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The iconic Model Tobacco plant in South Richmond undergoing a $59 million redevelopment into apartments

The iconic Model Tobacco plant in South Richmond undergoing a $59 million redevelopment into apartments

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An iconic former tobacco plant in South Richmond is in the midst of returning to its stylish past.

The art deco-style Model Tobacco building, which closed more than three decades ago, is being turned into 203 upscale apartments.

The six-story building on Jefferson Davis Highway is undergoing a renovation that will cost about $59 million. Work started a couple of weeks ago after the developer got financing for the project.

The first occupants should be able to move in during the spring of 2022.

Most of the one-, two- and three-bedroom apartments will be rented at market rates, but a third of those units will be rented at below-market rates for workforce housing tenants.

The top floor of the building will have 31 loft apartments with two or three bedrooms. Tenants will enter the apartment on one level — for the kitchen, dining room and a bedroom and a bathroom — and then take steps to a mezzanine level for the other bedrooms and bathrooms.

The complex will feature a variety of amenities for tenants.

Plans call for a rooftop community room and deck that will have commanding views of the city’s skyline.

A former power plant behind the main building on the 14.79-acre property will become a recreation center for tenants. It will include a half-court indoor basketball court, gym space, a 30-foot climbing wall, a large community room with a cooking kitchen, a yoga studio and a gaming center. Off the gym will be a deck and an outdoor swimming pool.

A 36,000-square-foot event center or additional apartments are planned for a second phase.

But the project’s main attraction is the Model Tobacco building, which was built in the late 1930s for the U.S. Tobacco Co. and designed by the Chicago firm of Schmidt, Garden and Erikson. U.S. Tobacco operated the plant until 1986, then sold it to West Park Tobacco Inc., which closed it in 1988.

While it was built as a tobacco manufacturing plant, the Model Tobacco building was considered one of the better examples of mid-century industrial design of a multistoried building, according to a guidebook on Virginia architecture.

“Model Tobacco, in terms of the way it was built and the way it was constructed, it was built to look different from other manufacturing warehouses,” said Christopher Harrison, managing member of C.A. Harrison Companies LLC, the Bethesda, Md.-based commercial and residential development firm behind the redevelopment of the Model Tobacco project.

“For us to be able to bring back that former architecture and the former glory of the building and bring it back to life and to repurpose it, I think it will be tremendous for the South Side and for all of Richmond,” Harrison said.

“It is uniquely designed and constructed, and you just won’t be able to find anything like it in Richmond,” he said. “It is a very, very solid building.”

Besides, those driving along Jefferson Davis Highway can’t miss the 9-foot-tall Model Tobacco letters that dominate the north and south sides of the building.

***

It took Harrison, 48, a former University of Virginia football player and former NFL offensive guard and tackle, more than three years to turn his idea to transform Model Tobacco into reality.

Model Tobacco Development Group LLC, an entity tied to Harrison’s company, bought the property at 1100 Jefferson Davis Highway in June for $8.575 million. A local businessman and his wife owned the property for 31 years, and the building was used as a storage warehouse.

In late October, Harrison closed on nearly $20 million in federal and state historic tax credits and another $34.7 million in financing for the project from Virginia Housing, the self-supporting, not-for-profit state housing finance agency.

Harrison first heard about the building in the summer of 2017 from his commercial real estate broker, who mentioned that the property was back on the market for sale.

“Chris looked at it and he quickly put an offer on it,” said Tom Rosman, a principal and director of commercial real estate for One South Realty who helped broker the sale.

But this wasn’t the first time the property had a potential buyer, Rosman said. It was under contract in 2008 with plans from another developer for about 600 apartments on the property. But the financial crisis delayed those plans, and the project fell through.

Other offers were made since then, but financing was a problem, Rosman said.

“I’ve been working on this for years,” he said. “After you have worked on something for so long, you want to make this thing happen. It is a great building. You fall in love with it. It is really unique.”

At one time, Harrison said the property was listed for $11 million. “That just wasn’t feasible.”

But Harrison wanted to make it happen. So he established benchmarks with the building’s owners where he would post funds as time went along.

“He had the tenacity to make this thing happen,” Rosman said. “If he didn’t make a deadline, he was coming up with some solution.”

Timing was everything for redeveloping the Model Tobacco building, Harrison said.

“This transaction probably couldn’t have happened five or six years ago. We hit it at the right time I think,” Harrison said.

For instance, there was increasing interest for multifamily projects along that portion of Jefferson Davis Highway, particularly after the successful first phase opening of local developer Tom Wilkinson’s Port City project that transformed the former American Tobacco Co. complex just south of the Model Tobacco building into upscale apartments for workforce housing.

The first tenants moved into the Port City complex in early 2019. Plans call for turning the former 300,000-square-foot tobacco manufacturing plant’s four interconnected brick buildings and 11 former tobacco storage sheds into nearly 300 apartments plus artist studios.

“Manchester has slowly but surely been transforming, and there has been a push for apartments further and further down Jefferson Davis Highway,” Harrison said.

Also helping the Model Tobacco project was the right financing and being able to take advantage of more favorable interest rates, which are now at historic lows.

But even getting the financing had its delays.

An investor for the historic tax credits backed out of the deal in December, a week from closing, said Andrew Little, a partner and investment banker with John B. Levy & Co., a real estate investment banking firm based in Henrico County that helped pull the financing deal together for the Model Tobacco project.

That pushed the closing to March, but the pandemic delayed it again, he said.

But the delays ended up being favorable to Harrison as he got a better interest rate in the end, Little said. “Chris has displayed unbelievable tenacity to stick with this thing and get it done. I’m impressed with his patience and fortitude in pushing this through.”

Virginia Housing handled the $34.7 million in financing for the development.

Dale Wittie, the agency’s director of rental housing lending programs, said he has worked on trying to secure financing for a redevelopment of Model Tobacco with two other developers in the past 10-plus years.

“I am thrilled this deal finally got done,” Wittie said.

The agency, he said, was interested in providing financing because a big part of its mission is to help with revitalization of areas that need a jump-start.

“We lend in areas like around Model Tobacco that are riskier than others because we know it will help in the revitalization and there is a strong economic development portion as well,” he said.

***

Harrison persisted through the years to get the deal done.

“We stayed with it,” he said. “We had a lot of bumps in the road and a lot of times I wondered when I was putting so much time into it if it will ever come to fruition. But we got it done.”

Little said he believes Harrison learned about perseverance while playing college and professional football.

Harrison got his undergraduate degree from UVA in 1994 and a master’s in education in 1996. After that, he went on to be an NFL offensive guard and tackle playing for the Detroit Lions, Minnesota Vikings, Baltimore Ravens and Denver Broncos.

He got into real estate development as a fluke.

While playing for the Ravens, Harrison looked to buy a house in the Columbia Heights neighborhood of Washington, D.C. A church had a block of five houses on the market, “selling them at the time for next to nothing.” He was thinking about buying one of them, but a church elder suggested he buy them all. He did.

“Within literally a year, I was going to training camp with the Broncos. I was a typical football player who was looking for an exit,” he said. “I called my [real estate] broker and I asked how much I could sell those houses for, hoping to break even and get out of football and start something else.”

The broker told him $225,000. “I paid $250,000 for all five houses and I thought I had lost money. But she meant I can get you $225,000 for each one of those houses. And that’s when I said I was done with football and I’m going into real estate. Back then, the market was so hot you could throw a dollar to the wall and you could make money.”

While at training camp with the Broncos in 2000, he left the NFL to get into real estate.

He eventually created C.A. Harrison Companies to focus on acquiring neglected buildings and renovating them. He started in the Washington area.

During the 2008-09 economic downtown, Harrison shifted his real estate focus to Richmond, where he also at the time owned three cellular phone retail stores as an investment. Besides, he had fond memories of Richmond, where he had spent some summers in his early childhood with his grandparents who lived in North Side.

His first project here was a 75-unit apartment complex at 2001 E. Broad St. in 2010. Several years later, he converted the former Daniel Building at 3805 Cutshaw Ave. in Richmond into the Argon apartment complex.

He has since sold those properties.

Harrison ventured to Winston-Salem, N.C., where he took a former R.J. Reynolds Tobacco Co. manufacturing plant in downtown and turned it into Plant 64, a $55 million, multiuse complex with 242 one- to three-bedroom apartment units.

“People thought I was crazy when I was doing Plant 64,” Harrison said.

The Model Tobacco project reminds Harrison of Plant 64.

“You can’t replicate these kinds of buildings. They are all each individually unique. It is exciting to bring them back to life and repurpose them,” Harrison said. “I try to focus on historic projects. I like the challenge of being able to find something to do with them but also the uniqueness of the finished product.”

Harrison is in the final planning stages to convert the former R.J. Reynolds Whitaker Park manufacturing complex near Wake Forest University in Winston-Salem into a high-end apartment complex. He should buy the property in December and close on the financing in January.

The first phase calls for converting a building into 163 apartment units. Later phases would include constructing a 150-unit apartment building and adding retail space and a hotel.

Harrison “has shown he can bring a product like this [Model Tobacco] to the fruition. He has the ability,” Virginia Housing’s Wittie said.

“One of the things with developers I have noticed over the years is that the successful ones have a vision of what the development will be and they describe it with a certain amount of passion. That is always a good sign to me. That they are emotionally invested in their development,” Wittie said. “Chris has that, and he has done it before. We give a lot of credit to those who have that kind of vision.”

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