Top 6 Commercial Office Sales and Leases in Q1 & Q2 2016

Market Insight

Over the first half of the year, 79 office leases and 18 office building sales over 15,000 square feet have demonstrated an increase in the number of transactions in Prince George’s County.

By Dave Wills

The volume of sales transactions, eight of which were investment purchases, averaged $84.93 per square foot, or a total of $55,787,949. The office leases, totaling 300,962 square feet, were term extensions or expansions of existing leases 45% of the time. Starting rents averaged $23.20/SF with full service terms. Rents usually included some remodeling or interior office construction. There were five executed leases that exceeded 10,000 square feet totaling 134,564 square feet with terms averaging five years. Below are the top three commercial property sales and the top three business office leases in the county that were executed by mid-2016.

Notable Sales

  1. Metro Plaza (Metro East) – 8100-8300 Professional Place, Landover:
    A four-building office property totaling 175,717 square feet was sold on May 6, 2016 for $13.175 million ($74.98/SF). The buildings were 75% leased at the time of sale. Market lease rates were $21.95/SF full service for comparable buildings in the Landover submarket.
  2. Corporate Plaza (Metro East) – 8200-8400 Corporate Drive, Landover:
    A three-building office property totaling 179,062 square feet was sold on June 14, 2016 for $14.6 million ($81.54/SF). The buildings were 82% leased at the time of sale. Market lease rates were $21.95/SF full service for comparable buildings in the Landover submarket. The Metro East buildings are located near the intersection of the Capital Beltway (I-495) and Route 50. They are within walking distance of the New Carrollton transit station.
  3. Triangle Centre – 6401 Golden Triangle Drive, Greenbelt:
    A four-story, 80,454 SF office building was sold on June 2, 2016 for $4 million ($49.72/SF). The building was 44.7% leased at the time of sale. The building is brick construction and includes interior/exterior structured parking. Market lease rates were $21.87/SF full service for comparable buildings in the Greenbelt submarket. The building is located near the intersection of Greenbelt Road and Kenilworth Avenue, with direct access to the Capital Beltway.

Notable Leases

  1. In the first quarter of 2016, ATA Aerospace leased approximately 12,000 square feet at Maryland Trade Center II, 7474 Greenway Center Drive, Greenbelt. The space will be used for a NASA contract along with ASRC Federal Space and Defense.
  2. Fluor Enterprises leased approximately 44,000 square feet at 6801-6811 Kenilworth Avenue in the Calvert Metro Park, Riverdale. Fluor Enterprises will be working on WMATA’s Purple Line, which is scheduled to be completed in 2022. The Purple Line is a 16-mile light rail line that will extend from Montgomery County through College Park and onto New Carrollton in Prince George’s County.
  1. 2U, Inc., a software company, has signed a lease for approximately 252,950 square feet at 4900 Harkins Road in Lanham. They will be relocating from nearby 8201 Corporate Drive in Landover, vacating approximately 80,000 square feet. The move is scheduled for the 2nd quarter 2017.


How Can We Help You?

NAI Michael is a full-service commercial real estate firm located in the Washington, DC metropolitan area. We have been providing brokerage, property management, and development consulting services for over 40 years.



Industrial Property Demand in Prince George's County

Industrial Property Demand in Prince George’s County

Market Reports

Prince George’s County has seen industrial property demand rise over the past few quarters. Our mid-year 2016 industrial market report examines this demand and shows growth for the county’s industrial market.

Prince George’s County’s location makes it ideal for serving the District of Columbia, suburban Maryland, and northern Virginia markets. This makes it highly attractive to storage and distribution businesses. There has been a significant increase in industrial property demand and we have seen ample new construction to meet this growing demand. Two new buildings totaling 275,000 square feet were delivered at Cabin Branch Distribution Center in 2015. We have already seen 225,000 square feet absorbed, primarily by the United States Government. Overall vacancy in Prince George’s County held at 8.1% during the first two quarters of 2016, even with the additional supply added of new buildings.

Also contributing to the industrial property demand in the county are attractive rental rates compared to the neighboring jurisdictions of the District of Columbia and northern Virginia.  While rental rates in those neighboring markets are averaging north of $9 per square foot, tenants can still lease class A product in Prince George’s County for the mid $7’s per square foot NNN.

Lance Schwarz and Peter Burleigh of NAI Michael provide the full details and numbers behind the industrial market’s first two quarters of 2016.


2016 Mid-Year Office Market Report

Office Market Activity Boost in Prince George’s County

Market Reports

Our 2016 mid-year office market report indicates that there is an office market activity boost in Prince George’s County during the first two quarters of the year.

Over the first half of the year, increased interest in Prince George’s County contributed to an office market activity boost. The County’s office market is showing signs of growth, while the Washington DC office market has been slowing down. One reason for this is the attractive rental rates in Prince George’s County. The average office rental rate is approximately $30 less in Prince George’s County than in the District of Columbia.

Additionally, there has been an increase in the number of transactions in the county – 79 full service office leases and 18 office sales over 15,000 square feet have been completed. As we’ve recently reported, this is part of the dramatic increase in office investment sales in suburban Maryland. We expect sales of multi-tenanted office buildings to ultimately benefit office tenants. There will be a push to upgrade and renovate properties to more modern standards. This means that some buildings will finally receive long-awaited upgrades, both cosmetic and in the systems that support their workplace environments.


Increase in Office Investment Sales in Suburban Maryland

Market Insight

2016 is poised to be a great year for the office market, thanks to an increase in office investment sales in suburban Maryland. We are already seeing major growth in the number of sales and the total square footage being sold throughout Prince George’s, Montgomery, Howard, and Anne Arundel counties.

By the end of June 2015, the suburban Maryland* market saw 43 buildings sold, with a total of 2,856,583 square feet – the equivalent of nearly 6 football fields – according to data NAI Michael has gathered from the CoStar Group**. This year so far, CoStar reports the sale of 53 buildings and a total of 4,227,305 square feet. In other words, the first half of 2016 has seen a 19 percent increase in the number of buildings sold and a 32 percent increase in total square footage sold.

Increase in Office Investment Sales - Square Footage Sold Comparison
Increase in Office Investment Sales – Square Footage Sold Comparison

Keep reading

Leasing Space for Small Businesses

4 Tips on Negotiating Personal Guarantees when Leasing Space for Small Businesses

Market Insight

Leasing space for small businesses can be difficult for tenants that don’t fully understand the commercial real estate process. One aspect of leasing space that small businesses should understand is the personal guarantee. Andy Mayr of NAI Michael provides some insight on how to best negotiate personal guarantees when leasing space for small businesses. By Andy Mayr, CCIM

Landlords usually require their prospective tenants to provide business financials, such as tax returns, income statements, balance sheets, and personal financials before moving forward on a formal lease agreement.  If the landlord is not comfortable with the review of these documents or requires additional security, s/he may also ask the tenant to sign a personal guarantee.  In the event of leasing space for small businesses, it is especially important to understand personal guarantees.  Personal guarantees have been around in the banking industry for many decades, though they have only been in the real estate leasing world for about the past 40 years.

A personal guarantee puts the tenant’s own assets — such as real estate, savings, or other valuables — on the line should their business not be in a position to pay rent or other lease obligations. If you are new to owning a business or desperate to obtain a lease, you might overlook the legality of the personal guarantee. It is important to know what you are committing to and that you can negotiate the extent of the guarantee. Landlords sometimes expect a tenant to either not accept or limit a guarantee to a specific financial or time constraint. The four most popular resolutions to achieving a mutually acceptable personal guarantee are as follows: Keep reading

Mr. Michael at Business Hall of Fame

Business Hall of Fame Inducts NAI Michael’s Kenneth H. Michael

Company News

Business Hall of Fame recognizes Kenneth H. Michael’s business and community contributions.

NAI Michael’s Chairman, Mr. Kenneth H. Michael, was inducted into the Maryland Chamber of Commerce’s Business Hall of Fame last week. This is an immense, well deserved honor that recognizes his lifetime of successes throughout the great state of Maryland. Mr. Michael founded The Michael Companies (now NAI Michael) in 1973 and has grown it into the prominent commercial real estate firm that it is today. He has passed the company down to his two sons, Gary and David, while still remaining an active leader in the commercial real estate and development industry. Keep reading

Inaugural Creating Kingdom Buildings Conference Organizers

Inaugural Creating Kingdom Buildings Conference Gathers Real Estate Industry Leaders to Teach Pastors How to Build Their Houses of Worship

Company News

by Marcus Daniels

The Inaugural Creating Kingdom Buildings Conference brought together industry leaders in real estate, civil engineering, zoning & land use, architecture, construction, finance and risk management in the Washington Metropolitan Area to educate the faith community on how to successfully grow and build their houses of worship.

Over 200 attendees representing more than 100 churches gathered at The Sanctuary at Kingdom Square in Capitol Heights, MD on Saturday, April 30th. They learned more about the building process for houses for worship, identifying their congregations’ needs for space, assembling a project team, preparing their finances, determining the right location,  hiring the architect & contractor, maintaining the property and managing the risks associated with their property. With seminars and speakers on how to acquire, create and maintain optimal worship spaces, the conference featured speakers from NAI Michael, Linowes and Blocher LLP, Ben Dyer Associates Inc., EagleBank, Industrial Bank, Arel Architects, SAA Architecture and more. Keep reading

New and ongoing development projects - Riverdale Park Station

State of the Economy Previews New and Ongoing Development Projects in Prince George’s County

Market Insight

There are a number of new and ongoing development projects that are contributing to economic development in Prince George’s County, according to the 2016 Prince George’s County State of the Economy Address that NAI Michael had the pleasure of attending on April 13, 2016.

Many new and ongoing development projects were highlighted during the State of the Economy for Prince George’s County. County Executive Rushern L. Baker III, Jim Coleman of the Prince George’s County EDC, Derrick L. Davis of the County Council, and Jim Estepp of the Prince George’s Business Roundtable all spoke about the transformation and re-envisioning of the County. In fact, Baker said that there are more than $7 billion worth of projects in the pipeline, including:

Keep reading

  • 1
  • 2
  • 6

Archived Posts