Mack-Cali Realty Corp. has turned to Washington, D.C., to quench its new thirst for multifamily assets, acquiring more than 800 units and development rights just outside the nation’s capital.
The Edison-based real estate investment trust announced today its acquisition of a property in Arlington, Va., through a joint venture with a fund advised by UBS Global Asset Management, according to a news release. The group purchased the property from Avalon Bay for about $262.5 million, marking its entrance into the D.C.-area multifamily market.
The site, known as Crystal House, in the Crystal City section of Arlington, includes a two-building, 828-unit multifamily property and land to accommodate another 295 additional units. It will be managed by Mack-Cali’s Roseland subsidiary, which it formed last fall when it acquired Roseland Property Co., based in the Short Hills section of Millburn.
The company has since moved to expand its reach in the booming multifamily market. In January, Mack-Cali said it was acquiring two Boston-area rental properties managed by Roseland.
In the news release, Mack-Cali President and CEO Mitchell E. Hersh said the company was “thrilled to be entering the metro D.C. market, one that offers enormous potential.” It also seems to have zeroed in on the Arlington submarket, as Hersh said in a separate statement to NJBIZ that Mack-Cali was “not looking at other markets in D.C. right now.
The joint venture in the deal obtained a $165 million mortgage loan from Walker & Dunlop LLC under a Fannie Mae program, the news release said. The property is about 96 percent leased, and Roseland will renovate the unrented units.
“When we’ve completed the renovation project, we are confident that we’ll be able to command rents at the highest end of the market,” Hersh said in the statement.
Mack-Cali, a longtime office giant, has about 330,000 square feet of commercial space in Washington, D.C., and nearly 1 million square feet in suburban Maryland, according to its website.