Unizo Sells D.C. Office Building For 20% Loss To Coworking Company
The Japanese buyer that drove the D.C. investment sales market for 18 months starting in 2016 has just sold one of its downtown properties for a loss.
Unizo Holdings sold the office building at 1201 Connecticut Ave. NW to Novel Coworking for $73.6M in a deal posted Friday to the D.C. Recorder of Deeds and first reported by the Washington Business Journal.
The sale price is roughly 20% less than the $93M Unizo paid for it in March 2016. The deal was the first of at least nine D.C. office building acquisitions the Japanese investor made between then and August 2017. Unizo also sold the office building at 50 F St. NW in March for $85M after acquiring it for $109.5M in 2016.
The deal represents one of the first D.C. office buildings to be acquired by a coworking company, as shared workspace concepts continue to lease D.C. office space at a rapid pace. WeWork in December partnered with The Meridian Group to buy a Dupont Circle office building for $136.5M.
Chicago-based Novel Coworking has used acquisitions as part of its growth strategy, previously buying buildings in Denver, Milwaukee and Chicago.
The coworking company has locations in Alexandria and Richmond, but the 1201 Connecticut building will be its first space in the District. The 193K SF office building is roughly 67% occupied, and Novel plans to renovate five floors for coworking. It plans to expand the size of the coworking space as leases with existing tenants expire.
CBRE's Ezra Weinblatt represented Novel in the acquisition, while JLL represented Unizo. Novel is working with Fox Architects to design the coworking space.
