Thalhimer now sole principal for Diamond District redevelopment

Loop Capital is no longer affiliated with the development partnership working on the mixed-use development component of Richmond’s $2.4 billion Diamond District project, leaving Thalhimer Realty Partners as the development team’s sole principal.

The partnership, a limited liability company named Diamond District Partners, is developing the area surrounding the planned new baseball stadium for the Richmond Flying Squirrels for the first phase of the redevelopment. The entire 67-acre project is expected to include 2,800 residential units, 935,000 square feet of office space and 195,000 square feet of retail and community space.

In a statement issued by Dan Herbst, an attorney with Reed Smith representing Loop, the company said, “Although Loop had discussions with the city, Thalhimer and Republic about participating in the Diamond District development project, Loop never signed onto the project and currently is not involved in any capacity. … Loop engaged in discussions with Thalhimer and the city through April/May 2024 regarding participation in the real estate development project but did not sign onto the development agreement in May 2024.”

In a statement, Thalhimer said, “We can confirm that Loop is not affiliated with Diamond District Partners LLC. While Loop chose not to proceed, we continue to maintain a great relationship with them. The development program is in line with projects our team has completed over the last several years, and we’re excited to build a new, successful Diamond District community with the Squirrels, VCU and the city as our partners.”

Diamond District Partners includes Capstone Development, Pennrose, Maryland-based NixDev and M Cos., “as well as a deep bench of design and construction experts,” according to the Thalhimer statement.

Loop, Thalhimer, Diamond District Partners and four people have been named in a $40 million lawsuit from a former Diamond District development partner.

In May, the city of Richmond, Richmond Economic Development Partners and Diamond District Partners signed a development agreement.

In May 2023, Richmond City Council originally approved a development agreement with RVA Diamond Partners LLC, a joint venture that including Connecticut-based developer Republic Projects, Thalhimer Realty Partners, Loop Capital Holdings and San Diego venue developer JMI Sports. However, Republic Projects filed a lawsuit in July claiming that Thalhimer Realty Partners and Loop Capital cut Republic out of the development deal sometime between June and December 2023.

“Loop never signed onto any partnership agreement that is the subject of Republic’s lawsuit,” Loop said in a statement. “Loop maintains that it is incorrectly named in Republic’s lawsuit and has requested that Republic voluntarily dismiss Loop to avoid the need for further litigation. Republic has not agreed to dismiss Loop to date and, if necessary, Loop intends to file a demurrer to the complaint.”

According to the development agreement between the city, the EDA and Diamond District Partners, the development team must fund the first phase’s development, which now will be without Loop Capital’s involvement.

The three-part first phase of the project, according to the development agreement between the city, the EDA and Diamond District Partners, is 22.5 acres. The minimum capital investment for the total phase 1 is $567.45 million. Thalhimer has not said how much it has raised so far.

Under the agreement, the developer will buy the first section of the phase 1 property from the EDA. The purchase price for the phase 1A properties, which total 11.67 usable acres, is set at approximately $11.4 million. Diamond District Partners will also have “the exclusive option to purchase” the properties for phases 1B and 1C.

Under the development schedule, phase 1A is expected to be completed by 2032, and all of phase 1 is expected to be completed by 2034.

The Richmond Flying Squirrels is working with Texas-based development management consultant Machete Group for the stadium itself. In July, Rhode Island-based Gilbane Building announced it and Chesterfield County-based Prestige Construction Group had won a contract to build the stadium. Having a separate development team chosen by the Squirrels for the stadium was a change from the original development agreement.

In August, the Richmond EDA’s board approved a 30-year lease and a stadium development agreement between the EDA and the Flying Squirrels. The Squirrels will pay $3.2 million in annual rent for the next 10 years, after which the rates will decrease.