The Riverside on the James office tower in downtown Richmond has been sold for $77 million.
Opal Holdings, a New York-based real estate investment firm, purchased the building from McLean-based American Real Estate Partners, which had owned the building at 1001 Haxall Point overlooking the James River since 2011.
Only the 15-story office tower was sold.
The 10-story condominium building that is next door to the office tower that makes up the Riverside on the James mixed-use project was not part of the sale. The Riverside on the James was completed in 2005.
The 263,752-square-foot office building sold last week, according to American Real Estate Partners. The sale had not been recorded in the Richmond Circuit Court as of Wednesday afternoon, but a source familiar with the transaction said it sold for $77 million.
The building is 95% occupied, American Real Estate Partners said.
The Troutman Pepper law firm and Harris Williams & Co., an investment banking firm, combined occupy about 75% of the building’s space.
“Our success in raising the occupancy of Riverside on the James from 82% at acquisition to 95% as well as expanding and extending two of the building’s long term, credit-worthy tenants multiple times exemplifies the quality of the asset,” said Brian Katz, co-founder and president of American Real Estate Partners. “We have been excited to be a part of the Richmond community for the past decade and pleased to pass the stewardship of this trophy asset to the team at Opal.”
The privately held real estate investment company purchased the property a decade ago for $63.8 million from a venture of Prudential Financial Inc. and Dominion Realty Partners.
American Real Estate Partners initially had put the building on the market in early 2017.
Commercial real estate brokerage JLL’s Capital Markets group got the listing about a year ago, but held off marketing the building during the spring and summer because of the pandemic, said Christopher Lingerfelt, senior director of JLL’s Capital Markets.
Lingerfelt and his team began marketing the property in earnest in the fall.
“Given what we were stacked up against as far as the pandemic and what was going on in the world at the time, we had a significant amount of interest for sure in the building,” he said.
The underlying fundamentals were strong, he said, noting that the building had long-term leases from its two main tenants.
“The driving force behind the offering was good strong reliable cash flow from two of Richmond’s quality tenants,” he said.
The sale of the Riverside on the James office building comes as other large office buildings have been sold recently in the downtown area.
In late January, CoStar Group Inc. bought its downtown Richmond global research headquarters building for $130 million.
That nine-story building was originally built for MeadWestvaco, now called WestRock. WestRock downsized its space in the building and moved its corporate offices to Atlanta. The WestRock and CoStar names are on the sides of the building.
CoStar occupies the four upper floors of the building, which is next to the Federal Reserve Bank of Richmond’s office tower.
The Edgeworth Building at 2100 E. Cary St. in Tobacco Row sold in late February for $29.5 million. The 140,573-square-foot building is 95% leased to tenants including the Hirschler Fleischer law firm, Ernst & Young and HKS Architects.
The property, originally built as a tobacco factory in 1925, was redeveloped into offices in 2007.
The 12-story Mutual Building at 909 E. Main St. sold in late November for $12.8 million. The sale came a couple of months after the Christian & Barton law firm had announced plans to relocate to the 21-story One James Center at 901 E. Cary St. this year.