WASHINGTON REIT LEASES FULL FLOOR AT ARMY-NAVY BUILDING IN WASHINGTON, DC, COMPLETES $4M RENOVATION
Washington REIT (Washington Real Estate Investment Trust – NYSE: WRE) has leased a full floor (13,000 square feet) at the historic Army Navy Building in the heart of Washington, DC to a major national nonprofit organization. The 109,000 SF LEED Gold certified building is now 71 percent leased to a variety of prestigious tenants.
At the same time, Washington REIT is completing a thoughtful $4 million renovation that has created a VIP tenant amenity in previously under-utilized space. The “collaboration lounge” and conference center, featuring stunning mid-century furniture and finishes, leads to a penthouse bar on the roof level and outdoor terrace seating with panoramic views of Farragut Square and the capital city. The entrance lobby at 1627 Eye Street, NW and the elevator cabs are also being updated.
Washington REIT, which acquired the asset in 2014, has worked since May of 2016 to renovate and lease the building’s top three floors after a law firm tenant needed to double its space following a merger. The ownership had a choice of re-leasing the vacant space or undertaking a renovation designed to raise market rents by about $10 per square foot. With relatively small 13,000 SF floorplates, the Army Navy Building is suited to small- to medium-sized tenants. Washington REIT’s redevelopment plan specifically addresses these tenants’ unique needs, providing collaboration and conference space that they cannot accommodate in their own offices.
“We created value at the Army Navy Building by providing a truly differentiated offering that delivered what our target tenant wanted without overspending,” said Mandi Wedin, Vice President, Asset Management, Washington REIT. “Being disciplined capital allocators, we were meticulous in defining the design scope of this project and are delighted by the positive market reaction and the leasing success we have experienced.”
Jones Lang LaSalle represented the landlord in the recent lease transaction. Cresa represented the tenant.
Tenants at the Army Navy Building enjoy an unmatched downtown location, directly across from Farragut Square, two blocks from the White House, and just a block from two Metro stations on the Red and Orange/Blue/Silver lines. Also within easy walking distance are hundreds of restaurants, shops, bars, hotels, and other attractions.
President William Howard Taft presided over the 1912 dedication of the original Army and Navy Club Building. A complete redevelopment and expansion in 1987, designed by renowned architectural firm Shalom Baranes Associates, added four floors and enlarged the building’s office space on two sides. The five-star Army and Navy Club, which offers dining and hospitality facilities to its members, now occupies the lower four floors under a long-term agreement. The Club has a separate entrance on 17th Street NW across from Farragut Square.
“In Washington’s central business district, many older office buildings have been repositioned with expensive ‘facadectomies’ and glass boxes,” Wedin continued. “The Army Navy Building’s redevelopment illustrates how landlords can create optimal value at a moderated cost by better understanding their target tenants’ needs and deploying value-add capital to specifically address those needs, ultimately yielding higher returns for investors.”
Washington REIT is a self-administered, equity real estate investment trust investing in income-producing properties in the greater Washington metro region. Washington REIT owns a diversified portfolio of 50 properties, totaling approximately 6.3 million square feet of commercial space and 4,480 multifamily units, and land held for development. These 50 properties consist of 20 office properties, 16 retail centers and 14 multifamily properties. Washington REIT shares are publicly traded on the New York Stock Exchange (NYSE:WRE).