Carr Properties Offloads Downtown D.C. Office Building For $84M
Carr Properties has shed another D.C. office building amid its portfolio reshuffling.
The major local landlord has sold 901 K St. NW to Shorenstein for $84.3M, according to documents filed with the D.C. Recorder of Deeds on Monday.
Carr developed the 219K SF building near the convention center in 2009 and renovated it in 2021. Its tenants include Baker Donelson, Seward & Kissel, Unite Here Local 25 and Microsoft.
“Carr Properties is pleased to have completed the transaction of 901 K Street with Shorenstein,” a Carr spokesperson said in an emailed statement to Bisnow. “We are also honored to have been retained to provide property management services and the opportunity to uphold our signature Carr Experience, prioritizing best-in-class hospitality and service for our customers.”
Shorenstein declined to comment on the deal.
The buyer secured a $74.3M loan from two AllianceBernstein debt funds, $53M of which was used for the office building acquisition, deed records show.
The sale pencils out to $385 per SF, above the city’s average office pricing over the last 12 months of $266 per SF, according to Newmark.
901 K is Shorenstein’s first D.C. acquisition since 2007, according to its website, and it is the only property it currently owns in the city.
The San Francisco-based company's property page indicates it purchased and subsequently sold five D.C. office properties through various funds, including Hamilton Square near the White House, the Commonwealth building at 1625 K St. NW and the huge Washington Harbour complex in Georgetown.
901 K St. NW is already on Shorenstein's property page, which says the asset is in its Fund Fourteen portfolio.
The property is the third D.C.-area office property Carr has offloaded over the past few months. In late April it transferred its interest in 1152 15th St. NW, a 394K SF office building next to Midtown Center, and in early May it sold a 228K SF Bethesda office building for $35M.
Carr’s portfolio shake-up is part of a larger shift in its ownership structure that is underway.
Bisnow first reported last month that one of Carr's major investors, a fund managed by J.P. Morgan Asset Management, signed a memorandum of understanding to exit its 35.5% stake in the company. In exchange for its share, the J.P. Morgan fund is set to take over three of Carr’s properties debt-free.
The pending deal was revealed in March investor documents from Israeli public company Alony Hetz, which owns a 47.8% stake in Carr. Alony’s latest investor documents, which it filed with the Tel Aviv Stock Exchange in late May, indicate that the deal is still pending.
The latest documents say Carr had engaged in the sale of two properties for a combined $120M. That total matches the price of Carr's combined Bethesda and 901 K St. sales. Carr is in the process of recapitalizing three more properties, according to the Alony filings.
Last month, the company and its partner, National Real Estate Advisors, refinanced the debt on their 1.1M SF One Congress office building in Boston for $650M.
