WASHINGTON, DC-Groundbreaking began this morning on thelong-stalled CityCenterDC, a development by Hines|Archstone. Itslaunch had been rumored for months - and technically constructionbegan at the end of March - along with the news that equityfinancing had been secured for the $700 million project. Today atgroundbreaking, the project’s anchor investor was announced: QatariDiar Real Estate Investment Company, the real estate investment armof the Qatari Investment Authority, is providing 100% of theproject’s equity. The financing was put in place by Barwa Bank’sinvestment banking subsidiary The First Investor, which willco-invest in and manage the dedicated TFI U.S. Real EstateFund.

It is not surprising Qatari Diar is the investor, Association ofForeign Investors in Real Estate CEO James A. Fetgatter tellsGlobeSt.com. “They have been taking an active role in foreigninvestment in real estate lately, particularly in London where theyhave been fairly active.” In general, reports of foreign investorsstepping up their activities in the US are starting to gainmomentum. Some of these investments are coming in the form of jointventures; others are via less-than-transparent vehicles, such asco-mingled funds, making it difficult to track just how much newcapital is flowing into the U.S. from these funds.

CityCenter DC is a 10-acre, mixed use project on a parcel boundedby New York Ave., 9th, H and 11th Streets. It is expected to bealmost complete by fourth quarter of 2013. The first phase of theproject will include more than 185,000 square feet of retailsituated at the base of six buildings that encompass 458 rentalapartment units and 216 condominium units. There will also be520,000 square feet of office space. The second phase of theproject is planned to include a 350-room upscale hotel, along with110,000 additional square feet of retail.

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Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.