Industries Commercial Real Estate

Clayco breaks ground on Gateway Plaza in downtown Richmond

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Print this page By Paula C. Squires

Against a backdrop of yellow cranes, Richmond officials celebrated the beginning of construction on Gateway Plaza, downtown’s newest office tower, with a groundbreaking ceremony Tuesday that hailed Richmond as an “emerging city” with the will to get projects done.

“We’re building projects in 25 cities across America, and we haven’t had a better experience than with the city of Richmond,” Bob Clark, chairman and CEO of  Clayco, the project’s developer, told a gathering of about 200 people. “We’re excited to be a part of an emerging city … We see a bright future for Richmond.”

Richmond’s city government signed on to assist the $110 million Gateway Plaza, a public-private project, with as much as $14 million in city financing.  The money will pay for a portion of a parking garage and includes up to $3 million in performance-based grant money.

Richmond Mayor Dwight Jones called the 18-story tower that will be the new home for the McGuireWoods law firm “a strategic downtown project with economic benefits.  One of my jobs is to attract new business and to retain businesses that are already here. I can’t think of Richmond without McGuireWoods,” he said in a reference to the prominent local law firm, one of the state’s largest.

As lead tenant, McGuireWoods LLP has agreed to lease 217,000 square feet of the building’s 315,000 square feet of office space. Chapman said the building’s total footprint would be 550,000 square feet, which includes office, more than 14,000 square feet of first-floor retail space and a 506-space parking garage.

According to Jones, economic studies show Gateway Plaza will generate 812 construction jobs with more than $50.7 million in wages; another 1,653 jobs, including the retention of more than 630 jobs at McGuireWoods, and new cumulative tax revenues for the city of more than $117 million over the next 30 years.

A contingent of about 90 employees from McGuireWoods turned out for the ceremony held under a white tent at the corner of Eighth and Cary Streets. Richard Cullen, chairman of McGuireWoods, called Gateway Plaza “a very exciting project” for the firm, which currently leases about 244,000 square feet in One James Center, across the street from the Gateway site.

Larry Chapman, a partner and principal at Clayco, said in an interview with Virginia Business that the firm will lease about 20 percent less space when it moves into Gateway Plaza in 2015, and that space will be used more efficiently, a trend playing out among law firms across the country.

“Everyone will have the same size office,” Chapman noted, from the chairman of the board down to associates.  To foster collaboration, there will be more space for workrooms and a conference center on the top floor for clients.

George Martin, managing partner of McGuireWoods Richmond office, says the same-size office trend already is in force at the firm's office in Charlotte, N.C. “We’re gone to more of a team focus,” he said, with lawyers working on industry-specific teams. “If we have to change and adjust teams down the road, it will be easier to move people around.”
Martin termed Gateway Plaza an important project for the city. “We’re helping to stabilize Cary Street,” he said.

Charles Saunders, president of Richmond City Council, summed up the day’s celebratory spirit by commending his council colleagues “for coming together” to move projects along, including the Washington Redskins summer training camp facility, which opened in July,  “and now this new building.” 

Perhaps the cooperation will allow Richmond to put to rest its former reputation of “not getting along and taking a long time to get things done,” Samuels said.

Chapman said Clayco, a real estate development and construction firm based in Chicago, got involved about a year and half ago when it was invited to compete on a project that would serve as the new headquarters for McGuireWoods.

Financing for the project came from an affiliate of New York-based Lexington Realty Trust. “It’s all closed,” Chapman said, of the financing, with work moving forward at Gateway Plaza, even before Tuesday’s ceremony. Recently, the Eighth Street Connector, which bisected the site, was closed. Construction crews are installing the building's drilled caisson foundation system, which will be followed by a concrete frame structure on the first six levels.

When the building is complete, Chapman said the contemporary structure and all-glass tower will rival buildings in the much larger markets of New York and Boston. Colliers International is the leasing agent for the project. So far, no other tenants have signed, Chapman said, but discussions with possible tenants are in the works.

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