Safety, Income & Growth Inc., the leading company focused on ground leases, has originated a new $150 million ground lease, the largest single asset lease in its portfolio, on a trophy office building located on Pennsylvania Avenue in Washington, D.C. SAFE’s customer utilized the ground lease to help capitalize the acquisition of the property.
The property is a class-A 14-story office building centrally-located directly between the White House and the Capitol Building and two blocks from three metro stations which provide access to all six of D.C.’s metro lines. The building is 100% occupied by a global law firm on a long-term lease.
“We’re pleased to see that our ground lease product is starting to gain attraction in the Washington D.C. market, where this year we’ve closed five deals for nearly $270 million,” said Jay Sugarman, Chairman and Chief Executive Officer. “This deal demonstrates that SAFE can deliver its value-enhancing product to its customers at any scale.”
This SAFE Ground Lease™ features fixed annual rent escalations over 99 years with CPI-based adjustments. The leasehold was purchased by a venture with majority ownership from PRP, LLC and leasehold financing from a third-party global institutional lender.