The Washington Post HQ

About the Client

The Washington Post, founded in 1877, is an American daily newspaper headquartered in Washington, D.C. The Washington Post is a top 10 US newspaper by circulation and has over 1 million paid digital subscribers. 

Client Need

The Washington Post and its parent company Graham Holdings, were determined to better align their real estate with changing operational requirements to achieve long-term business goals. The client leadership team retained JM Zell to evaluate the D.C. portfolio within the context of their business and to determine the best course of action.

Solution

Our team began the engagement by completing a thorough analysis of the existing real estate portfolio including establishing market value, base-lining space utilization and determining shortcomings; defining operational and ownership interest requirements and formulating alternate occupancy/operational strategies.

We then assisted the client in establishing an analytical framework to evaluate multiple real estate scenarios to determine and build consensus behind the best course of action. Based on comprehensive review and analysis, The Washington Post and Graham Holdings decided to move forward with the implementation phase of the engagement which resulted in the disposition of their previously owned headquarters asset and subsequent relocation of the headquarters into a leased premises.

Outcome - Disposition

JM Zell led the entire disposition process from marketing the opportunity and evaluating offers through negotiation and closing. Ultimately JM Zell negotiated a single transaction with Carr Properties, which included the existing office building, development rights (total of 840,000 SF), ground lease, and a short-term leaseback.

In March 2014, Carr Properties closed on all elements of the transaction, making it the largest land sale in the District.  Less than a year later, Carr Properties signed a long-term lease with Fannie Mae for nearly the entire buildable area. The timing of the transaction enabled The Washington Post to move forward with their overall real estate strategy in a timely manner with limited risk.

Lease Transaction

While negotiating the disposition of the original headquarters premises, JM Zell performed an extensive local market search for a suitable replacement headquarters location resulting in approximately 37 qualified responses ranging from existing buildings to build-to-suit projects. Ultimately, 1301 K Street was selected as it met the criteria for success established during the initial phases of the project.