Apparently content with its employees’ remote-work productivity, a local Fortune 500 company says it doesn’t have much use for its downtown office space anymore.
Mechanicsville-based healthcare logistics firm Owens & Minor has pulled the plug on its call center at Riverfront Plaza and is now seeking tenants to sublease the space it moved into three years ago.
“Owens & Minor continues to invest in our Richmond presence, including upgrades and renovations to our Mechanicsville headquarters and our Ashland distribution center. We have, though, placed our Riverfront leased location on the market for sublet. It is a great site that will serve future tenants extremely well,” a company spokeswoman said in an email last week.
Like other firms, Owens & Minor shifted office workers to remote work in response to the coronavirus pandemic. As the year wore on, the company said it found the downtown call center employees adapted well to a work-from-home setting. That prompted the decision to leave Riverfront Plaza, the spokeswoman said.
“As 2020 progressed, the COVID-19 pandemic compelled us to reevaluate our call center operations. The performance of our call center teammates in the work-from-home era has been spectacular, and the teammates requested that we carry that new business model into the future. We have recently made the decision to exit from our call center location in downtown Richmond,” the spokeswoman said.
The health care logistics company signed on in 2017 for a 90,000-square-foot office across four floors inside Riverfront Plaza at 951 E. Byrd St. The move was heralded at the time as a big get for the downtown office market, as the company was to bring 200 workers in the near term and 300 more long-term.
At the time the company announced it would invest $15 million in the office over several years. The company didn’t respond to an inquiry about whether that happened or how many call-center employees are affected by this latest change to move out of Riverfront.
As part of the 2017 deal, the state approved a grant of $1.5 million from the Virginia’s Commonwealth Opportunity Fund to help with the expansion, and Owens & Minor was said to be eligible for benefits through the Virginia Enterprise Zone Program and Virginia Jobs Investment Program funding and services.
A Virginia Economic Development Partnership spokeswoman didn’t respond to an inquiry about how the company leveraged those resources.
Owens & Minor said it has already sublet two of its suites in the building, though the spokeswoman wouldn’t identify the new tenants.
The company is still seeking tenants for about 50,000 square feet of space, according to a marketing flyer. Brett McNamee and Jimmy Cunneen of Divaris have the listing.
Riverfront Plaza is in line to lose another tenant next year, when investment firm Raymond James & Associates will move out in favor of the new Westhampton Commons development at Libbie and Patterson avenues in the West End.
Owens & Minor reported year-to-date net revenue of $6.1 billion in 2020, as part of its third quarter results announced Nov. 2. During the same nine-month period last year, the company reported net revenue of $7 billion. The company announced net revenue of $2.2 billion for the three months ended Sept. 30. During the same time period last year, the company reported $2.3 billion in net revenue.
Another notable local office space to hit the market in recent weeks is the 13,000-square-foot space in Scott’s Addition that’s being vacated by consulting firm Frontier Project. The firm also cited remote work as part of the reason for it moving out.