introduced uncertainty in the DC
area that is reflected in pricing.
WASHINGTON, DC-New York City-based Rockrose Development Corp. is under contract to buy 1900 M St. NW, for approximately $55 million. The seller, Ralph Dweck, was represented by Gerald P. Trainor of Transwestern. Craig Deitelzweig, head of Rockrose’s office division, represented Rockrose in-house.
This is Rockrose’s third acquisition in the city. The company has been acquiring a building in the DC market about every six months now, Deitelzweig tells GlobeSt.com—and it intends to continue.
“We like DC and we plan on acquiring more properties,” he says, explaining that the sweet spot for this market are value-add plays located in the CBD and East End. Previous purchases include 1150 18th St. and 1776 Eye St., which was also sold by Dweck.
The newly purchased asset traded at a 5.5 cap rate going in. In three years the company expects the rate to be in the 7% range, Deitelzweig says.
The 112,687-square-foot building was fully renovated in 2000. It is 89% leased to such tenants as Levick Strategic Communications, law firm Sherman Meehan and State Farm Insurance.
At the moment pricing is favorable to buyers, Deitelzweig says: “There is an uncertainty about DC and that’s reflective in the pricing.” Much of the uncertainty is related to the presidential election, he adds. One frustration for buyers, though, is that there is not that much product on the market right now, which Deitelzweig says is probably also related to uncertainty surrounding the election.