ACORE Lends $182M to Refinance Republic’s DC Office
ACORE Capital has provided a $181.5 million refinancing of Republic Properties’ Portals III, a 510,157-square-foot, Class A office building in Washington, D.C., according to JLL, who facilitated the financing.
The debt will be used to refinance the existing loan, lease-up available space and fund capital improvements.
Located at 1201 Maryland Avenue SW, the 10-story property is part of the $1 billion-plus mixed-use Portals development in D.C.’s Southwest submarket. The project was originally started by Republic more than 10 years ago, with Samsung SRA making a $95 million equity investment in the office building back in 2014.
“For us, there was a sponsorship who was deeply well-pocketed and had the right economic incentives to see this project through to fruition,” Warren de Haan, a managing partner at ACORE, told Commercial Observer. “When you look at our basis, not only is the equity basis reset through Samsung, but the debt basis is reset by us, too. We think with the reset basis here, it’s a tremendous opportunity with the depth of Samsung’s balance sheet.”
When finished, the project will consist of more than 1.5 million square feet of office space, 370-plus residential units, a 400-room Mandarin Oriental hotel and a number of retail amenities.
The property is adjacent to the 24-acre District Wharf and close to two Metrorail stations featuring five of the six Metrorail lines. Amenities at Portals III include a fitness center, conference center and panoramic views of the Potomac River, Tidal Basin, Jefferson Memorial and Washington Monument.
“We have closed about $600 million of deals in D.C., and it’s an important part of ACORE’s strategy to grow our branding and do more transactions there,” de Haan said. “D.C. has a very deep bench of sophisticated borrowers who either own real estate in the market or are from the market.”
Additionally, he noted that there is a lot of high-quality institutional real estate stock in the area, which translates into a lot of financing opportunities.
JLL’s Capital Markets team was led by Andrew Weir, Cary Abod, Rob Carey, Drake Greer and Jay Graham.