Check out this week’s episode of The Weekly Take featuring FD Stonewater Co-Founder and Principal Jeff Toporek! In this episode, Jeff provides insight into what it takes to raise capital, especially at a time of high market uncertainty, and shares how the firm’s investment strategy has evolved over the past 20 years. Thank you to Spencer Levy and JM Schapiro for an engaging discussion and for the opportunity!
Click here to access the podcast.
About The Weekly Take
The Weekly Take invites industry, economic, and subject matter experts to share their unique insights on what matters most today in commercial real estate. Spencer Levy is a Global Client Strategist and Senior Economic Advisor for CBRE and is considered one of the most insightful commentators on issues of importance to commercial real estate.
About the episode
Patience: The key to raising investment capital today (35 min)
“Investing in commercial real estate always entails a complex mix of science and art. FD Stonewater principal Jeff Toporek and Continental Realty Corp CEO JM Schapiro share their secrets for prudently raising capital and adroitly putting it to work at a time of high market uncertainty.”
Copyright © 2023 CBRE. All rights reserved.
Disclaimer
This is not an offer to sell or a solicitation of an offer to purchase any securities, and any such offers will only be made pursuant to a private placement memorandum or similar disclosure document and other definitive documentation relating to any such security. The statements in this podcast include the speaker’s personal opinions and predictions, which by their nature are uncertain, and there can be no assurance that actual events will occur as predicted.
The FD Stonewater STAR Evergreen Fund, L.P. (the “STAR Evergreen Fund”) formally announced Michael McNamara, Daniel Philips, and Nancy McGrath as initial members of the fund’s Advisory Committee. The Advisory Committee’s primary role is to review and opine on conflicts of interest related to the fund. The fund launched in December 2022 to pursue a Single Tenant Active Return (STAR) strategy focused on assembling a diversified portfolio of mission-critical single-tenant real estate assets in U.S. secondary and tertiary markets across industrial, government, research and development, and office sectors. In December 2022, FD Stonewater announced the first closing of the STAR Evergreen Fund in the amount of $19 million, simultaneous with the acquisition of two seed assets.
Michael McNamara has a career spanning four decades leading numerous global real estate investment platforms, most recently as the Senior Managing Director and Global Head of Real Estate Investments for Manulife Investment Management. In that role, Mr. McNamara was responsible for the development, execution, and portfolio management of the company’s global real estate investment strategies for both the General Account as well as institutional investors that include both public and private pension funds. Prior to joining Manulife, Mr. McNamara worked at Brookfield Office Properties and was responsible for all U.S. investment activity. Before joining Brookfield Office Properties, he spent nine years as a Managing Director at Lehman Brothers and 20 years at Equitable Real Estate Investment Management, Inc. Over the course of his career, Mr. McNamara has been responsible for transactions valued at over $100 billion.
Daniel Philips is co-founder and Chief Executive Officer of JDJ Capital Management, a private investment firm located in New York City. Prior to forming JDJ Capital in 2006, Mr. Philips worked in the investment banking group at Bear, Stearns & Co., with a focus on industrials and real estate. Mr. Philips began his career as a corporate lawyer with Cadwalader, Wickersham & Taft, where his practice concentrated on mergers, acquisitions, and securities offerings. Mr. Philips currently serves on the Board of Directors of Air Wisconsin Airlines, LLC, and AWAC Aviation, Inc., and is also on the Advisory Board for Emory University’s Goizueta Business School. Mr. Philips received his BBA from Emory University and his JD and MBA from The George Washington University.
Nancy McGrath is General Counsel for Peterson Companies and serves on the company’s Executive, Investment, and Finance Committees. Nancy concentrates her practice on all aspects of real estate development including the structuring of complex mixed-use projects, land and building acquisition and disposition, joint ventures, financing, construction, leasing (government and private sector), project management, and operations. She also advises the company on family office, general business, strategic and corporate matters. Prior to joining Peterson Companies Nancy was an associate at the law firm of Melrod Redman & Gartlan. Nancy received her BA degree magna cum laude in History and Political Science from Duke University and her Juris Doctor degree from the University of Virginia Law School.
Jeffrey Toporek, Co-Founder for FD Stonewater said “We are incredibly grateful to Mike, Dan, and Nancy for their continued commitment to, and support of, FD Stonewater and the STAR Evergreen Fund. Together, they bring significant diversified perspectives, experience, and leadership as well as exemplary reputations to the Advisory Committee’s role of reviewing and opining on conflicts. Over the past 20 years, Mike, Dan, and Nancy have each provided invaluable guidance to FD Stonewater and we are pleased to formalize these relationships with their membership in the fund’s Advisory Committee.”
FD Stonewater has acquired, asset managed, and/or developed 5.6 million square feet of single-tenant assets valued at $1.3 billion. FD Stonewater’s national capabilities encompass over 8 million square feet of experience in more than 40 secondary and tertiary markets across the country.
For more information on the STAR Evergreen Fund and our Advisory Committee, please visit https://fdstonewater.com/star-fund/.
Disclaimer
Please note that the foregoing is not an offer to sell or a solicitation of an offer to purchase any securities of FD Stonewater STAR Evergreen Fund, L.P. (the “Fund”) or any affiliate, and any such offers will only be made pursuant to a private placement memorandum or similar disclosure document (“Private Placement Memorandum”) and other definitive documentation relating to any such offering. The foregoing information excludes material information that is detailed in the Private Placement Memorandum, including, but not limited to, risk factors. Prior performance is not indicative of future results. An investment in the Fund is speculative and involves a high degree of risk. Only investors who can withstand the loss of all or a substantial part of their investment should consider investing in the Fund. Additionally, an opportunity to invest in the Fund is only available to (a) “accredited investors” as defined in Rule 501(a) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), or (b) non-U.S. persons that meet the requirements set forth in Regulation S promulgated under the Securities Act.
2022 was an extremely positive year for FD Stonewater. We continued to grow our core development, investment and brokerage business lines while expanding into new verticals where demand shows no sign of slowing, such as logistics, industrial, and multifamily. While diversifying, we remain disciplined, focusing on new opportunities that reflect our strengths and integrated capabilities. The outlook for 2023 is extremely bright as we continue to capitalize on our cross-platform model as the engine for continued growth and expansion.
FD Stonewater announced the first closing of the FD Stonewater STAR Evergreen Fund, L.P. (the “STAR Evergreen Fund“) in the amount of $19 million, simultaneous with the acquisition of two seed assets.
The fund closed on an 83,000 square foot mission critical research and development, office, and specialized manufacturing facility located adjacent to Redstone Arsenal in Huntsville, AL. The building is 100% leased to a leading defense contractor and was purpose-built for the tenant in 2020. The tenant utilizes the facility to service government contracts.
The fund also closed on the second seed asset, a 55,624 square foot Class A headquarters building 100% leased to Harvey | Harvey-Cleary, a full-service general contractor based in Houston, TX, and leased through 2036. The headquarters is located in Houston’s Westchase submarket and benefits from the area’s considerable economic growth and proximity to major transit hubs.
The fund has a Single Tenant Active Return (STAR) strategy with a focus on assembling a diversified portfolio of mission-critical single-tenant real estate assets in U.S. secondary and tertiary markets across industrial, government, research and development, and office sectors.
Owen Burke, Principal and Director of Asset Management
“The team’s deep experience in investing across sectors and geographies will enable us to build a portfolio of high-quality, mission-critical assets for the fund. Additionally, the fund will benefit from the firm’s unique fully integrated cross-platform approach by utilizing our investment, asset management, development, and brokerage platforms at various stages of a deal. Our cycle-tested strategy focuses on acquiring resilient assets with both durable cash flows and defined opportunities to seek value enhancement.”
Andrew Schwartzman, Principal and Director of Acquisitions
“We are excited to announce the successful acquisition of both seed assets. Both facilities fit the single-tenant, mission-critical objective that we are actively pursuing for the fund. With the combination of compelling tenant stories and strong underlying real estate fundamentals, these deals are representative of FD Stonewater’s single-tenant strategy that has realized tremendous success over the past 20 years.”
FD Stonewater has acquired, asset managed, and/or developed 5.6 million square feet of single-tenant assets valued at $1.3 billion. FD Stonewater’s national capabilities encompass over 8 million square feet of experience in more than 40 secondary and tertiary markets across the country.
FD Stonewater announced today that the firm has launched a new value-add evergreen fund targeting single-tenant assets, FD Stonewater STAR Evergreen Fund, L.P. (the “STAR Evergreen Fund”). The fund will pursue a Single Tenant Active Return (STAR) strategy and will focus on assembling a diversified portfolio of mission-critical single-tenant real estate assets in U.S. secondary and tertiary markets and will be diversified across industrial, government, research and development, and office sectors.
Click here to learn more about the fund and invest today.
FD Stonewater’s repeatable single-tenant active return strategy has historically generated value through the identification of underpriced assets and an active management approach in a traditionally passive asset class. FD Stonewater has acquired, asset managed, and/or developed 5.6 million square feet of single-tenant assets valued at $1.3 billion. FD Stonewater’s national capabilities encompass over 8 million square feet of experience in more than 40 secondary and tertiary markets across the country.
The STAR Evergreen Fund will be primarily led by four FD Stonewater principals: Owen Burke, Andrew Schwartzman, David Stade, and Jeffrey Toporek. The firm’s founding partners have worked together for 25 years and bring over 80 years of combined experience in investment acquisitions and asset management.
Principal of Investment and Co-Founder Jeffrey Toporek
“We are excited to publicly announce the STAR Evergreen Fund. We believe our demonstrated and consistent execution of the single-tenant strategy creates a unique investment opportunity, especially in today’s market of noise and volatility. For the first time in 20 years, we are giving outside investors the ability to invest in this strategy.”
Owen Burke, Principal and Director of Asset Management
“The team’s deep experience in investing across sectors and geographies will enable us to continue to build a portfolio of high-quality, mission-critical assets. Additionally, the fund will benefit from the firm’s unique fully integrated cross platform approach by utilizing our investment, asset management, development, and brokerage platforms at various stages of a deal. Our cycle-tested strategy focuses on acquiring resilient assets with both durable cash flows and defined opportunities to seek value enhancement.”
Adnan Virani, Director of Investor Relations
“We believe the STAR Evergreen Fund is coming to the market with a differentiated offering led by mission-critical tenant stories, strong credits, and lease terms that should provide strong cash yields over a full market cycle of 10-15 years. We think this type of exposure is a great fit across investor types and has a perpetual and permanent place in private real estate allocations.”
Disclaimer: Please note that the foregoing is not an offer to sell or a solicitation of an offer to purchase any securities of FD Stonewater STAR Evergreen Fund, L.P. (the “Fund”) or any affiliate, and any such offers will only be made pursuant to a private placement memorandum or similar disclosure document (“Private Placement Memorandum”) and other definitive documentation relating to any such offering. The foregoing information excludes material information that is detailed in the Private Placement Memorandum, including, but not limited to, risk factors. Prior performance is not indicative of future results. An investment in the Fund is speculative and involves a high degree of risk. Only investors who can withstand the loss of all or a substantial part of their investment should consider investing in the Fund. Additionally, an opportunity to invest in the Fund is only available to (a) “accredited investors” as defined in Rule 501(a) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), or (b) non-U.S. persons that meet the requirements set forth in Regulation S promulgated under the Securities Act.
The DC region is facing a tsunami of federal shadow vacancy – vacant space not being captured in widely circulated market reports. In the aftermath of the pandemic, government agencies are swiftly adopting telework and aggressive flexible work policies. While some private sector companies are pulling back on telework initiatives, many federal agencies are doubling down by memorializing these benefits in union agreements and entrenching them into agency-wide employment policy. As a result, tenant agencies are giving back space to the GSA at a record clip.
Our team has compiled a list of large blocks of leased and owned space (50,000 square feet or greater) that have been released back to GSA, are in the process of being released to GSA, or are planning to be released in the near future. The list includes 36 instances of space givebacks and reductions known to our team in both owned and leased assets in Washington, DC, and Northern Virginia. Of the leases reflected in our list, the firm term remaining ranges from 1 year to 15 years.
Click here to download the report.
WHAT IS A REDUCTION?
A reduction is categorized as an agency allowing a lease to expire (i.e., no renewal) or choosing to downsize significantly at its natural expiration date. The space is not carried on GSA’s vacancy portfolio but instead released back to the market.
WHAT IS A GIVEBACK?
A giveback is when a tenant agency releases space back to the GSA prior to the firm lease term ending or releasing space to GSA in a federally-owned asset. In a market context, space given back to GSA by tenant agencies should be included in the “shadow vacancy” calculations for the overall market – although technically still “under lease”, nobody is in occupancy and conducting business inside the premises.
WHY IT MATTERS
Space givebacks force GSA to either carry vacancy on their books for the remainder of the firm term of the lease or backfill the space with another agency, presumably cannibalizing other leased space. Reductions create additional negative net absorption. This flood of vacancy injected into a market awash with Class B and C space will no doubt have a profound impact on future leasing projections. In DC alone, the square footage reductions identified in this report will increase the vacancy rate among Class B and C assets by up to 14%. However, opportunity remains as not all agencies are shedding space and the GSA still has 35 million square feet of active leases in DC and Northern VA. There is anticipated federal growth as a result of a long-term response to the pandemic, increasing agency budgets and missions, escalating global tensions, and an expansion of government services. If you are a building owner with a pending federal lease expiration or are sitting on vacancy, it will take considerable skill and knowledge to navigate through this coming environment.
For questions about this article please contact:
Chad Habeeb, Director of Federal Leasing
FD Stonewater
[email protected]
Dan Cain has joined the firm as Executive Managing Director and will assume a leading role within the firm’s Development platform, with a primary focus on expanding the company’s logistics and industrial initiative.
Prior to joining FD Stonewater, Dan was a Director at Matan Companies, a private commercial real estate investment fund with $1.4 billion AUM consisting of industrial, life sciences, multi-family, and office assets located in the Mid-Atlantic region.
Dan is an industry veteran and comes to FD Stonewater with nearly 20 years of commercial real estate development, investment, and asset management experience. During his eight-year tenure at Matan Companies, Dan managed the 6 million square foot portfolio from acquisition and development through disposition and was accountable for maximizing returns and meeting fund, joint venture, and investor objectives.
Prior to joining Matan Companies, Dan spent over five years at JBG Smith (NYSE: JBGS) and four years at Armada Hoffler (NYSE: AHH).Dan earned his Master of Business Administration from The University of Virginia, Darden School of Business, and a Bachelor of Business Administration from James Madison University.
Dan Cain, FD Stonewater Executive Managing Director:
“I’m delighted to join FD Stonewater, as this is a unique opportunity to unite with an entrepreneurial, growing firm with a proven track record and help expand the firm’s development capabilities in different vertical. FD Stonewater maintains a strong reputation in the market while continuing to expand their national capabilities and I hope to build on this success as the firm continues to grow.”
David Alperstein, FD Stonewater Principal:
“Dan is a tremendous addition to the team, and we expect him to make an immediate impact on the business, particularly within our development platform. We are confident that Dan’s analogous experience across the real estate development and investment spectrum will boost FD Stonewater’s executive team, and he will prove to be a tremendous resource to the entire company.”
Claiborne Williams, Lead Development Principal:
“We could not be more pleased to welcome Dan to the firm. His experience in development, financing, and acquisitions directly correlates to our firm’s core capabilities and we are confident that his expertise will also help us achieve great success in several new ventures that we continue to pursue.”
To view the press release, click here.
Last week, the entire FD Stonewater team convened in DC for an All-Hands Company Event! Our employees traveled from around the country to participate in a series of team-building events. We kicked it off with a “town hall” presentation where different team members shared the company’s YTD accomplishments and discussed the future for each of our business lines – brokerage, development, and investment. We also traveled to Annapolis for a fun day sailing on the Chesapeake Bay and enjoyed an authentic Maryland crab feast. Thanks to all who organized the events, and looking forward to capping off another great year at FDS!
Click here to watch the recap video.
FD Stonewater recently completed the development of a 46,000 SF ground-up build-to-suit facility to house the Pennsylvania State Police in Skippack, PA. The three-building facility is located northwest of Philadelphia and consists of a police station, state-of-the-art training center, task areas, and an indoor firing range. After the lease award, FD Stonewater acquired the previously undeveloped land from the owner to subdivide a portion of the land. During the due diligence process for the land acquisition, it was revealed that the 40-acre site was partially covered in wetlands. The subdivision allowed FD Stonewater to acquire the most developable acreage within the site while mitigating the environmental impact on the wetlands.
UNIQUE PROJECT FEATURES
- State-of-the-art training center
- Indoor Firing Range
- Secure Evidence Room
- Secure Weapons Storage
Thank you to our entire project team for their efforts in bringing this project across the finish line!
Wight & Company, Harvey | Harvey-Cleary, Graf Engineering, ESC Limited, and Building EnergetiCx
On May 16, 2022, members of our development team joined elected officials, representatives from VA Central Office, VA NJHCS, Ocean County, and local Veteran groups to participate in a ceremonial groundbreaking for the new Toms River VA Clinic.
The new 68,000-square-foot clinic will serve the area’s Veteran population and will offer comprehensive medical care including primary health care, dental care, women’s health care, mental health counseling, and physical therapy. The Toms River clinic groundbreaking marks the culmination of many years of planning and community partnerships. Erecting a new, larger VA clinic in Ocean County expands services and permits closer-to-home care for many more Veterans.
Preliminary architectural rendering, courtesy of SmithGroup
DISTINGUISHED GUESTS
- Congressman Andy Kim – Third Congressional District of New Jersey
- Congressman Chris Smith – Fourth Congressional District of New Jersey
- Maurice B. Hill – Mayor, Toms River, New Jersey
- Dr. Steve Lieberman, VHA Deputy Under Secretary for Health
- Dr. Joan Mclnerney, Network Director VISN 2
- John A. Griffith, Acting, Executive Medical Center Director
FD Stonewater has completed the acquisition of the Alside Distribution Center at 7550 East 30th Street in Yuma, Arizona. The 222,554 square foot, single-tenant manufacturing and distribution facility is 100% leased to Associated Materials, LLC, the parent company to the user Alside Window Company. The property was built-to-suit for Alside in 2005, and the long tenure at the property reflects the facility’s mission criticality to operations and proximity to high growth southwest markets.
The industrial building has 25-foot clear heights throughout the warehouse, an internal crane system, 50-foot column spacing, 22 dock high truck doors, and 60-foot concrete truck apron. The property includes 6,000 square feet of recently renovated office space, new restrooms, and exterior enhancements. The building has expansion capability for another 55,000 square feet to accommodate any future tenant needs.
FD Stonewater Principal Owen Burke commented, “We are excited to enter the Yuma, AZ, market, and pleased to acquire this high-quality industrial facility. Our investment and development teams have extensive relevant experience acquiring single-tenant product and leveraging in-house development capabilities to successfully execute similar business plans. We have been focused on strategic investments in the industrial and manufacturing space and the Alside facility is both a perfect fit for our strategies and well positioned to benefit from tailwinds in industrial real estate.”
FD Stonewater recently completed the phased redevelopment of the U.S. Drug Enforcement Administration (DEA) headquarters on behalf of ownership. The two-building complex at 600-700 Army Navy Drive, also known as Lincoln Place, is a Class A, 511,000 square foot, highly-secure facility located in Arlington County’s Pentagon City neighborhood. FD Stonewater also represented ownership on the 15-year lease renewal for Lincoln Place in what was the largest lease transaction in Northern Virginia in 2018. The redevelopment of Lincoln Place enables the agency to modernize their law enforcement mission and to implement efficiencies that will allow 400 hundred additional staff to work at the headquarters complex, increasing the County’s employment base and supporting the agency’s expanding mission.
At the onset of the deal, ownership committed to significant capital upgrades with the goal of transforming Lincoln Place into a best-in-class government-leased facility. The redevelopment includes secure office with 20,000 SF of Sensitive Compartmented Information Facility (SCIF) space, café and fitness center amenities, courtrooms, agency museum, as well as building systems upgrades for both buildings. The facility meets Federal Security Level IV requirements. One of the more unique components of the project, the 12,000 square foot DEA Museum is an interactive state-of-the-art exhibit space that displays the history of the agency and the evolution of their mission while addressing key agency themes.
“The DEA has been a longstanding part of Arlington’s federal presence, and we are thrilled to see the agency choose to remain here in Arlington and make significant improvements to enhance its home here,” said Arlington County Board Chair Matt de Ferranti. “This newly redeveloped facility not only maintains a large employment presence that will support many other businesses in the Pentagon City neighborhood, but also entices additional visitors through the reimagined DEA Museum.”
Securing swing space for DEA headquarters staff was necessary to the success of the project. FD Stonewater’s leasing team secured 75,000 square feet of swing space at 2200 Crystal Drive and negotiated a 2-year term with flexible extension options. FD Stonewater provided turnkey swing space to the agency for the duration of the headquarters redevelopment and coordinated the agency’s move to the temporary space.
The DEA redevelopment assignment marks the continued expansion of FD Stonewater’s federal development and construction management platform. FD Stonewater has delivered other large-scale federal projects on behalf of building owners this year, including the 500,000 square foot redevelopment and restack for the National Institutes of Health (NIH) campus in Bethesda, MD.
FD Stonewater teamed up with SmithGroup as Architect-of-Record and HITT Contracting as General Contractor. The project delivered on time and on budget in September 2021.
Ben Dineen, Principal and Director of Development at FD Stonewater, commented, “Our development team was intensely focused on delivering the highest degree of service, bringing our ownership mentality to the project to optimize costs for ownership and the Government, while also leveraging our specialized government experience and technical capabilities to meet the DEA’s unique requirements.”
Claiborne Williams, Principal at FD Stonewater, added, “This redevelopment assignment fully aligns with our core development platform, as FD Stonewater has a rich history of providing services to owners with Federal Government occupants. We are proud of this team, and especially honored to be a part of this project, while also maintaining this value-critical occupancy for ownership and positively impacting Arlington County at large.”
Joe Delogu, Principal at FD Stonewater, led the lease negotiations on behalf of ownership for the long-term renewal at Lincoln Place. A long-time Arlington County resident, Delogu commented, “this lease renewal and the subsequent capital investment by ownership at Lincoln Place was vital for the County and its economic growth. The redeveloped facility creates an enhanced employment base while keeping a major government tenancy, two big wins for Arlington County that will spur further growth.”
Photo credit: Judy Davis, Studio HDP
FD Stonewater has completed the acquisition of 6000 Spine Road in Boulder, Colorado. The fully leased, 60,000-square foot, office building is located in Gunbarrel Business Park and surrounded by numerous Fortune 500 companies in the life science and technology industries.
Despite market uncertainty caused by the pandemic, Boulder’s office market has remained resilient, largely due to stable and diverse economic drivers, high barriers to entry, and a robust talent pipeline. The opportunity to acquire an office asset that features healthy cash flow and several paths to upside at a material discount to replacement cost in Boulder was compelling.
FD Stonewater Principal Andrew Schwartzman commented, “We are pleased to add this asset to our portfolio and excited to enter the Boulder market. Occupancy at the property went from about 70% to 100% during our acquisition pursuit, which demonstrates the health of the market, and we believe there are further upside opportunities as well. Our team continues to evaluate unique, strategic opportunities in high-growth secondary markets across the country. This property fits well into that strategy and is an exciting addition to FD Stonewater’s investment portfolio. We hope it’s the first of several in Boulder.”
FD Stonewater has completed the acquisition of the Harvey | Harvey-Cleary headquarters, a 55,624-square foot, Class A suburban office building in Houston’s Westchase submarket. The headquarters property is 100% leased to Harvey | Harvey-Cleary, a privately held, full-service general contractor with offices in Houston, Austin, San Antonio, and Washington, DC. The 15-year sale-leaseback was completed as part of FD Stonewater’s single-tenant investment program and caps more than a year and a half of collaboration on the deal.
Harvey | Harvey-Cleary has been headquartered in Houston since its founding in 1957. The company acquired the Westchase vacant property in 2019 and subsequently completed significant capital upgrades and interior renovations transforming the property into a modern, collaborative workspace. The building benefits from the area’s considerable population and economic growth and close proximity to major vehicular arteries and transit hubs.
FD Stonewater Principal Andrew Schwartzman commented, “We are excited to see this deal come to fruition after many months of collaboration with Harvey | Harvey-Cleary. We greatly value our relationship with them as a trusted service provider and partner. With a stabilized, reputable tenancy and strong underlying real estate fundamentals, this deal is representative of FD Stonewater’s single-tenant strategy that has realized tremendous success.”
Harvey | Harvey-Cleary President, Kevin Rogge, stated, “our relationship with FD Stonewater has grown steadily over the past decade and has been marked with many great successes. This deal is really the culmination of many years of collaborating on business pursuits. We are looking forward to seeing this through and continuing our strong partnership.”
By Norman Dong | Managing Director at FD Stonewater
Federal agencies are facing significant uncertainty about their space and facilities needs in the aftermath of the pandemic. Does the recent increase in telework reflect a temporary accommodation to get through the current public health crisis, or a more permanent way of doing business? After a decade of reducing agency space utilization, has the time come to reverse course to allow for more space and separation? As government real estate planners and decision-makers try to understand longer term impact of the pandemic, the time has come to re-consider the conventional thinking about how best to support the space and facilities needs of Federal agencies.
Without doubt, the remote work “proof of concept” that we have experienced over the past year will have lasting implications. Many working professionals have lived the benefits (and shortcomings) of remote work, and few may be willing to walk away from the increased flexibility and reduce commute time they have grown accustomed to during the pandemic. As a result, employers, including Federal agencies, must be willing to accommodate some increased level of remote work to remain competitive in the labor market. As both the private and public sectors recognize the economic benefits of further reductions in real estate utilization from increased telework, employers seem willing to accept this new way of doing of business.
Although we will likely never fully revert to the workplace centric model we once knew, neither will we adhere to the scale of remote work experienced during the height of the pandemic. According to a recent Gensler workplace survey, at least 80 percent of employees want to return to the office at least one day a week. After a year of working in isolation, many of us have grown weary of endless video calls and the distractions of the barking dog or the neighbor’s lawnmower. Moreover, some agency missions, including law enforcement, lab research, national security functions, and public facing functions, cannot be performed effectively through long-term telework. For many people, working from home will never be able to provide the workplace setting that fosters the type of communication, collaboration, and innovation to advance agency missions.
As the pandemic began, there was some speculation that agencies might need to expand their real estate footprint to allow for more private offices and greater physical separation among employees. Instead, we have seen agencies take a practical approach to de-densify the workplace by creating shifts of employees throughout the workweek instead of undertaking the more expensive proposition of re-designing the existing layout. As the Federal Government re-examines the need to provide a dedicated personal workspace for the entire workforce, we can assume that agencies will still need space, but less than what they were using in the past. The question of exactly how much less remains an open question.
The Federal experience under the pandemic warrants a fresh look at the traditional approach to new Federal construction projects like the Department of Homeland Security at St. Elizabeths or other large agency consolidations. After a year where most of the workforce has worked remotely, is the original value proposition of co-locating thousands of employees across multiple bureaus and divisions still valid? In the future, these new Federal construction projects may still be warranted, but in a smaller, modified form. While Federal construction makes sense for the most essential and specialized functions, it is increasingly clear that general and administrative functions can be accommodated more effectively through traditional leasing arrangements, telework, or the rise of flexible co-working solutions.
Government real estate officials also should reconsider the long- term leasing mandate that has governed Federal leasing for almost a decade. In the coming few years, agencies will face the decision to renew, replace, or extend their existing leased space – all of which can be expensive, multi-year commitments. Today, longer lease terms may not be appropriate as we continue to deal with the global health crisis. Amid all this uncertainty, the ability to maintain maximum flexibility is paramount.
As government real estate planners and decision-makers try to determine the long-term impact of the pandemic, some may be feeling pressure to have this all figured out by now. It will take several years before we understand how the pandemic will impact agency space requirements over the longer-term. Simple human nature compels us to want answers now, but we should resist the temptation to decide too quickly, and we should continue to seek better information before making long-term facility decisions. That is not to suggest that we disregard current agency needs, but instead consider the growing number of flexible options to support agency office space requirements without making longer-term commitments we are not ready to make.
While the scale and scope of Federal telework over the past year will influence future thinking about Federal real estate, we should also consider whether this scale of working from home has enabled Federal agencies and employees to do their best work. Recent events underscore the important work of our Federal agencies – whether it is responding to the public health crisis, processing benefits payments, dealing with the impact of natural disasters, or protecting our national security. In the words of one government real estate official, our objective should be to create a working environment that is “as good, if not better” than what we knew prior to the pandemic. Amid all this uncertainty, one thing is clear – our Federal real estate strategy must never lose sight of how best to support agencies in performing this mission critical work.
Norman Dong is a Managing Director at FD Stonewater and is the Former Commissioner of the U.S. General Services Administration, Public Buildings Service.
FD Stonewaterhas been recognized in the 2020 Greater Washington Area Best Places to Work, an awards program presented by the Washington Business Journal. FD Stonewater landed at number four on the list of mid-sized companies in the region.
Select employers from the Greater Washington Area were named winners of the awards program and were honored during a virtual event held on August 27, 2020. The winning organizations were recognized for their exceptional workplaces, comprehensive and creative benefits, and commitment to developing top talent.
Award applicants were evaluated and ranked across several research-based categories according to the number of Greater Washington Area employees. The program measured several workplace factors that impact employee engagement and satisfaction and honored companies in the region that demonstrate excellence in areas such as workplace experience, benefits and perks, employee engagement, and management practices.
FD Stonewater was one of just 30 organizations that were honored in the mid-sized business category. Over 400 companies participated in this year’s program, representing a cross section of industries including commercial real estate, technology, financial services, and consulting.
About 2020 Best Places to Work
Best Places to Work is an innovative publication and awards program produced by the Washington Business Journal. The rankings were determined by surveys that went directly to employees who answered a series of questions. The survey was administered online by the employers and through a service provided by Quantum Workplace, our research partner. The rankings are numeric based on Quantum’s scoring process. By ranking companies and sharing best practices we facilitate idea sharing and help other companies learn from the best.
Portland, ME – July 22, 2020 – FD Stonewater, J.B. Brown & Sons, and the U.S. Department of Veterans Affairs (VA) recently held an official groundbreaking ceremony at the site of the new VA Community-Based Outpatient Clinic (CBOC), located at 141 West Commercial Street in Portland, Maine.
Once opened, the clinic will replace and consolidate the existing leases at the Saco and Portland CBOC locations, without disruption of care and services during the transition. The new 68,710 rentable square foot facility will enable VA Maine to expand services to Veterans in a state-of-the-art and energy efficient facility. The new clinic will offer core healthcare services as well as additional specialty care services to Veterans and will embody the VA’s Patient Aligned Care Team (PACT) principles.
FD Stonewater entered into a Joint Venture agreement with J.B. Brown & Sons, one of the oldest and largest commercial real estate owners in greater Portland, for development of the site. The project was awarded to the JV entity (FDS JBB Portland LLC) in the fall of 2019, with substantial project completion planned for fall 2021.
“We are honored to serve our nation’s Veterans,” said Ben Dineen, Principal at FD Stonewater. These facilities are essential to ensure our Veterans have improved access to the care they deserve. We are proud to work alongside the VA team and our project partners to develop this project, especially one that will have a meaningful impact on the city of Portland and surrounding communities.”
The July 17th event attendees included representatives from VA Maine, including the Executive Steering Committee for the project as well as the current Saco and Portland VA Clinic managers.
SmithGroup will serve as the Architect of Record and Landry French Construction of Scarborough, ME, will serve as the General Contractor. Gorrill Palmer of South Portland will provide civil engineering services. NBT Bank is the lender for the project.
Photo Credit:Tim Greenway
By Norman Dong | Managing Director at FD Stonewater
As the nation continues to battle the COVID-19 pandemic, and with much of the country on lockdown, it may seem like we are living in unprecedented times. There are many open questions about the current public health situation, the outlook on the U.S. economy, and the capacity of the Federal Government to address these challenges. But there is some historical precedent for the magnitude of national crisis we are experiencing today. Our nation has experienced previous shocks to the system, which have been followed by a strong and sustained Federal response to these major events. It is important to understand how the Federal Government has responded to previous crises and the implications for government real estate.
As we try to make sense of our current situation, and as we consider the longer-term Federal impact, the events of September 11, 2001, come to mind. After the attacks, there was a significant expansion of Federal activity and spending to prevent future terrorist attacks at home and abroad. The establishment of the Department of Homeland Security in November 2002 was a direct response to the events of September 11. Moreover, other Federal agencies, including the Department of Defense and the Federal Bureau of Investigation, significantly expanded their functions to prevent future terrorist activity. Not surprisingly, funding for Federal homeland security activities at DHS and other agencies increased from $16 billion in FY2001 to almost $70 billion in FY2011 — an increase of more than 300 percent.
As the economy loses steam under the COVID-19 pandemic, we can expect to see large and sustained increases in Federal spending to promote economic growth. During previous economic downturns, there were significant spikes in Federal spending as the government deployed a strong fiscal stimulus strategy to respond to the crisis and to jump start the economy. This was true during the economic recession of the early 1980s, and it was true after the Financial Crisis of 2008-2009. During the Great Recession of 2009, for example, Federal spending increased to a record 24.4 percent of Gross Domestic Product. This increase was due in part to the American Reinvestment and Recovery Act of 2009 — the fiscal stimulus package that included $831 billion in new spending to provide temporary relief programs for those most affected by the recession and to invest in infrastructure, education, health, and renewable energy.
Change in Square Footage 2000-2019
As Federal spending increased in the aftermath of both September 11 and the Financial Crisis of 2008-2009, so did the Federal real estate footprint. The chart above shows trends in GSA leased inventory over the past two decades. The data shows a significant upward trajectory in the amount of Federally-leased space in the immediate years after the September 11 terrorist attacks as well as after the 2008 financial collapse, both in the National Capital Region and across the larger GSA portfolio.
Given past history, how can we expect the COVID-19 pandemic to impact Federal real estate? We can start by examining the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. The fiscal stimulus package enacted by the Congress last week reflects more than $2 trillion in government spending, with a $340 billion boost for Federal operations and response efforts to combat the COVID-19 pandemic. Increased agency spending includes spending to enhance the nation’s public health infrastructure, including $500 million for the Centers for Disease Control and Prevention to modernize public health data collection. Agencies including the Department of Agriculture, Interior, and Health and Human Services will receive funding to expand their workforce. And the General Services Administration will receive $275 million, which will fund deep cleaning and enhanced screening at Federal buildings and provide for emerging space requirements to support agency efforts to deal with the COVID-19 crisis. Depending on the severity of the current public health crisis and economic downturn, the CARES Act of 2020 may end up being the first in a series of steps taken by the Federal Government to get the economy moving again.
As we think about the short- and long-term impact on Federal real estate, there are several factors that should be considered, and these factors might have conflicting effects on Federal occupancy statistics:
- Historical precedent suggests that we might expect an expansion in the Federal real estate footprint as Federal activity ramps up to bolster the nation’s public health infrastructure and reinvigorate the economy.
- But in contrast to the previous events, the Federal response to the COVID-19 pandemic is taking place in era of significant downsizing of the Federal footprint. Our chart shows dramatic reductions in the Federal leasing footprint here in the National Capital Region since 2013, and a continuing trend of reductions in the overall GSA leased portfolio.
- As the vast majority of Federal employees telework every day during the pandemic, we are seeing a proof of concept unlike anything the Federal Government has experienced before. The CARES Act of 2020 will provide millions of dollars to agencies across government to improve their telework capacity through network expansions and software license purchases. As agencies demonstrate their ability to perform the functions of government by working remotely, will the Federal Government double-down on the concept of telework over the long-term?
- Finally, we must consider the concept of space densification. Over the past decade, agencies have dramatically improved their space utilization by eliminating private offices and embracing open-office environments that feature benching, hoteling, and telework. Will the COVID-19 pandemic and heightened concerns about infectious disease result in a push-back against the densification of workplaces and increase pressure to reconsider open office environments? Or, based on what is reflected in the Fiscal Stimulus package and in recent GSA policy guidance, will it only engender a new standard for janitorial services and cleaning of shared space?
As the Nation battles the COVID-19 pandemic, history has shown how the Federal Government and the nation have been able to overcome these monumental challenges. The current situation provides an opportunity to reflect on the Federal capacity to respond to the current crisis and our nation’s ability to recover from this event. These types of events compel us to examine not just the Federal program infrastructure, but also the Federal real estate posture, for dealing with these major shocks to the system. As the Federal real estate strategy continues to mature and evolve, it must do so in a way that supports our nation’s resilience.
Norman Dong is a Managing Director at FD Stonewater and is the Former Commissioner of the U.S. General Services Administration, Public Buildings Service.
FD Stonewater has been recognized as a winner of the 2019 Greater Washington Area Best Places to Work, an awards program presented by the Washington Business Journal.
Select employers from the Greater Washington Area were named winners of the awards program and were honored during an event held on May 16, 2019. The winning organizations were recognized for their exceptional workplaces, comprehensive and creative benefits, and commitment to developing top talent.
Award applicants were evaluated and ranked across several categories according to the number of Greater Washington Area employees. The program measured several research-based workplace factors that impact employee engagement and satisfaction. The awards honored companies in the region that demonstrate excellence in areas such as workplace experience, benefits and perks, employee engagement, and management practices.
FD Stonewater was one of just 32 organizations that were honored in the small business category. Over 500 entries were received this year, a record number of submissions for the awards program.
For further information:
Kathryn Nuss
703-537-7628 Direct
FD Stonewater announced today that the company recently completed the disposition of a single-tenant property located on the grounds of the Grand Junction Regional Airport in Grand Junction, CO. The company acquired the property in a joint venture along with P&L Properties and Lynxs Group in April 2015 as part of the firm’s single-tenant strategy. The facility was fully leased at the time of acquisition on a long-term net basis.
The 30.6-acre site included a 229,744 square foot airport hangar facility housing an industry-leading aviation maintenance, repair, and overhaul (MRO) service provider. The seven-building facility is an FAA-authorized, Class 4 repair station, able to service all makes and models of large metal aircraft. Key investment attributes included the asset’s attractive, long-term lease and the tenant’s market-leading reputation.
FD Stonewater and their JV partners were initially attracted to the opportunity due to the long-term cash yields combined the tenant’s strong business prospects, along with the facility’s strategic location and mission critical functions.
During the hold period, the company renegotiated the tenant’s lease expiration date and renewal options to align with a restructured ground lease, which resulted in significant value to potential buyers. Multiple bids were received during the competitive process. The JV partners settled on a public REIT buyer who closed on an extremely aggressive timeline.
Andrew Schwartzman, a Principal at FD Stonewater, noted, “This was an extremely successful transaction for all parties involved. We’d like to thank our JV partners at P&L Properties and Lynxs Group who were instrumental throughout the deal. We knew going into this acquisition that it was a unique endeavor, but we were optimistic about the potential and confident that we had aligned ourselves with strong partners to implement and execute a robust business plan for the asset.”
For further information:
Kathryn Nuss
703-537-7628 Direct
[email protected]
FD Stonewater announced today it has completed the acquisition of Aramark’s Global Business Center, an 89,000-square foot office building in Nashville, TN. The building is 100% leased to Aramark, (NYSE: ARMK) a publicly-traded global food services, facilities management, and uniform services provider and full-building occupant since 2013. The acquisition was completed within FD Stonewater’s stabilized asset, secondary market investment strategy.
Located just south of Nashville in the Brentwood submarket, the property benefits from its strategic location, which provides easy access to the Nashville International Airport and to major interstates, along with proximity to a robust local employment base, strong business community, and vibrant public amenities. The building can support Aramark’s future growth and its above-market parking ratio allows for flexible, dense space-planning.
The Nashville office market has shown strong fundamentals in recent years and continues to attract active development and investment. The Aramark acquisition marks FD Stonewater’s fourth investment in Nashville, less than seven years after the firm’s first acquisition in the market.
FD Stonewater Principal Andrew Schwartzman commented, “We are thrilled to add this property to our portfolio and we continue to be strong believers in the Nashville office market. Since our first investment here in 2012, we have continued to evaluate opportunities in Nashville and surrounding submarkets that fit our investment strategies. We are confident that through thoughtful and active ownership, we will foster a long-term relationship with Aramark and provide support to the tenant’s objectives at the property.”
About FD Stonewater
FD Stonewater is a boutique real estate investment, development, and brokerage firm headquartered in Washington, DC. Collectively, the firm’s leadership has a track record of more than $10 billion, over 45 million square feet of lease transactions, and 21 build-to-suit projects completed, with $450 million of development currently in production.
For further information:
Kathryn Nuss
703-537-7628 Direct
[email protected]
Until Friday’s temporary fix for the partial federal government shutdown, the General Services Administration, the government’s in-house real estate services/design and construction/facilities management/bill payer was on the verge of freaking out.
I imagine some lessors were about to lose it, too.
The GSA pays the rent for government agencies, including the FBI, which leases its whole 110,000-square-foot Oklahoma City field office building at 3301 W Memorial Road, and Immigration & Customs Enforcement, which leases space in at least two private office buildings.
I imagine that until rent payments were threatened because of general contention and political animosity over the border (and how many walls are enough), there was no more reliable lessee in the world than the GSA acting for the USA, what with its full faith and credit on the
line every time the rent was due.
With the shutdown, January rent payments due in early February were in limbo.
Norman Dong, a managing director at FD Stonewater in Arlington, Virginia, and a former commissioner of the General Services Administration’s Public Buildings Service, brought some historic perspective in remarks earlier this week in a piece for the National
Federal Development Association, which he serves as a board member.
“In the past, there have been 20 instances of a Federal Government shutdown, with the first one taking place under the Ford Administration,” he wrote. “Never before has the Federal Government faced such a real and significant threat of delaying payments for its privately leased space.
“As we continue into these unchartered waters, it is helpful to see a potential solution for the Government to fund the next cycle of rental payments and avoid significant disruption and consequence, at least in the short-term.”
A “short term” fix apparently is what we got Friday.
Not lost on some people, whether regular federal funding returns or not, is that the standoff over the wall was a threat not only to lots of everyday people, but two of the agencies charged with protecting them, including border protection: the FBI and ICE.
By Norman Dong
Managing Director at FD Stonewater, NFDA Board Member
At Day 33 of the Federal Shutdown, which is now the longest shutdown in U.S. history, owners and investors of property leased to the Federal Government continue to wonder whether the Government will be able to pay its January rent payments that are due in early February. This concern is not lost on GSA, as reflected in a recent statement posted on its website: “GSA also is aware of concerns from the Lessor community regarding GSA’s ability to make timely rent payments. GSA is diligently exploring all available options to ensure its rental obligations are met in a timely manner.”
It is unclear, however, how the Agency will address this pressing issue. As noted in our previous article, the question is not whether the Government will pay its full rent obligations, but when it will make these payments. What remains at risk is the timing of nearly half a billion dollars in rental payments due in early February, affecting more than 8,000 leases in the GSA portfolio. GSA leases typically do not contain any provision allowing the Government to delay rent payments, and the reliable receipt of those payments is an important factor to the value of GSA leases in the market. Missing or delaying a scheduled rent payment potentially could put numerous GSA lease-secured commercial mortgages into default and eventually increase GSA’s cost to acquire leased properties. Moreover, this type of payment disruption could result in a downgrade of the U.S. Government’s credit rating.
While the consequences of a delay in payments would be significant, there is a potential path forward for the Federal Government to make the next cycle of rental payments. It is important to understand the mechanics of the GSA budget to see the potential near-term resolution.
GSA makes payments to private landlords through its Federal Buildings Fund Rental of Space Account. In its FY2019 Budget, the Agency requested about $5.6B, which translates into a monthly rental obligation of approximately $470M for the space it occupies in privately-leased facilities. Because the GSA Public Buildings Service receives funding that can be carried forward from one year to the next, the Agency was able to use “carry-over” funds from last year to meet its December rent obligation. However, the current balance of GSA’s Rental of Space Account is insufficient for the Government to fund the next cycle of rental payments.
Although the Rental of Space Account may be dwindling, there are other funds in GSA’s coffers that potentially could be brought to bear on this issue. A review of the FY2018 Agency Financial Report for GSA shows almost $4.9B in unspent funding from prior years across the various accounts within the Federal Buildings Fund, funds that GSA can carry-forward and use in the current fiscal year. A significant portion of these unspent funds reflects money that Congress has appropriated, but the Agency has not yet spent, for new construction, acquisition, and repairs and alterations to Federally-owned buildings. For now, these funds are sitting idle, waiting to be spent as the Agency moves forward to execute these capital projects. During this current 1 2 shutdown period, the probability is extremely low that the Government will spend this money as these activities are largely prohibited under GSA’s current shutdown guidelines.
Technically speaking, GSA has the money in its various accounts in the Federal Buildings Fund to make its next cycle of rental payments. One potential solution would be for the Government to transfer these unspent capital funds on a temporary basis to the Rental of Space account to fund the next cycle of rental payments. When the Government is funded and open for business once again, GSA could replenish these capital accounts. GSA has statutory authority to move funding among its various accounts, but not without prior approval from the House and Senate Appropriations Committees. While this may seem like a tall order in today’s environment, approval of this type of funding transfer at the committee level would be far less complex than enacting the full-year appropriations bills that are currently at the center of the Shutdown debate, and which must be passed by the full House and Senate and signed by the President.
In the past, there have been 20 instances of a Federal Government shutdown, with the first one taking place under the Ford Administration. Never before has the Federal Government faced such a real and significant threat of delaying payments for its privately-leased space. As we continue into these unchartered waters, it is helpful to see a potential solution for the Government to fund the next cycle of rental payments and avoid significant disruption and consequence, at least in the short-term.
Norman Dong is a Managing Director at FD Stonewater and is the Former Commissioner of the U.S. General Services Administration, Public Buildings Service
By Norman Dong
Managing Director at FD Stonewater,
NFDA Board Member
Annual funding for a significant part of the Federal Government, including GSA, expired on December 21, 2018, resulting in the current government shutdown. Because the GSA Public Building Service receives funding that can be carried over from one year to the next, GSA was able to utilize carryover funds to continue its real estate functions beyond December 21 and support ongoing operations, including salaries and expenses, on a temporary basis. As the balance of carryover funding has declined in recent weeks, the Agency has furloughed employees beginning Monday, January 7, 2019.
GSA Order ADM 4220.1L: Operations in the Absence of Appropriations, issued on September 24, 2018, identifies a limited number of “excepted” activities within GSA Public Buildings that may continue in the absence of appropriation. These activities are “to protect Federal property under GSA’s custody and control and to continue to provide critical support to other Federal agencies’ exempt and excepted activities for the protection of life and Federal property.” Under the shutdown, GSA leased buildings will remain open to allow tenant agencies to perform vital services and perform essential missions. Although the reduced number of employees reporting to work might suggest an ability to scale back on some services, leases typically do not contain specific shutdown provisions and lessors are required to continue to meet the requirements of the lease.
There are other important items to note regarding GSA Leasing during the shutdown:
• The lapse in appropriations will not reduce the total amount of the Government’s lease obligations. If a contract was fully obligated (as is the case with most GSA leases) before the lapse in appropriations, the contract is in full force and effect and no additional actions are required.
• Although there has never been an instance of it occurring, the length of the shutdown could hypothetically impact the timing of lease payments. GSA makes rental payments in arrears several days after the end of the month. If GSA does not have sufficient budget authority in its Rental of Space Account when January rental payments are due in early February, and no other provision has been made, then payments could be delayed. During the 2013 shutdown, which began on October 1 and lasted for 16 days, the government had re-opened early enough in the payment cycle for there to be no disruption or delay in the timing of payments.
• Brokers working under the GSA National Broker Contracts will continue to work because their function is not funded through annual appropriations but through commissions paid by private sector landlords. But to the extent that the brokers are working with GSA staff who have been furloughed, there may be an impact on on-going lease procurements.
• Unless notified by the Government or a representative, lessors and offerors are still required to meet submission deadlines and other delivery milestones of contracts and procurements. However, in most instances, new contracts may not be awarded, and contract options increasing the Government’s financial obligation may not be exercised except in rare circumstances.
• The shutdown impact on post-award activity (work in progress for new build-outs, tenant improvement projects, build-to-suit projects, etc.) will vary by project based on whether specific projects have been deemed as excepted, whether the work has already been funded, and/or the extent to which staff at GSA and tenant agencies have not been furloughed.
Most of the uncertainty surrounding this shutdown’s effect on GSA’s leased portfolio revolves around how long GSA goes without funding. While a shutdown ending in the next few days would have a relatively minor impact on Federal leasing, a shutdown that persists into February would require the Government to take unprecedented steps to fund its ongoing rent obligations to avoid significant disruption and consequence.
Norman Dong is a Managing Director at FD Stonewater and is the Former Commissioner of the U.S. General Services Administration, Public Buildings Service.
Arlington, VA – November 20, 2018 – FD Stonewater announced today that the firm will once again represent ownership, this time as a development manager, for the redevelopment of the U.S. Drug Enforcement Administration (DEA) Headquarters complex at Lincoln Place. The DEA recently committed to a 15-year follow on lease at the two-building complex, a highly secure facility situated in Arlington County’s Pentagon City neighborhood. DEA remains the sole occupant of Lincoln Place. FD Stonewater represented ownership on the 15-year lease renewal for Lincoln Place in what is expected to be the largest lease transaction in Northern Virginia this year.
The redevelopment of Lincoln Place will be comprehensive and is expected to be valued between $80-$100 million dollars. The work will enable DEA to materially modernize their law enforcement mission and to implement efficiencies that will allow an additional 400 staff to work at the headquarters complex. Ownership has committed to concurrent capital upgrades, with the project goal of maintaining Lincoln Place as a best-in-class federally-leased facility.
The DEA redevelopment assignment also marks continued expansion of FD Stonewater’s federal development and construction management platform. FD Stonewater is currently managing several large-scale federal projects on behalf of building owners, including the 118,000 square foot interior renovation for the Federal Emergency Management Agency (FEMA) in Atlanta, and the 500,000 square foot redevelopment and restack for the National Institutes of Health (NIH) in Bethesda, MD.
Ben Dineen, Vice President at FD Stonewater, commented, “Our development team is focused on delivering the highest quality service to this assignment, bringing our ownership mentality while also leveraging our specialized government experience and technical capabilities to meet the DEA’s unique requirements. The redevelopment of this complex will significantly improve the properties and will meet the tenant’s modern occupancy standards as the agency upgrades and expands their mission over the next several years.”
Claiborne Williams, Principal at FD Stonewater, added, “This redevelopment assignment fully aligns with our core development platform as FD Stonewater has a rich history of providing services to owners with federal government occupants. We are comfortable navigating the complexities of this high-profile project and we are confident operating within the unique federal real property space. Most importantly, we are extremely proud to be a part of this project that will improve the DEA’s efficiency in carrying out their mission, while also maintaining this value-critical occupancy for ownership and positively impacting the country at large.”
FD Stonewater is working with SmithGroup as the lead architect for the project.
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.
Arlington, VA – September 24, 2018 – FD Stonewater announced today that it successfully represented building ownership in securing a long-term lease renewal with the General Services Administration (GSA) for 511,000 square feet, in what is the largest Northern Virginia federal leasing deal this year. The transaction was completed for a two-building complex, known as Lincoln Place; a highly secure facility situated in Arlington County’s Pentagon City neighborhood. Lincoln Place is fully occupied by the U.S. Drug Enforcement Administration (DEA) and serves as the DEA’s national headquarters.
FD Stonewater negotiated the 15-year lease renewal in a highly-competitive procurement and will now represent the owner, as construction manager, during a comprehensive, multi-phase building redevelopment and renovation program slated to complete in 2020. FD Stonewater represented ownership in all aspects of negotiating the new lease at Lincoln Place and concurrently is negotiating the swing space requirement for the renovation.
Chad Habeeb, Vice President at FD Stonewater, commented, “With TSA’s forthcoming departure from Pentagon City, there was a lot of pressure on the County to keep the DEA in Arlington and getting the County involved was imperative to the success of this deal. We are optimistic that this renewal will materially impact the county’s economic vitality, as nearly 3,000 jobs will remain in the county and the redevelopment of the site and mission expansion of the agency will likely spur additional jobs and growth.”
Joe Delogu, Principal at FD Stonewater, added, “We are thrilled to have secured the DEA’s tenancy in Arlington County for the next 15 years. The redevelopment of this complex will greatly improve the properties and will meet the tenant’s modern occupancy standards. We are extremely proud to be a part of this transaction that will improve the DEA’s efficiency in carrying out their mission, while also maintaining this value-critical occupancy for ownership and positively impacting the county at large.”
FD Stonewater worked closely with Joel Berelson and Gregg Otten of the GSA, as well as the GSA’s tenant brokers, Henry Chapman and Sara Dunstan of CBRE. This highly competitive, prospectus-level deal is nearly four years in the making and required a strategic, creative approach to successfully meet ownership and tenant objectives.
About FD Stonewater
FD Stonewater is a boutique real estate investment, development, brokerage and advisory firm headquartered in Washington, DC. Collectively, the firm’s leadership has a track record of more than $10 billion, over 45 million square feet of lease transactions, and 18 build-to-suit projects completed, with $240 million of federal development currently under construction.
For further information:
Kathryn Nuss
703-537-7628 direct
[email protected]
Arlington, VA – July 23, 2018: FD Stonewater announced that it has recently been awarded two new development deals, both for specialized healthcare facilities housing federal tenants. The new projects represent the most recent successes for the firm’s expanding federal development and construction management platform. The first award was for a 15-year lease by the General Services Administration (GSA) to house the United States Air Force in Brandon, FL. FD Stonewater acquired the building and is redeveloping the 44,000 square foot asset, transforming it from its prior call center and general office use into the new MacDill Satellite Clinic, a state-of-the-art medical facility that will provide comprehensive medical care to members of the Air Force and their families.
The second development is a 20-year lease for the United States Department of Veterans Affairs in Charlotte Hall, MD. This ground-up development is situated on a 6.9-acre site and will consist of approximately 25,000 square foot Community Based Outpatient Clinic that will provide Veterans with accessible, comprehensive, and patient-centered healthcare. Claiborne Williams, Principal at FD Stonewater, commented, “We are thrilled to have been selected to lead these two important projects. Our expertise in government-occupied real estate, along with the proven track record of our project partners in delivering specialized healthcare facilities across the country, will guide critical decisions at key project milestones and ultimately result in the best possible outcome for the tenants. We are truly honored to support these vital organizations and deliver new facilities that will serve the men, women, and families of our Armed Forces, as well as our country’s Veterans, for the next 20 years and beyond.”
FD Stonewater is a leader in designing, developing and owning facilities leased and occupied by government tenants. The firm and its affiliates has successfully delivered 18 build-to-suit lease projects on behalf of government tenants. The company has over $240 million of federal development projects underway nationwide.
Oculus Inc. serves as the project architect with Harvey Cleary Builders serving as general contractor for both projects.
About FD Stonewater
FD Stonewater is a boutique real estate investment, development, and brokerage firm headquartered in Washington, DC. Collectively, the firm’s leadership has a track record of more than $10 billion, over 45 million square feet of lease transactions, and 18 build-to-suit projects completed, with $240 million of federal development currently under construction.
For further information:
Kathryn Nuss
703-537-7628 Direct
[email protected]
Arlington-based real estate firm FD Stonewater has long been known for leasing government-occupied properties in the Washington area and purchasing office portfolios that offer potential for significant reinvestment.
But over the past two years, the company has turned its attention to buying office buildings it considers “stabilized” — think properties with high-profile tenants under long-term leases that generate steady rents.
“Over the last couple of years, we have been looking at more stable cash flow investments,” said Andrew Schwartzman, a principal with FD Stonewater. “That’s the addition of a new strategy for us, whereas 10 years ago we weren’t looking at stable, multitenant investment deals.”
The latest example of that strategy is FD Stonewater’s recent purchase of SunTrust Center I and II, a 420,000-square-foot Class A suburban office campus in Richmond, Virginia. That deal, announced Wednesday, was made with an undisclosed foreign investor formed to acquire real estate assets in the United States. Terms were not undisclosed.
SunTrust Center I and II are considered stable, due largely to SunTrust Bank’s Mid-Atlantic regional headquarters, the anchor tenant there, Schwartzman said. The bank occupies all of SunTrust Center I and 40 percent of SunTrust Center II. The property is currently undergoing a $30 million renovation that will include a new lobby, fitness center and cafe. That renovation was underway before FD Stonewater bought the property from Atlanta-based Bridge Commercial Real Estate.
“That’s a longer-term stabilized type of deal, where we are buying based on the strength of the cash flow,” Schwartzman said. “Today, everybody seems to want to buy value-add deals. There’s probably less capital today chasing stable deals in secondary markets. … We are always looking for returns relative to the risk.”
Schwartzman declined to provide specific markets, but said the company will continue to purchase stabilized properties in areas of the country such as the Midwest, Southeast and Southwest. Last year, it bought River Park 1, a 170,000-square-foot office property in Conshohocken, Pennsylvania, that is 100 percent occupied by Reimbursement Technologies, Inc.
That’s not to say the firm has given up on what got it here. It has a team that handles federal leasing for several thirdparty clients as well as build-to-suit projects, such as a recently completed Citizenship and Immigration Services facility in Nashville.
It will also continue to acquire properties that are in need of significant reinvestment, such The Timberland Buildings office portfolio in Troy, Michigan. That property, which FD Stonewater also announced Wednesday it had purchased, is about 50 percent leased to a variety of tenants including law and engineering firms.
FD Stonewater has hired Transwestern to provide property management and leasing services for the Michigan property. FD Stonewater will invest $12 million to renovate and reposition those buildings over two years, Schwartzman said.
“We’re redesigning the buildings from a physical aesthetic perspective,” Schwartzman said. “We’ll be doing leasing. We’ll be improving the buildings’ systems and providing a lot of the capital that has not been available to these buildings for the last several years. … We bought it for what we think was a reasonable price, and we’re investing a lot more money in those buildings to reposition them and create a lot of value.”
FD Stonewater recently raised money for both of the deals. According to SEC filings, the company raised $2.4 million toward the Timberlands deal and $1.25 million for the SunTrust Center transaction.
Arlington, VA – May 24, 2018 – FD Stonewater announced today it has completed the acquisition of SunTrust Center I & II, a 420,000-square foot, Class A suburban office campus located in Richmond, VA. The buildings are 100% leased and benefit from the successes of the Innsbrook office submarket and the nearby Short Pump retail corridor. The acquisition was completed within FD Stonewater’s stabilized asset, secondary market investment strategy.
The property’s anchor tenant, SunTrust Bank, utilizes the space for its Mid-Atlantic regional headquarters. These buildings were selected over newer, build-to-suit office product, largely due to the branding opportunity, central location, existing building infrastructure, and abundant amenities. In an effort to elevate the property as a flagship location for the SunTrust brand, the property is undergoing a significant renovation, with more than $30 million being invested to transform the asset into a vibrant and collaborative workspace with core building upgrades and a new lobby, fitness center, and café.
SunTrust Center is the second investment in FD Stonewater’s partnership with a foreign, multifamily office investor formed to acquire real estate assets in the U.S.
Owen Burke, Director of Asset Management for the firm, commented, “The business strategy is to operate the property in an institutional manner and develop long-standing relationships with the tenants. This is the second acquisition for the firm in the past week as we have seen our portfolio continue to grow through various investment and development strategies. The portfolio currently has 14 active projects and we will continue to selectively sell or recapitalize assets as business plans are completed.”
FD Stonewater Principal Andrew Schwartzman added, “We are thrilled to continue our relationship with our investment partner through this acquisition of SunTrust Center. The property is located in a highly amenitized Richmond office submarket that has historically seen resilience and strong occupancy trends. We are confident that through thoughtful ownership and a strategic approach to the property, we can accentuate the property’s successful history of leasing space to large corporate users while highlighting the property’s competitive advantages in this market.”
About FD Stonewater
FD Stonewater is a boutique real estate investment, development, brokerage and advisory firm headquartered in Washington, DC. Collectively, the firm’s leadership has a track record of more than $10 billion, over 45 million square feet of lease transactions, and 18 build-to-suit projects completed, with $240 million of federal development currently under construction.
For further information:
Kathryn Nuss
703-537-7628 direct
[email protected]
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The FD Stonewater development team, along with Maine Governor Paul LePage, helped ceremonially break ground for a new office building for more than 500 state employees in the Department of Health and Human Services. The building is the first major addition to Maine’s State House complex since the 1970s and is slated for completion in summer 2019.
Norman Dong, managing director at FD Stonewater, discusses evolving trends and potential practices in federal government real estate with Government Matters host Francis Rose
Arlington, VA – September 26, 2017 – FD Stonewater announced today it has recently completed construction of an 151,066-square foot build-to-suit facility which is under a long-term lease to the U.S. General Services Administration (GSA) for use by the Federal Bureau of Investigation (FBI). The lease contract total value is $101M. The project was completed on time and on budget and is situated on 13 acres of land ground-leased from Mercer University.
This state-of-the-art facility will serve as the FBI’s Atlanta field office and supports the FBI’s mission while ensuring seamless collaboration and integration with state and local law enforcement.
FD Stonewater announced today it has recently completed construction of an 151,066-square foot build-to-suit facility which is under a long-term lease to the U.S. General Services Administration (GSA) for use by the Federal Bureau of Investigation (FBI). The lease contract total value is $101M. The project was completed on time and on budget and is situated on 13 acres of land ground-leased from Mercer University.
This state-of-the-art facility will serve as the FBI’s Atlanta field office and supports the FBI’s mission while ensuring seamless collaboration and integration with state and local law enforcement.
A San Francisco real estate investor has paid $80 million for a State Street office building, betting it can find new tenants to fill a large vacancy. Shorenstein Properties today said it has acquired the 533,000-square-foot office portion of 1 N. State St., connected towers of 11 and 16 stories. The statement did not name a sale price, which someone familiar with the deal said is almost $80 million.
The sale does not include retail space on the bottom two floors of the building, which are owned separately.
The seller is Arlington, Va.-based FD Stonewater, which bought the property for $31.7 million in 2007, before the recession, according to Cook County property records.
The building’s office space is 45 percent vacancy, according to Shorenstein’s statement.
At more than double the previous owner’s purchase price, Shorenstein is demonstrating confidence in a downtown leasing market where vacancy fell to a 15-year low during the second quarter.
Shorenstein knows Chicago well, having previously owned iconic office properties including the John Hancock Center and Prudential Plaza. Last year, Shorenstein sold the former Apparel Center, now known as River North Point, to Blackstone Group for $378 million.
Jeffrey Toporek, an FD Stonewater principal, did not immediately return calls requesting comment on the sale.
The State Street building was constructed in phases between 1900 and 1912, according to the Shorenstein statement.
FD Stonewater spent more than $10 million over the past two years upgrading the building with a new roof deck, bike room and lobby renovation. Shorenstein plans additional upgrades and new amenities, according to the statement.
The largest tenants are the Noble Network of Charter Schools, the e-commerce office of Sears and co-working firm MakeOffices, all with more than 50,000 square feet.
Ori, Ryan. “State Street Office Property Sells for $80 Million.” Crain’s Chicago Business. Crain’s Chicago Business, 30 Aug. 2016. Web. 06 Dec. 2016.
FD Stonewater announced today that effective July 17, 2017, Norman Dong, the former Commissioner for the United States General Services Administration, Public Buildings Service, will be joining the firm as Managing Director. Mr. Dong will assume a leading role within the firm’s Federal Government real estate third-party advisory and principal development platforms. Mr. Dong has a distinguished history working in both the private sector and as a Government executive. During his tenure as Commissioner for the GSA’s Public Buildings Service, Mr. Dong led the asset management, design, construction, leasing, building management, and disposal of nearly 374 million square feet of government-owned and leased space across all 50 states, six U.S. territories, and the District of Columbia.
“I’m delighted to join FD Stonewater, as this is a unique opportunity to leverage my experiences to achieve positive outcomes for Federal Government real estate from a different perspective,” said Dong. “I am impressed with the caliber of FD Stonewater’s team and the national resume of work that this firm carries. It’s rare to see a firm with their depth and breadth of experience, and they have maintained a nimble and entrepreneurial business model that undoubtedly serves both their private-sector clients and the public sector well. I hope to build on this success as the firm continues to grow.”
A graduate of Yale University and Harvard’s John F. Kennedy School of Government, Mr. Dong has spent the last decade of his 30-year career serving the Federal Government in executive, management, and advisory capacities; including previously held positions as Deputy Controller of OMB, CFO of DHS/FEMA and Deputy Mayor for Washington, DC. Mr. Dong’s notable accomplishments as Commissioner for the GSA’s Public Building Service include reducing the Federal real estate footprint, which resulted in annual savings of more than $100 million, as well as overseeing a multi-billion-dollar capital program to support new construction and major renovation of various GSA properties. In addition, Mr. Dong developed the portfolio strategy to identify productive use for underutilized GSA properties, which will yield more than $1 billion in value to the Federal Government while supporting local urban development objectives.
FD Stonewater Principal Richard Mann said, “Norm is a tremendous addition to the team and we expect him to make an immediate impact on the business; particularly with our clients who own Federal Government leased real estate across the country. His notable background, insight, and expertise in Federal Government real estate matters are well-suited for the firm’s strengths and enhances our strategic advisory practice and development platforms in this arena.” Principal Joseph Delogu further commented, “We are pleased to welcome Norm to the firm and we are confident he will bring a fresh and very current perspective to our business. His experience and wealth of knowledge is extremely valuable, particularly in today’s highly competitive marketplace when crafting sound strategy is more important that ever. We are confident that Norman will be integral in solidifying our firm’s status as the preeminent expert for Federal Government leasing, development, and advisory services.”
Arlington, VA – Tim Lenahan has joined FD Stonewater as a Managing Director of Government Leasing. At FD Stonewater, Tim will bring his 13 years of experience in the government real estate sector to advising the firm’s 3rd party landlord clients on transacting business with government entities and will also support the company’s own principal development efforts in the government arena. Prior to joining FD Stonewater, Tim was a First Vice President of CBRE’s Federal Lease Advisory Group.
David Alperstein, a principal at FD Stonewater, commented “we’re very excited to have Tim join our government leasing and advisory team, which has long been one of our firm’s most valued franchises. Adding Tim to the team is just another step in maintaining our best-in-class offering to our clients and their investors.” FD Stonewater principal Joe Delogu added, “Tim’s tremendous experience is an outstanding addition to FD Stonewater. His entrepreneurial and creative approach to our business is an excellent complement to the platform and will offer expanded expertise to our clients.”
Tim reflected, “After 13 very productive years at CBRE, it was simply time for me to expand my horizons and FD Stonewater is truly the only other team that offers its clients the level of strategic guidance that I find critical to achieving successful transactional outcomes. The unique vertically-integrated, yet-boutique and entrepreneurial platform allows for FD Stonewater to execute better than anyone else in the sector.”
Tim can be reached directly at [email protected] or (703) 537-7625.
Arlington, VA – FD Stonewater announced today it has completed the acquisition of a Class A, 164,845-square foot multi-tenant office building located at 1007 Church Street in downtown Evanston, Illinois. The iconic building was designed by world-class architect Helmut Jahn and is located less than one block from the Davis Street Station (Metra and CTA) and approximately 13 miles from Chicago’s CBD. The property – 79% leased upon acquisition – is home to several national and international tenants in the education, healthcare, and technology sectors. The acquisition was procured under FD Stonewater’s secondary market, multi-tenant, value-add investment strategy.
The building has been renamed “Evanston MetroCenter,” and ownership is planning to enhance the tenant experience through physical building improvements, expanded tenant services and cosmetic upgrades. The acquisition also includes onsite expansion potential that is currently being evaluated by FD Stonewater’s development team for multiple possible uses.
FD Stonewater Principal Jeff Toporek commented, “we are thrilled to acquire Evanston MetroCenter, particularly on the heels of recently selling One North State Street in the Loop this summer. We have enjoyed success in Chicago and are excited to add such a high-quality, transit-oriented asset to our portfolio. The asset’s superior location is well-suited to meet the discerning needs of tenants desiring an amenity-rich, urban environment outside of downtown Chicago but only an 18-minute train ride away.”
Andrew Schwartzman, Principal and Head of Acquisitions for the firm added, “Evanston MetroCenter is one of only a few office buildings in all of Chicagoland’s suburbs that offers superior access to mass transit, dozens of walkable amenities, and abundant parking in such a vibrant environment. We plan to restore the property’s stature as a true Class A office building in Evanston with one of the most unique amenity bases in the market.”
About FD Stonewater
FD Stonewater is a boutique real estate investment, development, asset management, brokerage and advisory firm based in Arlington, Virginia, with an office in Los Angeles. The company has a track record exceeding $10 billion in investment, advisory, and development as well as over 40 million square feet of lease transactions.
Arlington, VA – FD Stonewater announced that it has been awarded the exclusive rights to negotiate a 30-year lease contract with the State of Maine Bureau of General Services (BGS) for the purchase and redevelopment of the Maine DOT 109 Capitol Street in Augusta, ME. The parcel consists of 9.2± acres with eight connecting buildings and other out-buildings situated two blocks from the State Capitol. The existing structures on site would be demolished to make way for an approximate 89,000-square foot facility for the Department of Health & Human Services. Construction is estimated to commence in mid-2017. The design team is comprised of HGA Architects based in Alexandria, VA and Maine-based Mark Mueller Architects. The general contractor is Landry/French.
FD Stonewater principal, Claiborne Williams, commented, “We are thrilled to have been chosen to be the State of Maine’s development partner on this important assignment which, while delivering a high-quality build-to-suit for a State agency, will also revitalize a large land parcel in the heart of Augusta. Our national expertise in government-occupied real estate, along with the proven track records of our team partners in delivering projects across the State of Maine, are tailor-made for this endeavor. We are truly excited about the opportunity to deliver a new facility which will meet the State’s mission for the next thirty years and beyond.”
FD Stonewater is a leader in designing, developing and owning facilities leased and occupied by government tenants. This will be the 18th such build-to-suit lease project that the firm and its affiliates have successfully delivered on behalf of government tenants. The company has over $200 million of projects underway nationwide, consisting of government build-to-suits, corporate build-to-suits and other commercial projects.
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.
Arlington, VA – FD Stonewater announced today that effective January 1, 2016 William Magner joined the firm’s Board of Advisors and will be actively involved in the organization’s continued expansion. In particular, Bill will assist with growing the investor base within the firm’s nationwide principal investment and development platforms. Mr. Magner has a distinguished history in the commercial real estate industry having most recently served as the U.S. President for Cushman & Wakefield. Prior to Cushman & Wakefield, Bill was an International Director for Jones Lang Lasalle (JLL) and Spaulding & Slye, where he served as a Managing Partner of the DC Region prior to JLL’s acquisition of the firm.
FD Stonewater Principal David Alperstein said, “Bill is a long-time friend of the firm and has been a valued partner and mentor to many of us throughout our careers. Adding Bill as an active member of our Board is a tremendous opportunity for us to tap into his broad knowledge base, trusted relationships and strategic thinking as we plot our future path.” Principal Joseph Delogu further commented, “Some of us have known Bill for 20 years and he is one of the most thoughtful and respected professionals in our industry. His experience in managing both boutique firms and large national enterprises, will provide FD Stonewater with insights unique for our growing, entrepreneurial and fully-integrated national platform.”
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.
Arlington, VA – FD Stonewater announced today the sale of a four-building portfolio, each fully leased by the Federal Government. The portfolio consists of two Customs and Border Patrol (CBP) facilities located in Jacksonville and Riviera Beach, Florida; a U.S. Military Entrance Processing Command (MEPS) facility in Nashville, Tennessee; and an Immigration and Customs Enforcement (ICE) facility in Cary, NC. The portfolio was purchased by Boyd Watterson.
FD Stonewater, attracted by the staggered lease roll over and geographic diversity, originally purchased three of the buildings in 2012 as the first acquisitions for the FD Stonewater/Roseview Fund. During its tenure as owner of the portfolio, FD Stonewater executed lease renewals in two of the buildings and was awarded a long-term lease extension and substantial expansion at the ICE facility in North Carolina.
Jeff Toporek, a Principal at FD Stonewater, commented, “This sale represents a successful execution of our opportunistic Federal acquisition and development program, having purchased existing assets with shorter terms remaining and developed new longer term assets. The properties are mission critical facilities with well-funded government agencies, representing business plans we have been pursuing over the past few years, and it’s great to see the strategy fully realized.” Principal Joe Delogu further commented, “We are pleased to have invested on behalf of a Fortune 100 corporate pension fund and delivered a successful outcome for the strategy from inception to completion. The fund truly employed each of the disciplines fully integrated into our platform including investment, asset management, development and federal leasing – resulting in returns outperforming the original underwriting.”
Arlington, VA – FD Stonewater announced today it has completed the acquisition of a single-tenant property located in Cantera, a 650-acre mixed-use commercial development in Warrenville, IL. The Class A building consists of 136,000 square feet of office space on 19 acres of land with an above-market parking ratio. The building is fully leased to a subsidiary of a top Global Fortune 500 company and is replete with a high-tech creative office build-out.
FD Stonewater has a long track record of successful investment and advisory strategies in Chicagoland. Nationally, the company has completed over $467 million of property acquisitions and development. Regarding the Cantera transaction, David Stade, a Principal at FD Stonewater, commented, “Within four years, as the current lease expiration approaches, we expect to reposition the property for sale to an owner/user or lease to a tenant who wishes to take advantage of the state-of-the-art facility, a parking ratio of more than 5/1,000 square feet, and excellent freeway visibility.”
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.
Arlington, VA – FD Stonewater and Lynxs Group announced today they had completed the acquisition of a single-tenant property located in Grand Junction, Colorado. The multi-purpose industrial hangar and office facility is located within the airport grounds of the Grand Junction Regional Airport, and is fully leased to a single-tenant with a long-term lease. The transaction exemplifies FD Stonewater’s strategy of acquiring single-tenant, mission-critical facilities nationwide. The company has acquired in excess of $200 million of these types of assets encompassing more than 3.0 million square feet.
The facilities were acquired in a joint venture with Lynxs Group, a developer specializing in airport facilities worldwide; the seller, P&L Properties, also remains a partner in the new ownership structure. David Stade, a Principal at FD Stonewater, commented, “Complicated deals with ground leases and multiple parties at the table such as this one can be more challenging to transact, but we tend to specialize in them and have built a solid track record doing it.” Andrew Schwartzman, FD Stonewater’s newest partner, added, “We’re excited by the opportunity to work with our new partners to continue to build value at the Grand Junction Airport in an enterprise that will continue well into the future.” Ray Brimble, Founder of Lynxs Group, said, “The location is outstanding with a world-class business aircraft maintenance and refurbishment service in the facility. We are pleased to be associated with this site.”
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.
Arlington, VA – FD Stonewater announced today it has closed on the acquisition of a single-tenant property located in Nashville, TN. The transaction exemplifies one of FD Stonewater’s platform strategies; namely, acquiring single-tenant, mission-critical facilities nationwide. The company has acquired and developed in excess of $275 million of these types of assets encompassing more than 2.8 million square feet.
The 123,000-square foot building is located in the Airport South submarket of Nashville and is 100% leased to Asurion, a leading technology company headquartered in Nashville. Asurion provides mobile protection, electronics warranty protection and customer support services globally.
Andrew Schwartzman, FD Stonewater Principal of Acquisitions commented, “We are truly excited to add to our portfolio in the Nashville market. The asset basis, tenant quality, high parking ratio and improving location were strong drivers in our decision to acquire the property.” Jeff Toporek, a Principal at FD Stonewater, further commented, “2014 was a busy year for us acquiring 300,000 square feet of single tenant assets and expanding our other investment and development strategies nationally. We look forward to growing that significantly in 2015 and are on target to close on multiple investments in the first quarter.”
About FD Stonewater
FD Stonewater is a boutique real estate development, investment, advisory and brokerage firm based in Arlington, Va., with an office in Los Angeles. The company has a track record of more than $10 billion in investment, advisory, and development deals and has completed over 40 million square feet of lease transactions.