- The Washington Times - Thursday, September 25, 2003

An early look at third-quarter office market statistics shows that the commercial real estate industry is continuing to improve around the Washington area.

Advantis Real Estate Services Co. said this week that nearly 1.5 million square feet of office space has been filled in the District since June, compared with a mere 270,000 square feet during the first six months of the year.

Office-vacancy rates fell 0.5 percent in the District and 0.8 percent in Northern Virginia, and more tenants are pre-leasing office space that is under construction.

Rental rates, which are among the highest in the nation, were stable during the quarter, which ends Tuesday. The average landlord in the metropolitan area is asking $29 per square foot per year, the D.C. company said.

What’s more, the office sales market is still red hot, particularly in the District. Already this year, 77 buildings have been sold, and analysts expect sales to meet last year’s total of 102.

But things aren’t perfect everywhere. The office market is still slow in suburban Maryland, where the vacancy rate increased from 13.3 percent to 13.8 percent during the quarter.

In Northern Virginia, rental rates have failed to increase after hitting five-year lows earlier this year. In addition, the average sale price for office buildings in Northern Virginia has declined from $40.9 million last year to about $31 million so far this year.

Akridge markets big office park

Akridge Real Estate Services partnered with the American Red Cross to market three buildings in Merrifield as a single office park.

The D.C. company said it will try to attract tenants to Dominion One, a 210,000-square-foot office building, and Dominion Two, a planned, identical building.

In addition, it will market the national headquarters of the Red Cross, which is expected to be vacant by next year. Together, the buildings will total 670,000 square feet. The Red Cross has begun moving to the District.

Akridge, which owns the properties with Deustche Bank subsidiary RREEF Funds, said it hopes to attract a large tenant that does not want to spend the time and money on the planning and construction of a new complex. With both properties available by next year, a company looking for more than 400,000 square feet can be accommodated and will have room to expand once Dominion Two is completed. CB Richard Ellis is handling the leasing.

The office park, in the Jefferson Park community, is less than a mile from the Dunn Loring Metro Station, as well as a 159-room Marriott Hotel, restaurants and retail outlets.

In other news

• Phillips Realty Capital of Bethesda arranged $27 million in permanent financing for Clark Enterprises’ new luxury apartment building at 3883 Connecticut Ave. NW.

• The Army selected three companies to build new housing for military families at Fort Detrick in Frederick, Md. GMH Military Housing of Philadelphia, Benham Constructors of Oklahoma City and Centex Construction of Dallas will build, operate and maintain the complex. Construction is expected to begin in the summer.

Property Lines appears Fridays. Tim Lemke can be reached at [email protected] or 202/636-4836.

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