ALEXANDRIA, VA. — A joint venture between American Real Estate Partners and Investcorp has acquired Canal Center, a 540,000-square-foot office complex in Alexandria, for $176 million. The Class A complex is located at 44 Canal Center Plaza. Tishman Speyer was the seller.
The four-building complex is situated on the banks of the Potomac River, just minutes from downtown Washington, D.C., and Reagan National Airport.
“This acquisition adheres to Investcorp’s approach of targeting properties located in major metropolitan areas with attractive yields and near-and long-term upside potential,” says Herb Myers, managing director in Investcorp’s real estate group.
Canal Center was originally built in 1987. It is currently 83 percent leased. No major leases expire until 2018.
“The northern Old Town Alexandria submarket has been going through a dramatic redevelopment in the last several years and is one of the few urban mixed-use markets outside of Washington, D.C.,” says Brian Katz, president of American Real Estate Partners.
“Alexandria is one of the strongest markets in the Washington metropolitan area and Canal Center enjoys an unparalleled location within the city and the Washington, D.C., region. Couple this with the extensive capital improvement projects we have planned, and we believe that Canal Center will be one of the best-conceived, mixed-use environments in the region.”
This is the partnership’s fourth joint acquisition. It is also the second investment American Real Estate Partners has made through its American Real Estate Partners Strategic Office Fund.
Herndon, Va.-based American Real Estate Partners is a vertically integrated institutional real estate investment manager. It invests with its partners in Class A office and office flex assets. It also invests in real estate-related financial instruments throughout the Mid-Atlantic and Eastern Seaboard.
Investcorp provides and manages alternative investment products. It focuses on corporate investments in the U.S., Europe and the Gulf, real estate investments in the U.S. and global hedge funds. Investcorp has offices in New York, London, Bahrain, Saudi Arabia and Abu Dhabi.
— Nellie Day