CoStar Group announced a deal today (Friday) to expand its presence in a Rosslyn office building as it moves forward with relocation plans.
The company, which announced plans to move its corporate headquarters from D.C. to Arlington in February, expects to relocate in early 2025, according a press release.
As part of this process, the research and consulting firm Gartner agreed to cede 11 floors in the office building at 1201 Wilson Blvd. Gartner paid a $48 million early termination fee to occupy a 49,000 square foot space on the building’s 11th and 12th floors.
“I’m delighted we’ll be able to more fully tap into the building’s extensive amenities and location in business-friendly Virginia ahead of schedule and can’t wait to welcome employees, customers and other constituents early next year,” said Andy Florance, Founder and Chief Executive Officer of CoStar Group.
The press release notes that CoStar Group considered more than 25 other locations in Crystal City, D.C. and Tyson’s Corner before settling on 1201 Wilson Blvd.
A key advantage of the building is its location above the Rosslyn Metro, “offering excellent access to Ronald Reagan National Airport and Dulles International Airport and transportation, including five major road networks, from around the greater Washington DC area.”
“The move to Rosslyn will offer employees access to extensive retail and dining amenities, a network of biking and jogging trails and the waterfront in a highly desirable, vibrant, and safe environment,” the release says.
CoStar Group also “believed that market conditions at the time of purchase provided an opportune time to acquire a high-quality property at a significant discount.”
Arlington County agreed to a package of agreements to secure the company’s relocation — a move that County Manager Mark Schwartz called “the county’s most impactful development project since HQ2.”
One controversial aspect of the deal was a decision, approved by the Arlington County Board, to trade public access to the “View of D.C.” observation deck at 1201 Wilson Blvd in exchange for a $14 million investment in planned renovations to nearby Gateway Park.
A complete press release on CoStar Group’s latest deal is below.
WASHINGTON–(BUSINESS WIRE)–CoStar Group (NASDAQ: CSGP), a leading provider of online real estate marketplaces, information, and analytics in the property markets, today announced an agreement with research and consulting firm Gartner to take back-office space previously leased by Gartner in Arlington, Virginia. Located at 1201 Wilson Boulevard, the building is a 552,000 square foot trophy office tower with LEED Platinum certification. CoStar Group purchased the property earlier this year with the intention of relocating its Washington, DC employees to Arlington as part of a corporate headquarters transition.
As part of the deal, Gartner paid CoStar Group a $48 million early termination fee and signed a new lease for approximately 49,000 square feet on floors 11 and 12 at 1201 Wilson Boulevard for a term through December 2032 at prevailing market rates. The deal unlocks sufficient space at 1201 Wilson Boulevard to allow CoStar Group to relocate its headquarters from Washington, DC in early 2025.
“We’ve always intended for 1201 Wilson to become CoStar Group’s headquarters, but this agreement makes it possible for us to complete that process even faster and to better accommodate our continued rapid growth and expansion,” said Andy Florance, Founder and Chief Executive Officer of CoStar Group. “I’m delighted we’ll be able to more fully tap into the building’s extensive amenities and location in business-friendly Virginia ahead of schedule and can’t wait to welcome employees, customers and other constituents early next year.”
With the Company’s current lease in Washington, DC set to expire in 2025, CoStar Group assessed more than 25 viable sites across Washington, DC, Rosslyn, Crystal City and Tyson’s Corner before selecting 1201 Wilson Boulevard. With the industry’s largest team of researchers, economists, software developers and analysts focused on real estate, CoStar Group enjoys a unique perspective on commercial property values and believed that market conditions at time of purchase provided an opportune time to acquire a high-quality property at a significant discount. The company previously acquired 1331 L Street, NW, in Washington, DC in 2011 and executed a sale and leaseback transaction for over a 140% return. That deal was the most profitable sale of Washington commercial real estate from the recession at the time.
1201 Wilson Boulevard is located directly above the Rosslyn Metro offering excellent access to Ronald Reagan National Airport and Dulles International Airport and transportation, including five major road networks, from around the greater Washington DC area. The move to Rosslyn will offer employees access to extensive retail and dining amenities, a network of biking and jogging trails and the waterfront in a highly desirable, vibrant, and safe environment.
The agreement comes at a time of significant growth and expansion for CoStar Group, with revenue growing from $252 million in 2011 to $2.46 billion in 2023 and employees growing from 1,000 in 2011 to over 6,400 today. Founded in 1986, CoStar Group has digitized the real estate industry, empowering people to discover properties, insights, and connections that improve their businesses and lives. CoStar Group is included in the S&P 500 Index, one of the premier benchmarks of the U.S. equities market, and in the NASDAQ 100, one of the world’s largest preeminent large-cap indexes.
