BETHESDA, MD-Two real estate investment funds, Meritage Properties and GoldenTree InSite Partners, have partnered to acquire a local office building from AEW, who was acting on behalf of an institutional client. The acquisition price has not yet been listed in local comps, but buildings in this submarket typically trade between $220 sf to $300 per sf.

Two-thirds of the 235,000-sf building, located at 10401 Fernwood Rd., is leased to the National Institutes of Health, leaving 57,000 sf available. The building is located in North Bethesda’s Rock Spring office park. Leasing and management will be handled by Lincoln Property Co.

Andy Nathan, principal of Meritage Properties, tells that the duo plan to make $1 million in captive improvements to the building. Once the renovations are complete, he says, they will be able to lease the one vacant floor in the building at “highly competitive rates.”

The two firms have not formally developed a joint investment platform, but they expect to acquire additional properties together in the future, Rob Vahradian, managing director of GoldenTree InSite Partners, tells “Typically we invest with operating partners we like. It is very efficient.” He adds that this is GoldenTree’s fourth investment in the Greater Washington, DC market and the second for Meritage. He says there is nothing specific in the pipeline for the area.

Comparable transactions in this market include 6100 Executive Blvd., which traded for $278.83 per sf earlier this year. It was sold to Stephen Goldberg by the Washington Science Center for $35.2 million. In February 7201 Wisconsin Ave. traded for $221.29 per sf.

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