WASHINGTON, DC-The sale of Liberty Place, one of DC’s trophy buildings located in the East End at 325 7th St. NW, closed this week for total of $139 million and at a sub-5 cap rate, according to a source. Paramount Group purchased the 169,542-square-foot, 12-story property from Beacon Capital. Paramount Group is financing the transaction with a senior mortgage loan from a life company. The same source tells GlobeSt.com that the lender was Axa.

Jones Lang LaSalle’s Steve Collins and Jim Molloy and former JLL brokers John Kevill and Collins Ege, now with Eastdil Secured, brokered the sale. Wes Boatwright, Jon Goldstein and Jim Gladden in JLL’s Capital Markets group secured the financing.

The competition was intense for both the asset itself and among lenders to provide financing, Boatwright tells GlobeSt.com. “When you have an asset that is in arguably the best market and is a trophy asset that is well maintained and bought by a top tier owner like Paramount, there is going to be a lot of interest from the lender community,” he says. “Certainly it makes my job a lot easier.” Boatwright declined to discuss specifics about the deal, other than to point out that there is some 100,000-square feet of tenant space set to rollover within the next four years.

The building itself and the market fundamentals are so good that this, in fact, is an opportunity more than a drawback, Kevill tells GlobeSt.com. “I think when people hear of buildings trading at low cap rates they then forget that, given these great fundamentals, the risk-adjusted returns will wind up being as good as or better” than a building that traded at a higher cap rate, he says. For Liberty Place the 100,000-square feet that is coming up will be an opportunity to go to market seeking higher rents that it will likely get, he says. Paramount has tapped JLL’s leasing team, including Trip Howell and Amy Bowser, to lease the property.