WASHINGTON, DC-While national average pricing for commercial real estate properties has decreased 17.1% year-over-year, pricing in the Washington DC area has held steady, increasing 2.5% during the same period, according to Jones Lang LaSalle. In fact says JLL's Lucy Kitchin, "sales for federally-leased assets have remained in a stable bandwidth over the past several years."
"Much of that has to do with the renewal rates for GSA leases, especially for first generation space, which is 95%," she tells GlobeSt.com.
Despite the sequestration and recent clashes over the debt ceiling, investors are still confident about government-leased real estate. It is not that investors have become inured to the tensions, Kitchin says, "but as of yet these political and financial issues haven't played out in the investment sales market."
Since 2006, sales volume for GSA-leased office buildings across the county historically averaged approximately $3.3 billion per year. Washington DC captured 40.7% of GSA-leased investment sales per year, JLL says. The region contains approximately 41$ of GSA-leased space.
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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.
