Citi Real Estate Funding Provides $207M CMBS Funding for Two DC-Area Offices
Arlington-based developer Monday Properties had successfully fought off foreclosure proceedings in December
By Brian Pascus April 16, 2024 11:55 am
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A top developer in Northern Virginia has turned to the CMBS market to refinance two of its prized office assets.
Monday Properties has secured a combined $207 million to refinance its trophy office tower at 1812 North Moore Street in Arlington, Va., and its 206,000-square-foot medical office building Shirlington Gateway, Commercial Observer has learned.
Citi Real Estate Funding provided a pair of five-year, fixed-rate commercial mortgage-backed securities loans to recapitalize the two properties. Citi refinanced 1812 North Moore Street for $173 million and Shirlington Gateway for $32 million.
Anthony Westreich, founding managing partner of Monday Properties, told CO that Citi was the original lender at 1812 North Moore Street and that his firm had refinanced Shirlington Gateway with the bank in December, so it made sense to combine the refinancings with Citi on a CMBS deal.
“We had just completed Shirlington Gateway financing with their refinancing team. We sole-sourced it to them in late January, and they had a great execution,” said Westreich. “The CMBS market is pretty liquid for the right type of assets and the right type of sponsors.”
The successful refinancing of 1812 North Moore Street comes after a tumultuous December, when Westreich had successfully fought off a foreclosure auction on his 35-story office tower.
The building’s mezzanine lender RBC Real Estate Capital Partners had decided to facilitate a Uniform Commercial Code (UCC) foreclosure for the 581,000-square-foot property, scheduled for Dec. 18, 2023, according to an offering from Eastdil Secured.
With more than 325,000 square feet, Nestle USA serves as the lead tenant of the building. Together with health insurance firm Humana and health tech firm Cerner, the three firms occupy 76 percent of the building.
Westreich has since moved to fill the remaining space in the property he called his portfolio’s “crown jewel.”
“We’ve done probably close to 60,000 square feet of leasing since December 2023 recap, [and are] about 90 percent leased today,” said Westreich, who added only two floors in the 10-year-old building remain available. “I’d lying if I told you it’s easy to lease, but what we are seeing thematically is there is a flight to quality — tenants have options, and they’re absolutely going to the buildings that are best in class from light and air standpoint, efficiency standpoint, amenities, so we’re enjoying that migration.”
The 206,200-square-foot Shirlington Gateway sits at 2800 Shirlington Road in Arlington. Westreich defined the glass-encased office building as “a good little workhorse for us.”
“The loan came due, the CMBS market was liquid, we went to those guys [at Citi] and had pretty good execution there, as well,” he said. “And we’ve had some pretty constant and stable leasing at that asset there, as well, thank God.”
Brian Pascus can be reached at bpascus@commercialobserver.com
