StonebridgeCarras and Walton Street Capital have sold part of their seven-acre Constitution Square redevelopment project to US insurance firm, Northwestern Mutual.
The two firms said in a statement they had sold the 589,000-square-foot office building at Two Constitution Square for $305 million. The entire property is leased to the US’ Department of Justice.
The office is part of a 2.5 million-square-foot redevelopment of Constitution Square by Bethesda, Maryland-based StonebridgeCarras and Walton Street. StonebridgeCarras and Chicago-based Walton Street acquired the site in 2006 and began the first phase of construction in 2008.
The government agency, the General Services Administration, recently agreed to lease the entire 329,000-square-feet of space at neighbouring One Constitution Square for five years from 2011, while its headquarters undergoes modernisation.
Constitution Square was the first major mixed-use project to break ground in Washington DC’s North of Massachusetts Avenue (NoMA) area, and – in addition to the office properties at One and Two Constitution Square – includes a residential building with 440 apartments, a 50,000 square foot grocery store, a 204-room hotel and 30,000-square-feet of street-level retail.
Matt Ascher, Northwestern Mutual Investment Management Company director, said the firm closed the deal owing to the “location, building and the long-term lease with the [Department of Justice]”.
StonebridgeCarras and Walton Street were represented in the transaction by Cassidy Turley and Northwestern Mutual was represented by Cambridge Property Group.
Washington DC is one of a handful of real estate markets being targeted by core investors, not least owing to its growth as the centre of US government. Earlier this year, real estate services firm DTZ said Washington DC was the third most expensive city in the world, judged by average annual rents, behind London and Tokyo. All three cities were expected to retain their standing through to 2013.