A partnership led by an affiliate of New York real estate giant Related Cos. has acquired an office building on Georgetown's waterfront with plans for a residential conversion.
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Related Fund Management and Arlington, Virginia-based Network Realty Partners acquired The Flour Mill, a 124K SF building at 1000 Potomac St. NW. The property sold for $16.5M, according to documents posted Tuesday to the D.C. Recorder of Deeds.
The buyers secured a $13.9M loan from RSHP Funding LLC, deed records show. The seller, Equus Capital Partners, was represented by Cushman & Wakefield.
Related, NRP and Equus didn't respond to requests for comment.
Cushman & Wakefield Managing Director Shaun Weinberg, in a post announcing the deal on LinkedIn Tuesday, said that of the 6M SF of office-to-residential conversions that the firm's D.C. capital markets team has brokered over the last decade, this one “takes the cake as the most complex, yet smoothest close.”
“It has potential to be one of the highest-end properties in the city once reimagined,” Weinberg told Bisnow.
“They’re going to go through the development process, which is involved in Georgetown, from ANC to historic preservation to Old Georgetown Board, "he added.
The development in its current form dates back to 1980, when Weissburg Development Corp. integrated two flour mill buildings, one built in the 1840s and another from the 1920s, into a new office building.
A 1980s-era 57-unit condo building, also called Flour Mill, sits next door to the property.
Related has a real estate portfolio valued at $60B, but its D.C. portfolio is relatively small. The company partnered with Ruben Cos. to build a pair of adjacent apartment buildings totaling around 700 units in Capitol Riverfront, with the second phase delivering in 2020. Its website doesn't list any other D.C. properties.
Network Realty Partners was founded in 2017 by former JBG Cos. executive Rod Lawrence and former Avison Young principal Bill Morris. The company has five properties listed on its website, including a conversion project of a pair of office buildings near Union Station it acquired in 2019 into a hotel.
UPDATE, OCT. 1, 4:45 P.M. ET: This article has been updated to reflect that Related's asset management arm, Related Fund Management, acquired the building. It has also been changed to reflect the full history of the building.
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