WASHINGTON, D.C. — Republic Properties Corp. has received a $255 million refinancing for Portals III, the company’s 509,935-square-foot office building in Washington, D.C. The Class A property is located at 1201 Maryland Ave. S.W. in the Southwest Riverfront submarket.
The 10-story building is situatedin the master-planned Portals development, one of the largest, privately held developments in the area. Portals III is currently 78 percent leased.
Korean Exchange Bank provided a $160 million senior debt facility, while Samsung SRA made a $95 million equity investment. The debt and equity facility will extend the capitalization for another five years with sufficient funds for future leasing cost requirements.
David Webb and Jamie Butler led the team from CBRE’S Mid-Atlantic Debt and Structured Finance Group, which arranged the refinancing on behalf of Republic Properties Corp.
“Samsung SRA’s key management staff approached us expressing an interest in investing in the Portals III building,” says Steven Grigg, president of Republic Properties. “In a remarkably short time, we established a relationship which allowed us to replace and simplify the capital structure of the project to the mutual benefit of all involved. Even though the transaction is about a quarter of a billion dollars, it came down to a mixture of old-fashioned personal relationships that were built on mutual objectives being satisfied in the context of fundamentally sound real estate.”
The property previously received $243 million in bridge and mezzanine financing — including an equity stake from a national pension fund —in September 2012. Prior to that, it had received $212 million in bridge financing in 2008.
Portals III will soon benefit from the completion of The Wharf, a 3.2 million-square-foot, $2 billion mixed-use development at the Southwest Waterfront. The property’s immediate vicinity already includes more than 1.5 million square feet of office, retail/service and restaurant space, in addition to the 400-room Mandarin Oriental Hotel.
“Portals III is a premier office property located in the dynamic and rapidly changing Southwest Riverfront submarket,” says Webb. “The combination of the institutional quality of Portals III, the strength and experience of the borrower and the premier location of the property resulted in very favorable financing terms, including a comfortable structure for the borrower.”
Republic Properties Corporation is part of the Republic Family of Companies, which also includes Republic Land Development LLC and Republic Urban Properties LLC. Republic is a privately owned, full-service real estate investment, management and development enterprise.
The company has developed and invested more than $4 billion in about 17 million square feet of properties. It is based in Washington, D.C., with additional offices in San Jose, California, and Reston, Virginia.
— Nellie Day