JP Morgan Sells 179K-SF D.C. Office Building for Just $29M

Not that they’re hard to come by, but Colorado-based Real Capital Solutions (RCS) found a hefty office bargain in Washington, D.C., just in time for the holidays. 

An affiliate of RCS paid J.P. Morgan Investment Management just $29.4 million for an 11-story, 178,589-square-foot building at 1501 M Street NW, according to D.C. property records. RCS also secured a $26 million financing package from Hingham Institution for Savings, records show. 

The building is 61 percent leased, according to the Business Journals, which first reported the news. Transwestern’s Gerry Trainor facilitated the deal.

The sale price, emblematic of declining property values in the District lately, is less than half of the $78.6 million J.P. Morgan paid for the building in 2010. Not only that, the latest price is barely more than half of the property’s most recent assessed value of $59.7 million. 

A spokesperson for J.P. Morgan declined to comment, while a spokesperson for RCS did not immediately respond to a request for comment. 

RCS’s purchase caps off a dismal year for office investment in Washington, D.C., as interest rates remained elevated and vacancy hit record levels. Buildings frequently sold for heavy discounts, such as Douglas Development’s $34.3 million August acquisition of 701 Eighth Street NW — compared to the $98.5 million Clarion Partners acquired it for in 2013. Others faced some sort of distress, like the $130 million loan tied to the headquarters of the Federal Emergency Management Agency transferring to special servicing earlier this month for the second time in just two years. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.