6120 & 6130 executive boulevard, rockville, maryland€¦ · white flint metrorail station (red...
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CONFIDENTIAL EXECUTIVE SUMMARY
VALUE-ADD OFFICE INVESTMENT WITH STABLE IN-PLACE CASH FLOW AND DEMONSTRATED LEASING MOMENTUM
6120 & 6130 EXECUTIVE BOULEVARD, ROCKVILLE, MARYLAND
Holliday Fenoglio Fowler, L.P. (“HFF”), as exclusive representative for the Owner, is pleased to present this offering for the sale of Executive Plaza, a two-building 327,453 square foot Class A office portfolio (the “Portfolio” or “Properties”) located at 6120 and 6130 Executive Boulevard in Rockville, Maryland. The Portfolio is currently 67% leased to eight tenants with 9.6 years of weighted average remaining lease term.
Over $14.7 million has been invested in the Properties to deliver a best-in-class on-site amenity package, including a state-of-the-art fitness center with towel service, bike room, an on-site cyber café, and a 4,281 square foot conference center capable of seating up to 250 people. The renovations also included full main lobby upgrades, new elevator lobbies and corridors on all floors, and a complete modernization of the HVAC systems. These upgrades have generated significant leasing demand at the Properties, resulting in over 210,000 square feet (67% of total RBA) of net absorption since May 2016.
The Portfolio’s existing tenancy is anchored by Abt Associates Inc. (“Abt”), who leases the entirety of 6130 Executive Boulevard (155,939 SF, 48% of total Portfolio RBA) through June 2028. At the time the tenant signed the lease, it was the largest private sector lease signed in Montgomery County in over a decade. Abt is a global research and consulting firm with over 3,000 employees in 11 offices around the world. Abt moved to 6130 Executive Boulevard from 4550 Montgomery Avenue, which is located in downtown Bethesda with asking rents in the $47.00 PSF, full service range. Abt’s tenancy both provides stable in-place cash flow while the Portfolio’s remaining vacancy is leased, and it demonstrates the ongoing trend of tenants migrating from the more expensive Bethesda area to competitively priced, highly amenitized Metrorail proximate assets such as Executive Plaza.
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY | 2
Abt Lobby Reception Area – 6130 Abt Open Floor Plan Buildout – 6130
PROPERTY OVERVIEWADDRESS 6120 & 6130 Executive Boulevard Rockville, Maryland 20852
RENTABLE AREA 6120: 176,002 RSF 6130: 151,451 RSF Total Portfolio: 327,453 RSF
YEAR BUILT/RENOVATED 1985/2018
DEVELOPER West*Group
STORIES 8
TYPICAL FLOOR PLATE 6120: ±21,000 RSF6130: ±20,000 RSF
COLUMN SPACING 32’ X 30’
FINISHED CEILING HEIGHTS 9’ 0”
PRIVATE BALCONIES 12 (6 at each building)
PARKING Surface Spaces: 528Garage Spaces: 623Total Spaces: 1,151 (3.5 spaces per 1,000 SF)
SITE AREA 12.92 acres
ZONING CR-1.5, C-1.5, R-1.0, H-100
TOTAL POTENTIAL DENSITY Approximately 840,000 square feet (at a 1.5 FAR)
% LEASED 67%
WEIGHTED AVERAGE LEASE TERM
9.6 Years
MAJOR TENANTS
Institutional Quality Class A Office Portfolio
Transformative $14.7 Million Renovation With A Best-In-Class On-Site Amenity Package
67% Leased to Eight Tenants; 9.6 Years of Weighted Average Remaining Lease Term
Increasing Rents In Bethesda & Downtown Washington, DC Fueling Tenant Migration To Class A North Bethesda Assets With Red Line Accessibility
Immediate Proximity To Pike & Rose (470,00 SF of Retail Space; 860 Residential Units); One Of The Region’s Premier Live-Work-Play Destinations
White Flint Metrorail Station (Red Line) Accessible Via On-Site Shuttle
Montgomery County Life Sciences & Healthcare Demand Drivers Have Driven Lab Space Vacancy To 3.5% Office-To-Lab Conversions Set To Decrease Office Supply
Ideal Value-Add Investment Opportunity; Significant In-Place Cash Flow Provides Stability While The Remaining Existing Vacancy Is Leased
Free & Clear Of Existing Debt
3 | EXECUTIVE SUMMARY
INVESTMENT HIGHLIGHTS
Abt Associates, Inc. (155,939 SF; 48% of Portfolio; Jun-28 LXD)
EXECUTIVE SUMMARY | 4
TRANSFORMATIVE $14.7 MILLION RENOVATION DELIVERS BEST-IN-CLASS ONSITE AMENITY PACKAGE
State-of-the-art fitness center with towel service
3,500 square foot conference center capable of
seating up to 250 people
Full-service on-site cyber café
WiFi enabled creative lounge
New façade and landscaping upgrades
Entrance and outdoor plaza upgrades
Full lobby renovations including granite walls, marble
flooring, and white-back painted glass
Scenic outdoor plaza with café seating, lounge areas
and walking paths
Secure bicycle storage
Complimentary shuttle service to the White Flint
Metrorail Station, Pike & Rose, and
North Bethesda Market
New elevator lobbies and corridors on every floor
First-class restroom renovations with granite vanities
Complete modernization of the Portfolio’s
HVAC systems
EXECUTIVE SUMMARY | 4
State-Of-The-Art Fitness Center With Towel Service 4,281 SF Conference Center Convenient On-Site Café
WiFi Enabled Creative Lounge Tenant Lounge & Event Area
5 | EXECUTIVE SUMMARY
TILDE
N LN
NIC
HOLS
ON
LN
ROCKVILLE PIKE
OLD GEORGETOWN RD
TWINBROOK PKWY
ROCKVILLE PIKE
MONTROSE PWKY
EXECUTIVE BLVD
KAISER PERMANENTE
NATIONAL INSTITUTES OF HEALTH (NIH)
THE GEORGE WASHINGTON UNIVERSITY BIOSTATISTICS CENTER;
FEDERAL REALTY INVESTMENT TRUST
INTERNAL REVENUE SERVICE; U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
NATIONAL INSTITUTE OF MENTAL HEALTH
PIKE & ROSE
BETHESDA NORTH MARRIOTTHOTEL & CONFERENCE CENTER
FOOD & DRUGADMINISTRATION
NATIONAL INSTITUTE OF ALLERGY & INFECTIOUS DISEASE
U.S. DEPARTMENT OF HEALTH & HUMAN SERVICES
U.S. NUCLEARREGULATORY COMMISSION
NATIONAL INSTITUTES OF HEALTH (NIH)
WHITE FLINT
TWINBROOK
OUTSTANDING MULTIMODAL ACCESSIBILITY & AMENITIESExecutive Plaza is prominently located just off of Rockville Pike within the North Bethesda submarket. Excellent multimodal accessibility is provided by the White Flint Red Line Metrorail Station
and close proximity to major commuter thoroughfares such as I-270, I-495, Rockville Pike, and Old Georgetown Road. Nearby major amenity concentrations include Pike & Rose (0.6 miles),
North Bethesda Market (1.1 miles), and Montrose Crossing Shopping Center (1.0 mile). The Portfolio is also less than a 10 minute Metrorail ride from downtown Bethesda, one of the
premier suburban live-work-play environments in the United States.
PIKE & ROSE
Pike & Rose, which is a short walk from the Properties, is a transformational mixed-use development by Federal Realty Investment Trust that will feature more than 3 million square feet at full build-
out. The project includes approximately 470,000 square feet of retail space encompassing more than 20 restaurants, 25 stores, a Sport & Health gym, a Pinstripes bowling alley, and an iPic
movie theatre. In addition to these diverse retail offerings, over 860 residential units and a 177-room Canopy by Hilton Hotel have been delivered. Accordingly, Executive Plaza’s immediate
proximity to this exciting mixed-use destination will serve to drive demand and rental rate appreciation in the near term.
3.4 Million SF Total At Full Buildout | 470,000 SF of Retail | 860 Residential Units | 1 Million SF of Office
Pike & Rose
Confluence of Rockville and North Bethesda – an amenity-rich hub anchored by the award winning,
24-7 Pike & Rose mixed-use development
EXECUTIVE SUMMARY | 6
INCREASING RENTS IN BETHESDA & DOWNTOWN WASHINGTON, DC FUELING TENANT MIGRATION TO CLASS A NORTH BETHESDA ASSETS WITH RED LINE ACCESSIBILITYIn 2018, Class A office properties within one mile of the White Flint Metrorail Station experienced over 295,000 square feet of positive net absorption (23% of total inventory), demonstrating a
pronounced increase in tenant demand for high quality office space with Red Line Metrorail access that is priced at a discount to Bethesda and downtown Washington, DC. Currently, Class A
market rents in Bethesda and Washington, DC’s central business district are 40% and 90% higher than in the North Bethesda submarket, respectively, making this highly amenitized and accessible
location a compelling value proposition for tenants.
IDEAL VALUE-ADD INVESTMENT OPPORTUNITYExecutive Plaza’s unmatched on-site amenities make it one of the highest quality office assets with Red Line Metrorail access north of Bethesda, and it is therefore ideally positioned to capture
the ongoing demand from tenants seeking a discount to Bethesda and downtown Washington, DC. Accordingly, investors are ideally positioned to achieve compelling risk-adjusted returns by
leasing the Portfolio’s existing vacancy at increasing rental rates, while also benefiting from its significant in-place cash flow and 9.6 years of weighted average remaining term from its eight
existing tenants.
PIKE & ROSE
EXECUTIVE SUMMARY | 6
Abt Internal Staircase 12 Private Balconies With Sweeping Views 6120 Lobby
Capital Bikeshare in Vicinity Abt Class A Buildout
Stephen Conley, a licensed real estate broker in the state of Maryland, along with Holliday Fenoglio Fowler, L.P. (collectively “HFF”).
HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF,
and neither Owner nor HFF, nor their respective equity holders, officers, employees and agents makes any representations or warranties, express or implied, as to the accuracy or
completeness of such information. Any and all reference to age, square footage, income, expenses and any other property specific information are approximate. Any opinions,
assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that
used by a purchaser, and HFF, its partners, officers, employees and agents disclaim any liability that may be based upon or related to the information contained herein. Prospective
purchasers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change.
1775 PENNSYLVANIA AVENUE NW | 5TH FLOOR
WASHINGTON, DC 20006 | HFFLP.COM
James A. MeiselHolliday Fenoglio Fowler, L.P.
Senior Managing [email protected]
Andrew M. WeirHolliday Fenoglio Fowler, L.P.
Senior Managing [email protected]
Matthew T. NicholsonHolliday Fenoglio Fowler, L.P.
Senior Director202.533.2502
David B. Baker IVHolliday Fenoglio Fowler, L.P.
Director202.777.2301
INVESTMENT SALES
FINANCING
Susan B. CarrasHolliday Fenoglio Fowler, L.P.
Senior Managing Director202.533.2526
Chris J. HewHolliday Fenoglio Fowler, L.P.
Senior [email protected]