Dominion Resources: New High-rise Building Planned for Downtown

[Brent114]

How is downtown real estate these days?  With the extremely high vacancy rates in central business districts across the globe I’m not sure the lot is as enticing as we think.   The days of hoping for a corporate signature tower are over, at least for the next decade or more.  
 

 

[123fakestreet]

28 minutes ago, Brent114 said:

How is downtown real estate these days?  With the extremely high vacancy rates in central business districts across the globe I’m not sure the lot is as enticing as we think.   The days of hoping for a corporate signature tower are over, at least for the next decade or more.  
 

 

If there is a development there my guess was residential or possibly a hotel. Just no demand for office space.

[ancientcarpenter]

3 hours ago, eandslee said:

Are we sure that GRP isn’t working with a potential buyer?  I’m sure that if they were, there would be non-disclosure implications, but what if?  I had heard that there were some really big fish trolling the waters here in Richmond in the not too distant past. Maybe they’ve come back with the news of this very prominent block becoming available.
…This is the optimistic side of me talking here. 

Crossing fingers for Lego to open their America HQ in RVA with a signature tower using the lego design.

As of now, I think Lego has some facility in the northeast (New Hampshire?) but it's not considered an HQ and is barely recognized by them in their marketing docs. Lego has been and continues to make big pushes in the American market. I'm shocked they don't have a stronger "western hemisphere" HQ somewhere in America. Maybe it's time... they've already invested hundreds of millions in the facility south of RVA. This dream of mine makes most sense to my biased mind  

A taller, more dense version of  their Denmark campus in RVA!

Edited June 1, 2023 by ancientcarpenter

[eandslee]

19 minutes ago, ancientcarpenter said:

Crossing fingers for Lego to open their America HQ in RVA with a signature tower using the lego design.

As of now, I think Lego has some facility in the northeast (New Hampshire?) but it's not considered an HQ and is barely recognized by them in their marketing docs. Lego has been and continues to make big pushes in the American market. I'm shocked they don't have a stronger "western hemisphere" HQ somewhere in America. Maybe it's time... they've already invested hundreds of millions in the facility south of RVA. This dream of mine makes most sense to my biased mind  

A taller, more dense version of  their Denmark campus in RVA!

Heard they were moving their American HQ to Boston, so I think RVA is out. 

Axios just caught wind of the announcement and did a little write up. No real News here other than confirming the rumor that they are selling the lot:

https://www.axios.com/local/richmond/2023/06/01/dominion-downtown-park-plan

[Icetera]

7 minutes ago, eandslee said:

Heard they were moving their American HQ to Boston, so I think RVA is out. 

This.  Announced late last year just months after ensuring CT that they had no plans of moving anytime soon.

[ancientcarpenter]

7 minutes ago, eandslee said:

Heard they were moving their American HQ to Boston, so I think RVA is out. 

Axios just caught wind of the announcement and did a little write up. No real News here other than confirming the rumor that they are selling the lot:

https://www.axios.com/local/richmond/2023/06/01/dominion-downtown-park-plan

Thanks for crushing my dreams.

The Dominion park doesn't really make sense from the research I've done with EV. Their target audience is to have (paying) customers charge there during work hours. This seems like a great idea but there's no way that much money is going into a park like that for just standard charging stations - these would have to be fast charging stations. Therefore, if I had an EV, I would park there for 30minutes max to get my max charge and then I'd need to move my car which defeats the purpose for the target audience, especially as most people are 30minutes max in their commute to the city - that's about 30miles distance (60miles total) for cars that are no average 200-300 miles per charge.

The practicality side of this park just doesn't make sense. The business side never made sense.

[whw53]

4 minutes ago, ancientcarpenter said:

The practicality side of this park just doesn't make sense. The business side never made sense.

It's almost like this proposal came out of the marketing dept. 'green Energy park' seemed all about brand to me, nothing more. 

Edited June 1, 2023 by whw53

[I miss RVA]

1 hour ago, Brent114 said:

The days of hoping for a corporate signature tower are over, at least for the next decade or more.  

  Agreed, Brent.

NOW - the ONLY thing that could maybe be a game-changer would be if Greater Richmond Partnership were to REALLLLLLLLLLLLLLY hit a grand slam in landing a Moby Dick-sized fish to relo an HQ or to open an HQ2 in Richmond - particularly in downtown - and if said company (and a developer) worked out something to put their HQ at 700 Canal. That's pie-in-the-sky, I realize, but I honestly think at this time, that's the only shot we have of some kind of epic, corporate signature office tower being constructed downtown anytime soon after CoStar's building is complete.

To @123fakestreet's point - I concur. Prolly we could see residential or a potentially large hotel or some kind of mixed use, multi-building development.

All of that said - circling back to something @wrldcoupe4said this morning: best bet is a developer buys the block and sits on it until the sweetheart deal of sweetheart deals comes along -- and I think that would involve the fruits of GRP's labor to get a BIG relo or HQ2 -- as in bringing at least a few thousand jobs -- here. At that point, a case could be made for the developer either selling or teaming up with the incoming big company to put together something fantastic on that block.

Coupe's prolly nailed it tho - don't expect anything on that block anytime soon - especially anything substantial like we'd like to see.

Edited June 1, 2023 by I miss RVA

[rjp212]

A little more info from WRIC:

Quote

When asked why they had chosen not to move forward with the project, a spokesperson cited “capital stewardship and capital allocation choices.”

“Our preference is to invest in customer-facing programs (clean energy generation like solar, grid modernization and hardening, etc.) at this point,” they said.

The company said it expects to launch the sale process in the coming weeks

 

Edited June 1, 2023 by rjp212

[ancientcarpenter]

2 hours ago, rjp212 said:

 Quote

When asked why they had chosen not to move forward with the project, a spokesperson cited “capital stewardship and capital allocation choices.”

“Our preference is to invest in customer-facing programs (clean energy generation like solar, grid modernization and hardening, etc.) at this point,” they said.

The company said it expects to launch the sale process in the coming weeks

 

This is in tune with their sale of the Robinson St properties in the Fan/Byrd Park area. Quite a footprint but clearly Dominion is not in the real estate business. If they don't need something they will get rid of it. 

[I miss RVA]

1 hour ago, ancientcarpenter said:

This is in tune with their sale of the Robinson St properties in the Fan/Byrd Park area. Quite a footprint but clearly Dominion is not in the real estate business. If they don't need something they will get rid of it. 

I'll be curious to see what either the asking price or the actual sales price for this property is, if either figure is disclosed. Am guessing it will be quite a pretty, shiny penny for this location.

This is definitely where we need GRP and the city's economic development office - not to mention even the governor's office - to really step up and land a BIG relo or an HQ2 for Richmond - and to market the living daylights out of downtown -- particularly this block. I hope whatever eventually goes there not only has significant height - but is actually multi-building with good massing and density - and not just a single tower surrounded by either open space, whether green space or a plaza  (in other words, a "pedestal tower" like OJRP) or low-rise construction, a la the current Dominion tower next door. 

If it takes a couple of years and we get something epic there - the wait will be worth it.

Edited June 1, 2023 by I miss RVA

[wrldcoupe4]

11 hours ago, I miss RVA said:

Coupe -- wondering, then, if the developers who were planning to flip it to residential still have that parcel at 7th and Cary on their radar for new construction (wasn't it for something like 300 apartments? Eighth and Main was to be for 300 apartments and I recall that the reporting was for a total of 600 new apartments between the two projects). Does the collapse of the contract for Eighth and Main impact 7th and Cary at all?

Think it’s all back on the market. 

[rjp212]

Wishful thinking here, but it feels like something is afoot.  Between the CoStar Campus, Kanawha Plaza pedestrian upgrades, and the amphitheater, there's just too much momentum for this to sit idle for long.  Dominion and CoStar both have huge connections and being located between the both of them should be a huge plus.

[I miss RVA]

1 hour ago, rjp212 said:

Wishful thinking here, but it feels like something is afoot.  Between the CoStar Campus, Kanawha Plaza pedestrian upgrades, and the amphitheater, there's just too much momentum for this to sit idle for long.  Dominion and CoStar both have huge connections and being located between the both of them should be a huge plus.

I get the same feeling.  RVA's really been riding "Big Mo" (momentum) -- especially in that part of downtown. It does "feel" like there's more to come - and maybe Dominion actually putting this block on the market is something of a good sign. Who knows... pie-in-the-sky - but you gotta believe...

Edited June 2, 2023 by I miss RVA

[Virginian11]

Give me bottom floor restaurant/retail below 15 stories of hotel space, below 15 stories of residential (mixture of rentals/to own) for a nice 31 story tower.  

[Wahoo 07]

1 hour ago, Virginian11 said:

Give me bottom floor restaurant/retail below 15 stories of hotel space, below 15 stories of residential (mixture of rentals/to own) for a nice 31 story tower.  

I'd take it.  The block, or at least part of it, would be great for a mixed use building.  The southern facing units/rooms would have a fantastic view of the river and beyond that would, most likely, never be obstructed.  That many new bedrooms would be a big step towards the CBD becoming a twenty-four hour neighborhood.

[ancientcarpenter]

5 minutes ago, Wahoo 07 said:

I'd take it.  The block, or at least part of it, would be great for a mixed use building.  The southern facing units/rooms would have a fantastic view of the river and beyond that would, most likely, never be obstructed.  That many new bedrooms would be a big step towards the CBD becoming a twenty-four hour neighborhood.

Most people that have lived in the James Monroe tower swear by it not only b/c of the building but the downtown lifestyle. They all itch to go back but none of them can actually explain it to me. I tend to agree with them, I lived just a block east of the Franklin YMCA and it did feel like "the city" to me when I was fresh out of college. I still look fondly to those very short times I lived there - people yelling outside my window, someone playing the sax, barbershop below me, parking sucking, random people watching, etc. It was so exciting to young me that I vowed never to live in the suburbs again. I have a feeling living downtown is similar, it just grabs you! Even more people down there would be even more attractive and fun!

[Flood Zone]

11 hours ago, rjp212 said:

Wishful thinking here, but it feels like something is afoot.  Between the CoStar Campus, Kanawha Plaza pedestrian upgrades, and the amphitheater, there's just too much momentum for this to sit idle for long.  Dominion and CoStar both have huge connections and being located between the both of them should be a huge plus.

You know how aspiring home sellers “stage” their homes to sell? Perhaps Dominion could beautify this property to entice potential buyers by removing all the crap around it and restoring the street scape.

Edited June 2, 2023 by Flood Zone

[I miss RVA]

Michael Schwartz has good reporting in today's RBS about the Dominion property.

A couple of interesting nuggets from Michael's reporting:

Dominion did not say whether it plans to list the property itself or hire an outside brokerage.

The company said it’s too soon to say whether Dominion would be involved in any future development of the site. However, its possible involvement as a tenant of any future building on the property is unlikely. 

And it will be interesting to see what the asking price will be -- and what the sale price ultimately turns out to be -- if either figure is ever disclosed.  It's a pretty pricey piece of land.

The Cary Street parcel was most recently assessed by the city at $10 million. It’s zoned B-4 Central Business District.

This could get interesting, lads.

From today's Richmond BizSense:

https://richmondbizsense.com/2023/06/02/dominion-to-sell-downtown-city-block-after-scrapping-plans-for-clean-energy-park/

[123fakestreet]

https://richmondbizsense.com/2023/11/27/dominion-takes-downtown-real-estate-holdings-off-the-market/

Still holding on to my fantasy that Dominion sells all their other offices (notably the riverfront ones) and still builds that 2nd tower.  Of course them not being able to sell the two smaller parcels near the new tower isn't helping that idea.

 

[jbjust]

11 minutes ago, 123fakestreet said:

https://richmondbizsense.com/2023/11/27/dominion-takes-downtown-real-estate-holdings-off-the-market/

Still holding on to my fantasy that Dominion sells all their other offices (notably the riverfront ones) and still builds that 2nd tower.  Of course them not being able to sell the two smaller parcels near the new tower isn't helping that idea.

 

I mean, why wouldn't you at least leave them on the market while you decide?  It's not like they're selling their house and they're concerned with the days-on-market statistic. 

[ancientcarpenter]

10 minutes ago, 123fakestreet said:

https://richmondbizsense.com/2023/11/27/dominion-takes-downtown-real-estate-holdings-off-the-market/

Still holding on to my fantasy that Dominion sells all their other offices (notably the riverfront ones) and still builds that 2nd tower.  Of course them not being able to sell the two smaller parcels near the new tower isn't helping that idea.

 

That is the only good outcome here.

Dominion lowly gagging on these properties is showing a lack of any vision from Dominion. If you can't handle your own properties that you have 100% control over then what else are you unable to do? This is a leadership question.

[I miss RVA]

@wrldcoupe4& @upzoningisgood-- what's your take on this?  The RBS article didn't shed any light on what's happening - and when it comes to Dominion, it may very well be a black box. Do you think there's simply a lack of interest in purchasing these sites? (Does the fact that the Genesis folks were in process of purchasing with the eye toward redeveloping 8th and Main and 7th and Cary (parking deck) into 600 apartments suggest otherwise?) Is it related more broadly to the current economic climate? (interest rates, etc.) Is it RVA's market size tamping down "demand" for these parcels - even though "conventional wisdom" at least from an RVA perspective would seem to view these parcels as legit "prime" real estate). @upzoningisgood- I'm recalling something you once said about how/why there's SO much demand for downtown property in Nashville - and that downtown RVA lacks a "draw" to put downtown land in that category of high demand. Do you see this as the case relative to the three Dominion parcels?

Am I overthinking it and it all boils down to the fact that Dominion's asking price may be prohibitively high? (either because they want to max out their profit on the land - or - it's too high relative to the level of "demand" for these locations)? Am I off base in suggesting that if these parcels were in Nashville or the two primary Carolina cities that they'd probably move pretty quickly? Which is to say - is this: 1.) a (typically) Richmond problem, 2.) a broader, national problem or 3.) some combination of both? I just can't help but feel that if this were ANY city other than RVA, such prime real estate would get snapped up pretty quickly and developers would be lining up to build, even considering the current economic climate.

Please, help me out on this.

Edited November 27, 2023 by I miss RVA

[123fakestreet]

5 hours ago, I miss RVA said:

@wrldcoupe4& @upzoningisgood-- what's your take on this?  The RBS article didn't shed any light on what's happening - and when it comes to Dominion, it may very well be a black box. Do you think there's simply a lack of interest in purchasing these sites? (Does the fact that the Genesis folks were in process of purchasing with the eye toward redeveloping 8th and Main and 7th and Cary (parking deck) into 600 apartments suggest otherwise?) Is it related more broadly to the current economic climate? (interest rates, etc.) Is it RVA's market size tamping down "demand" for these parcels - even though "conventional wisdom" at least from an RVA perspective would seem to view these parcels as legit "prime" real estate). @upzoningisgood- I'm recalling something you once said about how/why there's SO much demand for downtown property in Nashville - and that downtown RVA lacks a "draw" to put downtown land in that category of high demand. Do you see this as the case relative to the three Dominion parcels?

I would guess they hoped to be able to sell them fairly quickly and move on, but after a year (?) and no movement on any of the multiple properties, they are making a strategic reset. Probably reevaluating all of their properties as far as long term use, what they need to consolidate, renovate, or build new over the next ten years, and how best to use existing assets to achieve that.  After some studies and planning, maybe they decide to move some offices around based on which properties will sell and which won't, then re-list the property with a different sales strategy. 

Maybe those studies show them they should go ahead and build the 2nd tower, or maybe those studies show them the best financial move is to sit on those lots for another decade.

Edited November 27, 2023 by 123fakestreet

[upzoningisgood]

6 hours ago, I miss RVA said:

@wrldcoupe4& @upzoningisgood-- what's your take on this?  The RBS article didn't shed any light on what's happening - and when it comes to Dominion, it may very well be a black box. Do you think there's simply a lack of interest in purchasing these sites? (Does the fact that the Genesis folks were in process of purchasing with the eye toward redeveloping 8th and Main and 7th and Cary (parking deck) into 600 apartments suggest otherwise?) Is it related more broadly to the current economic climate? (interest rates, etc.) Is it RVA's market size tamping down "demand" for these parcels - even though "conventional wisdom" at least from an RVA perspective would seem to view these parcels as legit "prime" real estate). @upzoningisgood- I'm recalling something you once said about how/why there's SO much demand for downtown property in Nashville - and that downtown RVA lacks a "draw" to put downtown land in that category of high demand. Do you see this as the case relative to the three Dominion parcels?

Am I overthinking it and it all boils down to the fact that Dominion's asking price may be prohibitively high? (either because they want to max out their profit on the land - or - it's too high relative to the level of "demand" for these locations)? Am I off base in suggesting that if these parcels were in Nashville or the two primary Carolina cities that they'd probably move pretty quickly? Which is to say - is this: 1.) a (typically) Richmond problem, 2.) a broader, national problem or 3.) some combination of both? I just can't help but feel that if this were ANY city other than RVA, such prime real estate would get snapped up pretty quickly and developers would be lining up to build, even considering the current economic climate.

Please, help me out on this.

Land sellers think they’re going to get 2021 prices in 2023. In this rate environment, urban land sellers either commit to a number that is really paltry or they go under contract for 2+ years.