News | 4 min read
Henrico backs deal to fill office space left by Circuit City
December 4, 2014
News | 4 min read
December 4, 2014
Henrico County is putting $500,000 of its own money into a deal to move a medical supply company to a western Henrico office building.
County leaders see the deal as good for the county — heading off potential job losses and drawing new investment — and also as a bit of a milestone.
The move will effectively fill an office building that once was part of Circuit City’s headquarters. The firm’s demise left the complex empty, one of several corporate casualties in the county during the recession.
McKesson Medical-Surgical Inc. has agreed to relocate from another county location to more than 160,000 square feet in Deep Run III at 9954 Mayland Drive, almost six years after Circuit City’s fall left the 360,000-square-foot building vacant.
“This pretty much backfills all the space that was vacated when Circuit City went bankrupt and shut down,” said Gary McLaren, director of the Henrico Economic Development Authority.
The move is part of a larger rebound for the county. In the depths of the recession, office vacancies in that area of Henrico — in and around the Innsbrook Corporate Center — rose sharply, exceeding 27 percent by one measure in late 2009. Now, there are only two buildings with significant amounts of open space in that area, McLaren said.
McKesson plans to add 225 employees over five years at the site, McLaren said. The jobs are expected to have salaries that average more than $100,000 annually, he said.
“The McKesson decision was a huge win for us, there’s no question,” McLaren said.
Henrico will match a $500,000 state grant, for a total of $1 million in incentive payments to the company for relocating within the county.
McKesson had a headquarters operation on Landmark Road, near the intersection of East Parham and Staples Mill roads, but the county ran the risk of the company’s headquarters relocating elsewhere in the region and of seeing the job growth lost to another state entirely, McLaren said.
“The county potentially could have lost the entire thing to another locality in the greater Richmond region,” McLaren said.
He added that the company had another state “under serious consideration.”
“It’s good news all around,” said county Supervisor David A. Kaechele, whose Three Chopt District includes the building.
He said the company’s choice to stay in Henrico and its decision to add jobs are both important for the county.
Markel | Eagle has owned the building for about three years, having bought it out of foreclosure, said J.B. Gurley, a principal at the company. The company built a nearly 800-space parking garage and thoroughly renovated the office building itself, Gurley said.
“It might have been built in 1996, but as of 2014 everything’s pretty much brand new,” Gurley said.
The facility has a full-service cafeteria; a fitness center; a conference facility; new elevators; upgraded heating, ventilation and air-conditioning capabilities; refitted lobbies; and updated restrooms.
“It’s the premier class A suburban office building … in the Richmond market,” Gurley said. “I can say that, but the demand and success that we had in leasing it really proves it.”
The building is 97 percent leased and is not being actively marketed, Gurley said. The space that remains will largely be used as tenants expand, Gurley said. Travelers Insurance, Essex Bank and McKesson have been the major tenants added to the building, Gurley said, though a number of other tenants also are there.
Gurley credited Henrico’s business-friendly environment as a boost to the company’s leasing efforts.
McKesson did not respond to a request for comment.
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