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Equity Residential Sells Northwest D.C. Building For $65.5M

The Calvert Woodley apartments in Northwest D.C.

Equity Residential sold a Northwest D.C. apartment building this week that has a long history of being involved in some of the biggest multifamily portfolio sales in the region.

An affiliate of Akelius purchased the Calvert Woodley apartments from a limited partnership owned by Equity Residential for $65.5M, property records show. 

The property, located at 2601 Woodley Place NW, contains 136 units, according to records filed with the Securities and Exchange Commission by Equity Residential in 2013. Equity also said the property was constructed in 1962, though some reports peg the construction of the longtime Charles E. Smith-owned property in the 1940s. 

Akelius and Equity Residential didn't respond to requests for comment.

The multifamily property, located on the western side of the Duke Ellington Memorial Bridge near the Woodley Park-Zoo/Adams Morgan Metro station, sits within the Woodley Park Historic District, though it's considered a noncontributing building.

The property has changed hands as part of a larger portfolio several times. Charles E. Smith Cos., one of the largest D.C. office and multifamily developers of the 20th century, merged with rival Archstone Communities Trust in a $3.5B deal in 2001, creating the second-largest real estate investment trust in the country at the time, The Washington Post reported. The REIT owned 274 apartment communities, including the Calvert Woodley apartments.

Archstone, in turn, was acquired by Tishman Speyer and Lehman Brothers in October 2007 in a $22.2B deal.

Finally, an apartment portfolio that included the Calvert Woodley apartments was acquired by Equity Residential as part of a $9B deal that closed in February 2013. Equity Residential bought 60% of the Archstone portfolio in the deal, with AvalonBay Communities acquiring 40%.

That deal netted Equity Residential 25 properties in the D.C. area totaling 7,922 units, the publicly traded company announced at the time.

When the deal closed, the Calvert Woodley's average rental rate was $2,854, slightly above the average rate for the entire portfolio, according to SEC filings.

In the nearly a decade since, Equity Residential has been caught up in legal battles with tenants in some of its legacy buildings.

At 3003 Van Ness, another former Archstone property acquired by Equity Residential, tenants in May earned a $2M settlement following a lawsuit from Attorney General Karl Racine alleging the property manager engaged in illegal rent hikes through its lease renewal process.

The buyer in the Calvert Woodley deal, Akelius, sold a significant portion of its European holdings last year to fund a U.S. expansion. That has included Northern Virginia's Dwell Vienna Metro apartments, which the Swedish firm acquired from Brookfield for $106M in December.

Matt Serenius, who leads Akelius' D.C. office, told Bisnow following that deal that the firm had an "expansion mindset." Other acquisitions in the last two years include the Rittenhouse Apartments in Brightwood and the Fairway Apartments in Reston.