August 20, 2004


Commercial Real Estate Direct Staff Report

Monument Realty has completed its purchase of The Watergate Hotel at 2650 Virginia Avenue NW in Washington, D.C.

The local developer, which purchased the property from a partnership controlled by Blackstone Real Estate Advisors, will rename it Belles Rives at The Watergate.

Blackstone will continue to operate the 251-room hotel over the next year, while plans are drawn up for converting the underperforming hotel into 133 luxury condominiums that would range in price to $3 million apiece.

Monument did not disclose a sales price, but a report in today's Washington Post pegs it at around $55 million.

Blackstone had acquired the property in 1998 for $39 million from Japan's Nikko Securities. Two years ago, it hired Eastdil Realty to market the property for sale. At the time, the thinking was that it could sell for $50 million to $68 million.

Ackman-Ziff Real Estate Group and Meridian Capital Group arranged acquisition and construction financing for the property from PB Capital Corp.


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