BXP Eyes DC Office Building Revamp

January 8, 2025

Office Investment Mid-Atlantic News More Washington D.C.

The redevelopment is slated for completion by 2028.

Exterior rendering of 725 12th St., a new office building to rise in Washington, D.C. — A new office building will rise at 725 12th St. in Washington, D.C.’s East End. *Image courtesy of Duda | Paine Architects*

BXP has completed the $34 million purchase of 725 12th St. NW, a 300,000-square-foot office building in Washington, D.C. Hines Interests was the asset’s previous owner, according to CommercialEdge information. The firm had paid $61 million for it about 30 years ago, media reports show.

The Boston-based REIT plans to demolish the East End property and redevelop it into an approximately 320,000-square-foot workplace. Demolition work is expected to begin in the second half of this year, according to Washington Business Journal.

Duda | Paine Architects is designing the new building that is slated for delivery in late 2028. The office property is set to feature private terraces and outdoor spaces.

In conjunction with the purchase, BXP also signed a 150,000-square-foot, 15-year prelease with global law firm McDermott Will & Emery for the top five floors of the new building.

McDermott, which opened its first office in D.C. in 1978, has leased space at 500 North Capitol St. NW on Capitol Hill since 2012. BXP owns a 30 percent stake in that building, according to Bisnow.

Lou Christopher, Jordan Brainard, Rob Copito and Clay Hammerstein of CBRE represented the tenant in the lease transaction. Evan Behr of JLL negotiated on behalf of BXP.

CBD location

Completed in 1992, the office building at 725 12th St. NW rises 12 stories in Washington’s Central Business District, three blocks east of the White House. The property is steps from Metro Center Station, the transportation hub for the city’s Metrorail service, where the Red, Orange, Blue and Silver lines converge.

In 2015, a joint venture between an affiliate of Hines Interests Limited Partnership and a pension fund advised by Sarofim Realty Advisors secured a $135 million, 10-year loan from Allianz Real Estate of America to refinance the property. At that time, the asset was the global headquarters of law firm Williams & Connolly, which has since moved to new space at The Wharf, a mixed-use project in Washington’s Southwest waterfront.

The building became vacant in 2022, following the law firm’s relocation. The same year, Hines transferred the property to the lender and continued to serve as its manager, although never formally concluding a foreclosure, Bisnow revealed.

In 2023, the joint venture of Madison Marquette and Highland Square Holdings became interested in the asset and intended to purchase it for $70 million. However, the deal never closed.

BXP recent activity

This is not the only office development project BXP is undertaking. The REIT is developing a 950,000-square-foot office building on Madison Avenue, near Manhattan’s Grand Central Terminal. The project was designed by Kohn Pederson Fox as a fully electric, zero-carbon workplace.

Last month, BXP signed a 413,000-square-foot office lease renewal with global law firm Ropes & Gray at the Prudential Tower, a 1.2 million-square-foot building in Boston. The law firm, which moved into the upper floors of the skyscraper in 2010, will remain in the space through 2041.