The Yards development in Southeast D.C. has lured another technology company.
Xylem Inc. (NYSE: XYL), a New York based water technology company, has signed a lease for 17,000 square feet at 301 Water St. SE in the Lumber Shed building, taking up all of the office space in the former Navy Yard industrial building that was converted into mixed-use.
The space initially housed some Forest City Washington offices before Forest City was acquired by Brookfield Properties. Brookfield's own development, design and construction group had been using the office for a time, but the developer has recently consolidated its local operations to a new building it co-developed at 655 New York Ave. NW, it said in a statement.
Xylem is a $4.88 billion water technology company that develops tools to move, treat, analyze and return wastewater for public utilities. The company has an extensive relationship with the D.C. Water and Sewer Authority, having installed its Flygt Concertor wastewater pumping system at the Blue Plains Advanced Wastewater Treatment Plant in 2017. Also that year, the two entities inked a memorandum to pilot more technology that treats and manages wastewater sustainably.
The company's new office is just a short walk from D.C. Water's new headquarters at 1385 Canal St. SE. Xylem didn't say how many employees would be based in the office, which will be its first in the District.
The company was a targeted win for the landlord, according to Toby Millman, senior vice president of development for Brookfield Properties. With the new D.C. Water headquarters nearby, this is a chance for a collaborator to locate within close proximity, and a chance for The Yards to become a magnet for more tech-focused companies, Millman said. Already, international development firm Chemonics International is consolidating its D.C. and Northern Virginia operations and almost 1,000 employees to a new home in over 200,000 square feet at 1275 New Jersey Ave. SE.
JLL represented Brookfield and Cushman & Wakefield represented Xylem in lease negotiations. Xylem will joint restaurants such as Agua 301, Bammy's and Osteria in the Lumber Shed building.
Brookfield recently unveiled its plans for the 3.4 million-square-foot second phase of The Yards, in an expansion of the 48-acre project Brookfield picked up with its 2018 acquisition of Forest City. Millman said the Xylem lease is another indicator the company should remain focused on more office space for The Yards' second phase — even as Covid-19 has slowed the rate of leasing activity and increased vacancy rates in Greater Washington.
"I don't think we've seen the slowdown, I think The Yards has seen an uptick in leasing interest this year," Millman said. "The tenants who are new to the market like this one have started their search for space in the newer product, so sites like this are certainly being considered earlier."
