BXP sells Dupont Circle office to Jemal Equities for $92.3 million

BXP has sold 1330 Connecticut Avenue NW, a 254,000-square-foot Dupont Circle office building, to affiliates of Jemal Equities for $92.3 million, per Commercial Observer, which cites deed records reported by the Business Journals. Burke & Herbert Bank & Trust financed $72.5 million, a 78% share of the price that works out to $285 a square foot against the $363-a-foot valuation and leaves the buyer about $19.8 million of equity.

That makes the fourth D.C. office purchase in about 14 months for Jemal Equities, run by Douglas Development managing principal Matthew Jemal, and lifts the firm's recent acquisitions to almost $227 million. The prior three were the 123,000-square-foot 1750 H Street NW, bought last year for $28.8 million; the 155,000-square-foot Lion Building at 1233 20th Street NW, acquired from affiliates of MRP Realty and BGO for $12.4 million; and the 235,000-square-foot 99 M Street SE, bought from a Polinger affiliate for $93.2 million in May, one month after the Lion Building.

On BXP's side, the sale continues a shift away from older Washington buildings toward 725 12th Street NW and 2100 M Street NW, both pre-leased to law firms and described in the coverage as the only new private office construction in the District's pipeline. In August the Boston REIT also transferred its leasehold interest in the 210,000-square-foot Sumner Square complex to an affiliate of Vieron Capital for $63 million.

The trade shows the two-sided clearing this publication has described in Greater Washington office: a REIT moving toward newer buildings with signed law-firm leases, and a local operator taking older stock with a bank covering most of the cost. It clears office twice, once through the debt stack and once through per-foot comps. The nearest comparison is Falls Church, where Tavaco paid $28.5 million in August for an office building at roughly 35% below the seller's 2016 price—a different submarket and a different building, but the same direction of travel for older stock.

The deed records do not show what BXP paid for 1330 Connecticut, how much of the building is leased, or at what rents—the figures that would say whether $363 a square foot is a clearing price or a concession. They do show the buyer's pattern rather than its underwriting: acquisitions at prices between $12.4 million and $93.2 million.