Prominent Law Firm Fleeing to Quality in D.C.

Almost five years on from the start of the pandemic, the flight-to-quality for office tenants remains as hot as ever.

Milbank LLP, a law firm dabbling in real estate, finance, corporate and antitrust practices, is leasing roughly 65,000 square feet at Oxford Properties and Norges Bank Investment Management’s property at 1101 New York Avenue NW in Washington, D.C, the Washington Business Journal reported. The move is anticipated to take place next fall.

The New York-based firm is relocating its D.C. office from International Square, where it occupied the same amount of space at the Tishman Speyer-owned property. In a statement, Milbank cited growth of the law firm’s local office and the need to “build out to be consistent with our other offices in terms of efficiency and location.”

A critical difference between the two properties? Age. The Tishman property was constructed in 1982, though it was recently renovated to include a modern lobby and food hall.

Oxford’s property, meanwhile, was completed fewer than 20 years ago and has been renovated twice since the onset of the pandemic. The 380,000-square-foot building includes a rooftop penthouse, fitness center and conference center.

Details of Milbank’s lease on New York Avenue were not immediately available. A Cushman & Wakefield team including Dale Schlather and Malcolm Marshall represented the tenant, while a Stream Realty Partners team including Matt Pacinelli and Kyle Luby represented the landlord.

Milbank will be occupying the sixth and seventh floors of the property, recently left by the Milken Family Foundation and BP plc, respectively. Other tenants include law firm Allen & Overy LLP and Bloomberg; there’s only 28,000 square feet still available, according to Stream.

The D.C. office leasing market has been down in the gutter and shows no signs of improving anytime soon. In the third quarter, the vacancy rate rose 30 basis points to 22.7 percent, according to a CBRE report.

— Holden Walter-Warner