Situated in the Golden Triangle area of the city's Central Business District, 1801 K was developed in 1971 and rises up 12 stories toward the sky. The building could be considered a class B+ property because of its age and the fact that 200,000 sf of space will be up for expiration in the next four years, but its stellar location and the presently sizzling market helped allow it to command the approximately $320 per sf in the transaction.

"The price is reflective of the demand for office buildings downtown," Advantis Real Estate Services Co. director of research David J. Masters tells GlobeSt.com. According to Advantis's September 2003 update of its DC Office Market Monthly Survey, office space in Washington, DC's CBD is currently at a low 5.9%, with only about 530,000 sf scheduled to deliver in the area for the entire year. At the time of the deal, 1801 K was 92% leased to 28 tenants including law firm Robins, Kaplan, Miller & Ciresi, Potomac Capital Investment Corp, and real estate services company Cushman & Wakefield, which leased 17,000 sf in the building in 1998.

"Given the building's strong tenant roster, and the attractive rates in-place when we purchased it, the asset will produce good current cash flow," explains Starwood Capital Group senior managing director Rick Kleeman. "Additionally, we believe that the District will remain a healthy market over the next several years, and 1801 K Street is well-positioned to attract new tenants as existing leases in the building roll over." The structure has always been a hot item on the market; it brought in $140 million when a joint venture involving Apollo Real Estate Advisors and Louis Dreyfus Property Group sold it to TIAA-CREF in 2000, making it one of the top sales in the district for the year.