Leases  ·  Office

Fannie Mae Exiting 713K-SF DC Lease Early

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In yet another blow to the beleaguered Downtown D.C. office market, Fannie Mae is reportedly leaving its Washington, D.C., headquarters at Midtown Center five years earlier than expected.

Carr Properties has listed 720,000 square feet of space available at 1100 15th Street NW beginning in June 2029, Bisnow first reported — not much more than the  government-backed multifamily agency signed for in 2019.

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“Fannie Mae notified us that it will exercise its early out clause to vacate its leased premises at Midtown Center, effective May 2029,” a spokesperson for Carr Properties, told Commercial Observer. “We continue to work collaboratively with Fannie Mae and is committed to a long-term relationship with them as a valued customer.”

As a preeminent trophy property in the heart of downtown D.C., Carr Properties is confident that Midtown Center will again attract a notable flagship customer seeking an unparalleled experience with luxury level amenities and access to highly-acclaimed restaurants, retail options and more, the spokesperson added.

The lending agency paid $37.7 million to rent 713,000 square feet in the building over a 15-year term, which it said at the time would save taxpayers $341 million compared with its prior headquarters expenses. 

At the time, Fannie Mae’s headquarters was the largest private sector office lease in the history of the District. Cushman & Wakefield represented Fannie Mae in that deal. 

But now, landlord Carr Properties has listed 720,000 square feet across two towers at the Midtown Center, according to a CoStar listing, suggesting that Fannie Mae is leaving five years early.

“Like many other companies, we are continuing to embrace our flexible work environment by exploring office space options that support our workforce while being fiscally responsible,” a Fannie Mae spokesperson emailed CO, confirming the exit. “Per our charter, we will continue to maintain a presence in the Washington, D.C., metropolitan area.”   

Completed in 2018, Carr Properties’ 868,000-square-foot complex consists of a pair of glass-curtain-walled towers connected by both a common base and by skybridges. The property includes on-site parking, a fitness center and ground-floor retail space that flows into an outdoor plaza.

The CoStar listing consists of 306,000 square feet in the east tower and 414,000 square feet in the west tower of the complex, Bisnow reported.

In October of 2019, Carr Properties picked up a $525 million CMBS refinancing on the office building.

Requests for comment from Carr Properties and Fannie Mae were not immediately returned.

Keith Loria can be reached at Kloria@commercialobserver.com.