Correction: This story has been updated to correct information about the height of CoStar’s proposed office tower and its ranking among the state’s tallest and highest buildings.
Commercial real estate data giant CoStar Group is ready to make a larger splash in Richmond with a commercial real estate project of its own.
The D.C.-based firm announced Friday morning plans to construct a new office complex along the downtown riverfront next to its current main local office at 501 S. 5th St.
The campus, which CoStar CEO Andy Florance described as the company’s “HQ2,” would span 750,000 square feet and include a 26-story office building and six-story multipurpose building.
The project amounts to a $460 million investment and would bring 2,000 additional jobs to Richmond over the next few years, adding to the 1,000 employees CoStar has here already. That would make it the company’s largest office.
Florance said about 1,000 of the newly created jobs will be in software development and that CoStar also is planning to devote resources to its residential real estate divisions following its recent acquisition of Norfolk-based Homes.com.
At 425 feet tall and 510 feet above sea level, CoStar’s new building would be the highest in Richmond, and may soon be the tallest. That title is currently held by the James Monroe Building which is 449 feet tall, however the state-owned building may soon be demolished as Virginia’s Department of General Services is planning to replace it. The tallest building in Virginia currently is the Westin Virginia Beach Town Center, which per high-rise database SkyscraperPage reaches 508 feet.
The architect on the project is Pickard Chilton, the same firm that designed the new Dominion Energy office tower downtown. CoStar spokespeople said a general contractor has not yet been selected.
The project may receive some public funding. An announcement from the governor’s office states that up to $15 million would be invested into infrastructure around the complex, including upgrades to pedestrian access, road and traffic improvement and utilities.
The infrastructure investment is subject to approval from the General Assembly’s Major Employment and Investment Project Approval Commission.
Once completed, CoStar will occupy around 1 million square feet of office space in downtown Richmond. It is currently the main tenant in the nine-story former WestRock building on 5th St., which it bought earlier this year for $130 million.
The new complex would be constructed on a 4-acre parcel at 600 Tredegar St. that CoStar bought last summer for $20 million. Florance said they’ve acquired all the land needed to build the complex, but noted the company is under contract on an unidentified Richmond building that it will use for swing space until the new buildings are completed.
The company also this year leased the entire 13,000-square-foot Pattern Building at 470 Tredegar St., and subleased 51,000 square feet on the ninth, 10th and 11th floors of Riverfront Plaza’s east tower.
Florance said the new complex will include more than office uses.
“We are bringing Tredegar Street alive by bringing some restaurants and art galleries and retail down (at ground level),” Florance said.
He added that it’ll also have an indoor event venue and outdoor amphitheater that will be able to host concerts, particularly during the Folk Festival.
CoStar is looking to break ground between mid- and late-2022, and Florance said he’s hoping for a 2024 delivery.
“There’s a lot of work to do but that’s our goal,” Florance said.
The announcement was made Friday morning in conjunction with the governor’s and mayor’s offices, at what Gov. Ralph Northam said was likely one of the last economic announcements of his term. Mayor Levar Stoney was also in attendance.
BizSense reporter Michael Schwartz contributed to this story.
But also a firm reminder much of the propaganda during the Navy Hill pitch was clearly a farce. The NH team trotted out Costar as an example of a company that would only expand in Richmond if we had a new arena district… I called BS on that then and it has resoundingly proven to be so…
Wow. Just WOW. Anyone want to build apartments? Anyone believe the bubble has burst? Anyone believe that the City is going to slide into an abyss? Apparently, not CoStar! And they do the research.
I see a huge wave of much taller apartment buildings coming if they bring in the amount of people that is in the article. This is really awesome news for us. I always dreamed of seeing new tallest I was born in 1988 and always wanted to witness a new tallest for Richmond and the state. I guess this is my era of a new tallest to what old Richmonders saw when the Monroe building was being built as the new tallest for Richmond and the state of Virginia.
Enjoy this moment, my friend – and may this be the first of many such moments that we can enjoy together as RVA reaches for the stars. I’m one of the “old Richmonders” who saw four such moments — when City Hall replaced the old CNB building as the city’s/state’s tallest in 1971 – only to be bested by the now Bank of America Building in 1974. Then the Federal Reserve building at 393′ raised the bar in 1978 before the Monroe Building secured the mantle in 1981. I was only nine years old when City Hall topped the CNB… Read more »
510 feet? That’ll be tallest in the state.
You are correct! It will be taller than the VB Westin Town Center (I believe) by 2 feet.
Fairfax County has a 600′ in the pipeline however so it may not stay on top for long and that’s if it does beat it on the ascent i suppose.
With the amount of time it takes to get permits in the City I suspect the one in Fairfax will be done first and this won’t even get that moniker, even for a bit.
Will it be taller than Amazon’s under construction headquarters in Arlington?
Yes – the helix building is only set to reach 350′. Their headquarters is not only confined to that building however and will take up multiple buildings across the Crystal City neighborhood.
Interesting. I wonder how likely it is that Costar will build to that height. Not unheard of to shave off a few floors before the building stops out.
yes that is low due to Regan Airport.
Bruce: The “bubble” hasn’t burst yet, but eventually it will ! As we both know it always happens. It’s just a matter of when.
Agreed. We can see historical trends in real estate that have 15 year cycles and don’t discount those Black Swans either. Time will tell.
When your company is literally printing cash, you have to put it somewhere, what better place than down by the river lol I have lived in NOVA and in DC, and now RVA. Hard to believe anybody would NOT want to come to RVA, it is awesome here, so those 2,000 folks will be pleasantly surprised, just watch.
This super welcomed news! A win for CoStar, a win for Downtown Richmond, a win RVA as a whole, a win for development enthusiasts! Hope this is the start, and the fuel that sparks many more new developments in and around downtown. This is a huge statement to other companies looking to make a move that Richmond is open for business!
Now, would love to know the construction timeline. When can we expect to see a groundbreaking?
and another green space disappears. Happening in Henrico and elsewhere.
That entire block was an asphalt parking lot until the parking deck and West Rock were built. It has not been “green space” for long and the plan was always to build on it.
A 26-story, 510′ office tower is:
A. Unheard of
D. All of the above
Good news for RVA regardless!
I like this office tower in that it saves a lot of green space in that I have seen office parks that have parking lots that would cover three to four lots this size for even a 3 story tall building.
Dominion CEO Robert M. Blue said “Hold My Beer” I have an empty lot and bunch more cash……..
Co Star needs to re link the James River and Kanawha Canal to the Haxall Canal as part of this project so canal boats can sail though canal locks. It would make a really interesting water feature for the building.
I think this building and this company adding 2,000 jobs is a much better fit for the city then a casino.
The taxes collected on this project would easily be double watch Richmond is spending on their city sidewalk repairs in a year.