Major Expansion Coming for Durham’s American Tobacco Campus

American Tobacco Expansion

An aerial view of the expanding American Tobacco Campus. Image courtesy of Hines.

American Tobacco Campus (ATC) is getting supersized as a new partnership is planning to greatly expand development around the historic district.

Capitol Broadcasting Co. (CBC), which owns the campus, WRAL-TV, and WRAL TechWire, has formed a joint venture with Hines, an international real estate firm, and USAA Real Estate to develop a 700,000-square-foot mixed-use project on 11 acres in downtown Durham as an extension to the current campus.

Previously occupied by University Ford, the property sits adjacent to the American Tobacco Historic District.  The first phase of the development is set to increase the size of the district by “60 percent.” The current campus, along with other offices known as the Diamond View Buildings, covers more than 1 million square feet of Class A office space.

American Tobacco expansion

A render of the new buildings planned for ATC. Image courtesy of Hines.

“By the numbers, it’s the biggest single project executed at one time in downtown Durham,” said Michael Goodmon, CBC’s senior vice president of real estate, in an interview. “It beats the first phase of American Tobacco, which at the time was huge.”

Goodmon added that the partners had been working “really hard for a very long time to pull this together.” “We kind of have the dream team,” he said.

No price tag was disclosed for the development.

The expansion of the ATC is the latest in a series of developments that have helped reshape Downtown Durham. The renaissance began with the construction of the Durham Bulls Athletic Park by the City of Durham in 1995 followed shortly thereafter by the development of the office building known as Diamond View I, the CBC purchase and renovation of the ATC, the city’s construction of the Durham Performing Arts Center which opened in 2008 and many other investments made in the immediate area.

“This is not a suburban shopping opportunity. This is not that. What this is, is trying to do an infilled project in the midst of a downtown and maintain the character that downtown Durham is known for,” Goodmon told WRAL-TV.

American Tobacco expansion

Rendering of American Tobacco Campus expansion. Image courtesy of Hines.

The ATC expansion project is divided into two phases. The first includes developing 313,000 square feet of leasable space in two Hines T3 creative office buildings and building 350 multifamily units into a 14-story high-rise. The Hines T3 buildings will stand 6 stories and 7 stories with the first floor of each set aside for retail, according to Mark Stanford of CBC.

RARE TIMBER CONSTRUCTION
It will also be a work of innovation.

The Hines T3 creative office buildings, which stands for Timber, Transit and Technology, utilize all-timber construction to create a “vintage aesthetic and warehouse environment” with the amenities of new construction.

Goodmon said it will be the first of their kind in the market and join only a handful of markets in the country using this innovation.

Construction is expected to begin in late 2021 or early 2022.

“One big thing on my list is families. Families is a group that historically downtown Durham hasn’t been real sticky for,” Goodmon said. “But if you add the amenity base we’re adding here and look broader across American Tobacco, all of a sudden you have an urban environment that’s really inviting to families.”

The new construction will carefully fit with the historic look of the original American Tobacco campus, said Hines Senior Managing Director Kurt Hartman.

By way of comparison in scale, the nearby Durham Innovation District covers 15 acres with two major buildings providing 350,000 square feet of space.

American Tobacco expansion

A rendering of a new look American Tobacco Campus. Image courtesy of Hines.

Alongside a central plaza and pedestrian alleyways, there’s also 90,000 square feet of retail space reserved for a possible movie theater/draft house, grocery, other amenity shops and restaurants.

A LONG-TIME VISION
CBC bought the 11 acres for the expansion in 2016. There has always been a long-term vision for the site, Goodmon said.

“We signed on from day one. When we started working in downtown Durham, this was always about developing a community and the revitalization of a downtown,” he said. “This is taking it to another level.”

Not even a pandemic was going to get in the way of plans, he added. “People crave interaction; we crave being a part of a community, and you can’t do that virtually. At the end of the day, the most competitive companies in the world are going to be the places that will drive the most competitive talent, and that means you’ve got to develop those places.”

“It’s at the gateway to downtown Durham,” noted Hines director Paul Zarian. “We have the opportunity to create something special and learn from this COVID-19 experience.”

PRAISE FOR PROJECT
“The folks at ATC are transforming an under-used corner of Durham’s urban core into a vibrant new downtown destination,” said Mayor Steve Schewel.

Geoff Durham, CEO of the Durham Chamber of Commerce, also welcomed the news. “The timing for such an ambitious project comes at an essential time for the Durham market,” he said. “Without adequate space for our businesses to grow, we risk losing these innovations to other markets.”

THE PARTNERS
Hines, a privately owned global real estate investment firm, has a presence in 205 cities in 24 countries with some $133.3 billion of assets under management.

USAA Real Estate acquires, develops, finances and manages real estate investments.

Hines and USAA are partners in the Fenton development in Cary.

Thanks to WRAL TechWire’s Chantal Allam for this Capcom story and to Hines for these Capcom photos.

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