Meridian’s Fund II Purchases the Complex in Tysons

The Meridian Group announced today that it has acquired Tysons Metro Center, a four-building Class A office portfolio near The Boro in Tysons, Va.

Meridian purchased the 763,965-square-foot portfolio for an undisclosed price. The recently renovated complex is located adjacent to two properties already owned by Meridian:

- Greensboro Station, a three-building, Class A office complex totaling approximately 640,000 square that is just steps away from the Greensboro Metro Station;

- The Boro, a 3.7 million-square-foot development that will offer a vibrant mix of offices, apartments, condominiums, retail stores, restaurants and entertainment.

“We are delighted to add Tysons Metro Center to our Tysons portfolio, which will now be approximately 2 million square feet on Greensboro Drive near the new Greensboro Metro station,” said David Cheek, President of The Meridian Group. “We are working on a master plan that integrates Tysons Metro Center, Greensboro Station, and the mixed-use Boro development into an amenity-rich urban center with easy access between the sites and the Greensboro Metro station.”

Gary Block, Chief Investment Officer of Meridian, said the acquisition makes perfect sense for the firm.

“With its scale and adjacent location, Tysons Metro Center is a strategic acquisition for us,” Block said. “It will create real synergy between these properties, and everyone will benefit from this new vibrant community. It will be a dynamic place to live, work, shop, eat and relax.”

The previous owner recently completed a $26.9 million capital improvement program at Tysons Metro Center, attracting an impressive array of tenants. Collectively leased to 40 tenants, the portfolio is anchored by Booz Allen Hamilton and Alarm.com.

“Tysons Metro Center is an excellent income-oriented investment for us at 91 percent leased, with value-add potential as we lease the vacant space,” said Andrew Pence, Vice President of The Meridian Group, who led the transaction for Meridian. “We have experienced first-hand strong leasing velocity following the arrival of Metro and renovation programs at Greensboro Station and Tysons Metro Center, and we expect the delivery of the adjacent Boro development to provide further momentum to the submarket.”

Holliday Fenoglio Fowler (HFF) represented the seller in the deal. Leading the effort for HFF were Stephen Conley, Executive Managing Director; James Meisel, Stephen Potts and Andrew Weir, Senior Managing Directors; and Matthew Nicholson, Associate Director.

The Class A portfolio is comprised of four buildings:

- Tysons Metro Center I at 8251 Greensboro Drive: Built in 1984, the 12-story building was renovated in 2012. The 168,006-square-foot building features a landscaped rooftop terrace with outdoor seating, a fitness center, an on-site deli and a bicycle locker room.

- Tysons Metro Center II at 8255 Greensboro Drive: Constructed in 2002, the 129,916-square-foot building was renovated in 2015. The six-story building features an exterior patio as well as a lounge and gaming center that offers collaborative workspace and a place for catered events.

- Tysons Metro Center III at 8281 Greensboro Drive: This 12-story building was constructed in 1980, then renovated in 2014 with $18.1 million in improvements. The building features 257,824 square feet of rentable space along with a state-of-the-art conference center, a 2,800-square-foot café, and locker rooms with showers.

- Tysons Metro Center IV at 8285 Greensboro Drive: Constructed in 1999 and later renovated, the 13-story building features 208,219 square feet of rentable space.

The four buildings also share a number of amenities. These include a tenant-only sports court, equipped for basketball, short court tennis, volleyball and a variety of other games, as well as a turf area with round tables for relaxing.

Tysons Metro Center is ideally situated just a short walk from the Greensboro Metro station. It’s also close to two well-known malls -- Tysons Galleria (a 5-minute walk) and Tysons Corner Center (a 15-minute walk, or one Metrorail stop).

Block noted that this is the sixth transaction by Meridian’s second fund -- Meridian Realty Partners II, L.P., a $231.6 million discretionary fund focusing on DC area real estate.

“We plan to acquire assets totaling approximately $1.5 billion with this fund, using leverage and additional co-investment capital,” Block said. “With this acquisition, we have now purchased properties totaling over $628 million in value.”

The fund’s five other transactions:

- 1901 L Street, an eight-story office building in the Central Business District of downtown Washington, DC. Meridian plans an extensive renovation that will add three new floors of trophy space to the building.

- International Place, a 12-story office building at 1735 N. Lynn Street in the fast-evolving center of Rosslyn, Va. The Meridian Group is renovating and repositioning the 293,539-square-foot building.

- 1400 L Street, a 12-story Class A office building at the corner of L and 14th streets in Washington, DC. Meridian is working on a major renovation to the 172,453-square-foot building, located less than two blocks from the McPherson Square Metro station.

- 11111 Sunset Hills Road, a Class A office building in Reston, Va. The 216,000-square-foot building is located near the Dulles Toll Road and the Wiehle-Reston East Metro station.

- The Hyatt Regency Bethesda, a 390-room upscale hotel located at 7400 Wisconsin Avenue. Meridian is repositioning the well-known hotel, which sits atop the Bethesda Metro station.

Bruce Lane, Executive Vice President and Managing Director of Meridian, said the firm is continuing to seek properties in the DC area.

“We’re focusing on properties that are well-located and where we can create value,” Lane said. “We’re very pleased with the acquisitions we’ve made so far.”

ABOUT THE MERIDIAN GROUP

The Meridian Group is a real estate investment and development firm based in Bethesda, Md. Since its inception in 1993, Meridian has acquired and developed more than 14 million square feet of office, residential, hotel, mixed-use, and land with a focus on the metropolitan Washington, DC market. To learn more, visit Meridian’s website at www.tmgdc.com.