Rockwood Capital Buys Stake in DC Office Complex

655 New York Ave. NW. Image courtesy of Rockwood Capital

Douglas Development and a Brookfield Asset Management fund, owners of the trophy office property at 655 New York Ave. NW in Washington, D.C., have welcomed a new partner with the recapitalization of the approximately 756,000-square-foot asset. Rockwood Capital just acquired a 49 percent interest in the property, which has a current assessed value of roughly $386.6 million, according to DC Office of Tax and Revenue records.

Rockwood made the purchase of the stake in 655 New York through an affiliate on behalf of Meritz Alternative Investment Management for an undisclosed amount. Rockwood now claims a notable investment in one of the city’s most distinctive office destinations.

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655 New York Ave. NW. Image courtesy of Rockwood Capital

Spanning a full city block adjacent to the Washington Convention Center in the East End area, 655 New York is a model of historic preservation, as well as a prime example of the successful blending of old and new. The complex is the result of Douglas having acquired 15 historic buildings in nine separate transactions over 15 years and then partnering with Brookfield to add an 11-story, Shalom Baranes Associates-designed, glass office tower to the collection.

The result is a unique, unified workplace destination that includes 79,000 square feet of retail offerings. By the time 655 New York made its debut in the second quarter of 2019—at a development cost of approximately $185 million, according to the Washington, DC Economic Partnership’s 2019/2020 Development Report—it was nearly 90 percent preleased. The property is home to the likes of PwC, UnitedHealth Group and Brookfield.

Magnet for money

Rockwood’s investment at 655 New York comes 18 months after Douglas and Brookfield refinanced the asset in the early days of COVID-19 in May 2020 for $494 million via a two-year mortgage through a consortium involving Credit Agricole Corporate & Investment Bank, Standard Chartered, Helaba and BayernLB.

For Rockwood’s part, the attraction to 655 New York was multifaceted. In a prepared statement, David Becker, a managing partner with Rockwood Capital, said: “We continue to target state-of-the-art office assets with significant tenant credit and weighted average lease term in locations and settings that are poised to successfully attract and retain a highly educated labor force.”