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Real Estate Bisnow (DC)

Quiet Giant on 7th Street

It's one of the largest pension fund advisors in the country and has had a hand in some of the nation's largest mixed-use projects. It's invested in about $6B worth of real estate over the years. And you may have never heard of them. But quietly, National Real Estate Advisors is helping change the urban core of America.

CEO Jeff Kanne might prefer that you don't know much about his firm, as long as the investment community does. DC-based National has historically shied away from broad media exposure, letting its investments tell the story instead. As an investment manager for several massive pension funds (many of which are in the electrical industry), National quietly invests debt and equity in every major market throughout the US across all asset classes. "Generally we focus on urban core developments, since that's where the economic dynamism of the future is," says Jeff, a lawyer by trade who's led National and its predecessor for 15 years. And the firm's strategy has paid big dividends, literally: Jeff says the firm has experienced annual double-digit returns for its investors for each of the last 14 and a half years.

TEEL (CorpInter3) MDCRE

Above, the firm's 900 7th St HQ. Though National doesn't market itself as broadly as other investment advisors, Jeff says the firm has "about 50 to 60 institutional investors" that it attracts through a deep network of relationships and industry clout. "We've been at this a long time, and we see far more opportunities than we can handle," he says. While it typically provides mezzanine debt and equity in the development stage of new projects, National will periodically provide construction financing or credit enhancements, too.

CohnReznick (Field) MDCRE

Last night, National celebrated the opening of Bainbridge Bethesda, a 200-unit apartment complex it invested in on behalf of one of its funds. (We snapped the firm's Michelle Johnstone and JLL's Luca Barber on the rooftop.) Down the street, it's involved with a site it's trying to rezone to build more apartments. It also financed the development of its 7th Street HQ, a hefty portion (with Akridge and an English investor) of the Buzzard Point site in Southwest DC, where the DC United stadium will (fingers crossed) eventually be built, and an apartment project at the Shady Grove Metro that will soon deliver. National also owns land out in Ashburn where a data center complex could soon be built—about 10% of the firm's portfolio is in data centers, Jeff says. National is also the capital, with Lowe Enterprises, behind the upcoming residential addition to the Washington Hilton, called the Dupont Residences.

Lerner (SmartSpaces3) RDCRE

In NYC, it was the money behind the innovative 8 Spruce St apartments in the Financial District, along with partner Forest City. In 2012, it sold a 49% interest in that property to TIAA-CREF—the deal valued the building at over a billion dollars, at the time believed to be the highest valuation for an apartment complex in the US. 

National also just topped out on two major projects: a 418-unit apartment complex in downtown San Francisco, as well as a 378-unit building in the South End of Boston. It's also gearing up to start construction on a big mixed-use project on Market Street in Center City, Philly (rendering above), and is in the middle of a big mixed-use redevelopment in the heart of Los Angeles called the BLOC. All in all, Jeff says that National is currently involved in financing and developing over 20 projects throughout the country.

Hickok Cole (RI-Ave) DCRE
Fairfax EDC (MetroLine) DCRE
Cleaners (Car) DCRE
Reston (ShuttleSevice) DCRE
Bisnow Hypnotic HALF

This Monday: A Rare Bisnow Afternoon Event—Our Restaurant Summit

To celebrate the platinum age of the DC dining scene, we're assembling big-name chefs and real estate execs this coming Monday, Sept. 29. Brokers, bankers, and designers, who make the physical spaces possible, will also join us at our 4th annual DC Restaurant Summit at The Hamilton Live on 14th Street. Remarks from Cava Mezze Grill founder Brett Schulman, Busboys & Poets founder Andy Shallal, and DC Brau CEO Brandon Skall, among others, as well as superbrokers Dave Dochter of Cushman & Wakefield and Bill Miller of Miller Walker Retail Real Estate. It's an afternoon event, with one of our signature Schmoozaramas following the panels. Sign up here.

How to Capture Small Tenants

With big office leases few and far between, office developers are scrambling to fill up their rent rolls with smaller deals. But the big, glassy office jewels that have popped up over the past few years aren't the only option for tenants with small square footage requirements, says Stream Realty Partners' Kyle Luby. Boutique older office buildings with small floor plates are an attractive alternative to newer, pricier digs where a small tenant may only find space in the back corner of a building without much of a view. And as appetites for new space in the smaller tenant sector grows, owners have to be more flexible at the negotiating table to succeed. That means shorter terms and being more open during the design process, he adds. "What landlords need to be doing to capture that demand is to be the path of least resistance."

Kyle tells us Stream has just picked up the listing on 1432 K St overlooking McPherson Square, a boutique 33k SF property with 2,700 SF floor plates. The smaller floor area allows tenants views of K Street and the square they may not get on a bigger plate, as well as a historic (the building dates back to 1917) urban design that's in limited supply downtown. Smaller lobbying, government affairs, design, and law firms are the likely target tenants for a boutique building like 1432 K, Kyle says, and that it's also an option for growing tenants looking to migrate downtown from smaller submarkets.

VA Gold Cup (Oct25) DCRE
Fidelity National (Get-to-know) DC

Good Eats Coming to an Airport Near You?

Your layovers at DC area airports are about to get a little tastier. That's because there's a huge influx of new restaurants at Dulles, Reagan National, and BWI—and father-son team Parker and Bryce Teel of TEEL Construction are building many of them out. We ran into Parker and Bryce at your publisher's house earlier this week, and they tell us they've either finished or are building out seven restaurants at Dulles (including Bistro AtelierDistrict Chop House, Michael Symon's Bar Symon, DC Craft Brews), one at Reagan (Grille District), and two at BWI (Capital Teas, and one that can't be named just yet). Bryce says the wave of new spots at each airport is due to a big number of lease expirations in airport food locations. There were plenty of other real estate-ers at our event earlier in the week; for more, check out our coverage from Tuesday's The Scene Bisnow.

Bisnow (Sales-Checklist)

Prince William County Event
This Tuesday

Prince William County is one of the leading innovation hubs in the region, if not the nation, with cutting-edge life sciences and technology research leading the way. The promising nature of its growth is why we're holding our Prince William: Harnessing Innovation event this Tuesday at the Hylton Performing Arts Center in Mannasas (pictured). The center sits on George Mason U's Prince William campus, and we're thrilled to welcome GMU president Angel Cabrera to open up Tuesday's event. We'll feature another keynote from Prince William County chairman Corey Stewart, as well as county economic development head Jeff Kaczmarek. We'll also feature panels with WestDulles Properties CEO Eric Wells, Ceres Nanosciences CEO Ross Dunlap, and Roadside Development founding partner Richard Lake. The event gets going at 7:30am—click here for more info and to sign up!

Bisnow's Power Women
in Tech

Did you know the DC region has been ranked the top place for women entrepreneurs? This month, in a multi-part series in Tech Bisnow, we're profiling our selections for the 40 Most Powerful women in tech, and then celebrating them at an event on Oct. 15 in Crystal City. These women are the names you need to know from hottest DC-based companies, like Vox Media (here's honoree and VP Alexis Junega), newBrand Analystics, EverFi, SocialRadar, LiveSafe, Augaroo, and Optoro, among many others. Join us next month to recognize the great talent in the DC tech community, and meet the women who are making things happenSign up!

Week 4 in the NFL—who ya got? Email chris.baird@bisnow.com



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© 2014, Bisnow LLC, 1817 M St., NW, Washington, DC 20036. All rights reserved.

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