by Marcie Geffner
Inman News Features
The National Association of Realtors has figured out yet another way to get its lobbyists even closer to Congress. The association’s board of directors has authorized an expenditure of up to $45 million for land acquisition and construction of a new office building at 500 New Jersey Ave. NW, three blocks from the U.S. Capitol building.
The 103,500-square-foot building will have an unobstructed view of the Capitol from the rooftop and uppermost floors. NAR plans to occupy 32,500 square feet of office space on the top four floors.
“If we can see them, they can see us,” said California REALTOR Richard Rosenthal, vice chairman for the Washington, D.C., area subcommittee of NAR’s Real Property Operations committee, which recommended construction of the new building to the association’s board of directors.
The total price tag is comprised of $36 million for site acquisition, $5 million for improvements, $2 million for a photovoltaic solar array on the roof, a double curtain wall for thermal heat dissipation, a recyclable water system and other green building features, and $2 million for other project costs.
A $15 million down payment will be drawn from a reserve fund set up five years ago when NAR sold a building it owned then on Fourteenth St. NW. Options for financing the $30 million balance of the acquisition and construction costs will be presented to the board at its next meetings to be held in New Orleans in November.
An additional 57,290 usable square feet of office space and two retail spaces of 1,500 and 1,600 square feet will be leased to tenants. The building also will have 72 below-ground parking spaces and a 3,000-square-foot rooftop facility suitable for receptions.
Rosenthal said the association would pay substantially more money in the future to continue leasing its current facility than it would pay to occupy the space in the new building once it is stabilized. The aggregate savings are expected to start at $500,000 per year and increase each year.
Rosenthal said the cost of occupancy should decline to zero over the years and that the new building eventually will generate net income for the association. NAR’s Chicago headquarters building on Michigan Avenue generates $1 million in income annually for the national REALTORS group, he said.
A contract to develop the building, subject only to the directors’ approval, was signed with Washington, D.C.-based CarrAmerica prior to Saturday’s meeting. The building plan is subject to approval by the D.C. Board of Zoning and Adjustment.
Groundbreaking is scheduled for this fall and completion is expected in 2004.
The association’s real property operations committee, chaired by Pennsylvania REALTOR® Jim Helsel, reported that the association’s lease on its current D.C. office space at 700 Eleventh St. NW will expired Oct. 31, 2004. The association has a five-year renewal option on the space, which it may exercise with an intent to sublease the space at a profit. The landlord reportedly is eager to allocate the space to a prominent law firm already occupying a portion of the building.
“We have the option and if we want to exercise it, we can. And we could sublease the space and make some money off that,” said Rosenthal.
The committee analyzed options to build a new building, buy an existing building or continue leasing the current or other space in the D.C. area.
Minimum requirements for the building included specific geographic boundaries in the city, proximity to a Metro public transit stop, Class A office space and the opportunity to create a significant NAR presence in the Capitol.
A consultant identified only one potential building site and only six existing buildings that met those and certain other criteria, Rosenthal said.
The building site comes with a few drawbacks, including an inconvenient location for commuting staffers and its position on the Senate side, rather than the more populous House side of the Capitol building.
Directors at the NAR board meeting were shown a dramatic panoramic video of the expected view from the to-be-built building. The video was shot from a 100-foot-high construction crane positioned on the building site.
NAR Executive Vice President Terry McDermott, a former executive with the American Institute of Architects, reportedly utilized his experience and contacts in the architectural community to assist the real property operations committee in organizing a design competition for the new building. The winning design was submitted by Graham Gund Architects of Cambridge, Mass. Other designs were submitted by Clark Redfield Architects of Charlottesville, Va., and Bing Thom Architects of Vancouver, Canada.