There's been much debate about what to do with Washington, D.C.'s abundance of unoccupied office space. The owners of 2100 M St. NW faced a particular challenge: Their 301,347-square-foot, eight-story building was completely vacant.
So they let the market decide how it should be filled.
The answer came from a real estate development company known as Post Brothers, which won a competitive process and agreed to pay nearly $66.8 million to convert the office building into residential space.
That the sellers — a venture between Meadow Partners and Network Realty — got the deal over the finish line at a time when interest rates surged and conversions remain complex helped earn the transaction a CoStar Impact Award for sale of the year, as judged by real estate professionals familiar with the market.
"In the midst of an extremely challenging year to close on any real estate deal given the financial markets, this deal validated the potential value and promise of converting an iconic D.C. corner from office to residential use," wrote Mara Olguin, an Impact Award judge and chief marketing officer for Dweck Properties. "This was especially tricky at a time when valuations and underwriting for any product was difficult, much less a large-scale conversion. This deal will help set the bar for other D.C. conversions to come."
About the Property: For 50 years the building housed the headquarters of the Urban Institute, a nonprofit organization that provides economic and social policy research for governments and corporations.
What the Judges Said: "The marketing team overcame significant marketing and closing challenges and was able to successfully navigate a sale of an office to multi-family conversion in a difficult capital market's environment," wrote Caulley Deringer, one of the Impact Award judges and an executive vice president for Transwestern. "Further, it will have significant positive influence on Washington, D.C.'s needs for this type of residency."
They Made It Happen: Executive managing directors James Cassidy and Jud Ryan, along with Vice President Grant Marley, were the listing brokers for Newmark.
Senior market manager Nina Thilert contributed.