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News release


Venture Capital Investments a Bright Spot for D.C. Commercial Real Estate Market

Creative office space in Washington at a premium

WASHINGTON, Nov. 18, 2013 -- Technology-related companies and start-up firms in the greater Washington, D.C., metro area have attracted more than $943 million in venture capital investment through the third quarter of 2013, making this sector one of the region's true bright spots, according to research analysis from Jones Lang LaSalle.

Companies receiving venture capital and the firms graduating from the incubator/accelerator/coworking spaces like 1776 and WeWork are opening "decent sized" offices of their own, according to Andy O'Brien, Senior Vice President in the Washington, D.C., office of Jones Lang LaSalle.

"Once tenants get series A or angel funding, one of their first orders of business is to graduate from coworking offices and find space where they can grow," said O'Brien. "Most of these start-ups are looking for open office plans where everybody can work together."

Office space in Washington, D.C., typically reflects the build-out preferred by lobbyists or law firms, so a "land grab" has emerged for the creative-type spaces found in places like The Wonder Bread building, O’Brien says. Well-located, funky, urban buildings are attracting a premium rental rate for their features, which may include 12-foot ceilings and exposed brick.

"Cool spaces are at a premium," O'Brien says. "And for every company graduating from incubator or accelerator co-working space, there are 100 behind them."  

Year to date, venture capital investment in Washington, D.C., has topped $200 million, with more than half of that directed toward companies that occupy office space in the East End.

Suburban Maryland has seen over $400 million of venture capital flow into the market, with three quarters of that going into Bethesda and the I-270 Corridor. Biotechnology companies like Precision for Medicine in Bethesda's Central Business District are among the area's primary drivers.

Northern Virginia, which has collected more than $330 million in venture capital funding this year, has seen investments relating to software development, with Evolent Health and Clarabridge attracting $100 million and $80 million investments, respectively. These rank as two of the country's top ten largest deals of the third quarter.

About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $46.7 billion of real estate assets under management. For further information, visit