Article Date: August 24, 2023
HCPS is taking the entire Marwaha 2 building on the east side of the now-named Marwaha Business Park.
The Henrico School Board this month approved a roughly 10-year lease for the nearly 29,000-square-foot building at 1910 E.
Parham Road, where staff with the school system’s departments of transportation, workforce and career development, school safety, and school nutrition services will relocate by December, said Eileen Cox, HCPS’s communications chief.
The school system is relocating those departments from a rented building at 3751 Nine Mile Road, near HCPS’s central office at the county’s Eastern Government Center. That lease is set to expire in December.
Noting its offices are spread between the central office, the Nine Mile Road building, and the school system’s Fairfield Annex at 1001 N. Laburnum Ave., Cox said, “We are quickly finding, with emerging technology needs and working in a 21st-century work environment, it’s not set up quite the same way from when the building was built.”
With some central office staff also moving, Cox said, “Having to make some adjustments for comfort spaces and office spaces, we felt like this was an opportunity to move a few of the folks from the main building here into a satellite location, so we looked for something that was big enough for all of them.”
The lease is a big win for Marwaha, who in January bought the three-building office park that had been vacant since anchor tenant EAB moved to a new office near Innsbrook.
After closing on the $5.3 million deal for the 10-acre complex with 89,000 square feet of leasable office space, Marwaha quickly leased another building, Marwaha 1, to mechanical and electrical contractor ColonialWebb, which moved its local office hub to the 35,000-square-foot building on a 10-year lease.
ColonialWebb fills the Marwaha 1 building.)
He also moved his firm, Marwaha Investments, to Marwaha 3, taking 4,500 square feet in what’s planned to be a multi-tenant building.
With about 21,000 square feet remaining to be leased, Marwaha said the park is 75 percent leased up less than a year after he bought it.
He’s been working with Commonwealth Commercial’s Tucker Dowdy and Michael Good, who represented him in the purchase and are handling leasing for the park.
“We’ve been very aggressive in making deals and in reaching out to people,” Marwaha said. “Basically, I am giving credible tenants who did not have access to buildings like this, because of the previous ownership who only wanted to deal with one single tenant. I am coming in and giving these tenants access to Class A properties and multitenanting it or subdividing it.
“I’m giving something to the market, and I have other deals pending in the pipeline,” he said. “I have around $20 million or more office space in the pipeline that we are going to be looking at.”
Marwaha said he’s putting just over $1 million into upfitting the building for HCPS. He did not want to disclose the terms of the lease, but the School Board’s approval involved public documents that show the rent starting at $36,000 a month and increasing annually before reaching nearly $47,000 a month in the final year.
The building is about a mile east of Henrico’s Western Government Center, which Cox described as beneficial.
“It’s not uncommon for our staff to be working in different parts of the county, so it makes sense to have locations spread out,” she said.
“That’s the beauty of Henrico, that in the school division, you have the opportunity to be from one end of the county to the other on any given day, and often our work is being done in tandem with our partners in the county government, so having offices near them is also a benefit.”
HCPS plans to fill the Marwaha 2 building by December.
Marwaha described the addition of HCPS as a boon to the business park, where he expects the remaining space to be filled by two more tenants. He said he’s put $500,000 into the complex overall in terms of enhancements to common areas and curb appeal improvements.
Of HCPS, Marwaha said, “I am very excited about this lease. And I’m excited for the future.”
Turning his company’s focus and “value-add” approach away from single-family homes and more toward commercial, industrial, and multifamily investments, Marwaha said he’s listed part of his single-family portfolio in Henrico and Chesterfield for sale with One South Realty Group.
He said his main focus these days is on Class A office space that can be used by multiple tenants.
“Right now, we are really focusing on Class A discounted offices,” he said. “We want to subdivide it and give access to the tenants that never had access to such properties because they were owned by billion-dollar REITs or institutions who are only focused on single-tenant occupancy. That’s the quality of assets we want to buy.”
His company recently closed on a $17 million deal for four properties in Petersburg that total 171 apartments: the Lofts on Market at 9. S. Market St., Union Pen at 15 N. Union St., South Street Lofts at 803 Hinton St., and Dunlop Street Lofts at 214 Dunlop St.
One South’s Tom Rosman represented him in the deal.
The four properties in Petersburg that Marwaha recently picked up in a $17 million deal.
Those add to Marwaha’s other holdings in Petersburg, including the seven-story former bank building at 30 Franklin St. and the Cameron Lofts building at 325 Brown St.
He’s filled the third floor of the 30 Franklin St. building with another public-sector tenant: the City of Petersburg’s economic development department.
Back in Henrico, he said he’s working with county planners on options to develop a stretch of properties he’s assembled along Brook Road, including his company’s former office at 7520 Brook Road. He’s previously envisioned a multi-tenant office and retail development there and said other options could include a retail strip or shopping center.
As for what’s next, Marwaha said he’s on the lookout for more deals.
“It could be industrial tomorrow; it could be flex-use tomorrow. To me, it doesn’t matter what the asset class is. If I can add value, I’m putting money into it,” he said.
