WASHINGTON, DC-With Market Square finalized and a closing set for March 10, all that is left to wonder is how this deal changes the trajectory of transactions in the District. Briefly, the 679,710-square-foot complex at 701 and 801 Pennsylvania Ave. is trading for $615 million, or $904 per square foot. Wells Real Estate Investment Trust II is under contract to buy the property from Beacon Capital Partners.
According to data provide Real Capital Analytics, the deal has a quoted cap rate of 4.5%. That makes it one of the lowest cap rates in the District’s history, Homa says, rivaling only the sale of 1111 Pennsylvania Ave., NW.
At $615 million, Market Square is the third largest commercial real estate deal in the District’s history, topped only by Rosslyn Twin Towers and International Square, Homa relates. “Also, year-to-date, the Metro DC market has tallied 21 transactions for $1.5 billion,” he says. “Twelve of these deals accounting for $1.25 billion were concentrated in Downtown Washington, DC. In 2010, it took the metro area as a whole until June 2010 to reach the $1.5 billion it has registered in the first two months of this year.”
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