Penzance Buys Two NoVA Industrial Parks for $55M

With all the hype around Northern Virginia’s multifamily and data center markets, non-data center industrial property sales there are sometimes overlooked, until an investment firm like Penzance has something to say about it. 

The Washington, D.C.-based company has paid $55 million for two flex industrial parks in Manassas, Va., about 32 miles west of the District. A partnership between Davin Holdings and The Davis Companies sold both properties, which have a combined footprint of 212,086 square feet. The Business Journals first reported the news. 

The 102,277-square-foot Gateway Centre was built in 1988 at 7201-7401 Gateway Court, and the 109,809-square-foot Linden Business Center was built in 2001 at 7245-7795 Coppermine Drive, per Penzance. The firm said it plans to lease “current and upcoming vacancies,” which range between 6,000 and 33,000 square feet, and convert some of the more office-laden suites to industrial use via higher ceilings and docking doors. 

“In this supply-constrained Northern Virginia market, high-quality industrial flex assets like these are becoming increasingly scarce, making this a particularly valuable addition to our portfolio,” Lauren Kowall, Penzance’s senior vice president of investments, said in a statement.

A JLL Capital Markets team of Bill Prutting, Craig Childs and Chris Dale arranged the deal, per Penzance. 

“JLL is tracking over 7 million square feet of industrial tenant displacement driven primarily by data centers,” Prutting said in a statement. “Given this trend, the Gateway & Linden portfolio is exceptionally well positioned. It’s poised to retain current tenants who already supply goods and services to data centers, while also attracting new tenants ready to meet market rental rates in Manassas.”

The location of both business parks is indeed well suited to supporting Northern Virginia’s data center market. Prince William County, home to both Gateway Centre and Linden Business Center, contains over 8.5 million square feet of data center facilities. The capacity in that county alone is expected to skyrocket by 80 million square feet over the next decade, per JLL.

Yet Penzance, like many other investors with skin in the game in Northern Virginia, is also focusing much of its attention on the region’s multifamily sector. The firm is planning to reshape the Rosslyn skyline with three new residential towers, at 30, 27 and 26 stories apiece. Penzance last year paid JBG Smith $52 million for that property, which currently houses a two-building office complex. JBG had previously landed approval to redevelop the complex into a three-building, mixed-use development, but sold to Penzance instead as part the real estate investment trust’s current strategy of shedding “non-core” assets in the DMV. 

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