Leases  ·  Office

Andreessen Horowitz Plants Flag in DC

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One of Silicon Valley’s biggest and most popular venture capital firms is opening its first office in Washington, D.C., to expand its reach in the areas of defense, aerospace and national security.

With $42 billion in assets under management, Andreessen Horowitz is subleasing about 12,000 square feet of office space from FedEx at PNC Place a block and a half from the White House, the Business Journals reported, citing unnamed sources. The Menlo Park, Calif.-based investment company is expected to open the D.C. office at 800 17th Street NW later this quarter in a deal that will last at least through the end of FedEx’s lease in 2029.

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The sublease is in line with Andreessen Horowitz’s effort to invest more in the industries that call D.C. home. Last year, the company led by Ben Horowitz and Marc Andreessen created a new entity to invest in space, defense, robotics and manufacturing firms. Last month, Andreessen Horowitz led a $61 million funding round for Arlington telecommunications startup Cape, per the Business Journals.

The office vacancy rate in Washington increased in the first quarter to a new high of nearly 22 percent, according to the most recent report from CBRE (CBRE). However, Class A space recorded positive absorption over the first three months of the year, and has a much lower vacancy rate at 11.5 percent.

Gregory Cornfield can be reached at gcornfield@commercialobserver.