Portals Office Owners Secure $180M Loan For Residential Conversion
The Portals complex in Southwest D.C. will soon have two apartment buildings under construction.
Henderson Park and Lowe obtained a $180M construction loan from Deutsche Bank to convert the Portals I office building at 1250 Maryland Ave. SW to 428 apartments over 53K SF of retail, the developers announced Thursday.
The deal comes just one month after another major Portals deal: Republic Properties closed a $195M construction financing package to build a 356-unit multifamily building on the Portals IV site at 1301 Maryland Ave. SW.
For the Portals I project, the developers received approval from the Commission of Fine Arts in October to add three floors totaling 122K SF to the building. The result will be an 11-story, 658K SF apartment building, and the added stories will have setbacks to create patios on the ninth and 11th floors.
The developers also plan to transform the building's facade to "a more contemporary appearance" and to create floor-to-ceiling windows for the apartments. The building amenities will include a two-level fitness center, a rooftop pool and terrace, a resident lounge and coworking spaces.
Beyer Blinder Belle is the project's architect, KTGY is the interior desginer, Oehme, Van Sweden is the landscape architect, and Balfour Beatty is the general contractor.
"One of the many benefits of converting office buildings to residences is the ability to take advantage of the large existing office floorplates to offer generously sized units and abundant amenities," Lowe Executive Vice President Mark Rivers said in a statement.
The office building, constructed in 1992, sold at a foreclosure auction in 2017 for $84M. The prior owner, an affiliate of Republic Properties, had a $162M loan on the building, but it had fallen to 65% leased at the time of the foreclosure sale.
The entity that acquired it at the auction, special servicer LNR Partners, then sold it to London-based Henderson Park in December 2023 for about $26M. Los Angeles-based Lowe had filed plans earlier that year for the conversion and addition of three stories, and the two companies are now partnering on the project.
Henderson Park also acquired the Mandarin Oriental hotel in the Portals complex at 1330 Maryland Ave. SW in 2022. It then renovated the hotel and rebranded it as the Salamander Washington DC.
The Portals complex sits just steps from waterfront megaproject The Wharf, and it is near a cluster of aging, underutilized federal office buildings that are slated for disposition and have been eyed for a major redevelopment.
