MacKenzie Brokers Sale of Full-Leased Commercial Office Building in Ellicott City

“Despite the negative headlines about interest rates and the purported toxicity of this asset class, many opportunities persist for both sellers and investors of suburban-located office product,” says Owen Rouse,         

Kenwood Management Company has acquired 9011 Chevrolet Drive, a single-story, 19,259 square foot commercial office building located in the Ellicott City section of Howard County, Maryland for $3.25 million. Owen Rouse, Senior Vice President, Investment Sales and David McClatchy, Senior Vice President and Principal of MacKenzie Commercial Real Estate Services, LLC represented the seller, KMS Associates, of this full-leased and occupied asset. The buyer was self-represented in the transaction.

The two-story building was constructed in 2000 and is contained on an approximate 2.5-acre site which also included free surface parking for the tenants. The asset fronts Chevrolet Drive and is located in proximity to Baltimore-National Pike (US Route 40) and MD Route 29 and is approximately three miles from Columbia Town Center. Nearly 75,000 people reside within a three-mile radius from the building, including more than 26,000 households with an average household income eclipsing $190,000. The tenant roster is a 50-50 mix of medical and traditional office space users.

“Despite the continuing negative headlines about rising interest rates and the purported toxicity of the suburban office asset class, tremendous opportunities persist for sellers and investors both locally and nationally,” stated MacKenzie’s Owen Rouse. “Office as an asset class represents approximately 60 percent of the investable universe. After subtracting institutionally-owned assets in multifamily and industrial, as well as rarely-available retail assets, selected office investments can provide opportunities for smaller and private investors. The barrier to entry remains exceedingly high in many markets, and various other fundamentals are at play that make this asset class extremely attractive.”

Rouse explains that, with historically-low interest rates the past several of years, there is expected to be considerable pain for investors who look to refinance their properties in the not-too-distant future. “Large amounts of equity will be lost when these assets are refinanced at higher rates and with lower loan proceeds for some, this exercise might not be survivable.” Rouse said.

“The hybrid work model seems to be stabilizing over the past several of months, and more companies are being empowered to set and enforce guidelines for employees to return to work, which is excellent news for owners of commercial office buildings,” Rouse said. He adds that “holding an asset too long in an illiquid or declining market can force owners to become extended checkwriters due to rising expenses and vacancies.” Rouse says that “investors cycle into and out of positions for specific reasons and assets can become increasingly difficult or easy to manage as they age.”

“Commercial real estate is and will always be highly cyclical in nature and owners and sellers need to consider all present and future scenarios in their decision-making process,” stated MacKenzie’s David McClatchy. “Well-maintained assets contained in infill locations with a strong tenant roster are still hard to come by, and there will always be a strong demand for these properties as capital also remains plentiful.  We continue to see a flight-to-quality among office users, with amenity-rich commercial office environments having a significant edge.”

“We fielded multiple offers from credible investors for 9011 Chevrolet Drive, which makes us believe there are likely more office owners that would be amenable to selling if there were aware of the vibrant market,” McClatchy added.

MacKenzie Commercial Real Estate Services is the real estate brokerage arm of The MacKenzie Companies, which operates six full-service divisions addressing all real estate asset classes including MacKenzie Management Company, LLC, MacKenzie Contracting Company, LLC, MacKenzie Capital, LLC, MacKenzie Investment Group, LLC and MacKenzie Multifamily Management, LLC. The company provides customized real estate solutions for institutional owners, investors, private companies and individuals. For additional information, visit