RMR Group Nabs $57M Hampton Roads Asset

The Boston-area trust acquired the 288,000-square-foot office building from local developer Buddy Gadams. The property houses ADP, a New Jersey-based human resources firm.
2 Commercial Place in Norfolk, Va.
2 Commercial Place in Norfolk, Va.

RMR Group has acquired 2 Commercial Place, a 288,000-square-foot office building located in the heart of Norfolk, Va. The Boston-area trust purchased the property from local developer Buddy Gadams’ Marathon Development for $57 million, The Virginian-Pilot reports. This transaction marks the highest price paid for an office building in Norfolk since the Great Recession, the publication mentioned.

The property last traded in January 2016, when it was sold by an institutional investor represented by Cornerstone Real Estate Advisers. The property is fully leased to ADP, a New Jersey-based human resources firm, one of the largest employers to settle in the Hampton Roads area in the last few quarters.

ADP’s move to Norfolk, which was announced in March 2016 by Virginia Governor Terry McAuliffe’s office, involves the creation of 1,800 new jobs and an investment of roughly $32.3 million. According to a Cushman & Wakefield | Thalhimer market report, the 288,000-square-foot lease was, by far, the largest such transaction in the area closed in the first quarter of 2016. Prior to this, the building was fully occupied by Bank of America.

As of December 2016, RMR Group’s U.S. footprint included more than 1,400 properties, 48 of which were in Virginia. The trust’s portfolio in the state includes 15 hotels, 14 senior living communities, eight office assets, four industrial properties and three retail assets. RMR Group owns Perimeter Center, 501 S. Fifth St. and 9900 & 9930 Independence Park Drive in Richmond, as well as several Hampton Roads assets.

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