Douglas Development Nails Down Big Lease at DC Office Building
- Dec 03, 2020
Douglas Development Corp. has landed a new 49,000-square-foot, long-term lease at its historic Woodies Building, 1025 F St. NW, in Washington, D.C. CBRE represented Douglas in the lease transaction.
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The tenant is Morning Consult, a locally headquartered global data intelligence company, which will be backfilling space that becomes available next April 1.
Morning Consult has been tagged by Deloitte as one of North America’s fastest-growing tech companies, having been founded in 2014 and currently employing more than 255 people in four offices nationwide.
The CBRE team of Mark Klug, Carroll Cavanagh, Emily Eppolito, and Dimitri Hajimihalis represented Douglas Development. JLL’s Greg Lubar, Andy O’Brien, and Zach Boroson represented Morning Consult.
The growth of the technology sector in Washington, D.C., continues to be a very positive story for the region, according to Norman Jemal, principal at Douglas Development. Companies value the access to a skilled workforce, ease of commute and the diverse and dynamic lifestyle that D.C. offers, Jemal said in a prepared statement.
Morning Consult is one of a handful of growing tenants that CBRE is currently negotiating with, and “it is nice to see some positive signs of life in what has been an extremely challenging market,” added CBRE Executive Vice President Mark Klug.
According to JLL Vice Chairman Greg Lubar, Morning Consult’s growth is a true example of why startups are thriving in Washington. He added in prepared remarks that in just six years, Morning Consult has gone from operating in a rowhouse to becoming one of the fastest-growing tech companies in the country.
The 10-story building encompasses 92,850 square feet of retail space and 405,150 of Class A office space.
Built in the late 1800s, it served for decades as the flagship Woodward & Lothrop department store (whence the Woodies nickname). It became vacant by 1995, when all of the chain’s stores were liquidated following a Chapter 11 bankruptcy filing the previous year.
Several proposals for its revitalization came and went before Douglas Development bought the building in 1999 and eventually received approval to convert it to a mix of office and retail space. The building reopened in 2003.
Douglas Development might well have opened some extra champagne to celebrate this lease. In October, WeWork announced that it would close three locations in Washington, D.C.— and as it happened, all three are in buildings owned by Douglas.
They are Manhattan Laundry at 1342 Florida Ave. NW, Wonder Bread Factory at 641 S St. NW, and 718 7th St. NW. WeWork planned to shut down those locations by the end of October.
And WeWork isn’t the only bad news. The Washington office market is beset by stagnant demand and both an all-time high direct vacancy (13.5 percent) and a 10-year high for sublease vacancy (nearly 2 million square feet), according to a third-quarter report from JLL. The last three quarters have all seen negative absorption.
Nevertheless, the construction pipeline totals more than 3 million square feet, though JLL reports that this is tapering off, with no recent starts.