Taking advantage of a hot real estate market, the Smithsonian Institution made a $43.5 million profit on a downtown building.
The sale of the Victor Building, a landmark property on Ninth Street NW in the Gallery Place neighborhood, was approved yesterday by the Smithsonian's Board of Regents. The museum bought the property and refurbished it in 1999 for $114 million and had used the nine-story building for office space. It sold for $157.5 million.
"It is a remarkable gain, perhaps one of the most remarkable investments made by the institution," Sheila Burke, the Smithsonian's deputy secretary and chief operating officer, said in an interview after the regents meeting. The sale was prompted by the real estate boom in the neighborhood. The money will go into the Smithsonian's trust funds, she said.
Many of those working in the building were people displaced during the renovation of the Old Patent Office Building, which housed the National Portrait Gallery, Smithsonian American Art Museum and the Archives of American Art.
Burke said the Smithsonian will lease back space for those staffs from the new owners, Trizec Properties Inc. Other offices will shift to other rental space.
The regents also discussed the growing expenses and delays for the completion of the work on the Patent Office Building. Work on a glass canopy covering the interior courtyard was put on hold after the National Capital Planning Commission rejected the cover's design in June. Earlier this month, the NCPC reversed itself and approved architect Norman Foster's concept.
Now, Burke said, the canopy could cost as much as $20 million to $30 million more than the projected $50 million. The increase is partly the result of manufacturing delays and the rising cost of steel, cement and glass. The new cost projection also includes adjustments to the lighting, changes in the glass and landscaping, and the rebuilding of steps on F Street NW -- all ordered by the NCPC. Money to cover the additional costs will be raised privately, Burke said. Congress has authorized $166 million for the overhaul of the building.
The building, which has been closed since 2000, will open as announced in July 2006. The glass canopy will be in place by spring 2007, Burke said.