The Sun Trust Bank Building, a 25-story office tower in downtown Baltimore, has sold for $62.75 million, signaling continued strength in the city's commercial real estate market, CB Richard Ellis Group said yesterday.
The sale of 120 E. Baltimore St. to a Massachusetts-based investor brings the combined value of office properties sold downtown to more than $300 million this year, far surpassing the $185 million worth of office properties sold downtown all of last year, said Bo Cashman, a senior vice president in CBRE's Investment Properties Capital Markets Group.
The "Class A" building was sold to Franklin Street Properties Corp., a real estate investment trust based in Wakefield, Mass.
"People have been talking about the lack of strength of the [business district] as tenants move to other locations in the city, such as Harbor East, but this speaks to the strength of the [business district] market and how investors view the quality of assets within the central business district of Baltimore," said Cashman, who represented the seller, LaSalle Investment Management.
The 327,000-square-foot tower, built on the corner of Calvert and Baltimore streets in 1989 as the Bank of Baltimore building, is 94 percent leased to tenants including the Ober Kaler law firm and Sun Trust Bank.
Cashman said the seller got 24 offers from mostly out-of-town investors.
"That's great news for Baltimore," he said. "It speaks to the confidence investors have in the future of downtown's office market."
Other major office property sales this year have included 500 E. Pratt St. for $73.5 million; 1 N. Charles St. for more than $30 million; and Mercantile Bank and Trust Building at 2 Hopkins Plaza and the W. R. Grace Building, at 10 E. Baltimore St., together for $78.9 million.
Baltimore's office market is benefiting as older, less desirable office buildings have been converted to hotels or apartments. Additionally, Baltimore continues to be viewed as a value for investment compared to prices in major markets, Cashman said.
The market is on track for almost $500 million worth of sales this year, he said.