WASHINGTON, DC—Republic Properties has secured $255 million in refinancing for Portals III, a 509,935-squre foot, 10-story building located at 1201 Maryland Ave., SW. The debt-and-equity package was arranged by CBRE’s David Webb and Jamie Butler. Korean Exchange Bank provided the $160 million senior debt facility and Samsung SRA kicked in a $95 million equity piece. It was the first time either South Korean entity invested in real estate in the District.
Interestingly, Samsung SRA key approached Republic Properties expressing an interest in investing in the Portal III building, according to Steven Grigg, the company’s president. “In a remarkably short time, we established a relationship which allowed us to replace and simplify the capital structure of the project to the mutual benefit of all involved. “
In general, Webb tells GlobeSt.com, “we are seeing an increased interest on the part of Asian investors in the deals we have been working on.” This deal puts to bed Republic’s funding needs for five years, giving it time to further stabilized the property, which is now 78% leased following the for 87,286 square foot lease inked by the Energy Department’s National Nuclear Security Administration at the end of last year.
The southwest market has been challenged with government cutbacks in space and operations, Webb adds, but investors see this is a blip compared to DC’s long-standing appeal as a gateway city. Portals III is located in the master-planned Portals, a 1.5-million square foot mixed-use development that includes the 400-room Mandarin Oriental Hotel.