Tavaco pays $28.5M to reset Falls Church office basis

Tavaco Properties has paid $28.5 million for the 272,300-square-foot office building at 3110 Fairview Park Drive in Falls Church, Va., adding a third Greater Washington office asset to a portfolio assembled at steep discounts to previous trade values. The price sets the building's basis roughly 35 percent below the $43.7 million Hawaii-based James Campbell Company paid in 2016. The purchase, first reported by Business Journals and detailed by Commercial Observer, extends a pattern of buying below the prior mark.

In March, a Tavaco affiliate paid $8.2 million for the 100,900-square-foot Twinbrook Plaza in Rockville, Md., about half the $15.5 million an MRP Realty affiliate paid in 2016. Late in 2025, Tavaco paid $28 million for the 275,480-square-foot Ballston Station in Arlington, where the State Teachers Retirement System of Ohio had set the prior mark at $58.2 million roughly 30 years earlier. Together, the three purchases total just under $65 million.

Tavaco, based in Los Angeles, specializes in acquiring and optimizing underperforming assets. Managing Director Sam Tavakoli said the firm views the buildings as long-term additions and expects continued return-to-office trends to support demand for well-operated buildings. U.S. office visits rose 6 percent in the first half of the year, while on-site attendance remained 31 percent below 2019 levels.

James Campbell Company's side of the trade matters as much as Tavaco's. The Hawaii-based seller has been reducing its national office exposure and concentrating on industrial assets, adding supply to a market now pricing office buildings trade by trade. As this publication has argued, office has shifted from mark-to-market to trade-to-trade, and the underwrite is now set by local, vacancy-tolerant buyers rather than headline towers.

At $28.5 million, the Falls Church building works out to about $105 a square foot, against roughly $160 a square foot when James Campbell bought it—a spread that is a patient long-hold underwrite rather than a distress bet on a fast lease-up. The capital that bought this building is paying for the distance between the 2016 mark and today's clearing price, and that lower basis means almost any occupancy recovery turns cash-flow positive.