Prudential pays $318m, assumes debt on DC offices

Prudential Real Estate Investors (PREI) has acquired a 10-story office property in the East End of Washington, DC, for a reported $318m, assuming with it a $117m loan originated by TIAA-CREF.

Prudential Real Estate Investors (PREI) has acquired a 10-story office property in the East End of Washington, DC, for a reported $318m, assuming with it a $117m loan originated by TIAA-CREF.

The property at 500 8th Street, acquired on behalf of institutional investors, is a Class A, 325,360 sq ft office building with an additional 18,660 sq ft of retail and a three-level parking garage.

Screenshot 2015-09-22 at 3.17.26 PMTIAA-CREF originated a $130m construction loan to Boston Properties for the development of the building in December of 2005, several months after the developer and its partners purchased the site.

The property was refinanced with a 10-year, $117m loan in November 2007, which carries a 5.7% fixed rate and is due to mature in November of 2017, according to data from research firm Real Capital Analytics. A Prudential spokesperson did not respond to requests for additional comment.  

Developed in 2007, the property is in close proximity to the White House, the US Capitol and the National Mall, and within two blocks of all six major metro lines. It features a 10-story glass atrium, two marble/granite lobbies and two rooftop terraces.

“With an improving employment outlook and the expectation that tenants’ flight to quality and amenities will continue to drive long-term demand for premier office product in the East End, 500 8th Street is well-positioned to generate strong and stable cash flows for our investors,” said Kevin mith, head of Americas for PREI.

Boston Properties owns half of the entity that owns the building, according to local reports on the sale, and DLA Piper, its anchor tenant since then, takes up nearly 75 percent of the building and is locked into a lease through 2022.

Prudential Real Estate Investors is the real estate investment management and advisory business of Prudential Financial and operates as Pramerica Real Estate Investors in markets outside the Americas, Korea and Japan.

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