ROCKVILLE, MD-Now that it has done just about all it can do for Redland II and III -- two buildings that recently achieved full occupancy -- First Potomac Realty Trust is acquiring Redland I, the third building at the Redland Corporate Center, for $30 million.

This building, though, is no value-add play like its one of its sister buildings once was: the 133,895 square foot, class A office building is fully leased to the Department of Health and Human Services through early 2018.

Redland Corporate Center is comprised of three office buildings totaling 483,000 square feet. The REIT acquired Redland II and III in a joint venture with Perseus Realty, LLC in late 2010. This summer it announced that it brought Redland II from zero occupancy to 100% leased.

First Potomac plans to green its latest acquisition, with plans for either an Energy Star or LEED certification.

Redland II and III are both LEED Gold certified.

While Redland II and III were value add transactions, Redland I, with its government tenant, is clearly a cash flow play for the REIT. Acquiring the third building in the park, says Douglas J. Donatelli, chairman and CEO of First Potomac Realty Trust, also adds to its operations efficiencies "and gives us the opportunity to expand existing tenants in the future."

First Potomac used the 1031 exchange proceeds from the sale of its industrial portfolio in June 2013, cash on hand, and its line of credit to acquire Redland I.

Instant Insights /

First Potomac Buys Redland I for $30M

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