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  • FINMARC MANAGEMENT ACQUIRES NINE-BUILDING, 342,000 SQUARE FOOT PORTFOLIO IN WASHINGTON, D.C. SUBURB FROM FIRST POTOMAC REALTY TRUST FOR $33 MILLION

FINMARC MANAGEMENT ACQUIRES NINE-BUILDING, 342,000 SQUARE FOOT PORTFOLIO IN WASHINGTON, D.C. SUBURB FROM FIRST POTOMAC REALTY TRUST FOR $33 MILLION
Posted on: 03/02/2014

Portfolio in Gaithersburg, Maryland features mix of flex, office, retail and warehouse

Finmarc Management, Inc., a Bethesda, Maryland-based commercial real estate firm, has announced the acquisition of a nine-building, 342,000 square foot portfolio positioned in the City of Gaithersburg in Montgomery County, Maryland, from First Potomac Realty Trust for $33 million. The group of buildings, which consist of a mixture of flex/office, commercial office, retail and warehouse space, is cumulatively 82% leased.

The acquisition was part of a 1031 tax-free exchange, with Finmarc utilizing a portion of the proceeds generated from its sale last week of the 58-acre Port Covington retail development in Baltimore City for $35 million. Finmarc purchased the Port Covington project, which includes an operational 142,000 square foot Wal-Mart and a closed 130,000 square foot Sam’s Club, in 2005.

The former First Potomac portfolio is comprised of three separate and distinct product categories. Girard Place consists of approximately 175,000 square feet of flex/office and warehouse space, situated at 602, 620, 630 and 640 East Diamond Avenue. An additional 123,000 square feet of flex/office and warehouse space is contained at Girard Business Center, located at 200 and 220 Girard Street and 504 E. Diamond Avenue. The final component is Gateway Center, a 45,000 square foot two-building office and retail project situated at 811 and 831 Russell Avenue.

Girard Place and Girard Business Center are adjacent properties separated by Girard Street that are positioned within close proximity to Interstate 270, MD Route 200 (Inter-County Connector), MD Route 355, and the Shady Grove Metro Station. Gateway Center offers direct access to Interstate 270 and is adjacent to Lakeforest Mall.

According to research generated by Cushman Wakefield, the Montgomery County flex/office market stands at just over 11% vacant and has experienced positive absorption over the past nine months. Rates in this category have steadily risen approximately 7% over the past two years. Significant tenants contained within the portfolio are Communication Supply Corporation, The Foundation Schools, Family Services, and Quaker City Motor Parts.

“We were attracted to this portfolio because it satisfied each criteria we utilize to evaluate acquisition opportunities,” explained Marc F. Solomon, Principal – Managing Director for Finmarc. “These fundamentals include a strategic location in an economically-vibrant business environment, a strong and well-maintained physical plant and the presence of a long-term and stable tenant base. In addition, we have an extremely high regard for the First Potomac Realty Trust asset management and operational team, and are confident we have acquired a properly-maintained portfolio that complements our suburban Maryland property footprint.”

With the acquisition of this asset, over the last 18 months, Finmarc, along with its partners, has acquired or disposed of more than $312 million worth of properties.

Eric Berkman, Steve Gichner and Gideon Gil of Cushman Wakefield represented the former owner in this transaction.

Finmarc Management, Inc. is a fully-integrated commercial real estate company that focuses on the real estate investment, management, leasing and development of retail, industrial/flex projects, and office buildings throughout the Mid-Atlantic region. The firm presently manages a diverse portfolio encompassing more than five million square feet of space situated in Maryland, Washington, D.C., Virginia, Delaware, New Jersey and Pennsylvania. For additional information, visit www.finmarc.com.