The Most Active Block in DC Is...
A few years ago, the office properties on the 2000 block of M Street NW didn’t look like much. But four of the six buildings on the block have been sold since March, one has been renovated and the sixth is being built right now.
At the corner of M and 20th streets, Brookfield Office Properties is less than a year away from delivering 2001 M St, a 285k SF trophy office property, built on spec with Bracewell & Giuliani pre-leased for 50k SF. Brookfield SVP of leasing David Bevirt tells Bisnow his new building, which delivers next spring, will have world-class restaurant space and is positioned well for when leasing is expected to pick up in 2016, 2017 and 2018. David says Brookfield saw the opportunity to build an entirely new building when KPMG, which occupied all of the old structure, left in 2011. They waited patiently for the right time, and will be ready to deliver before several other redevelopments in the area come on line, he says.
Down the street, Tishman Speyer just purchased 2020 and 2030 M St to build a new CBS DC bureau and a separate office building. CBS’ new building will be ready in late 2017, Tishman confirmed to Bisnow, and the second building will be ready in 2019. We covered this in more detail yesterday. 2000 M St just underwent a $3.5M reposition by its owner, Washington REIT, and signed Bose, McKinney & Evans to anchor the project. The St. Gregory Hotel at 2033 M sold for $57M last month and its next-door neighbor, 2025 M St, sold in March for $106M, or about $557/SF.
The block is hot, and for good reason. It’s near the edge of the CBD, but just two blocks away from Dupont Circle, perhaps the No. 1 Millennial gathering place in the city. “Dupont Circle is really en vogue,” David says. “It’s a happening place to be.” A block up, at 19th and N, JBG is planning to build a brand-new, 130-foot-tall office building to replace the Class-B building it bought in 2012 for $110M. In the other direction, at 2000 L St NW, Rockrose bought the 401k SF office building for $192M in 2013, purchased an additional 182k SF of gross floor area in a transfer of development rights (which allows developers to shift density from one place to another), and it's dreaming up plans for what could be a large, expensive project down the road.
With so many deals and projects in the works, this little stretch of road in the CBD is the most active in the DC office market right now. With the new, state-of-the-art CBS building potentially opening in two years, it has a chance to redefine itself as a media hub, Washington DC Economic Partnership president and CEO Keith Sellars tells us. “We have been very excited about the area” since Tishman and CBS started negotiations, he says. They’re far from alone.