Now that plans to merge with New York REIT—creating an $8.4B publicly traded REIT—have fallen through, The JBG Cos will continue its selling spree.
It’s no longer about going public for the Washington-based developer and landlord, JBG managing principal Matt Kelly (pictured) told Bisnow last week. The firm was already putting assets on the market prior to its announced merger, and now it aims to sell at least a dozen properties, raising as much as $500M in equity within the next year. Here’s what JBG has sold within the past 18 months.
Westin Arlington Gateway Hotel
This 338-room hotel sold for $97.3M—or $288k per room— to a JV between Rockpoint Group and Highgate Holdings. The sale of the hotel in ths Ballston neighborhood of Arlington, VA, at 801 North Glebe Road was revealed in July, as the firm was looking to unload assets prior to the proposed merger. The decade-old hotel has recently undergone a major renovation, including adding a ground-floor Starbucks.
North Bethesda Place I and II
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These two offices, totaling 345k SF, sold to international powerhouse Hines for $54.6M at the beginning of the year, before the merger broke.
The two buildings—North Bethesda Place I and II—are at 5515 Security Lane and 11400 Rockville Pike, both in Montgomery County, north of the posh neighborhoods of Bethesda and Chevy Chase. When sold, the two had a combined occupancy rate of 49%, which Hines plans to improve with major renovations.
The upgrades will include a fitness facility and conference center; that's in addition to the renovations JBG just finished in 2015 on the lobby. Office buildings in this part of the DC suburbs have struggled with vacancy since the recession.
Reston International Center
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Last February, the firm sold the 15-story Reston International Center, an office building at the height of JBG's mixed-use development Reston Heights, in Reston, VA.
The 179k SF building sold for $35M to a JV between American Real Estate Partners and NY-based Square Mile Capital Management. JBG had purchased the office building in 2006 for $79.2M. The private developer/investor has a reputation for timing the market perfectly, but nobody's perfect.
The Shay Apartments
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JBG delivered these two apartment buildings along Florida Avenue in what it has tried to rebrand as North End Shaw off the hip U Street neighborhood in DC last October. Just days before it opened, JBG sold the residential portions of both buildings to prominent DC landlord Ralph Dweck for $123M, or roughly $484k per unit.
JBG still owns the retail, which it has leased to a who's who of Millennial-focused brands, like Warby Parker, Kit & Ace and others.
1025 Thomas Jefferson Office Building
JBG has had its Jefferson Court building in Georgetown—a neighborhood in DC—up for sale for some time now.
Built in 1984, the office building has 317k SF of leaseable space, and JBG picked it up about four years ago from Japanese investment firm N.S.P. Ventures for about $80.5M. The firm has since renovated the property for $5.2M, increasing its occupancy rate from 65% to 95%.
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