By James Cullum (Courtesy photo)
Nestle USA’s recent announcement that it would move its corporate headquarters from California to Rosslyn means great things for the region, and Alexandria is looking to be aggressive in courting its own potential tenants.
“There is a cutthroat competition for Class A office tenants,” Vice Mayor Justin Wilson said in an interview. “We’re working to be aggressive to bring you to Alexandria, and we have to look at different tools in our toolbox, like cash incentives.”
Alexandria submitted a proposal to Nestle, but the city doesn’t have any available Class A office buildings. The world’s largest package food company couldn’t turn down $16 million in tax incentives, including $6 million from Arlington County.
Despite missing out on the company itself, officials hope the move of 750 jobs to the Rosslyn campus means the economic boon will spill over into the Port City, as potentially hundreds of new residents search for homes and spend money on food, activities and nightlife.
The Class A property at 1812 N. Moore St. was built in 2013, and seems ideally situated; it’s the tallest building in the region, sits a stone’s throw from lawmakers, lobbyists and federal regulators and it’s also near a good school system and a Metro station.
Metro accessibility is a particularly desirable trait in the region, and when looking at Alexandria commercial properties, it shows. The office vacancy rate east of Quaker Lane and in Old Town rests at a stable 11.7 percent, while the 12 buildings at Mark Center on the West End, which sit four miles from the nearest Metro station, are at 45.3 percent, according to recently released figures.
Gov. Terry McAuliffe (D) said Nestle’s relocation from the west coast is a “huge win” for the commonwealth.
“As we continue to work to diversify our economy, I am particularly proud that this great company will locate in a property that has sat empty as the area and our entire state grappled with defense cuts and sequestration,” McAuliffe said in a statement.
The dynamic in Alexandria is such that developers won’t build office buildings without having a tenant in place ahead of construction. The more-than-600,000 square foot Victory Center property along Eisenhower Avenue, for instance, has sat vacant for more than a decade as owners have courted federal agencies for relocation.
“There will be more companies that follow the footsteps of Nestle,” said Stephanie Landrum, president and CEO of the Alexandria Economic Development Partnership. “We have, in Potomac Yard and in the Eisenhower Valley, developers who have entitlements to build offices, and there are things that the city and AEDP can do to help them.”
But when push comes to shove, Dak Hardwick, chairman of the city’s budget committee and board chairman of the Alexandria Chamber of Commerce, said Alexandria simply must become competitive with neighboring jurisdictions.
“We need to double down on what Alexandria offers,” Hardwick said. “You look across the river and see the tax revenue and development at National Harbor, and then you see a $1.3 billion development in Prince George’s County, which Alexandria can see from its waterfront.
“Then you have the District of Columbia, and as you drive up I-395 the extraordinary amount of development occurring along their southwest waterfront, and that is going to be a world class attraction.”
To that end, the chamber, under Hardwick’s leadership, has begun its Tomorrow’s Alexandria initiative, which is a series of conversations focused on the future of the city.
Next week’s meeting, slated for February 22, will include a discussion on the proposed King Street Business Improvement District and the potential for expansion of broadband Internet in the city.