CoStar Headquarters Commands $101M
- Feb 04, 2011
What a difference a year makes. Timing is everything. All such cliches apply to the anticipated disposition of the 169,500 square-foot office building at 1331 L St. NW in Washington, D.C. CoStar Group Inc., which maintains its headquarters in 149,500 square feet of the property, has signed a deal with an affiliate of GLL Real Estate Partners GmbH for a $101 million sale-leaseback transaction, just one year after CoStar bought the asset for $41 million.
CoStar had acquired 1331 L from the Mortgage Bankers Association for what now looks like a bargain-basement price in February 2010. Two years earlier, MBA had paid developers Paramount Group Inc. and DRI Development Services L.L.C a reported $79 million for the 10-story building.
CoStar is remaining mum on the amount of money it invested in 1331 L. However, unless the firm spent $60 million or more to spruce up the property, it turned a tidy profit on its one-year hold.
“The opportunistic acquisition of this building for our headquarters office was part of our larger strategy to create value through our occupancy of the building,” Andrew C. Florance (pictured), CoStar founder and CEO, noted in a prepared statement. “This sale will enable us to unlock the value of this formerly distressed property and provide an attractive return on our investment. At the same time, we were able to secure an efficient and environmentally responsible headquarters office for our Company at a tremendous downtown location for our employees, and create a valuable, fully leased long-term asset for the new owner.”
Upon the expected deal closing later this month, CoStar will sign a 15-year lease with two five-year renewal options.