Glendale’s national office and industrial landlord, PS Business Parks Inc., is building apartments.
The real estate investment trust announced Friday that its first-ever apartment venture, a 395-unit luxury mid-rise complex called Highgate at The Mile, at 7915 Jones Branch Drive in Tysons, Va., has opened to renters.
Highgate sits within PS Business Parks’ 750,000-square-foot, 45-acre The Mile office park, and is being built through a joint venture with Kettler, an apartment, condominium and mixed-use developer in McLean, Virginia. The venture expects to finish construction early next year.
The complex replaced a 123,000-square-foot building that had occupied the 5-acre site.
Highgate is the company’s first apartment complex. PS Business Parks owns 99 parks in six states distributed among 14.6 million square feet used as industrial, office and flex space.
Executive Vice President and Chief Financial Officer Edward Stokx said building apartments is not a new direction for the company, but an endeavor that for now is unique to that park.
“Where it makes sense, and where there are opportunities like that, we would pursue,” Stokx said. “This just enhances the value of that park and the offerings we have in the park.”
PS Business Parks said in its 2016 annual report that it established the joint venture in 2013 with the intention of building the apartment complex. It also owns 95 percent of the venture. At the time, it estimated the project to cost about $106 million.
For Highgate, Stokx said the broader reason for the project, and a trend it noticed when it bought the park in 2010, is that Tysons was focused on adding infrastructure and services such as public transportation to accommodate more residents.
“Tysons was very focused on increasing its residential base, and we saw that certainly as an opportunity, and something that would work well with our park,” he said.
The complex is within walking distance of the public transportation system, shopping, restaurants, entertainment and major employers. It also features green space with two parks, a one‐mile loop for walkers and joggers and a walking trail connecting office and residential communities as well as the Metro station.
Maria Hawthorne, chief executive of PS Business Parks, said in a statement that the apartment complex would bring features the tenants and employees of the office park could use, and therefore make the business park more valuable.
PS Business Parks (PSB) shares closed up on Friday by $1.82, or 1.4 percent, to $129.87 on the New York Stock Exchange.