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  • Posted May 6, 2019

WashREIT Closes First Tranche of $461M Multifamily Deal

The trust paid $379.1 million to acquire five communities totaling 1,685 units in Northern Virginia, as part of a larger portfolio acquisition that will be funded through the sale of office and retail assets.

NYSE-listed Washington Real Estate Investment Trust (WashREIT) has now closed on its $379.1 million acquisition of a portfolio of five multifamily assets in Northern Virginia, totaling 1,685 units. The suburban properties represent the first tranche of a larger $461 million, 2,113-unit multifamily portfolio acquisition that the REIT has dubbed “Assembly.”

The second tranche of the value-add transaction will consist of two apartment communities totaling 428 units in Montgomery County, Md. WashREIT, which announced the signing of the portfolio deal in early April, said it plans to fund both tranches of the acquisition through the sale of select office and retail assets.

The seller was not disclosed, but Yardi Matrix data indicates that the previous owner of the five Northern Virginia assets was Pantzer Properties, which picked up the communities from Bainbridge Companies in a portfolio deal in March 2011.

The five properties include:

  • The Point at Alexandria: 205 Century Place, Alexandria (532 units)
  • The Point at Dulles: 13690 Legacy Circle, Herndon (328 units)
  • The Point at McNair Farms: 2511 Farmcrest Drive, Herndon (283 units)
  • The Point at Bull Run: 10519 Lariat Lane, Manassas (408 units)
  • The Point at Leesburg: 86 Heritage Way, N.E., Leesburg (134 units)

All the communities were built between 1986 and 1990, except for The Point at Dulles, which was completed in 2000. Each of the properties is more 94 percent occupied, and four of the five properties are more than 96 percent occupied, according to Yardi Matrix data.

REIT RAMPS UP MULTIFAMILY HOLDINGS

WashREIT owns more than 6.1 million square feet of commercial space and 5,953 multifamily apartment units across 53 properties. The entire Assembly deal boosts its multifamily unit count by 50 percent, as the real estate investment trust bets on the rise of suburban renting.

“We are expanding our multifamily portfolio to serve the fast-growing cohort of renters—aging millennials—who can’t afford home ownership or urban infill rents and are drawn to well-located, Class B suburban multifamily with its larger living spaces and excellent community services,” commented Paul McDermott, WashREIT president and CEO in a prepared statement upon the initial signing of the deal.

In January of last year, WashREIT agreed to purchase Arlington Tower, a 398,000-square-foot Class A office building in the Rosslyn submarket of Arlington, Va., from Tishman Speyer for around $250 million. The REIT also sold 2445 M St. NW, a 290,000-square-foot office property in Washington, D.C., to Beacon Capital Partners for $101.6 million in June, according to Yardi Matrix.

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