Columbia Square Put on Market, Aiming at DC’s Priciest Office Trade

MEAG, the asset-management arm of German multinational insurance giant Munich Re Group, is listing for sale Columbia Square, a venerable 600K trophy office building a short walk from the White House at 555 13th Street NW.

MEAG has given the listing to Cushman & Wakefield. The building has been valued at close to $500M, which at $833 per SF would result in a buyer’s annual yield of 5.5%, according to a Green Street report.

If Columbia Square hits the target, it will become the priciest full-stake office deal in DC since 2020.

Columbia Square is 92% occupied, with a weighted average remaining lease term of more than 10 years. According to the listing, the property will generate $300M in contractual rent over the next 11 years.

The 13-story building stretches a full block between 12th and 13th Streets adjacent to Warner Theater. The property is two blocks east of the White House and a block from the Metro Center station.

The law firm Hogan Lovells anchors the building, with a lease for 80% of the office space that runs until 2033. Hogan Lovells, DC’s second-largest law firm, has been a tenant at Columbia Square since the building opened in 1987.

About $17M in renovations have been made to Columbia Square in the past five years, including the addition of a new fitness center, a 13-story atrium lobby with a concierge and a rooftop deck with conference space.

Developed and managed by Houston-based Hines—who also has offices in the building—and designed by architects Pei Cobb Freed & Partners, Columbia Square has been marketed as a pioneer of DC trophy office buildings.

Older office buildings in Washington’s central business district emptied out during the pandemic, but DC has been the third-most active market for office sales so far this year, with $3.6B of offices valued at $25M or more trading in the DC metro during H1 2022, according to Green Street data.

The largest full-stake office deal took place in March 2020, when a joint venture of Hana Financial and Nuveen Real Estate bought a 533K SF building at 601 D Street NW for $399 from Tishman Speyer. JLL represented the seller.

The largest overall deal, including partial stakes, since 2020 has been the purchase by a consortium of South Korean investors for $480M a 49% interest in Midtown Center, an 869K SF building at 1100 15th Street NW.