Office building ownership and development in the D.C. region are among the most expensive in the country, and the city’s central business district ranked as the 17th most expensive submarket in 2019.
Commercial real estate data company CommercialCafe reports office building sales in D.C.’s business district averaged $581.58 per square foot last year — almost three times higher than the national average.
The District’s central business district was followed closely by the East End submarket (the Chinatown and Mount Vernon Square area), ranked 18th nationally, with an average price of $556.34 per square foot. The District’s NoMa submarket ranked No. 40, at $383.96 per square foot.
One office sale in the District broke the $1,000 per square foot mark — Exan Group’s acquisition of 1701 Rhode Island Ave. NW, at $1,035. The total price for that property was $105 million, according to CommercialCafe, still 50% lower than the average price in the priciest U.S. submarket.
The Rosslyn submarket in Arlington ranked No. 46 last year, with an average sales price of $365.80.
Alexandria, Virginia, and Bethesda, Maryland, ranked as the 53rd and 54th priciest submarkets for office space sales in 2019. Tysons Corner and Reston ranked No. 72 and No. 92 respectively.
Suburban Maryland’s office market was the most active office market in the country last year, with 155 large sales.
CommercialCafe ranked submarkets based on commercial real estate transactions from Jan. 1, 2019, to Dec. 31, 2019, using data provided by Yardi Matrix. It included only sales of offices larger than 25,000 square feet and submarkets that registered at least three transactions.
The most expensive office submarket for sales in 2019 nationwide was Mountain View-Shoreline in the San Francisco Bay Area, at an average $1,554 per square foot. That ranking was propelled by Google’s acquisition of three buildings totaling more than $300 million, which added 204,000 square feet of office space to Google’s sprawling Mountain View campus.
California submarkets made up half of the top 10 in 2019.
Mountain View was followed by Plaza District in Manhattan, at $1,261, and Santa Monica in the Los Angeles market at $1,098.
Eight of the 100 most expensive submarkets for sales in 2019 were in D.C. and the Virginia and Maryland suburbs.
Here is a list of the 100 most expensive office submarkets of 2019, courtesy of CommercialCafe:
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