Washington DC-based Baltimore Land Holdings has sold one of the largest industrial properties in the BWI Corridor, for $40 million. 7605 Dorsey Run Road in Jessup, is a 612,900 SF industrial facility that is 30% leased by Iron Mountain. The buyer, Exeter Property Group in Pennsylvania, has retained CBRE to lease up the remaining 70%. CB’s Bruce Strasburg and Benjamin Meisels handled the sale. John Wilhide, Benjamin Meisels, Ed Harris and Mike Roden will be responsible for leasing. With this new property now in its corporate fold, Exeter owns 2 million SF in Maryland a little more than one year after it entered the market.
902-910 King Street, an office/retail building in Old Town, has sold for $7.9 million to a Pennsylvania-based general partnership. A group of local investors acquired the 31,870 SF building, called Firehouse Square. GVA Advantis’ Brian Ball, George Labarraque and Brian Ball Jr., represented the buyer.
Northrop has signed a 10-year, full-building lease with Opus East at a project in Linthicum near BWI Airport. Terms were not disclosed. Opus will begin construction on the five-story, 160,000 SF, class A office building in Q3 this year. The company acquired the 9.5-acre property last June with an eye to developing it as a spec office. Located on West Nursery Rd., the site is in the West*Quest Technology Park in Anne Arundel County, where Northrop’s Electronic Systems sector is already headquartered.
DoD has renewed 524,867 SF at 2530 Crystal Drive in Arlington in a five-year term. The government agency is the only occupant in the 547,930 SF building owned by Beacon Capital. Darian LeBlanc and Spencer Stouffer of Cassidy & Pinkard Colliers brokered the deal, with LeBlanc serving as the lead broker in the transaction.
Smoot Lumber has renewed a 172,000 SF lease with First Potomac at 6295 Edsall Rd in Alexandria. The company occupies more than a third of the 504,000 SF warehouse/office flex facility. Its lease puts Smoot Lumber in the facility until 2017.
Penn National Gaming has secured an 18-month option to purchase 36 acres in Perryville, MD from Principio Iron Company. Penn is hoping to develop a $125 million entertainment center that would include 2,500 slot machines. Its investment, of course, hinges on whether Maryland voters will decide to authorize up to 15,000 slot machines in the city of Baltimore and the counties of Allegheny, Anne Arundel, Cecil and Worcester this November in a state referendum.
Quarterly Report Card
Total office sales in Q2 registered $1.6 billion – a small but at least positive uptick from Q1’s $936.1 million in sales, according to GVA Advantis’ new report on sales activity in the area. It found that sales volume in the District increased to $982.5 million, from $538.3 million in Q1. In Maryland, Q2 sales registered at $148.6 million, from $80.6 million. In Northern Virginia, $422.4 million in office buildings traded, from a total of $317.2 million the previous quarter.
Leasing activity improved in the DC and NoVa markets; in suburban Maryland, though, it declined, according to CBRE’s numbers.
Net absorption in the Washington DC office market increased in Q2 to 358,911 SF from 131,323 SF in the previous quarter, led by gains in the CBD and East End. The East End absorbed 214,576 SF; in CBD that number was 90,234 SF. Still, though, absorption rates in these submarkets were well below the five-year and 10-year averages of 1.6 million and 1.9 million SF, respectively, according to CB.
In NoVa, there was net absorption of 702,813 SF in Q2. However CB says this figure does not reflect the current decline in demand for space in the area -- rather, the high level of absorption this quarter was a result of build-to-suit activity that began two years ago. Three buildings, totaling 732,404 SF, delivered this quarter for single users and contributed to 90.2% of the quarter's net absorptions.
In suburban Maryland in Q2, net absorption totaled negative 735,644 SF, reversing 65% of all demand gains since the beginning of 2007. CB says Maryland’s office market has been hit hard by the economic downturn – some 3,500 jobs have been lost which translates into a loss of 600,000 to 700,000 SF in demand.
Jim Reid, president of CBRE’s U.S. Eastern Division, has been appointed to the National Infrastructure Advisory Council. A presidential appointment, Reid is the only representative from the commercial real estate industry among the members of the board.
JBG has selected JLL as leasing agent for Central Place, the 521,000 SF trophy office tower in Rosslyn that at 390 feet tall had to get clearance from the FAA. Dave Bevirt, Michael Ellis, Herb Mansinne and Bob VeShancey will oversee the leasing. Central Place is being developed to Gold LEED standards. Expected to deliver in 2011, it will be developed in two phases: Phase I includes the office tower, a public plaza, public observation deck, and 12,000 SF of retail. Phase II will include 350 luxury residences and 35,000 SF of retail.
Cassidy & Pinkard Colliers’ Spencer Stouffer will spearhead the marketing and leasing effort for Braddock Place in Old Town. Last month, the four-building, 348,218 SF, class A office complex sold to MGP Real Estate. The 348,218 SF complex is 96% leased to government services groups, associations and the federal government.