ALEXANDRIA, VA-An office in this part of town has traded for $21 million. However, the price point was not based on current or future cash flow. Instead, the 129,564-square-foot, 89%-occupied building will be converted into condos by the buyer, EYA.
The building will soon be vacated, Jayne Shister of Cassidy Turley, tells GlobeSt.com. “Of the existing space, the federal government occupied 62,000 square feet, but the tenant has gone to Fort Mead,” says Shister, who represented the seller, an LLC, in the transaction.
Condos in the DC area are slowly coming back since their crash-and-burn of the recession. However, not every potential residential space should be a condo, according to EYA SVP AJ Jackson. “We focus on residential development in urban infill areas,” he says, “so that can mean brownstones or town homes or condos.” In this case, he thinks the condo was the right option because of the existing building. The floorplates are large and the building is situated so three out of the four sides have a water view. The project is still in the design phase, Jackson adds.
While condos in this particular building--601 N. Fairfax St.--may stand a better chance than most of selling, in general the condo market here is still in somewhat a slump, as there is still a glut of unsold inventory according to Delta Associates. According to its Q3 statistics, there are currently 2,950 unsold new condominium units that are actively be marketed in the Washington metro area--or two years’ worth of inventory.
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