Jefferson House, a 181-unit apartment building in Foggy Bottom, is being sold to its tenant association for $6.25 million. The tenant group plans to convert it to condominum ownership before the transaction goes to settlement in May.
The 16-year-old building is at 922 24th St. NW.
Marguerite Cox, president of the tenant group, said that negotiations for the purchase were conducted with the Oliver T. Carr Co., acting as agent for the owners, a joint venture group that includes the Carr Co. Cox said that 99 of the 181 tenents raised about $350,000 to negotiate the purchase of the building after it was learned last year that it might be sold to a developer who would convert it to condominium ownership. Apartment buildings here are often sold to a third party prior to condo conversion.
John K. Hoskinson, a realty broker who earlier represented tenants of the Beverly Court apartments when they purchased their building on Columbia Road, represented the Jefferson House Tenants.
Hoskinson said that the 99 tenants are mostly young professionals, with an average income of $17,500 a year. Tenants will probably pay about $70 a square foot for their dwellings -- in contrast to $108 a foot to outsiders who purchase, rehabilitated units, he said. The building has 151 efficiency apartments and 30 one-bedroom units. There are 44 private parking spaces, which will also be sold.
Hoskinson said that the sellers are providing a subordinated loan of $500,000 to make the interim financing more attractive to a lender. "We are now negotiating with several lender at 2 percentage points above the prime rate for the interim financing," Hoskinson said.
He said that the owners had found it easier to deal directly with a tenant group than to sell to a developer and then face possible tenant legal action, as has happened in a number of condominium conversion sales in the area.
Rents at Jefferson House are in the moderate range. Cox pays $248 a month for her efficiency unit, which will be priced at about $40,000. She said the building needs a new roof and some other repairs. The tenant group plans to spend $1 million for repairs and renovations, she said.