WASHINGTON, DC—While the office leasing market in the DC region was not particularly strong this year, the same cannot be said of the investment sales sector.
In the past 12 months investment sales were approximately $6 billion, a significant increase over the $4.7 billion in sales posted in 2013 according to real estate brokerage JLL. This year's investment sales were the highest since 2011, when $6.3 billion in transactions were recorded.
Another high water mark for 2014 was that the market earned the prestigious moniker of being a city that saw a trophy office building trade for more than $1,000 a square foot thanks to TIAA-CREF's acquisition of PNC Place for $392 million in a joint venture with Norges Bank Investment Management of Norway. The $1,000 barrier may also be hit when the American Square building changes hands, according to the Washington Business Journal.
JLL Mid-Atlantic research director Scott Homa says investors showed a preference toward well leased and well located properties, and that preference steered the bulk of the deals—66%—to the District. Northern Virginia scored nearly 30%, while suburban Maryland posted approximately 4%.
JLL senior managing partner Bill Prutting adds that a lack of new building inventory will likely drive foreign investment to suburban markets. See story in the Washington Business Journal.
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