Clayco Breaks Ground on $110M Downtown Office Project

The Richmond office market further stabilized during the first half of the year across all submarkets and experienced a decrease in vacancy rates to 13.6%, according to a report by CBRE. Good news for the city of Richmond and great news for developers such as Clayco, who officially started construction

The Richmond office market continued to stabilize in all submarkets during the first half as vacancy declined to 13.6%, according CBRE Group Inc. That is welcome news for the market and for developers like Clayco, which started construction this month on Gateway Plaza, a $110 million office project. Clayco Inc., the project’s developer, and city officials launched construction at a recent groundbreaking.

Located in the downtown business district Gateway Plaza will rise 18 stories on a parcel bounded by 8th and 9th Streets to the east and west, and Canal Street to the south. It will encompass 315,000 square feet of office space, more than 14,000 square feet of first-floor retail space and a 506-space parking garage. The projects glass tower is designed to LEED Gold standards. Completion is expected by the end of 2014.

An affiliate of New York-based Lexington Realty Trust provided the financing for the project. The city of Richmond is providing $11.3 million in bonds to finance 326 public parking spots and $3 million in performance grants.

McGuireWoods L.L.P. will be the building’s anchor tenant. It has already signed a lease for 217,000 square feet and expects to move in in 2015. Colliers International, which represented McGuireWoods, also serves as the project’s leasing agent.

“Gateway Plaza will be an attractive addition to the Richmond skyline and will offer significant benefits to the City of Richmond. Economic studies show that this project will generate 812 construction jobs with more than $50.7 million in wages; another 1,653 jobs, including retaining more than 630 at McGuireWoods; and new cumulative tax revenues for the City are estimated to be more than $117 million over the next 30 years,” Richmond Mayor Dwight C. Jones said in a statement.


Chart courtesy of CBRE Group Inc..