VCU Health System-anchored development will improve access to care, services, and create new connections in neighborhood
Richmond, Va., July 16, 2021 — Capital City Partners (“CCP”) has concluded its purchase of the former Public Safety Building at 500 North 10th Street from the City of Richmond for $3.5 million. The firm will soon demolish the building at a date to be set, then redevelop the three-acre property and adjacent city infrastructure into a vibrant, mixed-use block consisting of over 500,000 square feet.
The development will be anchored by VCU Health and include an investment of over $325 million. Richmond City Council unanimously approved the property sale and development agreement in March 2021.
CCP selected Oak Street Real Estate Capital, a Chicago-based private equity real estate firm for capitalization of the project. Mesirow, an independent Chicago-based investment bank, was selected as the bond placement agent.
“As downtown begins to rebound from the challenges of the past year, we know this project will breathe new life into a critical urban core and ensure Richmond’s key healthcare and support institutions are operating at full strength,” said Susan Eastridge and Michael Hallmark, co-developers for CCP. “We thank the City for their support of this project and we look forward to helping our partners at VCU Health, The Doorways, and Ronald McDonald House Charities expand their services to patients and families.”
The project is under design by Philadelphia-based architects KieranTimberlake, with Richmond-based architecture firm SMBW. The project contractor is DPR Construction with Canterbury Enterprises.
In addition to VCU Health, other planned uses include The Doorways lodging for families of hospitalized patients, Ronald McDonald House Charities of Richmond, a VCU Health-operated child care center, ground-level retail, office uses, and over 1,200 parking spaces. The size breakdown includes:
- VCU Health System: 150,000 square feet
- The Doorways: 125,000 square feet
- RMHC: 65,000 square feet
- VCU Health-operated child care center: 35,000 square feet
- Retail: 20,000 square feet
- Class A spec office: 90,000 square feet
The City estimates the completed development will create $16.8 million in tax revenue over the first 10 years and $60 million over 25 years to support city services and schools.
“We are thrilled to partner with VCU Health, the City of Richmond, CCP, and Mesirow on this wonderful project that we believe will be transformative for the community” - says Jared Sheiker of Oak Street Real Estate Capital.
The project reinvents the city block parcel that has been home to Richmond’s Public Safety Building since 1964. Since the departure of the Richmond Police Department in 2002, the property and site have gradually deteriorated, cutting off the historic “Court End” and the Valentine Museum from the rest of the City. The project will restore Clay Street to the City’s street system and enhance walkability, traffic patterns, and neighborhood connectivity with needed street-level service retail.
The VCU Health development will improve the experience of patients and their families and provide increased space for physician offices, as well as amenities such as a service retail. The child development facility will offer 20% of available child-care spots to Richmond families not affiliated with VCU or VCU Health System and feature dedicated outdoor green space for children and families.
The redevelopment includes a commitment of 40% participation by minority-owned businesses during and after the construction phase.
"We look forward to the completion of this project and the important services it enables for our patients and families, partners, students, faculty and staff," said Art Kellermann, M.D., senior vice president for health sciences at VCU and CEO of VCU Health System. "The project complements our investment in the buildings currently under construction including the VCU Health Adult Outpatient Pavilion and the Children's Hospital of Richmond at VCU Wonder Tower."
- The Doorways development will offer expanded guestroom hospitality for patients and their families. Its current 115-guestroom building, at 621 E. Marshall St., meets capacity nearly every day. The new building would add an additional 30 rooms.
- The RMHC development includes a new, expanded Ronald McDonald house to service Richmond’s pediatric patients and families.
- Ground-level retail will activate 9th Street, 10th Street, and Clay Street while creating a connection to Court End and the rest of the VCU Health campus.
- Class A commercial office space will be available to other office tenants to attract and create new jobs in the city.
Colliers International executive vice presidents David Wilkins and Will Bradley provided advisory services to Capital City Partners for the capitalization of the project.
“We congratulate Capital City Partners and a broad team of outstanding professionals on achieving this milestone for what will prove to be a best-in-class development. Not only will this development address the critical needs of VCU Health and their strategic partners, The Doorways and Ronald McDonald House, but the carefully crafted design principles align with the vision of the Richmond 300 master plan,” Wilkins said. “And investment from two leading institutional capital providers further supports Richmond’s steady rise as a top investment market.”
Colliers (NASDAQ, TSX: CIGI) is a leading diversified professional services and investment management company. With operations in 66 countries, our more than 15,000 enterprising professionals work collaboratively to provide expert advice to real estate occupiers, owners and investors. For more than 25 years, our experienced leadership with significant insider ownership has delivered compound annual investment returns of almost 20% for shareholders. With annualized revenues of $3.0 billion ($3.3 billion including affiliates) and $40 billion of assets under management, we maximize the potential of property and accelerate the success of our clients and our people. Learn more at corporate.colliers.com, Twitter @Colliers or LinkedIn.
About Capital City Partners LLC
Capital City Partners is a partnership between Concord Eastridge Inc. and Future Cities LLC, created specifically to design, finance, rebuild, and revitalize dormant real estate and streetscapes in downtown Richmond. The combined entity has distinguished track record in the development of complex mixed-use urban projects around the U.S.
About Oak Street Real Estate Capital:
Oak Street Real Estate Capital, LLC (“Oak Street”) is a real estate investment firm focused on acquiring properties net-leased to investment grade and creditworthy tenants. Oak Street’s investment funds currently have $15 billion of discretionary acquisition capacity and co-investment capacity to be deployed into sale-leasebacks and build-to suits. Oak Street specializes in providing flexible capital solutions to a variety of organizations including corporations, healthcare systems, universities and government entities.
Mesirow is an independent, employee-owned financial services firm founded in 1937. Headquartered in Chicago, with locations around the world, we serve clients through a personal, custom approach to reaching financial goals and acting as a force for social good. With capabilities spanning Global Investment Management, Capital Markets & Investment Banking, and Advisory Services, we invest in what matters: our clients, our communities, and our culture. To learn more, visit mesirow.com and follow us on LinkedIn.
Mesirow was recently named one of the Best Places to Work in Chicago by Crain’s Chicago Business and one of the Top Workplaces by the Chicago Tribune.
Virginia and Raleigh, NC
for Capital City Partners