Swedish construction giant Skanska is expanding its commercial development business to the U.S. The first project funded on the firm's balance sheet will be a 10-story, 172,000-square-foot office building in central Washington, D.C.
The $85 million speculative project in the East End submarket at 733 10th St., five blocks from the White House, is expected to break ground this quarter and be completed in the latter half of 2011.
The newly minted Skanska USA Commercial Development unit, which acquired the property from the First Congregational United Church of Christ, intends to achieve a minimum green building rating of LEED Gold on the project. The church had a development agreement with PN Hoffman, but Skanska has acquired the development rights and will build a new church facility for First Congregational as part of the project.
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The new unit will initiate, develop, lease and sell commercial properties, similar to its European operations.
Skanska USA Commercial Development will be based in Skanska’s office in the Empire State Building in New York. The builder will focus on developing office projects in selected cities where Skanska conducts construction operations, initially in the D.C. area, Boston and Houston.
Johan Karlström, President and CEO of Stockholm-based Skanska, said the firm's long-term strategic plan includes expansion of its development business.
"For decades, our commercial development activities have been highly successful in Sweden and Central Europe. We shall now further capitalize on the accumulated know-how in the group, Karlström said. Skanska USA Building, headquartered in Parsippany, NJ, has about 3,500 employees.