Elme Communities, a real estate investment trust based in Bethesda, Maryland, has announced it will sell nearly all of its remaining multifamily properties and dissolve the company within the next year. The move marks the end for a company that has been part of the Washington, D.C.-area real estate scene for decades.
The decisive step comes as Elme Communities, known until recently as WashREIT, has agreed to a $1.6 billion sale of 19 apartment properties to Atlanta’s Cortland. Most of these assets—16 out of 19—are located in the D.C., Maryland, and Virginia region. The transaction is expected to close before the end of the year. The remainder of Elme Communities’ real estate, including its only office property, will be sold off separately as part of the company’s liquidation.
Elme's bold move follows a period of significant change. For years, the company focused on managing office and retail assets in the D.C. metropolitan area. That focus shifted in the mid-2010s when Elme began investing more heavily in multifamily properties, aiming to capture growth in the apartment market as tenants’ preferences evolved. By 2021, Elme had exited almost entirely from the office market, including a $766 million sale of most of its local office holdings to Brookfield Properties, and exited retail soon after.
Despite these changes, challenging market conditions persisted. According to company leadership, Elme was unable to lower its cost of capital to levels that would allow for profitable expansion, given the current economic climate. Paul McDermott, Elme’s president and CEO, stated that the sale and subsequent dissolution follow a comprehensive review of strategic options in consultation with the company’s board. More than 80 potential buyers—including major pension funds, insurers, and other real estate firms—were involved in the review process before settling on the Cortland deal.
Cortland, the acquirer of the bulk of Elme’s multifamily portfolio, has grown rapidly since its founding in 2005. Already counted among the largest apartment owners in the United States, Cortland’s recent acquisitions have included a $1.2 billion purchase in Dallas that made it the area’s leading multifamily owner. The Elme assets will add further depth to its holdings, which already comprise around 80,000 apartment units nationally.
The remaining assets at Elme Communities include 10 properties also now slated for sale, among them 600 Watergate, the well-known Watergate office building in Washington, D.C., once tied to President Richard Nixon's scandal in the 1970s. The sale of these final assets is expected to be completed within the year, after which Elme plans to return net proceeds to its investors. The company also indicated it would delist its shares from the New York Stock Exchange to reduce ongoing expenses and maximize returns to shareholders as it winds down.
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