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WASHINGTON, DC-Preferred Real Estate Investments has a contract to buy a vacant 480,000-sf office building overlooking the Anacostia River in Washington, DC. The Conshohocken-based real estate investment firm believes that renovating the former FBI office building will make for a good leasing opportunity, despite the undeveloped, industrial character of the neighborhood at Buzzards Point.

“It’s a neighborhood that’s on the come,” says Eric Kolar, who oversees acquisitions for the firm. “This is a big block of space. There’s an incredible amount of development in the Navy Yard,” he adds.

The upcoming move of the Naval Sea Systems Command from nearby Arlington, VA will add 10,000 workers to the neighborhood soon, and has spurred ground-breakings on three other office buildings in the area. The seven-story building that Preferred plans to buy and rename the Riverview Corporate Center, is well-located at 1900 Half St. SW on a 2.5-acre tract, says Daid Fahey, who works in the firm’s Columbia office. “It’s right on the water with unbelievable views,” he says.

DC officials also want to develop the city’s waterfront, and Preferred plans to participate in that. The site lies in an enterprise zone, making it eligible for certain kinds of economic development aid. Preferred also wants to line up high-tech firms as tenants, also in line with the city’s plans. One possible tenant is bHive, Preferred’s own high-tech incubator.

The firm believes it can close a deal by January with owner Dr. Laszlo Tauber, a local real estate investor. The firms are negotiating with each other directly and have agreed not to reveal the price. Preferred plans to line up an anchor tenant, and then renovate the property’s interior and façade, a job that would take between 60 and 90 days, Kolar said.

The cost will range between $60 per sf and $80 per sf, depending on how extensive the façade work will be. That will depend greatly on the type of tenant it finds. Preferred will ask about $30 per sf full-service for the property, and expects to market to high-tech firms, associations, government contractors and government agencies. The last may likely want to save on façade improvements.

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