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The Best Value-Add Opportunity in the Washington, DC Metro Area Adjacent to Amazon HQ2 E XECUTIVE S UMMARY
The Best Value-Add Opportunity in the Washington, DC Metro AreaAdjacent to Amazon HQ2
ExEcutivE Summary
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EXECUTIVE SUMMARY
Development Includes Over 300,000 of Total Retail
Long Bridge Park
Reagan National Airport$1 Billion Reagan National Airport Renovation Project
New Commuter Concourse Replacing 14 Outdoor GatesAdditional 150,000 Square Feet
49,000 VPD1
395131,546 VPD
Pentagon City MallOver 170 Stores on 3 Levels
7 Story Garage
Creation of a vibrant public plaza120K SF of retail delivering in 2020
20K SF specialty grocery chain50K SF Alamo Drafthouse Cinema
New 43,900 SF community gathering placeOutdoor entertainment, retail businesses, farmers markets, and water features
The Central District500K SF Immediate Occupancy
Pentagon
4.1 MM SF OF OFFICEOwned and Funded by Amazon,
Developed by JBG Smith
North District
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Development Includes Over 300,000 of Total Retail
Long Bridge Park
Reagan National Airport$1 Billion Reagan National Airport Renovation Project
New Commuter Concourse Replacing 14 Outdoor GatesAdditional 150,000 Square Feet
49,000 VPD1
395131,546 VPD
Pentagon City MallOver 170 Stores on 3 Levels
7 Story Garage
Creation of a vibrant public plaza120K SF of retail delivering in 2020
20K SF specialty grocery chain50K SF Alamo Drafthouse Cinema
New 43,900 SF community gathering placeOutdoor entertainment, retail businesses, farmers markets, and water features
The Central District500K SF Immediate Occupancy
Pentagon
4.1 MM SF OF OFFICEOwned and Funded by Amazon,
Developed by JBG Smith
North District
AMAZON WILL IMMEDIATELY LEASE 500,000 SF OF EXISTING OFFICE SPACE
AMAZON IS BUYING LAND ACROSS THE STREET FROM THE PROPERTY FOR 4.1 MILLION SF HEADQUARTERS OFFICE
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EXECUTIVE SUMMARY
INVESTMENT HIGHLIGHTSIDEAL VALUE-ADD OPPORTUNITY
534 Units
831 Avg SF per Unit
95% Leased
WALKABLE TO METRO
ACROSS THE STREETFROM WHOLE FOODS ROBUST EMPLOYMENT
& POPULATION GROWTH
PROXIMITY TO PROMINENT EMPLOYMENT
UNIQUE VALUE-ADD OPPORTUNITY IN A CORE SUBMARKET
STRONG MARKET FUNDAMENTALS (10.3% RENT
GROWTH SINCE Q1 2015)
STRONG IN-PLACE DEMOGRAPHICS WITH IDEAL RENTER PROFILE
1.9MM SF OF RETAIL WITHIN 1 MILE RADIUS
HQ2
WALKABLE TO PENTAGON
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COMPELLING ARLINGTON COUNTY DYNAMICS
UNEMPLOYMENT RATE
2.2%
WEALTHY The average household income within a mile of the Property is
$147,406, well above the national average.
GROWING 20% population growth since 2010
and nearly 8% projected growth
through 2023.
HIGHLY EDUCATED83% of residents maintain a bachelor’s
degree or higher within one mile of the property. 92% of the workforce
holds a white-collar job.
COMMUTING Eight minute walk to Pentagon City and
Crystal City Metro Stations.
Richest Millennials in the U.S. live in Arlington (ages 18 – 24)(Bloomberg, 2016)#1 Largest Percentage of Wealthy Millennials (Zillow, 2016)
8.7% of millennial households make more than $350,000
(Zillow, 2016)
#1 Best DC Suburb for Young Professionals (Movoto, 2015)
#1 Coolest City in the U.S. (Forbes, 2014)
#1 for Highest Percentage of Highly Educated Millennials (Redfin.com, 2014)
#3 Most Walkable Suburb(Redfin, 2015)
#3 of the 100 Best Places to Live (Livability.com, 2015)
#6 Top Healthiest City (Livability, 2015)
#8 Happiest Cities to Work In (Forbes, 2016)
#2 Best Place to Retire (Bankrate, 2015)
#1 Best City for Staying Healthy
(AARP, 2015)
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EXECUTIVE SUMMARY
GEORGE WASHINGTON MEMORIAL PARKWAYJEFFERSON DAVIS HIGHWAY
JEFFERSON DAVIS HIGHWAY
395
GEORGE WASHINGTON MEMORIAL PARKWAY RONALD REAGAN WASHINGTONNATIONAL AIRPORT (DCA)
CRYSTAL CITYMETRO STATION
POTOMAC RIVER
PENTAGON
IMMEDIATE OCCUPANCY
UNMATCHED ACCESSIBILITYCrystal City is equipped with the best transportation infrastructure in the entire Washington, DC region. Convenient Metrorail access is provided by the Crystal City Metrorail station and Pentagon City Metrorail Station (Blue and Yellow lines), which are both just an eight minute walk from the Property. Excellent vehicular access is provided by immediate proximity to major commuter thoroughfares such as I-395, Jefferson Davis Highway (Route 1), and the George Washington Memorial Parkway. The Virginia Railway Express Crystal City station is a five minute walk from the Property, providing convenient access to Union Station and by extension the entire Northeast Corridor. The Property is also just 1.5 miles and one Metrorail stop from Ronald Reagan Washington National Airport, which offers non-stop flights to more than 95 domestic and international locations on 8 airlines.
Drive Times From Meridian Pentagon CityLocation TimeReagan International Airport 5 minutesRosslyn 8 minutesWashington DC (CBD) 9 minutesOld Town Alexandria 10 minutesGeorgetown 11 minutes
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GEORGE WASHINGTON MEMORIAL PARKWAYJEFFERSON DAVIS HIGHWAY
JEFFERSON DAVIS HIGHWAY
395
GEORGE WASHINGTON MEMORIAL PARKWAY RONALD REAGAN WASHINGTONNATIONAL AIRPORT (DCA)
CRYSTAL CITYMETRO STATION
POTOMAC RIVER
PENTAGON
IMMEDIATE OCCUPANCY
DIVERSE & CONCENTRATED AMENITY BASEWithin a ten minute walk of the Property, there are over 250 restaurants and dining options, 380 retailers, and 20 hotels. A 37,000 square foot Whole Foods Market is also less than a three minute walk. The Crystal City Shops, which include 10 restaurants, over 30 fast-casual dining options, and over 85 other assorted stores and retailers, are located immediately south of the Property. A major concentration of retail and mixed-use development is also located a half of a mile to the west of the Property around the Pentagon City Metrorail Station, including The Fashion Centre at Pentagon City (a 994,000 square foot super regional mall with a 365 room Ritz Carlton hotel) and Pentagon Row (270,000 square feet of retail, 830 multifamily units).
REPRESENTATIVE CRYSTAL CITY TENANTS
1.9 MILLION SF OF RETAIL WITHIN A 1 MILE RADIUS
12.5 MILLION SF OF OFFICE WITHIN A 1 MILE RADIUS
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EXECUTIVE SUMMARY
AMAZON HQ 2 IMPACT25,000 employees with average salaries over $150,000
8 MILLION SF of office space
OVER $5 BILLION in construction and other investments
$1.4 BILLION in employee compensation
$3.6 BILLION in business sales
NATIONAL LANDINGCentral District: Entertaiment and Nightlife Hub
$1 Billion Virginia Tech Campus
New Crystal City Metro Entrance
The D.C. Region is One Of The Country’s Strongholds For Tech Talent With More Than 300,000 Tech Workers
Multi-modal Transportation Hub
JBG Smith: 6.2 Million SF Existing, 7.4 Million SF Additional Density
Amazon Buying Adjacent Sites For 4.1 Million SF Headquarters Office
PEN PLACE
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RECORD DEFENSE SPENDING DRIVES DEMAND
Defense Highlights
• The great outsourcing: Between 1980 and 2010 Federal procurement spending increased from $4.2 bn to $81.5 bn – 1840% growth (60% per year).
• 17% goes to the DC Metro of which nearly 50% goes to Northern VA.
• In 2008, DoD spending accounted for 52% of all procurement spending. In 2016, that number went to 38.7%.
Total Virginia Federal Spending (in billions of dollars)
$10 billion JEDI defense contract
allocates $700 billion to defense, a year-over-year increase of $70 billion
DEFENSE PROCURMENT WELL ABOVE PRE-SEQUESTRATION
LEVELS
2018 Budget
130.1
143.7
148.0
120.0
125.0
130.0
135.0
140.0
145.0
150.0
2017 2018 2019
VIRGINIA
14% INCREASE
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EXECUTIVE SUMMARY
Immense Rent Growth Potential: Current average market unit rents at Meridian at Pentagon City are 30%-40% below recently delivered Class A
product. Core location enables stable rent growth opportunity.
RARE VALUE-ADD OPPORTUNITY IN CORE LOCATION
Flooring
Stainless Steel Appliances
FlooringVanity & Faucets
Lighting FixturesGranite Countertops
Cabinets Backsplash
MODERNIZE LOBBY WITH UPGRADED FLOORING, FURNITURE, & LIGHTING
ADDITIONAL UPSIDE THROUGH FITNESS CENTER AND CLUBHOUSE RENOVATIONS.
Cabinets
11
FortHunt
Chapel Hill
Arlington
Springfield
McLean
Alexandria
Hyattsville
PO
TO
MA C R I V
ER
Wilson Blvd
Woodland Acres
Huntington
Rose Hill
Capitol Hill
Columbia Heights
Groveton
Kirby Rd
ON
E MILE
THREE MILES
FIVE MILES
495
495
495
295
395
395
95
66
95
1
1
107
7
267
286
236
The Pentagon25,000 employees
Department of Defense HQ Services
8,000 employees
US Patent & Trademark Office10,000 employees
National Science Foundation
4,200 employees
Joint Base Andrews11,000 employees
MGM Resorts at National Harbour
4,000 employees
Fort Belvoir51,000 employees
NGA9,000 employees
Reagan NationalAirport1,300
employees
AMAZON25,000
employees
Washington, DC138 Million Office SFRosslyn-Ballston Corridor
25 Million Office SF
Tysons29 Million Office SF
Fairfax / Merrifield / Falls Church
26 Million Office SF
Old Town &Eisenhower
23 Million Office SF
Crystal CityPentagon13 MillionOffice SF
Van Dorn StreetMetro Station
AMAZON HQ2
Arlington - TOD - Inside the Beltway - DCA (Core Components)
Ideal Value-Add in a Core Location
Outstanding Access
Whole Foods Adjacent (1.9 Million SF of Retail in a 1-Mile Radius)
BRIAN J. CRIVELLAHolliday Fenoglio Fowler, L.P.
Senior Director202.533.2522 (o)[email protected]
STEPHEN C. CONLEYHolliday Fenoglio Fowler, L.P.
Executive Managing Director202.533.2533 (o)[email protected]
NICOLE BRICKHOUSEHolliday Fenoglio Fowler, L.P
G. WALTER COKERHolliday Fenoglio Fowler, L.P.
Managing [email protected]
JAMIE LEACHMANHolliday Fenoglio Fowler, L.P
Senior [email protected]
FINANCING
1775 Pennsylvania Ave NW, 5th Floor
Washington, DC 20006
MATTHEW LAWTONHolliday Fenoglio Fowler, L.P.
Executive Managing [email protected]
Holliday Fenoglio Fowler, L.P. (“HFF”) a Virginia licensed real estate broker.
HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF, and neither Owner nor HFF, nor their respective equity holders, officers, employees and agents makes any representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all reference to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a purchaser, and HFF, its partners, officers, employees and agents disclaim any liability that may be based upon or related to the information contained herein. Prospective purchasers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change.
