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WASHINGTON, DC-With partner Aetna Life Insurance Co., Columbia Equity Trust has closed on the acquisition of Georgetown Plaza, a 151,000-sf multi-tenant office and retail asset at 2233 Wisconsin Ave., for $23 million. Aetna will maintain a 60% ownership interest in the joint venture. Columbia Equity did not disclose the seller, but according to sources it was Unicorn Wisconsin LLC.

As GlobeSt.com previously reported, this transaction has been pending for several months. Over that time period the contract price dropped, from $23.5 million, as a result of due diligence findings. The deal had also been contingent on a ground lease that was set at that time to expire in December 2058. In an earlier earnings call, it was reported that the terms of the ground lease were renegotiated, extending the maturity date to 2105, or 99 years. Columbia did not return calls for this story.

Georgetown Plaza has a net rentable area of approximately 148,000 sf, including 30,000 sf of retail. Its current occupancy is approximately 67%. The new owners plan to make $2 million in targeted capital upgrades to re-position the building.

In conjunction with the acquisition, the venture assumed existing mortgage financing of approximately $15.8 million at an interest rate of 5.78% that matures in June 2013. Columbia funded the balance of its investment with proceeds from its revolving line of credit. Georgetown Plaza is expected to generate a first-year net operating income-to-purchase price return of 5.9% on a cash basis, which was calculated after including a deduction for the ground rent expense. Columbia will also receive fee income from providing asset management and leasing-oversight services.

Earlier this summer Columbia acquired a three-story 102,400-sf multi-tenant office building in Gaithersburg, MD for $26.7 million, at 101 Orchard Ridge Rd. At the time, in an interview with GlobeSt.com, CEO and chairman Oliver Carr indicated that the REIT would like to grow its presence in the north Rockville-Gaithersburg submarket. Columbia did not disclose the buyer. According to an SEC filing this April, Columbia entered into a material definitive agreement with Foulger Land LP and Argo Orchard Ridge Manager Inc. to acquire 100% of the ownership interests.

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