'Henrico Tomorrow' program helps re-envision office space

As many companies began to rethink their office space needs after the pandemic, Henrico County officials recognized that they would need to help the county’s office sector adapt to changes in the market.

The Henrico Economic Development Authority convened an office task force two years ago, bringing together business leaders, property owners, and county officials to develop strategies for sustaining and enhancing Henrico's office sector. After 18 months of study, the task force presented to the Henrico Board of Supervisors its recommendations about how the county could help modernize office space and support property owners as they adapt to changing workforce demands.

The result: Henrico Tomorrow, a new county initiative launched recently that aims to foster a transformation of office space into modern work sites that fuel productivity and innovation. 

The effort is designed as a strategic approach to strengthening the county's corporate services sector, ensuring it remains competitive and adaptable to the changing demands of businesses and employees. 

“A number of companies reduced their office space by substantial percentages," said Henrico EDA Executive Director Anthony Romanello. "Some eliminated office space and went fully virtual. It's really kind of a mixed bag."

Highwoods Properties Richmond Market Leader Jane DuFrane, a senior vice president with the company, was a member of the task force and has seen the impact of these changes. 

“We are in the thick of the change in the office market,” DuFrane said. “We’re the largest landlord in all of Richmond with 2 million square feet. When COVID hit and companies decided to work from home and either exit their leases early or not renew, we knew we had an issue.” 

A key aspect of Henrico Tomorrow is providing property owners with the flexibility and support needed to modernize and maintain office buildings. The program includes a renovation grant to help commercial landlords upgrade their properties to attract high-quality tenants. 

"One of the things that does seem to be a trend is that as companies are reducing the amount of space they have,” Romanello said. “They can rent higher quality space and still save money. The term of art that folks are using is ‘flight to quality.’ Through our renovation grant, we are working to help property owners move their buildings up the scale. COSTAR has a five-star scale rating for buildings, and we're trying to help four-star properties move up to five stars." 

The initiative also focuses on making office buildings "commute-worthy," ensuring they are attractive enough to encourage employees to return to in-person work in a competitive job market. 

“It boils down to placemaking and having a nice place to come to work,” DuFrane said. “We call it commute-worthy. What’s going to make you get out of your pajamas, off your couch, and come into the office?”

She added that while hybrid work is here to stay, physical office culture still matters. 

“I really do think what companies have learned over the years post-COVID is that we are better together,” DuFrane said. “Highwoods’ hashtag is ‘better together,’ meaning that you have to create a culture in order for people to feel the mission of your company. And you’ve got to be face-to-face to do that.”

Henrico's office market is a significant economic driver for the county, particularly areas like Innsbrook, which has an estimated economic impact of $7 billion annually. Henrico's gross county product is about $30 billion annually, which ranks it fourth in the state in that category. 

"We want to make sure that Henrico remains a premier place for knowledge workers," Romanello said. "That will help bring new jobs into the county and help our companies recruit people, including young professionals just entering the workforce."