Washington DC Metro Medical Office Building
Owner is motivated to sell.
The Medical Office Building is priced at $12,000,000.
Annual increases in rent from 5.00% to 8.00%.
Approx. 40,000 rentable SF.
This property underwent extensive renovation in 2007-2017 including full renovation of common areas and significant upgrades to HVAC, new parking lot, and security integration.
The elevators are undergoing a complete rebuild over the next two months along with the last cosmetic improvements including a new 20’ stainless steal pylon and new kiosk.
All structural elements, systems, and capital improvements on a ten year plus life.
The property was refinanced within the past two years so the appraisal, environmental report, property condition report, and ALTA should only need updates.
The property is 100% leased however one suite tenant has expanded into the neighboring suite and will absorb the existing tenant into their full term lease.
The owner also have a newly signed three year extension with a doctor tenant 200.
Another tenant will be signing a three year extension shortly as a continuation of their existing lease terms. These leases are not reflected on the ARGUS.
Both are not reflected on the ARGUS.
The way the leases were set up is that for new tenants or existing expansion on ten year leases the lease rate on the first two to three years is below market. However they escalations are 5% to 8% per year through the ten year lease terms. As a result the property is not being sold on an existing cap rate basis but on its IRR. Two to three years of IO on the acquisition loan should provide appropriate cash flow.
Also included is a neighboring parcel with site plans, photos and ARGUS priced at $750,000
The land and the building must be purchased together as a package.
The proposed building at this parcel is zoned for 60,000’ of medical office use with one single story parking deck. The FAR can be increased in three ways: (1) by increasing the number of parking decks; (2) by modifying usage to general professional office which allows for a higher parking ratio; (3) by purchasing additional land from the adjacent parcel.
The FAR is based on a cross easement between the two parcels.
Owner believes that the FAR can be increased to above 150,000’ on a maximum use level.
The site will accommodate up to a 25,000 SF slab on grade single story footprint.
The site would be suitable for a credited pad site.
The plans are drawn on the existing zoning and th owner has been working on the design.
$92/sf is for the building with all mechanicals and built out common areas.
The parking deck was not specked pending number of deck levels.
Above a two level deck requires an elevator and fire safety infrastructure so we are taking all configurations including changing the existing parking lot configuration in mind for cost effectiveness.
All utilities are on site as the original plan was for two towers and the second tower infrastructure was in ground.
The owner has not negotiated the price with the local neighborhood commission but has a strong indication that they are willing to negotiate.
A 25,000 SF slab on grade construction will come in significantly less.
The information contained herein contains confidential and/or privileged material. Any review, retransmission, dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the intended recipient will be prohibited. The information contained herein has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about the accuracy or completeness of the information. As a buyer, it is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. The value of this property to you depends on factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs. We have no knowledge of this offering other than the information received from Seller or their representatives. We are neither your agent or an agent for the seller. We will not participate in the negotiation of the purchase price or attend the showing of this property. As a buyer, you will be required to indemnify us and hold us harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this property.