VDOT buys Owens & Minor’s Hanover HQ for $33.5M

The Virginia Department of Transportation has purchased the Mechanicsville headquarters of Owens & Minor for $33.5 million, with plans to move the state agency’s central office there in summer 2025.

Much of VDOT’s staff will move from the Annex building at 1401 E. Broad St. into the new building at 9120 Lockwood Blvd. in Hanover County, according to Jessica Cowardin, assistant director of communications for the state agency. The 160,000-square-foot campus in Atlee Station Business Park was built by Timmons Group in 2006. VDOT also purchased an additional 50 acres, according to Newmark Group, which brokered the deal.

Meanwhile, Owens & Minor expects to vacate the building by the end of this year. The Fortune 500 global health care logistics and supplies company plans to relocate its corporate headquarters somewhere in the Richmond region. While declining to specify where the company would move, a company spokesperson said the move “better reflects the current needs of our organization and our teammates.” Owens & Minor has 1,400 employees in Virginia and more than 20,000 worldwide, including hundreds of workers in the Richmond area.

The move will not impact the company’s operations and is a reflection of workplace trends and worker preference, according to the company.

In November 2020, Owens & Minor announced it was pulling the plug on its 90,000-square-foot downtown Richmond call center and would be seeking tenants to sublet the space after so many workers started working remotely.

“We’re proud that Owens & Minor has called Richmond, Virginia, home for more than 100 years, and look forward to our continued presence in the local community,” a statement from the company said.

Brandon Turner, director of Hanover County Economic Development, said Monday that he doesn’t expect Owens & Minor’s next headquarters to be located in the county. “It would be very difficult because we don’t have a lot of Class A office space,”  he said. “What we have is very small, and I think what they’re looking for is larger than what we have available on the market in Hanover.”

Owens & Minor moving to a new headquarters is a double-edged sword, Turner said. The company will be off the county’s tax roll and VDOT, as a Virginia state agency, will not pay taxes.

“That in and of itself is a bit of a hit,” Turner said. “On the flip side, the building is heavily underutilized right now by Owens & Minor due to their [work-from-home] policies. When VDOT comes up, they will bring significantly more individuals up here, and those people will be going out into the neighboring businesses [and] eating, buying groceries, whatever. So if you own a business in this corridor, it’s going to be a boon.”

Andrew Sandquist and Adam Faulk, JC Asensio and Adam Petrillo,  Briggs Goldberg, Will Bradley and Mark Williford, all of Newmark, represented the seller on the transaction.

Owens & Minor reported $10.3 billion in 2023 revenues, up from $9.9 billion in 2022.