Health Diagnostic Laboratory, headquartered on North 5th Street, is making room for a new tenant. Photos by Burl Rolett.
In another cost-cutting measure, Health Diagnostic Laboratory is downsizing its downtown headquarters, and it has found a major tenant to fill its place.
HDL is seeking approval from federal bankruptcy court to reduce the amount of space it leases in its massive complex at 737 N. Fifth St. by 45,000 square feet. That space, according to a court filing Wednesday, would be taken over by VCU later this year.
The lab testing company, which filed for Chapter 11 bankruptcy in early June, is attempting to amend its lease with its landlord, Biotech 8 LLC, in order to allow for the change. HDL owns 58.9 percent of Biotech 8. Local real estate firm Lingerfelt Commonwealth Partners, which helped develop the massive lab facility, owns the remaining portion of the LLC.
Ryan Lingerfelt declined to comment on the possible lease with VCU.
A hearing will be held July 23 to consider the move.
Wednesday’s filings included a term sheet of the amended lease agreement that states that if the court does not approve the request within 30 days and a binding lease is not set up with VCU, both Lingerfelt and HDL “will lose this opportunity.”
Rep. Bobby Scott, former HDL CEO Tonya Mallory and Mayor Dwight Jones mark the completion of Health Diagnostic Laboratory’s $100 million headquarters last summer. Courtesy of HDL.
If the motion is approved, VCU will move in by Nov. 1.
Court documents did not state what the university plans to do with the space, and a representative with VCU did not return requests for comment by press time.
Douglas Sbertoli, corporate counsel for HDL, said VCU’s use will be “compatible with the current usage of the facility.”
“HDL enjoys a long-standing and collaborative relationship with VCU, and we’d be pleased to have them in close proximity to us,” Sbertoli said.
The two sides have worked together in the past. HDL had previously promised a $4 million donation to VCU Athletics but had to back out of that promise earlier this month.
By giving up the space after Nov. 1, HDL’s annual savings will amount to $1.5 million, including rent and utilities. The court document states that rent for the 45,000 square feet comes to about $91,000 per month.
HDL will likely have a new owner by the time a move takes place. The company received court approval this week to put itself up for sale in an auction process that should wrap up by the end of September.
HDL built the 283,000-square-foot headquarters in the Virginia Biotechnology Park in two phases, the first of which was completed in early 2012. The project was finished in June 2014.
When it built the complex, HDL was experiencing rapid growth and needed more space to welcome even more employees. The company at one point supported about 800 employees, most of which were in the Richmond office. After several rounds of layoffs, the company’s latest employee count decreased to 645. Sbertoli said the company still currently uses more than 100,000 square feet of the complex.
“The anticipated growth and expansion needs that were initially forecast haven’t materialized as quickly as contemplated,” Sbertoli said. “We think this change will allow us to make better use of the floor plan without sacrificing operational capacity.”
The company also freed up additional space in the building by auctioning off some excess lab equipment in late June, which brought in more than $1 million.
Health Diagnostic Laboratory, headquartered on North 5th Street, is making room for a new tenant. Photos by Burl Rolett.
In another cost-cutting measure, Health Diagnostic Laboratory is downsizing its downtown headquarters, and it has found a major tenant to fill its place.
HDL is seeking approval from federal bankruptcy court to reduce the amount of space it leases in its massive complex at 737 N. Fifth St. by 45,000 square feet. That space, according to a court filing Wednesday, would be taken over by VCU later this year.
The lab testing company, which filed for Chapter 11 bankruptcy in early June, is attempting to amend its lease with its landlord, Biotech 8 LLC, in order to allow for the change. HDL owns 58.9 percent of Biotech 8. Local real estate firm Lingerfelt Commonwealth Partners, which helped develop the massive lab facility, owns the remaining portion of the LLC.
Ryan Lingerfelt declined to comment on the possible lease with VCU.
A hearing will be held July 23 to consider the move.
Wednesday’s filings included a term sheet of the amended lease agreement that states that if the court does not approve the request within 30 days and a binding lease is not set up with VCU, both Lingerfelt and HDL “will lose this opportunity.”
Rep. Bobby Scott, former HDL CEO Tonya Mallory and Mayor Dwight Jones mark the completion of Health Diagnostic Laboratory’s $100 million headquarters last summer. Courtesy of HDL.
If the motion is approved, VCU will move in by Nov. 1.
Court documents did not state what the university plans to do with the space, and a representative with VCU did not return requests for comment by press time.
Douglas Sbertoli, corporate counsel for HDL, said VCU’s use will be “compatible with the current usage of the facility.”
“HDL enjoys a long-standing and collaborative relationship with VCU, and we’d be pleased to have them in close proximity to us,” Sbertoli said.
The two sides have worked together in the past. HDL had previously promised a $4 million donation to VCU Athletics but had to back out of that promise earlier this month.
By giving up the space after Nov. 1, HDL’s annual savings will amount to $1.5 million, including rent and utilities. The court document states that rent for the 45,000 square feet comes to about $91,000 per month.
HDL will likely have a new owner by the time a move takes place. The company received court approval this week to put itself up for sale in an auction process that should wrap up by the end of September.
HDL built the 283,000-square-foot headquarters in the Virginia Biotechnology Park in two phases, the first of which was completed in early 2012. The project was finished in June 2014.
When it built the complex, HDL was experiencing rapid growth and needed more space to welcome even more employees. The company at one point supported about 800 employees, most of which were in the Richmond office. After several rounds of layoffs, the company’s latest employee count decreased to 645. Sbertoli said the company still currently uses more than 100,000 square feet of the complex.
“The anticipated growth and expansion needs that were initially forecast haven’t materialized as quickly as contemplated,” Sbertoli said. “We think this change will allow us to make better use of the floor plan without sacrificing operational capacity.”
The company also freed up additional space in the building by auctioning off some excess lab equipment in late June, which brought in more than $1 million.