Year in Review: DC’s Top Office Leases of 2021
If there’s any doubt that the federal government is the driving force behind the Washington, D.C., office market, this past year made that point crystal clear.
The government was responsible for seven of the top 10 leases in 2021, though they were mostly renewals. In addition, eight of the top 10 were in the District, rather than the suburbs.
Katie Yanushonis, a senior vice president at The Meridian Group, called the activity in 2021 “polarizing.”
“Although overall leasing activity was still below historical averages, there were still plenty of leases signed,” she told Commercial Observer. “But there was a strong distinction between the haves and have nots — the buildings that are highly amenitized, well located and can provide an environment that employees want to come back to, are the ones that have been and will continue to be very successful.”
Here is a look at the top 10 leases signed in 2021 according to multiple brokers.
1. Securities and Exchange Commission: 1.2 million square feet
This year’s largest lease — which more than doubled the next highest on the list, was the Securities and Exchange Commission’s 1.2 million-square-foot deal at the upcoming 60 New York Avenue, NE. The SEC signed for 15 years and has an option to extend an additional 10 years. It will accommodate more than 4,500 employees and serve as the agency’s new headquarters.
The development, which is slated to break ground in June, is owned by a joint venture between Douglas Development and Midtown Equities. Norman Jemal, the managing principal for Douglas Development, noted the lease was the catalyst for the long-planned development getting to its next stage.
Brian Sullivan at JLL (JLL) represented the landlords in the deal, while the tenant was represented by Todd Valentine, David Lipson and Neil Levy at Savills and Kevin Terry at GSA.
2. D.C. Department of Consumer and Regulatory Affairs and Office of Tax & Revenue: 543,798 square feet
The D.C. government renewed its 543,798 square feet at 1100 and 1101 4th Street, SW, to continue to house the Department of Consumer and Regulatory Affairs and Office of Tax & Revenue.
It’s believed that the lease is a short one, as the Department of Consumer and Regulatory Affairs has gone on record noting it would move to a new office development in East of the River on the planned Parcel 7 of the St. Elizabeths East development.
USAA Real Estate is the owner of the pair of Waterfront Station buildings.
3. Raytheon: 517,866 square feet
Raytheon, a defense contractor, renewed and expanded its space with a 517,866-square-foot lease at a trio of buildings located at 22110-22260 Pacific Boulevard in Sterling, Va. The deal marks the largest in the D.C. suburbs, and one of only two suburban deals to make it into the top 10.
Beacon Capital Partners owns the property, which Raytheon has called home since 2010.
JLL served as the sole broker on the deal.
4. Federal Emergency Management Agency: 301,384 square feet
The Federal Emergency Management Agency (FEMA) comes in at No. 4 on the year, with a 301,384-square-foot lease extension at Federal Center Plaza.
The two-block office complex, located at 500 C Street SW, is owned by Donohoe Cos. The development was built for FEMA in 1981, and though there were rumors of the agency going elsewhere, it appears it will stay at its longtime home for at least another decade.
5. The Department of Veterans Affairs: 241,398 square feet
The Department of Veterans Affairs inked a 241,398-square-foot renewal at 425 Eye Street, NW with Saban Capital Group.
6. The Department of Veterans Affairs: The Department of Veterans Affairs comes in at No. 6, with a 217,000-square-foot renewal at 1800 G Street, NW with landlord Blake Real Estate.
7. Kaiser Permanente: 206,875 square feet
Kaiser Permanente renewed 206,875 square feet at 700 Second Street, NE with Property Group Partners.
8. D.C. Department of Health: 205,860 square feet
D.C. Department of Health renewed 205,860 square feet at 899 North Capitol Street, NE with Network Realty Partners.
9. U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response
The U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response signed a new 186,198-square-foot lease at 400 Seventh Street, NE with MetLife.
10. Microsoft: 181,174 square feet
Microsoft signed a 181,174-square-foot lease at 1300 Wilson Boulevard in Arlington, Va., with Tishman Speyer.
Known as Commonwealth Tower, the 15-story building in the Rossyln neighborhood, was fully renovated in 1996 and features unique symmetrical floor plates that allow for eight corner offices per floor.
Keith Loria can be reached at Kloria@commercialobserver.com.