Global brand

Arlington adds Nestlé’s U.S. headquarters to its corporate roster

Published February 28, 2017 by Paula C. Squires

Lightning has struck for the second time in Arlington County.

Only 18 months after landing the U.S. headquarters for German discount grocer Lidl, Arlington announced in early February that Nestlé USA Inc. will move its headquarters from California to Rosslyn.

The U.S. subsidiary of the Switzerland-based food and nutrition giant will be the anchor tenant in what has been an empty building, investing $39.8 million and creating 748 jobs.

“Adding a global brand like Nestlé USA to Virginia’s corporate roster is a huge win for our commonwealth,” Gov. Terry McAuliffe said.

The company will relocate from Glendale, Calif., to a 35-story building at 1812 N. Moore St. in the heart of Rosslyn. Nestlé initially will lease 40 percent of the building, 206,000 square feet, with the option to expand to more than 250,000 square feet.

Monday Properties finished the 537,000-square-foot building in late 2013. It has been working since then to fill the space, holding out for a major tenant rather than breaking up the space into blocks for smaller tenants.

The deal recalls Lidl’s 2015 decision to locate its U.S. headquarters in Arlington, a $77 million project creating 500 jobs. That project also includes a $125 million regional headquarters and distribution center in Spotsylvania County employing 200 people.

Christina Winn, director of business investment at Arlington Economic Development, says going after foreign companies is just one part of the county’s overall push to attract businesses from outside the region. Its annual international outreach budget is quite “lean,” she explains — about $30,000 — for now.

Arlington is targeting select markets, such as Germany, Italy and China, and partnering with other jurisdictions in the region when it does business recruitment abroad. Other aspects of the county’s strategy focus on encouraging international investment in local projects and working with existing employers to create export opportunities.  

Nestlé USA operates in more than 120 locations in 47 states and employs more than 51,000 people. In 2015, Nestlé’s U.S. sales topped $26 billion, making it the company’s largest market.

The Rosslyn lease culminated the company’s extensive and wide-ranging relocation search. “Nestlé USA carefully considered a number of locations, and Arlington hits all the marks,” Paul Grimwood, the company’s chairman and CEO, said in a statement. “The area offers appealing benefits for our current employees, as well as a great talent pool for the future. This location allows us to be closer to our business operations, our customers and other important stakeholders.”

The Virginia Economic Development Partnership worked with Arlington County to secure the project. To assist the county, McAuliffe approved a $6 million grant from the Commonwealth Opportunity Fund. The governor also approved $4 million in funds from the Virginia Economic Development Incentive Grant, which provides performance-based incentives to projects promising the creation of a large number of high-paying jobs.

Funding and services to support the company’s employee training activities will be provided through the Virginia Jobs Investment Program.

By securing one of the world’s most widely recognized corporate brands, Monday Properties validated its strategy of holding firm to its goal while carrying the building for more than three years. While it might have been tempting to pivot to smaller leases when times were tough, “it would have ruined our competitive advantage,” Tim Helmig, Monday’s president and COO, said. “Good things come to those who wait. The wait was painful, but it worked out for us in the end.”

According to Helmig, Nestlé officials saw the building in September and looked at other options in the greater Washington region. For a major real estate deal, things came together fairly quickly, he said. Soaring 390 feet, Monday’s LEED platinum-certified building is the tallest in metro Washington.

“It’s an iconic building,” Winn says, and now it has “an epic tenant.”

M.J. McAteer contributed to this story.

Northern Virginia’s recent deals

Source: Virginia  Economic Development Partnership        1 Deal occurred in 2017. All others in 2016