Northern Virginia Quarterly Market Report...Overall Market Summary Metropolitan D.C. Market Overview...

Quarterly Market Report

2nd Quarter 2018

Northern Virginia

lpcwashingtondc.com

2

Table of Contents

Metropolitan D.C. Market Overview .....................................3

Northern Virginia Quarterly Overview .................................5

Northern Virginia Top Ten Leases ........................................ 8

Northern Virginia Sales Transactions................................... 9

Market Spotlight, 2Q 2018:

Northern Virginia .................................................................. 11

Alexandria ............................................................................. 13

Crystal City ........................................................................... 15

Fairfax .................................................................................... 17

Loudoun County ................................................................. 19

Merrifield ............................................................................... 21

Old Town Alexandria / Eisenhower Avenue .............. 23

Reston - Herndon .............................................................. 25

Rosslyn - Ballston Corridor ..............................................27

Route 28 North ................................................................... 29

Route 28 South.................................................................... 31

Springfield ............................................................................ 33

Tysons Corner ..................................................................... 35r

13

Neil Alt Senior Vice President

[email protected] | 703.284.5868

Doug McLearn Senior Vice President


Chris Dyson Senior Vice President


Eamon McCrann Senior Vice President


Jae LeeSenior Vice President


Stoddie Nibley Vice President


Correll Caulfield Vice President


Jed Prossner Vice President


Mary Fitzgerald Senior Associate


Jack Redmond Senior Associate


Ben HickeyLeasing Associate


Brad Blum Market Research Associate


Ben Gallucci Market Research Associate


Northern Virginia Leasing & Market Research

Overall Market Summary

Metropolitan D.C. Market Overview 2nd Quarter 2018

The Washington, DC Metropolitan commercial real estate market is comprised of approximately 420.5 million square feet of rentable office space located in the District of Columbia, Northern Virginia, and Suburban Maryland.

The total vacancy rate decreased to 14.6% at the end the second quarter 2018, down from 14.8% at the end of the first quarter. The market recorded 367,301 square feet of net absorption in the second quarter, representing a 1.2% decrease from the 371,628 square feet absorbed in the first quarter.

Leasing activity totaled approximately 6.2 million square feet in transactions signed. The largest lease executed was signed by Appian for 204,547 square feet at 7950 Jones Branch Drive - Valo Park in McLean, Virginia.

Three buildings, totaling 1,339,000 square feet, broke ground; bringing the year-to-date 2018 construction pipeline total to 8,174,482 square

feet (66% pre-leased). Six buildings delivered this quarter (5 DC, 1 VA, 0 MD) totaling 2,177,996 square feet including; 1100 15th Street, NW - Midtown Center (875,000 sf, 80% leased to Fannie Mae).

There were eighteen sale transactions in the second quarter, totaling $1.21 billion. The largest sale was in the District with 875 15th Street, NW - The Bowen Building trading for $140,000,000 ($598 psf).

Average asking rental rates increased $1.05 to $37.39 per square foot, Full Service.

From May 2017 - May 2018 the DC Metropolitan area had a net increase of 41,300 jobs (45,100 private sector, -3,800 government) representing 1.3% growth, while the unemployment rate decreased to 3.2%.

DC VA MDMetro Area (YTD)

Direct Vacancy (2Q 2018) 10.1% 14.9% 13.7% 13.9%

Total Vacancy (2Q 2018) 10.9% 15.8% 14.2% 14.6%

Total Net Absorption(YTD 2018) 315,240 125,261 298,428

738,929 SF

Leasing Activity (YTD 2018) 4,270,536 7,288,651 1,433,502

13.0 M SF

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Outlook

Metropolitan D.C. Market Overview 2nd Quarter 2018


Looking ahead, the GSA will continue reducing the federal real estate footprint and begin to execute longer lease terms (15-20 year terms) while minimizing/eliminating short-term extensions to reduce costs. While market fundamentals appear strong, the region remains a “tenant’s market.” Aggressive landlords will continue to perform significant capital improvements on their buildings to remain competitive, while also offering generous rent concessions (TI Allowance and Free Rent). The Metro should continue be a catalyst for demand (leasing and sales) around Phase II of the Silver Line in Virginia and the Purple Line in Maryland.

The Metropolitan Washington, DC market posted another solid quarter and a rather strong first half of 2018, as total vacancy decreased (across all three regions), asking rents ticked up, and the region has absorbed nearly 740,000 square feet of space YTD 2018. There has been $3.21 billion in sales volume through the first half of 2018, representing a 34% increase in sales compared to the first half of 2017. Regional employment experienced 1.3% of growth YOY ending May 2018, primarily driven by the private sector, specifically the Professional & Business Services industry. The DC Metro area’s unemployment rate decreased to 3.2%, out-pacing the 4.0% national average.

5lpcwashingtondc.com101 Constitution Ave., Suite 325 East | Washington D.C. | 202.513.67001530 Wilson Blvd., Suite 200 | Arlington, VA | 703.522.46008120 Woodmont Ave., Suite 560 | Bethesda, MD | 301.304.8300

Market Summary

Northern Virginia 2nd Quarter 2018

The Northern Virginia office market consists of 1,531 buildings over 25,000 square feet, totaling approximately 186.6 million square feet of rentable space.

The largest non-GSA lease signed during the second quarter was a 204,547-square-foot relet by Appian at Valo Park - 7950 Jones Branch Drive in the Tysons Corner submarket. The largest lease signed by the GSA was a 13,558-square-foot relet for the United States Geospatial Intelligence Foundation at Bldg 7 - 13665 Dulles Technology Drive.

Building sales volume totaled $746,300,000 during the second quarter. The largest transaction was the sale of Boro Station I-III - 1765, 1775, and 1785 Greensboro Station Place. MetLife acquired the buildings from Meridian Group for $244 million ($380 psf). The building was 95.0% occupied at the time of sale, and traded at a 4.75% Cap Rate. The second largest sale was of Greensboro Park - 8180 and 8200 Greensboro Drive. Altus Group /Velocis acquired the buildings from Beacon Capital Partners for $142 million ($281 psf). The buildings were 83.0% occupied at the time of sale, and traded at a 5.60% Cap Rate. The third largest sale was of Commonwealth Centre - 14360 and 14370 Newbrook Drive in the Route 28 South submarket. Hines acquired the buildings from Equus for $97,750,000 ($306 psf). The buildings were fully occupied at the time of sale, and traded at a 6.50% Cap Rate.

Inside the Beltway, there were 48 buildings marketing 50,000 square feet or greater of contiguous space available at the end of the second quarter 2018, compared to 49 from the first quarter 2018. Outside the Beltway, there were 81 buildings marketing 50,000 square feet or greater of contiguous space available at the end of the second quarter 2018, compared to 76 from the first quarter 2018.

2Q 2018 1Q 2018 2Q 2017

Direct Vacancy 14.9% 15.1% 15.5%

Total Vacancy 15.8% 16.0% 16.3%

NetAbsorption (YTD)

125,261 SF

467,607 SF

353,145 SF

Leasing Activity (YTD)

7.3 M SF 4.2 M SF 6.4 M SF

Under Construction 2.3 M SF 2.7 M SF 4.8 M SF

Deliveries (YTD)

175,000SF

0SF

340,000 SF

Rental Rates $33.18PSF

$33.20PSF

$32.47 FS

U/C Percent Pre-Leased 75.9% 68.8% 73.9%


Deliveries vs. Under Construction

Deliveries | Net Absorption | Vacancy Rate

Absorption & Gross LeasingNorthern Virginia recorded -342,346 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to 125,261 square feet. A significant contributor to the negative absorption was UNICOM adding 243,314 square feet in the market at UNICOM Technology Park I - 15000 Conference Center Drive.

Leasing activity at the end of the second quarter 2018 totaled 7,288,651 square feet, which is a 14.1% increase from the 6,385,377 square feet leased through the second quarter of 2017. All ten of the top ten leases signed in the second quarter were by private sector tenants.

The ten largest leases signed during the second quarter ranged in size from 204,547 square feet to 35,000 square feet, two of these largest transactions were renewals.

The Crystal City submarket recorded the strongest absorption of the quarter with 143,013 square feet absorbed. The positive absorption for the quarter was driven by a 53,062-square-foot move-in by the GSA at Presidential Tower - 2511 Jefferson Davis Highway and a 19,094-square-foot move-in by GSA-Department of Health and Human Services also at Presidential Tower

0.0

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Vacancy Rate (%

)Northern Virginia 2nd Quarter 2018

Vacancy RateTotal vacancy in Northern Virginia decreased from 16.0% in the first quarter 2018 to 15.8% in the second quarter 2018, and has decreased from 16.3% since second quarter 2017. At the end of the second quarter 2018, 29.2 million square feet was vacant and available.

Direct vacancy decreased from 15.1% in the first quarter 2018 to 14.9% in the second quarter 2018, and has decreased from 15.5% since second quarter 2017.At the end of the second quarter 2018, 27.7 million square feet was vacant and available for direct lease.

The sublet vacancy rate in Northern Virginia decreased slightly from 0.9% in the first quarter 2018 to 0.8% in the second quarter 2018, and has remained flat since the second quarter 2017. At the end of the second quarter 2018, 1.5 million square feet was vacant and available for sublease.

Total vacancy for Class A product in Northern Virginia was 16.7% while Class B product was 14.4% for the quarter. Class A vacancy decreased from 18.0% in the first quarter 2018, while Class B vacancy decreased from 16.0% in the first quarter 2018.

Vacancy by Building Class

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35

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SF (M

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16.7%

14.4%

7.7%



A total of six buildings were under construction in Northern Virginia at the end of the second quarter, totaling approximately 2.3 million square feet.

2311 Wilson Boulevard delivered in the second quarter of 2018. The 175,000-square-foot building in the Rosslyn-Ballston Corridor submarket was 61.8% leased to Opower, Bean Kinney, and AHRI.

Buildings scheduled to deliver in 2018 include; Capital One Building 3 - Capital One Drive, a 975,000-square-foot building in Tysons Corner. The 100,000-square-foot building at 3000 Potomac Avenue in Crystal City which is 100% pre-leased by NIB and Kaiser Permanente. And finally, the 425,000-square-foot, 100% pre-leased building to the CIA at Dulles Discovery South - 13900 Air and Space Museum Parkway in the Route 28 South submarket.

Buildings scheduled to deliver in 2019 include; The Boro Loft - 1640 Boro Place, a 143,606-square-foot building. Also, the 438,169-square-foot building at The Boro - 8350 Broad Street, which is currently 24.3% pre-leased by Tegna and Hogan Lovells. Both buildings are in the Tysons Corner submarket. Also, scheduled to deliver in 2019 is 4040 Wilson Boulevard in the Rosslyn-Ballston Corridor submarket. The building is 51.3% pre-leased to Avalon Bay and Vida Fitness.

The second quarter 2018 was dominated by the private sector. All of the top ten leases signed in the second quarter were by private sector tenants.

Building off of last quarters momentum demand continues to climb as 7.3 million square feet leased, which is a 14.1% increase from the 6.4 million square feet one year ago. Increased demand also caused the total vacancy to drop from 16.2% at the end of 2017 to 15.8% this quarter. While market rates have continued to steady, The Carlyle Group announced they will be relocating from Rosslyn to Washington D.C. which will leave a substantial vacancy in the Rosslyn-Ballston Corridor submarket in the near future. Looking ahead, the Northern Virginia market shows no signs of slowing down as 2.3 million square feet is expected to deliver by the end of 2019 with the majority of it’s space pre-leased. As inventory in the market continues to grow, older buildings are being demolished or converted to alternative uses to meet the demands for higher quality trophy space. The removal of these high vacancy buildings will increase rental rates in the market as well as lower vacancy rates in the future. Northern Virginia also awaits the highly anticipated announcements from Amazon and Apple as a potential landing spot for the companies newest headquarters. If selected, it will have a significantly positive impact on the market showcasing its ability to attract world-class tenants.

Total nonfarm employment for the Northern Virginia area stood at 2,727,900 in May 2018, up 35,462, or 1.3%, year-over-year. The Professional and Business Services industry had the largest employment gain from May 2017 to May 2018, adding 15,098 jobs. The second and third-largest employment gains were in Education and Health Services (8,515 jobs) and Other Services (4,092 jobs).

OutlookConstruction



Top Ten LeasesIncluded in the top ten leases of the second quarter 2018 were five relets, two renewals, two subleases, and one expansion. The largest lease transaction of the quarter was a 204,547-square-foot relet signed by Appian at Valo Park - 7950 Jones Branch Drive in the Tysons Corner submarket. The second largest lease of the quarter was a 183,622-square-foot renewal signed by General Dynamics at Fair Lakes 2 - 12450 Fair Lakes Circle in the Fairfax submarket. The third largest lease of the quarter was a 120,000-square-foot sublease by Deloitte at Waterview Tower - 1919 N. Lynn Street. Cvent renewed 110,571 square feet at Boro Station I - 1765 Greensboro Station Place in the Tysons Corner submarket. OneWeb signed an 85,932-square-foot sublease at Boro Station III - 1785 Greensboro Station Place in the Tysons Corner submarket. College Board expanded by 74,000 square feet at Democracy Tower at Reston Town Center - 11955 Democracy Drive in the Reston-Herndon submarket. OneWeb also signed a 71,834-square-foot relet at Boro Station III - 1785 Greensboro Station Place in the Tysons Corner submarket. Akima signed a 69,489-square-foot relet at Dulles View South - 2553 Dulles View Drive in the Reston-Herndon submarket. National Center for Missing and Exploited Children took 64,614 square feet at Carlyle Gateway I - 333 John Carlyle Street in the Old Town/Eisenhower Ave submarket. Finally, United Healthcare signed for 51,323 square feet at 3160 Fairview Park 1 - 3160 Fairview Park Drive in the Merrifield submarket.

Valo Park 7950 Jones Branch Drive

Tenant Appian

Size 204,547 SF

Type Relet

Carlyle Gateway I 333 John Carlyle Street

TenantNational Center for Missing and Exploited Children

Size 64,614 SF

Type Relet

Democracy Tower at Reston Town Center 11955 Democracy Drive

Tenant College Board

Size 74,000 SF

Type Expansion

3160 Fairview Park 1 3160 Fairview Park Drive

Tenant United Healthcare

Size 51,323 SF

Type Relet

Boro Station III 1785 Greensboro Station Place

Tenant OneWeb

Size 85,932 SF

Type Sublease

Boro Station I 1765 Greensboro Station Place

Tenant Cvent

Size 110,571 SF

Type Renewal

Dulles View South 2553 Dulles View Drive

Tenant Akima

Size 69,489 SF

Type Relet

Fair Lakes 2 12450 Fair Lakes Circle

Tenant General Dynamics

Size 183,622 SF

Type Renewal


Tenant OneWeb

Size 71,834 SF

Type Relet

Waterview Tower 1919 N. Lynn Street

Tenant Deloitte

Size 120,000 SF

Type Sublease


Northern Virginia Sales Transactions


Stafford Bldg 1500 Westbranch Drive

Submarket Tysons Corner

Date Sold April-2018

Price $16,500,000($133 psf)

Buyer Caves Valley

Seller TIAA

RBA 123,960 SF

Class B

Occupancy 100.0%

Notes Redevelopment Project

Greensboro Park 8180 & 8200 Greensboro Drive


Date Sold June-2018

Price $142,000,000($281 psf)

Buyer Altus Group / Velocis

Seller Beacon Capital Partners

RBA 505,085 SF

Class A

Occupancy 83.0%

Cap Rate 5.60%

Argon Plaza 12701 Fair Lakes Circle

Submarket Fairfax

Date Sold May-2018

Price $38,800,000 ($141 psf)

Buyer Grubb Properties

Seller C-III

RBA 274,930 SF

Class A

Occupancy 72.0%

Cap Rate 7.50%

The Summit @ Reston 1 & 2

2000 & 2002 Edmund Halley Drive

Submarket Reston-Herndon


Price $95,000,000($327 psf)

Buyer Brookfield Office Properties

Seller JBG Smith

RBA 290,247 SF

Class A

Occupancy 100.0%

Cap Rate 5.26%

Boro Station I-III1765, 1775 & 1785 Greensboro Station Place



Price $244,000,000($380 psf)

Buyer MetLife

Seller Meridian Group

RBA 642,046 SF

Class A

Occupancy 95.0%

Cap Rate 4.75%

Commonwealth Centre

14360 & 14370 Newbrook Drive

Submarket Rt 28 Corridor South


Price $97,750,000($306 psf)

Buyer Hines

Seller Equus

RBA 316,081 SF

Class A

Occupancy 100.0%

Cap Rate 6.50%

WillowWood Plaza I & II

10300 & 10306 Eaton Place

Submarket Fairfax

Date Sold June-2018

Price $22,500,000($91 psf)

Buyer Polinger

Seller C-III

RBA 248,301 SF

Class A

Occupancy 50.5%

Notes REO Sale

Tavern Square

411-423 King Street, 121-123 N. Pitt Street, 110 & 130 N. Royal Street

Submarket Old Town Alexandria

Date Sold June-2018

Price $50,350,000($294 psf)

Buyer

Cambridge Property Group / Westport Capital Partners

Seller The Pyne Companies

RBA 171,008 SF

Class A

Occupancy 59.0%

Cap Rate 5.10%


Northern Virginia Sales Transactions


699 Prince Street

Submarket Old Town Alexandria


Price $13,200,000($264 psf)

Buyer CAS Riegler

Seller

National Center for Missing & Exploited Children

RBA 50,000 SF

Class B

Occupancy 100.0%

Notes Redevelopment Project

Tycon 1 8320 Old Courthouse Road


Date Sold May-2018

Price $11,000,000($123 psf)

Buyer Carderock Investments

Seller J Street Companies

RBA 89,558 SF

Class B

Occupancy 60.4%

Cap Rate 5.90%

Ridgetop II at Loudoun Tech Center

21641 Ridgetop Circle

Submarket Rt 28 North

Date Sold June-2018

Price $15,200,000($255 psf)

Buyer Boyd Watterson

Seller Fairbridge Properties

RBA 59,727 SF

Class A

Occupancy 100.0%

Cap Rate 6.60%


HighlightsTotal vacancy in Northern Virginia decreased from 16.0% in the first quarter 2018 to 15.8% in the second quarter 2018, and has decreased from 16.3% since second quarter 2017. Direct vacancy decreased from 15.1% in the first quarter 2018 to 14.9% in the second quarter 2018, and has decreased from 15.5% since second quarter 2017.

Northern Virginia recorded -342,346 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to 125,261 square feet. A significant contributor to the negative absorption was UNICOM adding 243,314 square feet to the market at UNICOM Technology Park I - 15000 Conference Center Drive.

Leasing activity at the end of the second quarter 2018 totaled 7.3 million square feet, which is a 14.1% increase from the 6.4 million square feet leased through the second quarter of 2017. All ten of the top ten leases signed in the second quarter were by private sector tenants.

Inside the Beltway, there were 48 buildings marketing 50,000 square feet or greater of contiguous space available at the end of the second quarter 2018, compared to 49 from the first quarter 2018. Outside the Beltway, there were 81 buildings marketing 50,000 square feet or greater of contiguous space available at the end of the second quarter 2018, compared to 76 from the first quarter 2018.

10 Year Averages (2008 - 2017)

Total Absorption 317,120 SF / Year

Deliveries (SF) 1.6 M SF / Year

Leasing Activity 12.6 M SF / Year

Market Stats

Inventory 186.8 M SF

Direct Vacancy 14.9%

Total Vacancy 15.8%

YTD 2018 Absorption 125,261 SF

YTD Leasing Activity 7.3 M SF

Under Construction 2.3 M SF

Percent Pre-Leased 75.9%

YTD 2018 Deliveries 175,000 SF

Asking Rental Rates (Full Service)

2008: $31.89

PSF

2017: $32.76

PSF

YTD 2018: $33.18

PSF

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4.8

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Vaca

ncy

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sking Rate ($)

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Leasing Activity Total Net Absorption

Market Spotlight

2nd Quarter 2018Northern Virginia


Under Construction

Market Spotlight

2nd Quarter 2018Northern Virginia

Property Submarket Building Size Available Pre-Leased Delivery Date Developer Major Tenants

3000 Potomac Avenue Crystal City 100,000 SF 0 SF 100.0% 2Q 2018 NIBNIB, Kaiser Permanente

Dulles Discovery South13900 Air and Space Museum Parkway

Rt 28 South 425,000 SF 0 SF 100.0% 3Q 2018 Peterson Co. GSA - CIA

Capital One Drive Tysons Corner 975,000 SF 0 SF 100.0% 3Q 2018 Capital One Capital One

Boro Tower8350 Broad Street Tysons Corner 438,169 SF 331,800 SF 24.3% 1Q 2019 Meridian

Tegna, Hogan Lovells

Boro Loft1640 Boro Place Tysons Corner 143,606 SF 111,642 SF 22.3% 1Q 2019 Meridian Whole Foods

4040 Wilson Boulevard RB Corridor 240,000 SF 116,979 SF 51.3% 4Q 2019 ShooshanAvalon Bay & Vida Fitness

Totals

Broke Ground 2Q 2018 0 SF

Total Under Construction 2,321,775 SF

% Pre-Leased (Does not include condos)

75.9%

2nd Quarter Start


HighlightsDirect vacancy in Alexandria decreased from 17.4% in the first quarter 2018 to 14.7% in the second quarter 2018, and has decreased from 17.8% since second quarter 2017. Total vacancy decreased from 18.0% in the first quarter 2018 to 15.1% in the second quarter 2018, and has decreased from 18.4% since second quarter 2017.

The Alexandria submarket recorded -19,643 square feet of net absorption in the second quarter of 2018, bringing year-to-date absorption to 8,514 square feet. Negative absorption was driven by a 64,614-square-foot move-out by Grant Thornton at Carlyle Gateway I - 333 John Carlyle Street. Two sales transactions occurred in the Alexandria submarket during the second quarter 2018. Tavern Square - 411-423 King Street, 121-123 N. Pitt Street, 110 & 130 N. Royal Street were purchased by Westport Capital Partners & Cambridge Property Group from The Pyne Companies for $50,350,000 ($294 psf). The buildings were 59.0% occupied at the time of sale, and traded at a 5.10% Cap Rate. 699 Prince Street was acquired by CAS Riegler from the National Center for Missing & Exploited Children for $13,200,000 ($264 psf). The building will now be converted to a hotel.

The largest lease signed in the Alexandria submarket in the second quarter was a 64,614-square-foot relet by the National Center for Missing and Exploited Children at Carlyle Gateway I - 333 John Carlyle Street.


Total Absorption -100,961 SF / Year

Deliveries (SF) 103,771 SF / Year

Leasing Activity 847,588 SF / Year


2008: $33.88

PSF

2017: $33.82

PSF

YTD 2018: $33.74

PSF

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Market Spotlight

2nd Quarter 2018Alexandria

Market Stats

Inventory 17.2 M SF


Total Vacancy 15.1%


YTD Leasing Activity 272,157 SF

Under Construction 100,000 SF


YTD 2018 Deliveries 0 SF


Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018Alexandria

Property Submarket Building Size Available Pre-leased Delivery Date Developer Major Tenants

3000 Potomac Ave Alexandria 100,000 SF 0 SF 100.0% 3Q 2018 NIB NIB, Kaiser Permanente


Tenant National Center for Missing and Exploited Children

Size 64,614 SF

Type Relet

2000 Duke Street

Tenant Spaces

Size 34,007 SF

Type Relet

Seven Skyline Place 5275 Leesburg Pike

Tenant Deloitte

Size 14,081 SF

Type Relet

Shirlington Tower 2900 S. Quincy Street

Tenant School Nutrition Association

Size 13,209 SF

Type Relet

Canal Center 4 99 Canal Center Plaza

Tenant Robbins-Gioia

Size 11,747 SF

Type Sublease

Property Submarket Date Sold Price Buyer Seller Class Occupancy Notes

Tavern Square411-423 King St, 121-123 N. Pitt Street & 110 & 130 N. Royal Street

Alexandria Jun 2018$50,350,000($294 psf)

Cambridge / Westport

The Pyne Companies

B 59.0% 5.10%

699 Prince Street Alexandria Apr 2018$13,200,000 ($264 psf)

CAS RieglerNational Centerfor Missing & Exploited Children

B 100.0%RedevelopmentProject


HighlightsDirect vacancy in Crystal City decreased from 17.5% in the first quarter 2018 to 16.9% in the second quarter 2018, and has decreased from 18.5% since second quarter 2017. Total vacancy decreased from 17.9% in the first quarter 2018 to 17.2% in the second quarter 2018, and has decreased from 18.8% since second quarter 2017.

The Crystal City submarket recorded 143,013 square feet of net absorption during the second quarter of 2018, bringing year-to-date absorption to 240,693 square feet. The positive absorption for the quarter was driven by a 53,062-square-foot move-in by the GSA at Presidential Tower - 2511 Jefferson Davis Highway and a 19,094-square-foot move-in by GSA-Department of Health and Human Services, also at Presidential Tower - 2511 Jefferson Davis Highway.

The largest lease signed in the Crystal City submarket in the second quarter 2018 was a 28,465-square-foot relet by March of Dimes at Crystal Square 2 - 1550 Crystal Drive. They are relocating their headquarter from New York. Also contributing to leasing activity in the Crystal City submarket this quarter was an 11,356-square-foot renewal by GSA-DoD at 1919 S. Eads Street.






2008: $37.11

PSF

2017: $36.81

PSF

YTD 2018: $37.10

PSF

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Market Spotlight

2nd Quarter 2018Crystal City

Market Stats

Inventory 11.4 M SF


Total Vacancy 17.2%







Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018Crystal City


3000 Potomac Ave Crystal City 100,000 SF 0 SF 100.0% 3Q 2018 NIB NIB, Kaiser Permanente

Crystal Square 2 1550 Crystal Drive

Tenant March of Dimes

Size 28,465 SF

Type Relet

Property Submarket Date Sold Price Buyer Seller Class Occupancy Cap Rate

No new sales reported during the quarter Crystal City N/A N/A N/A N/A N/A N/A N/A

1919 S. Eads Street

Tenant GSA-DoD

Size 11,356 SF

Type Renewal


HighlightsDirect vacancy in Fairfax decreased from 19.7% in the first quarter 2018 to 18.9% in the second quarter 2018, and has decreased from 19.5% since second quarter 2017. Total vacancy decreased from 20.5% in the first quarter 2018 to 19.5% in the second quarter 2018, and has decreased from 20.5% since second quarter 2017.

The Fairfax submarket recorded 98,270 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to 119,444 square feet. The positive absorption for the quarter was driven by a 93,000-square-foot move-in by Apple Federal Credit Union at 4090-4097 Monument Corner Drive.

There were two sales transactions in the Fairfax submarket during the second quarter 2018. Argon Plaza - 12701 Fair Lakes Circle was acquired by Grubb Properties from C-III for $38,800,000 ($141 psf). The building was 72.0% leased at the time of sale, and traded at a 7.50% Cap Rate. C-III also sold WillowWood Plaza I & II - 10300 & 10306 Eaton Place to Polinger for $22,500,000 ($91 psf). The buildings were 50.5% leased at the time of sale.

The largest lease signed in the Fairfax submarket in second quarter 2018 was a 183,622-square-foot renewal by General Dynamics at Fair Lakes 2 - 12450 Fair Lakes Circle. Also contributing to leasing activity this quarter was a 26,749-square-foot relet by N-Ask at One Fair Oaks - 4114 Legato Road.






2008: $28.71

PSF

2017: $26.00

PSF

YTD 2018: $27.26

PSF

0.00

0.04

0.08

0.12

0.16

0.20

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Market Spotlight

2nd Quarter 2018

Fairfax (Fairfax Center, Fairfax City, Oakton)

Market Stats

Inventory 12.5 M SF


Total Vacancy 19.5%



Under Construction 0 SF




Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018

Fairfax (Fairfax Center, Fairfax City, Oakton)

Centerpointe One 4050 Legato Road

Tenant ECS Federal

Size 20,154 SF

Type Relet


No new construction reported this quarter Fairfax N/A N/A N/A N/A N/A N/A

One Monument Place 12150 Monument Drive

Tenant Vaxcom Services Inc.

Size 10,673 SF

Type Relet

One Fair Oaks 4114 Legato Road

Tenant N-Ask

Size 26,749 SF

Type Relet

Fair Lakes 2 12450 Fair Lakes Circle

Tenant General Dynamics

Size 183,622 SF

Type Renewal


Argon Plaza12701 Fair Lakes Circle

Fairfax May 2018$38,800,000 ($141 psf)

Grubb Properties C-III A 72.0% 7.50%

WillowWood Plaza I & II10300 & 10306 Eaton Place

Fairfax Jun 2018$22,500,000 ($91 psf)

Polinger C-III A 50.5% N/A


HighlightsDirect vacancy in Loudoun County decreased from 9.4% in the first quarter 2018 to 9.0% in the second quarter 2018, and has decreased from 11.5% since second quarter 2017. Total vacancy has decreased from 10.3% in the first quarter 2018 to 9.8% in the second quarter 2018, and has decreased from 12.6% since second quarter 2017.

Loudoun County recorded 123,791 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to 185,055 square feet. The positive absorption for the quarter was driven by a 25,192-square-foot move-in by Orbital ATK at One Steeplechase - 21700 Atlantic Boulevard.

One sales transaction occurred in the Loudoun County submarket during the second quarter 2018. Ridetop II at Loudoun Tech Center - 21641 Ridgetop Circle was purchased by Boyd Watterson from the Fairbridge Properties for $15,200,000 ($255 psf). The building was fully leased at the time of sale, and traded at a 6.60% Cap Rate.

The largest lease signed in the Loudoun submarket was a 17,600-square-foot relet by the GSA-TSA at Dulles East Bldg - 45045 Aviation Drive.

Loudoun County vacancy has decreased by over 54% in the last decade. In 2008, the direct vacancy in Loudoun County was 19.7%. The drastic decrease in vacancy over the years is due to a growing demand and limited supply for office space in the county.






2008: $26.83

PSF

2017: $24.59

PSF

YTD 2018: $25.73

PSF

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Market Spotlight

2nd Quarter 2018Loudoun County

Market Stats

Inventory 15.3 M SF

Direct Vacancy 9.0%

Total Vacancy 9.8%







Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018

Loudoun County


No new construction reported this quarter N/A N/A N/A N/A N/A N/A N/A


Ridgetop II at Loudoun Tech Center21641 Ridgetop Circle

Loudoun County

Jun 2018$15,200,000($255 psf)

Boyd Watterson

FairbridgeProperties

A 100.0% 6.60%

Dulles East Bldg 45045 Aviation Drive

Tenant GSA-TSA

Size 17,600 SF

Type Relet


HighlightsDirect vacancy in Merrifield decreased from 11.5% in the first quarter 2018 to 11.3% in the second quarter 2018, and has decreased from 13.8% since second quarter 2017. Total vacancy has decreased from 12.2% in the first quarter 2018 to 12.0% in the second quarter 2018, and has decreased from 14.6% since second quarter 2017.

The Merrifield submarket recorded 41,590 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to -9,815 square feet. Positive absorption was driven by a 10,119-square-foot move-in by Arctic Slope at 2941 Fairview Park Drive, and other small tenant move-ins.

The largest lease signed in the Merrifield submarket this quarter was a 51,323-square-foot relet by United Healthcare at 3160 Fairview Park 1 - 3160 Fairview Park Drive. Also contributing to leasing activity in the Merrifield submarket this quarter was a 13,337-square-foot relet by Deloitte at 2941 Fairview Park Drive. Enterprise Resource Performance Inc. also signed a 13,055-square-foot expansion at Prosperity at Merrifield - 2751 Prosperity Avenue.






2008: $35.34

PSF

2017: $31.16

PSF

YTD 2018: $30.50

PSF

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Market Spotlight

2nd Quarter 2018Merrifield

Market Stats

Inventory 9.3 M SF


Total Vacancy 12.0%

YTD 2018 Absorption -9,815 SF



Percent Pre-Leased 0%



Major Leases

Market Spotlight

2nd Quarter 2018Merrifield

Under Construction

Sales


No new construction reported this quarter Merrifield N/A N/A N/A N/A N/A N/A

2751 Prosperity Avenue

Tenant Enterprise Resource Performance Inc.

Size 13,055 SF

Type Expansion

2941 Fairview Park Drive

Tenant Deloitte

Size 13,337 SF

Type Relet


No new sales reported during the quarter Merrifield N/A N/A N/A N/A N/A N/A N/A

3110 Fairview Park Drive

Tenant IQVIA

Size 11,078 SF

Type Relet

3160 Fairview Park 1 3160 Fairview Park Drive

Tenant United Healthcare

Size 51,323 SF

Type Relet


HighlightsDirect vacancy in the Old Town Alexandria and Eisenhower Ave submarket decreased from 10.3% in the first quarter 2018 to 9.5% in the second quarter 2018, and has decreased from 10.4% since second quarter 2017. Total vacancy decreased from 11.1% in the first quarter 2018 to 10.0% in the second quarter 2018, and has decreased from 11.1% since second quarter 2017.

The Old Town Alexandria and Eisenhower Ave submarket recorded -43,028 square feet of net absorption in the second quarter of 2018, bringing year-to-date absorption to -29,463. Negative absorption was driven by a 64,614-square-foot move-out by Grant Thornton at Carlyle Gateway I - 333 John Carlyle Street.

The largest sale in the Old Town Alexandria and Eisenhower Ave during the second quarter 2018 was the sale of Tavern Square - 411-423 King Street, 121-123 N. Pitt Street, 110 & 130 N. Royal Street. Westport Capital Partners & Cambridge Property Group acquired the four buildings from The Pyne Companies for $50,350,000 ($294 psf). The buildings were 59.0% occupied at the time of sale, and traded at a 5.10% Cap Rate.

The largest lease signed in the Old Town Alexandria and Eisenhower Ave submarket in the second quarter was a 64,614-square-foot relet by the National Center for Missing and Exploited Children at Carlyle Gateway I - 333 John Carlyle Street. Also contributing to leasing activity this quarter was a 34,007-square-foot relet by Spaces at 2000 Duke Street.





Market Stats

Inventory 13.3 M SF

Direct Vacancy 9.5%

Total Vacancy 10.0%







2008: $34.78

PSF

2017: $36.52

PSF

YTD 2018: $36.35

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Market Spotlight

2nd Quarter 2018Old Town/Eisenhower Ave


Market Spotlight

2nd Quarter 2018Old Town/Eisenhower Ave

Major Leases

Under Construction

Sales


No new construction reported this quarter

Old Town/Eisenhower Ave

N/A N/A N/A N/A N/A N/A


Tenant National Center for Missing and Exploited Children

Size 64,614 SF

Type Relet

2000 Duke Street

Tenant Spaces

Size 34,007 SF

Type Relet

Canal Center 4 99 Canal Center Plaza

Tenant Robbins-Gioia

Size 11,747 SF

Type Sublease

Property Submarket Date Sold Price Buyer Seller Class Occupancy Notes

Tavern Square411-423 King Street, 121-123 N. Pitt Street & 110 & 130 N. Royal Street

Old Town/ Eisenhower Ave

Jun 2018$50,350,000($294 psf)

Cambridge / Westport

The Pyne Companies

B 59.0% 5.10%

699 Prince StreetOld Town/ Eisenhower Ave

Apr 2018$13,200,000 ($264 psf)

CAS RieglerNational Centerfor Missing & Exploited Children

B 100.0%RedevelopmentProject


HighlightsDirect vacancy increased from 11.8% in the first quarter 2018 to 12.3% the second quarter 2018, and has increased from 11.3% since second quarter 2017. Total vacancy has increased from 12.8% in the first quarter 2018 to 13.4% the second quarter 2018, and has increased from 12.7% since second quarter 2017. Year-to-date direct vacancy for Reston was 9.9% and total vacancy was 10.8%. Year-to-date direct vacancy for Herndon was 16.2% and total vacancy was 17.5%.

The Reston-Herndon submarket recorded -318,047 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to -62,222 square feet. The negative absorption for the quarter was driven by a 211,800-square-foot move-out by Charter Spectrum at South Lake at Dulles Corner - 13820 Sunrise Valley Drive, and a 77,473-square-foot move-out by Serco at Reston Town Center - Building C - 1818 Library Street.

The only sales transaction in the Reston-Herndon submarket for the second quarter was the sale of The Summit @ Reston 1 & 2 - 2000 & 2002 Edmund Halley Drive. Brookfield Office Properties acquired the buildings from JBG Smith for $95,000,000 ($327 psf). The buildings were fully leased at the time of sale, and traded at a 5.26% Cap Rate. The largest lease signed in the Reston-Herndon sub-market in the second quarter was a 74,000-square-foot expansion by College Board at Democracy Tower at Res-ton Town Center - 11955 Democracy Drive. Also contrib-uting to leasing activity this quarter was Akima signing a 69,489-square-foot relet at Dulles View South - 2553 Dulles View Drive.






2008: $31.03

PSF

2017: $30.16

PSF

YTD 2018: $31.32

PSF

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Market Spotlight

2nd Quarter 2018Reston-Herndon

Market Stats

Inventory 30.6 M SF


Total Vacancy 13.4%







Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018Reston-Herndon

Monument III @ Worldgate 12930 Worldgate Drive

Tenant Peraton

Size 28,270 SF

Type Sublease

South Pointe I 2350 Corporate Park Drive

Tenant Cogeco Peer 1

Size 21,218 SF

Type Renewal

Enterprise Office Park 2 220 Spring Street

Tenant Marine Spill Response Corporation

Size 19,229 SF

Type Renewal


The Summit 1 & 22000 & 2002 Edmund Halley Drive

Reston-Herndon Apr 2018$95,000,000 ($327 psf)

Brookfield OfficeProperties

JBG Smith A 100.0% 5.26%

Plaza America Tower 4 11730 Plaza America Drive

Tenant Sophos Group

Size 25,637 SF

Type Relet


No new construction reported this quarter Reston-Herndon N/A N/A N/A N/A N/A N/A

Dulles View South 2553 Dulles View Drive

Tenant Akima

Size 69,489 SF

Type Relet

Democracy Tower at Reston Town Center 11955 Democracy Drive

Tenant College Board

Size 74,000 SF

Type Expansion

Liberty Park - Building 8

13461 Sunrise Valley Drive

Tenant Blackhorse

Size 18,712 SF

Type Relet

Plaza America Tower 3 11720 Plaza America Drive

Tenant Bechtel

Size 22,288 SF

Type Renewal


HighlightsDirect vacancy in the Rosslyn-Ballston Corridor decreased from 18.7% in the first quarter 2018 to 18.1% in the second quarter 2018, and has increased from 16.2% since second quarter 2017. Total vacancy decreased from 20.3% in the first quarter 2018 to 19.6% in the second quarter 2018, and has increased from 17.0% since second quarter 2017.

The Rosslyn-Ballston Corridor recorded -80,959 square feet of net absorption during the second quarter of 2018, bringing the year-to-date absorption to 37,018 square feet. The primary driver for negative absorption was a 22,915-square-foot move-out by Supply Partnership at Rosslyn Overlook - 1616 N. Fort Myer Drive and an 18,881-square-foot move-out by Healthnet at Colonial Place III - 2107 Wilson Boulevard. The Carlyle Group announced they will be relocating from Rosslyn to Washington D.C. which will leave a substantial vacancy in the Rosslyn-Ballston Corridor submarket in the near future.

The largest lease signed in the Rosslyn-Ballston Corridor submarket was a 120,000-square-foot sublease by Deloitte at Waterview Tower - 1919 N. Lynn Street. Convene subleased 35,000 square feet at 1201 Wilson Boulevard. Also contributing to leasing activity in the Rosslyn-Ballston Corridor submarket this quarter was a 26,421-square-foot relet by AAMI at Arlington Gateway - 901 N. Glebe Road. Industrious also leased 25,634 square feet at Ballston Exchange I - 4201 Wilson Boulevard.

2311 Wilson Boulevard delivered this quarter. The 175,000-square-foot building is 62.3% leased to Opower, Bean Kinney, Air-Conditioning, Heating, & Refrigeration Institute (AHRI), and The Merit School.






2008: $37.77

PSF

2017: $41.52

PSF

YTD 2018: $42.27

PSF

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Market Spotlight

2nd Quarter 2018Rosslyn-Ballston Corridor

Market Stats

Inventory 25.5 M SF


Total Vacancy 19.6%





YTD 2018 Deliveries 175,000 SF


Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018

Rosslyn-Ballston Corridor


4040 Wilson Boulevard RB Corridor 240,000 SF 116,979 SF 51.3% 4Q 2019 Shooshan Avalon Bay & Vida Fitness

DeliveriesProperty Submarket Building Size Available Pre-leased Delivery Date Developer Major Tenants

2311 Wilson Boulevard RB Corridor 175,000 SF 66,027 SF 62.3% 2Q 2018 CarrOpower/Bean Kinney/AHRI


No new sales reported during the quarter RB Corridor N/A N/A N/A N/A N/A N/A N/A

Potomac Tower 1001 N. 19th Street

Tenant KIMC

Size 18,898 SF

Type Renewal

Ballston Exchange I 4201 Wilson Boulevard

Tenant Industrious

Size 25,634 SF

Type Relet

3001 Washington Boulevard

Tenant FP1 Strategies LLC

Size 19,318 SF

Type Relet

Waterview Tower 1919 N. Lynn Street

Tenant Deloitte

Size 120,000 SF

Type Sublease

Ballston Point 4300 Wilson Boulevard

Tenant National Apartment Association

Size 23,564 SF

Type Renewal

1201 Wilson Boulevard

Tenant Convene

Size 35,000 SF

Type Sublease

Ballston Station 4301 N. Fairfax Drive

Tenant St. Mary’s Institute for Educational Excellence

Size 22,316 SF

Type Sublease

Arlington Gateway 901 N. Glebe Road

Tenant AAMI

Size 26,421 SF

Type Relet


Highlights

Direct vacancy in the Route 28 North submarket decreased from 11.8% in the first quarter 2018 to 11.3% in the second quarter 2018, and has decreased from 14.6% since second quarter 2017. Total vacancy decreased from 12.7% in the first quarter 2018 to 12.2% in the second quarter 2018, and has decreased from 15.7% since second quarter 2017.

The Route 28 North submarket recorded 61,996 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to 104,056 square feet. The primary driver of positive absorption was a 25,192-square-foot move-in by Orbital ATK at One Steeplechase - 21700 Atlantic Boulevard.

One sales transaction occurred in the Route 28 North submarket during the second quarter 2018. Ridgetop II at Loudoun Tech Center - 21641 Ridgetop Circle was purchased by Boyd Watterson from Fairbridge Properties for $15,200,000 ($255 psf). The building was fully leased at the time of sale, and traded at a 6.60% Cap Rate.

The largest lease signed in the Route 28 North submarket was a 17,600-square-foot relet by the GSA-TSA at Dulles East Bldg - 45045 Aviation Drive.






2008: $25.41

PSF

2017: $23.76

PSF

YTD 2018: $25.16

PSF

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Market Spotlight

2nd Quarter 2018Route 28 North

Market Stats

Inventory 9.5 M SF


Total Vacancy 12.2%







Market Spotlight

2nd Quarter 2018Route 28 North

Under ConstructionProperty Submarket Building Size Available Pre-leased Delivery Date Developer Major Tenants

No new construction reported during the quarter Rt 28 North N/A N/A N/A N/A N/A N/A

Major Leases

Sales


Ridgetop II at Loudoun Tech Center21641 Ridgetop Circle Rt 28 North Jun 2018

$15,200,000($255 psf)

Boyd Watterson

FairbridgeProperties

A 100.0% 6.60%

Dulles East Bldg 45045 Aviation Drive

Tenant GSA-TSA

Size 17,600 SF

Type Relet


HighlightsDirect vacancy in the Route 28 South submarket has increased from 11.4% in the first quarter 2018 to 14.4% in the second quarter 2018, and has increased from 12.8% in the second quarter 2017. Total vacancy has increased from 12.6% in the first quarter 2017 to 15.6% the second quarter 2018, and has increased from 13.3% since second quarter 2017.

The Route 28 South submarket recorded -230,172 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to -280,288 square feet. Negative absorption was driven by a 243,314-square-foot addition to the market by UNICOM at UNICOM Technology Park I - 15000 Conference Center Drive.

One sales transaction occurred in the Route 28 South submarket during the second quarter 2018. Commonwealth Centre - 14360 & 14370 Newbrook Drive were acquired by Hines from Equus for $97,750,000 ($306 psf). The buildings were fully leased at the time of sale, and traded at a 6.50% Cap Rate.

The largest lease signed in the Route 28 South submarketthis quarter was a 24,609-square-foot relet by Engility at Stonecroft at Westfields 4803 - 4803 Stonecroft Boulevard.

The 425,000-square-foot building at Dulles Discovery South - 13900 Air and Space Museum Parkway will deliver in the third quarter of 2018. The building is fully leased to the GSA-CIA.






2008: $28.87

PSF

2017: $25.28

PSF

YTD 2018: $26.38

PSF

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Market Spotlight

2nd Quarter 2018Route 28 South

Market Stats

Inventory 13.8 M SF


Total Vacancy 15.6%







Major Leases

Under Construction

Sales

Market Spotlight

2nd Quarter 2018Route 28 South


Dulles Discovery South13900 Air and Space Museum Parkway

Route 28 South 425,000 SF 0 SF 100.0% 3Q 2018 Peterson Co. GSA - CIA


Commonwealth Centre14360 & 14370 Newbrook Drive

Rt 28 South Apr 2018$97,750,000 ($306 psf)

Hines Equus A 100.0% 6.50%

Stonecroft at Westfields 4803

4803 Stonecroft Boulevard

Tenant Engility

Size 24,609 SF

Type Relet


Highlights

Direct vacancy in the Springfield submarket decreased from 21.9% in the first quarter 2018 to 21.5% in the second quarter 2018, and has increased from 20.2% since second quarter 2017. Total vacancy decreased from 22.1% in the first quarter 2018 to 21.8% in the second quarter 2018, and has increased from 20.5% since second quarter 2017.

The Springfield submarket recorded 48,920 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to -21,280. The positive absorption was primarily driven by a 47,350-square-foot move-in by Vencorp at Lake Building 4 - 6860 Commercial Drive.

The largest lease signed in the Springfield submarket in the second quarter 2018 was a 26,187-square-foot renewal by Xator Corp at Kingstowne Ridge - 5680 King Centre Drive. Also contributing to leasing activity this quarter was a 10,060-square-foot relet by Samson Companies, LLC at MetroPark 5 - 6363 Walker Lane.






2008: $29.87

PSF

2017: $29.76

PSF

YTD 2018: $29.50

PSF

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Market Spotlight

2nd Quarter 2018Springfield

Market Stats

Inventory 6.1 M SF


Total Vacancy 21.8%







Major Leases

Market Spotlight

2nd Quarter 2018Springfield

Under Construction

Sales


No new construction reported this quarter

Springfield N/A N/A N/A N/A N/A N/A


No new sales reported during the quarter Springfield N/A N/A N/A N/A N/A N/A N/A

Kingstowne Ridge 5680 King Centre Drive

Tenant Xator Corp

Size 26,187 SF

Type Renewal

MetroPark5 6363 Walker Lane

Tenant Samson Companies, LLC

Size 10,060 SF

Type Relet


HighlightsDirect vacancy in the Tysons Corner submarket decreased from 15.8% in the first quarter 2018 to 15.2% in the second quarter 2018, and has decreased from 16.8% the second quarter 2017. Total vacancy decreased from 16.3% in the first quarter 2018 to 15.8% in the second quarter 2018, and has decreased from 17.5% the second quarter 2017.

The Tysons Corner submarket recorded -48,091 square feet of net absorption in the second quarter of 2018, bringing the year-to-date absorption to -8,446 square feet. Negative absorption was driven by a 25,000-square-foot downsize by CHS at International Gateway 1 - 8100 Boone Boulevard.

The two largest sales transactions of the quarter for Norther Virginia occurred in the Tysons Corner submar-ket. Boro Station I-III - 1765, 1775 & 1785 Greensboro Station Place were acquired by MetLife from Meridi-an Group for $244,000,000 ($380 psf). The buildings were 95.0% occupied at the time of sale, and traded at a 4.75% Cap Rate. Greensboro Park - 8180 & 8200 Greensboro Drive also traded this quarter. Altus Group / Velocis purchased the two buildings from Beacon Cap-ital Partners for $142,000,000 ($281 psf). The buildings were 83.0% occupied at the time of sale, and traded at a 5.60% Cap Rate.

The largest lease signed in the Tysons Corner submarket this quarter was a 204,547-square-foot relet by Appian at Valo Park - 7950 Jones Branch Drive. Another top lease in the Tysons Corner submarket this quarter was a 110,571-square-foot renewal signed by Cvent at Boro Station I - 1765 Greensboro Station Place.






2008: $32.59

PSF

2017: $33.19

PSF

YTD 2018: $34.25

PSF

0.0

0.5

1.0

1.5

2.0

YTD '18 '17'16'15'14'13'12'11'10'09'08

SF (M

illio

ns)


0

4

8

12

16

20

YTD '18'17'16'15'14'13'12'11'10'09'08


Vaca

ncy

Rate

(%) A

sking Rate ($)

0

7

14

21

28

35

-0.5

0.0

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1.0

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YTD '18 '17'16'15'14'13'12'11'10'09'08

SF (M

illio

ns)


Market Spotlight

2nd Quarter 2018Tysons Corner

Market Stats

Inventory 29.2 M SF


Total Vacancy 15.8%



Under Construction 1.6 M SF




Major Leases

Market Spotlight

2nd Quarter 2018Tysons Corner

Under Construction

Sales


Capital One Campus - Building 3Capital One Drive N. Tysons Corner 975,000 SF 0 SF 100.0% 3Q 2018 Capital One Capital One

The Boro Tower8350 Broad Street Tysons Corner 438,169 SF 331,800 SF 24.3% 1Q 2019 Meridian

Tegna/Hogan Lovells

Boro Loft1640 Boro Place Tysons Corner 143,606 SF 111,642 SF 22.3% 1Q 2019 Meridian Whole Foods


Boro Station I-III 1765, 1775 & 1785 GreensboroStation Place

Tysons Corner Apr 2018$244,000,000 ($380 PSF)

MetLifeMeridian Group

A 95.0% 4.75%

Greensboro Park 8180 & 8200 Greensboro Drive Tysons Corner Jun 2018

$142,000,000 ($281 PSF)

Altus Group /Velocis

Beacon CapitalPartners

A 83.0% 5.60%

Boro Station I 1765 Greensboro Station Place

Tenant Cvent

Size 110,571 SF

Type Renewal

Valo Park 7950 Jones Branch Drive

Tenant Appian

Size 204,547 SF

Type Relet


Tenant OneWeb

Size 71,834 SF

Type Relet


Tenant OneWeb

Size 85,932 SF

Type Sublease

1660 International Drive

Tenant Industrious

Size 26,591 SF

Type Relet

Fairfax Square II 8075 Leesburg Pike

Tenant New York Life

Size 32, 966 SF

Type Relet

Northern Virginia Quarterly Market Report...Overall Market Summary Metropolitan D.C. Market Overview...

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