Long saddled by crime and sluggish business growth, Richmond is looking toward a return to the industrious energy that it was well-known for in the past, sparked by its recent choice as the site for a second research campus for the Lawrence Berkeley National Laboratory.[contextly_sidebar id=”045df9c4e19d2fdf19937351ba9646db”]That designation has helped turn investors’ eyes to Richmond’s availability of industrial and other land, and city leaders hope that their renewed promotion of economic incentives will make the town that much more attractive for development.
“The industrial space in Richmond for a long time has provided room to grow,” said Scott Peterson, former deputy director at the East Bay Economic Development Alliance, an Oakland-based public/private partnership that supports business, capital and job growth in the region. “I think some recent investments have helped attract other interests in some of those industrial properties.”
The Lawrence lab’s planned investment in a research center in Richmond is certainly a game-changer. The Richmond Bay campus on the city’s southern shoreline is expected to house thousands of employees and students. The start of construction was targeted as early as next year, but federal budget cuts will likely delay that. Still, city and business leaders remain confident that the campus will eventually be built.
“With the second campus in process, it’s really good for Richmond as a whole,” Peterson said. “It just doesn’t attract labs and facilities, but everything around the campus can be part of the supply chain that serves the employees there. Investors are really positioning themselves to have proximity and take advantage of future opportunities once the campus is in place.”
Just in recent months, real estate investors and developers have tied up property in Richmond for future or ongoing industrial or warehouse/manufacturing uses. Sacramento-based LDK Ventures, for example, has paid about $11 million to acquire 42 acres at Pinole Business Park. The former site of the steel-products maker Steelscape could eventually support the development of about 700,000 square feet of industrial distribution.
Nearby at Pinole Point, New York-based KTR Capital Partners has acquired 30 acres for $13.4 million that could become home to about 500,000 square feet of new Class A warehouse/distribution/manufacturing space. Also, Petaluma-based PB&J Acquisitions has bought a multi-tenant warehouse/manufacturing building at Point Richmond.
Compared to other Bay Area cities, “Richmond has ready-to-go land,” said John Troughton, an Oakland-based senior director for the real estate services firm Cushman & Wakefield. “There are places in Richmond, there are lots [of them] that can accommodate” industrial and distribution activities.
Troughton pointed out other drivers that are raising investor confidence in Richmond, including the planned $1 billion modernization of the oil refinery operated by Chevron, the city’s largest employer. He noted that Chevron’s project would add more than 1,000 jobs in the area.
The city is doing its part to further strengthen its appeal by highlighting its various business incentives such as those that have been available since it was designated a state economic development area in 1998.
Janet Johnson, Richmond’s senior business assistance officer, said that when the developers of the recent transactions start improvements on their property they can apply for incentives under the state designation.
Among these incentives, businesses engaged in manufacturing or biotechnology research may exclude the first $200 million in equipment purchases from the state’s share of the sales tax, starting July 1. Businesses may also be reimbursed up to 50 percent of the wages paid to a new hire during the initial training period up to six months.
“Our economy is turning around,” Johnson said, adding that Richmond is well positioned for dramatic business growth because of its central location in the Bay Area and major transportation corridors such as Interstates 80 and 580.
“There’s a confluence of a bunch of opportunities happening all at once in Richmond,” Troughton said. “Back in the day, Richmond was an industrial city. That went away except for Chevron. Now there’s an opportunity for that to come back.”
Photo courtesy of http://www.ci.richmond.ca.us