Brookfield Financial Inks $235M Deal for 540,000-SF TSA HQ

ARLINGTON, VA-Brookfield Properties Corp. affiliate Brookfield Financial Properties LP has signed a definitive agreement to purchase a 540,000-sf office complex here for $235.4 million. The two-building site is currently the headquarters of the Transportation Security Administration. Orlando-based Commercial Net Lease Realty Properties LP was the seller. The deal includes New York City-headquartered Brookfield’s assumption of an existing $95-million debt on the property. Located in the Pentagon City submarket, the TSA buildings are located at 601 and 701 S. 12th St., and sit within close proximity to the Pentagon and Washington Reagan National Airport. The towers were developed in 1983 and 1982, respectively, and underwent a multimillion upgrade under Commercial Net Lease’s ownership. TSA’s lease of the entire property is not scheduled to expire until 2014.

Commercial Net Lease acquired the site, which includes a two-story parking facility, in 2003 for approximately $143 million. “The sale of these office buildings will enable us to harvest the value that has been created,” company president and CEO Craig Macnab says, “and the reinvestment of the proceeds into a well-diversified portfolio of retail properties is consistent with our long-term strategy.”