Firm purchases Class A+ office asset totaling 235,210 square feet in key Metro D.C. urban-suburban hub
Bridge Investment Group LLC’s (Bridge) subsidiary Bridge Office Fund Manager (Bridge Office) announced today the acquisition of 77 Upper Rock, a 235,210-square-foot Class A office building in Rockville, Maryland near Washington.
Located at the interchange of Shady Grove Road & Interstate 270, 77 Upper Rock lies in the heart of one of Metro D.C.’s most vibrant live-work-play communities. The campus is surrounded by several walkable amenities, including 550 Class A residential units, convenient shopping, dining options and hotels. Metro accessibility is less than one mile away, with downtown Washington just 30 minutes out.
Originally built in 2005, 77 Upper Rock recently underwent a $6.5 million repositioning that modernized the building and created compelling new amenities that appeal to top professional talent. Recent capital improvements include upgrades to the lobby, conference center, restrooms and elevators. The full-scale lobby renovation enhanced the entry experience from the adjacent parking garage and also added several seating areas, a tenant lounge with WiFi, new coffee bar and additional breakout areas that allow tenants to collaborate or hold impromptu meetings. In addition, the property’s revamped amenity package includes outdoor seating and new fitness center with a yoga studio, locker rooms and Peloton bicycles.
More than 104,000 square feet of leasing activity has occurred at 77 Upper Rock over the last eight months, part of a larger ongoing renaissance in Rockville’s Shady Grove office submarket. After seeing an average of just over six leases signed per year greater than 20,000 square feet from 2000 to 2017, Shady Grove recorded 11 such leases in 2018 and 12 in just the first half of 2019 alone. Tenants at 77 Upper Rock include M&T Bank Corporation, Aurinia, Cisco Systems, Inc., Nutricia North America and Potomac - Hudson Engineering.
In line with Bridge’s proven strategy for creating next-generation workplaces, the firm plans to invest in additional capital improvements to maintain the property’s best-in-class status and continue attracting top talent. Planned capital projects include a new FF&E package in the main lobby, common area refurbishment, enhancement of the existing amenity space, delivery of a new signage package and the buildout of 16,000 square feet of spec suites.
“We are pleased to acquire a high-quality asset in a dynamic submarket that continues to see an influx of job growth and new amenities,” said Tommy Spinosa, Acquisitions Director for Bridge Investment Group. “Despite the positive momentum, there is still a dearth of premier, Class A office product in Shady Grove, which presents an opportunity for Bridge to deploy its proven strategy of creating desirable, next-generation workspaces that are compatible with how companies work both today and tomorrow. We look forward to creating a workplace community that will position our tenants for future growth and success.”
The Shady Grove submarket has not seen any construction or new supply since 2013, resulting in a vacancy rate for Class A office that is 3% lower than the regional rate. Meanwhile, Montgomery County maintains a low unemployment rate, deep talent pool and high median household income. Shady Grove in particular has emerged as a magnet for high-growth industries such as biotechnology and cybersecurity as a result of its proximity to the nation’s capital and regional campuses for top universities, including John Hopkins University, United States National Cancer Institute and The Universities at Shady Grove.
The transaction at 77 Upper Rock brings Bridge Office’s Maryland to more than 1.1 million square feet. Bridge also owns SkyBridge Towers, a pair of office buildings totaling 427,000 square feet in Bethesda, and Station Square, a three-building office complex encompassing 510,200 square feet in Silver Spring.
A fast-rising player in the U.S. commercial office market, Bridge Office currently has a presence in 15 states with a portfolio totaling more than 14.1 million square feet.
Available office spaces at Upper Rock 77 range from 7,515 to more than 30,000 square feet. Bridge Commercial Real Estate LLC, the operating company for Bridge Office, will oversee property management and redevelopment work at 77 Upper Rock. Renovations will begin immediately.
Acquisitions Director Tommy Spinosa represented Bridge in the transaction. Andrew Weir of JLL represented the seller.
About Bridge Investment Group
Bridge is a privately held real estate investment management firm with $20.1 billion in assets under management. Bridge combines its more than 3,600-person, nationwide operating platform with specialized teams of investment professionals focused on select US real estate verticals, which Bridge believes offer above-market opportunity: Multifamily; Office; Seniors Housing and Medical Properties, Affordable Housing, Opportunity Zones and Real Estate Debt Strategies.
Bridge principals are owners and operators who are deeply rooted in their assets. In-depth knowledge of local markets, as well as extensive real asset and capital markets expertise, enable Bridge to develop prolific deal flow and to deploy active asset management and monitoring across its business lines.
Bridge’s asset management strategy is specialized and focused in a way that emphasizes current income and capital appreciation while mitigating risk. By making improvements that build lasting communities, increase renter satisfaction, and ultimately bring value to investors, Bridge seeks to create alpha at the asset level.
The principals of Bridge have been investing in and improving communities around the US since 1991 and manage private equity funds, separately managed account vehicles, co-investments, and joint ventures. Bridge seeks to transform assets in a manner that maximizes their potential.
