Charleston’s newest office building fetches $24 million
The newest office building in downtown Charleston has a new landlord.
A company headed by a local resident and real estate executive acquired 25 Calhoun St. this week. The sale price was slightly more than $24 million, or about $370 per square foot.
The total cost of the four-story project at Calhoun and Washington streets was pegged at $18 million in 2010.
The buyer is CMB Property Co.’s 25 Calhoun CMB LLC. Its president is Sullivan’s Island resident Patrick Marr, a Washington, D.C.-based office leasing executive and vice chairman of the real estate giant CBRE.
“First, we selected the Charleston market due to the continued growth in the business sector, combined with the barriers on the peninsula that constrain future office space supply,” Marr said Friday in a written statement.
“Second, we feel like 25 Calhoun is truly trophy-quality space and that today’s tenants are looking for a modern and efficient office environment.”
The seller was Concord Park Charleston LLC, a group that included Holder Properties of Atlanta and locally based Durlach Associates.
“The partnership’s goal was to sell when certain investment objectives were met,” said Marc Durlach of Durlach Associates, which will continue to manage 25 Calhoun. “The property commanded a premium price due to its unmatched location, efficient sustainable design and high-quality construction.”
Office space on the peninsula is limited and the occupancy rate is historically high, which tends to pull in investors. Vacancies in the city’s central business district are down to about 3 percent, making “it one of the strongest office markets in the country,” Durlach said in statement.
“Most of Charleston’s submarkets and downtown, in particular, require new development to meet the demands of growing businesses as well as businesses locating to Charleston,” he said. “New development will require substantially higher rental rates, which leads to increased rent for existing properties.”
An online leasing brochure shows space in 25 Calhoun is priced at about $35 per square foot annually. The building is 93 percent occupied.
The glassy, 65,000-square-foot structure near the S.C. Aquarium is one of the most contemporary office addresses on the peninsula. It kicked off the long- delayed Concord Park development when work crews broke ground in 2010. At that time it was the first major privately funded office building to go up on the peninsula in about five years.
The project was completed in late 2011, when the law firm of Young Clement Rivers left its longtime home on Broad Street and became 25 Calhoun’s first tenant.
Marr’s 25 Calhoun CMB raised $8.2 million, or about one-third of the total purchase price, from equity investors this month, according to a document it filed with the U.S. Securities and Exchange Commission.