for assets inside the Beltway dropping into the mid-5 percent range.