First Potomac Realty Trust Buys Iconic Art-Deco Office Building
- Apr 14, 2014
A 12-story office building in the heart of downtown Washington, D.C., now has a new owner. First Potomac Realty Trust bought the Tower Building from Guardian Realty Investors LLC for $58 million. The Bethesda-based real estate investment trust announced the acquisition on April 8.
The Tower Building is located at 1401 K St., N.W., adjacent to Franklin Square, one of Washington’s largest downtown parks, and surrounded by numerous restaurants, hotels, entertainment and transportation options. It was constructed in 1929 and is considered one of the first art-deco office buildings in the city. In 1995, it was included in the National Register of Historic Places. The property offers 117,093 square feet of space, and according to First Potomac is currently 88 percent leased to 22 tenants.
First Potomac acquired the property with the assumption of $37.3 million of existing secured mortgage debt. The REIT plans to start a renovation project and upgrade the building’s lobby, storefront, elevator cabs and fitness center. It also hired CBRE Group Inc. to find new tenants for the property. The CBRE broker team comprises Mark Klug, Max Friedman and Abigail Todd.
“We are very pleased to add 1401 K to our portfolio. This iconic building fits in nicely with our strategic plan to acquire, own and operate high-quality office properties in the Washington, D.C., metropolitan area,” said Nicholas Smith, First Potomac’s chief investment officer, in a statement for the press. “1401 K further strengthens our position in the downtown office market, and provides an opportunity to continue to grow the portfolio by acquiring assets where we see the potential for long-term rental rate growth and value appreciation.”
Photo credits: First Potomac Realty Trust