Thor Acquires Rockville Flex Space for $45M, Plans Life Sciences Conversion
Thor Equities has acquired West Gude Labs, a trio of office/flex properties in Rockville, Md., for $45 million, with plans to convert them to life sciences space, according to CBRE, who represented the undisclosed seller in the deal.
Located at 20, 30 and 50 West Gude Drive in the Shady Grove neighborhood of Rockville, the properties total 231,582 square feet.
“The properties in Shady Grove presented a rare opportunity to acquire well-located assets with the potential to renovate and add value,” Jack J. Sitt, Thor Equities’ executive vice president, told Commercial Observer. “The Washington D.C., submarket has performed strongly, and we believe that trend will continue.”
The three properties, situated within Montgomery County’s growing life sciences corridor, are ripe for being converted into first-class lab buildings, according to CBRE.
“Our team worked extensively with the seller over the past year, creatively managing the rent roll to unlock vacancy and provide a clear path to life sciences conversion,” Tommy Cleaver, an executive vice president at CBRE, said in a prepared statement. “There is an insatiable appetite within the investment community for well-located projects of scale that can deliver inventory to this market quickly. Owners that can provide that will be rewarded.”
Combined, the properties feature approximately 70,000 square feet of vacancy available to be transformed to a life sciences use, with the potential to convert the remaining office/flex spaces to more life sciences space over time, according to Cleaver, as the site’s mixed-use employment, or MXE, zoning allows for additional development by right.
Notable tenants in the portfolio include Comcast and Seco.
The most recent industrial report from CBRE revealed that the U.S. vacancy rate for existing lab and research space was at a record low of 4.9 percent, and at 1.9 percent in the Baltimore/Washington market. That has caused rents to jump 7.5 percent as of September compared to March 2021.
Thor Equities has been on a life sciences tear in the last few years, buying up properties in key markets like New Jersey and the Research Triangle in North Carolina, as well as beefing up its team to continue the expansion.
Joining Cleaver on the recent deal were CBRE’sDan Grimes and Stuart Kenny. The same team facilitated the sale of Shady Grove Bio & Tech Campus, a 435,000-square-foot life sciences property to Boston Properties (BXP) in August.
The buyer’s broker was not disclosed.
Keith Loria can be reached at Kloria@commercialobserver.com.