The property has a classic red-brick facade and 45,000-sf floorplates. It is currently 82% leased to investment grade tenants--a good ratio for both Montgomery County and the Rockville submarket, observes Tonya Ginter, director of research and marketing for GVA Advantis. "Montgomery County's vacancy rate is 9.8%, which is still below equilibrium, or 10%," she tells GlobeSt.com. The Rockville submarket is doing even better, with an 8.7% vacancy rate.
The building's vacancy rate--both current and future--will be one avenue by which the new buyer expects to add value to its acquisition, Cassidy & Pinkard Colliers' Paul Collins tells GlobeSt.com. Next year, the lease will expire for the building's largest tenant, Thomson Information Services, which occupies half of the space. "The rent they are paying is currently below market price," he says. The building's asking rate is $29 per sf to $30 per sf, Collins adds.
The new buyer is also considering developing a bank pad site on the parking lot, which Collins says is now underutilized. Constructed in 1998, Research Plaza is in the I-270 Corridor.
Investment sales in this area have been slower than expected over the last six months, Ginter says. The closest comparable to the Research Plaza trade was 401 N Washington St., which sold in November for $282.20 per sf or $70 million, she says. It was a roughly 248,000-sf building built in 1972 and subsequently renovated.
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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.
