JPMorgan sells downtown D.C. office building at discount to Colorado investor

Washington Business Journal | December 23rd, 2024

A JPMorgan Chase affiliate has sold the 11-story office building at 1501 M St. NW in downtown Washington, D.C., to Colorado-based Real Capital Solutions for $29.3 million—about half of its $59.5 million assessed value. The 178,589-square-foot property, which JPMorgan acquired in 2010 for $78.6 million, is 61% leased and was last renovated in 2020.

Real Capital Solutions said the purchase reflects its strategy of acquiring high-quality but financially distressed office assets at a steep discount. The firm plans additional amenity upgrades to boost leasing and tenant retention, and the deal marks RCS’s first entry into the D.C. market as it continues expanding its national office portfolio.

PMorgan sells downtown D.C. office building at discount to Colorado investor
December 23, 2024
By Ben Peters, Washington Business Journal

A JPMorgan Chase & Co. (NYSE: JPM) affiliate has sold a downtown D.C. office building to a
Colorado investor for half its assessed value.
Affiliates of Real Capital Solutions acquired the 11-story, 178,589-square-foot 1501 M St. NW
for $29.3 million from an affiliate of JPMorgan Investment Management Inc., according to
documents filed on Monday with D.C.’s Recorder of Deeds.
The property, located a block west of Thomas Circle at the corner of 15th and M Streets NW,
has a 2025 assessed value of $59.5 million.
RCS received a $26 million loan from Hingham Institution for Savings to assist with the
purchase, deed records show. The firm also assigned leases, rents and profits from the building
to the bank.
JPMorgan declined to comment. The firm first acquired the property in 2010 from JBC Funds
1501 LLC for $78.6 million
“This acquisition represents our strategic approach to invest in high-quality office assets in a
prime location at a significant discount to replacement cost,” Marcel Arsenault, chairman, CEO
and founder of RCS, said in a statement. “In addition, it aligns with our disciplined strategy of
acquiring financially distressed, yet operationally strong, properties.”
The property, which is currently 61% leased, was last renovated in 2020, according to RCS. The
firm plans to add further improvements, including an expansion of the building’s existing
lounge and meeting spaces to the the vacant 7th and 8th floors. The amenities are intended to
increase leasing demand and tenant retention, according to Paul Marin, vice president of
acquisitions at RCS.
The sale marks RCS’ entrance into the D.C. market. Its portfolio includes office, industrial and
multifamily properties across more than a dozen states, Mexico, Canada and Puerto Rico.
Tenants at 1501 M include public relations firm Firehouse Strategies, consultant Kaiser
Associates and association Mutual Fund Directors Forum.
“We see enormous potential to unlock value by building on the property’s existing strengths
and introducing improvements that meet today’s tenant needs,” Adam Abeln, RCS chief
acquisitions officer, said in a statement.
Gerry Trainor with Transwestern brokered the deal.

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