Developers Stonebridge and Rockwood Capital sold an office property at 7500 Old Georgetown Road in Bethesda, Maryland to In-Rel Properties for $29.9 million, the Washington Business Journal reported. The deal — arranged by the building’s lender — for the 339,000-square-foot property works out to roughly $88 per square foot.
The decline in value in the four years since Stonebridge and Rockwood purchased the office building is staggering. The joint venture partners had the misfortune of buying the property a year before the pandemic for $133.8 million. That represents a 78 percent drop in value from 2019 to the last week of 2023.
The true wash Stonebridge and Rockwood took on the 16-story property may be even worse than first appears, as the partners spent $21 million renovating the building during their brief ownership.
In a statement, In-Rel president Dennis Udwin said that “timing might not have been favorable for the previous ownership.” In-Rel plans on pursuing an aggressive leasing strategy for the property, which is conveniently close to the Red Line’s Bethesda Metro station and a stop away from the National Institutes of Health.
The property is only 40 percent leased as of the sale, counting Clark Construction, Morgan Stanley and NorthPond Ventures among its major tenants.
For In-Rel, the acquisition marks the first foray into the Washington, D.C. market. The company is based in Lake Worth, Florida and operates throughout the Sun Belt region.
In 2016, In-Rel jumped into the Memphis office market, paying $19.25 million for the iBank Tower in East Memphis. An adviser to the firm said the company would look for more opportunities in the Greater Washington area, though it plans on focusing on its latest acquisition for now.
— Holden Walter-Warner
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