(For more retail coverage, click GlobeSt.com/RETAIL.)
WOODLAWN, MD—A portfolio of disparate assets including retail, office, and flex space has traded here for $77 million. Called Meadows Business Park, the 21 buildings are located off of Security Boulevard. Because of the portfolio's unusual make-up, two buyers with dissimilar investment criteria, Virginia-based Atlantic Realty Co. and an affiliate of Boston-based Colony Realty Partners, came together to acquire it from Emmes Realty Services.
"That was one of the challenges we had - identifying a buyer that was willing to take on that product mix," Chris Kubler of NAI KLNB's Columbia, MD office tells GlobeSt.com. But because their investment goals were different "they were able to rationalize the higher purchase price because they each assigned higher value to parts of the portfolio that they liked best."
Kubler, along with Jim Caronna and Tom Maddux in the firm's Towson, MD office and Kevin Barrett in its Northern Virginia division represented Emmes Realty, while the two purchasing companies – Virginia-based Atlantic Realty Co. and an affiliate of Boston were self-represented.
The 977,000-sf portfolio was difficult to value. Many of the assets were originally industrial buildings that have been converted to retail, office and flex over the last several years. In the aggregate, the portfolio is 85% leased, but the buildings' vacancy rates diverge widely on a asset-by-asset basis. Some buildings are stable, fully leased to government agencies, Kubler says. Others are completely vacant with deferred maintenance needed. He does not know how much the buyers will be investing for repositioning. "Probably there will be a few one-off strategic sales. They will be looking at these buildings one at a time to make a decision."
According to NAI KLNB, this portfolio, which dates back to the early 1960s and 1970s is among the oldest in this sub-market. The firm also said that the sale was one of the largest dispositions locally in the past several years.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
