Japanese REIT Buys Part of D.C. Mixed-Use District for $279M
The multifamily property is the former home of Fannie Mae and was converted in 2022
By Nick Trombola November 21, 2024 3:10 pm
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The developers behind the massive mixed-use redevelopment of the former Fannie Mae headquarters in Washington, D.C., have sold a chunk of the campus to a Japanese real estate investment trust.
Roadside Development and North America Sekisui House (NASH) sold four of the six buildings at the 1.8 million-square-foot City Ridge to latter’s sponsored REIT, Sekisui House REIT, for $279 million. The deal included the 157-unit The Branches North and South, the 107-unit The Coterie, and the 86-unit Botanica, for a total of 350 units across roughly 330,000 square feet. The deal is equal to about $797,142 per unit.
As of the end of July, the properties were about 91 percent leased, the REIT said in an announcement of the pending sale in August. The deal for City Ridge closed earlier this week, according to the Business Journals.
“Washington, D.C., is said to have the second-highest median household income, suggesting economic strength to support high rents,” the REIT said in its August announcement. “There are no major concerns about the balance between new supply of rental housing and new demand in the Washington, D.C., metropolitan area, because it is expected to generally balance out after 2024, and the vacancy rate is expected to remain in the low 6 percent range.”
The complex is only the second property acquired by the REIT in the U.S., following its $328 million deal earlier this year for the 407-unit Ivey on Boren residential tower in Seattle, which NASH also developed.
Fannie Mae left the property in 2018 for new headquarters at Midtown Center in Downtown D.C., allowing Roadside and NASH to swoop in. City Ridge, which together consists of 690 residential units and 159,000 square feet of retail space, opened in 2022.
Representatives for Roadside did not immediately respond to a request for comment.
At nearly $300 million, the deal for City Ridge is automatically one of the biggest sales in D.C. this year. Though just a fraction of the sale price, LBX Investments and Broadwill paid $87 million for JBG Smith’s mixed-use, 345-unit Fort Totten Square property in September.
Nick Trombola can be reached at ntrombola@commercialboserver.com.
