Rock Creek Property Group Acquires 1438 U Street, NW
Posted January 4, 2011
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Creek Property Group has acquired 1438 U Street, NW, a two-story building in the 14th and U Street corridor of Washington, DC, for $2.75 million, or $229 per square foot. A full building renovation is planned.
Originally built for the United States Post Office in the early 1900's, the property measures 12,000 square feet with a total mixed use development potential of approximately 25,000 square feet. The disposition strategy for Rock Creek is to redevelop the building into retail, office or mixed-use tenancy with all space being available for either lease or purchase.
"This deal was like planes, trains and automobiles. It was a long road with a little bit of everything along the way," said Rock Creek's Gary Schlager, a fund principal. "We've been working on this acquisition for almost a year and had to manage a foreclosure, auction, contract assignment, tenant eviction, real estate tax liens, an out of town bank and everything in between."
Rock Creek will pitch 1438 U Street to retailers, non-profit organizations and boutique law firms or other local service providers looking for a landmark headquarters location they can lease or own 1.5 blocks from the U Street-Cardozo Metro station. The site is also in a retail market near several hundred planned condo residences. Building features include an abundant window lines and 15 foot ceiling heights.
Rock Creek utilized its opportunity fund, Rock Creek Fund I Investors, LLC for all equity associated with the acquisition. 1438 U Street is Rock Creek Property Group's second acquisition within their investment fund. The fund completed its first purchase in 2009, the 32,000 square foot Pear Tree Village Center on Route 1 in Alexandria, VA.
"Most available spaces in this submarket are located either in small buildings amounting to less than 2,000 square feet or in planned developments delivering several years from now," added Schlager.
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