3 Downtown D.C. Office Tenants Land City Funding To Expand

A trio of companies are expanding their downtown office footprints with funding from D.C.’s $10M Vitality Fund. 

The deals were announced at D.C.’s annual March Madness event Wednesday, where city leaders showcased economic development initiatives and revealed upcoming requests for proposals.

Tax consulting firm Ryan, association management company Kellen and consulting services firm Acumen are receiving money from the Vitality Fund, a tool to incentivize businesses to locate downtown.

The fund gives financial support to companies in targeted industries relocating or expanding in D.C. and creating new jobs. The fund also requires that recipient companies' employees come into the office at least 50% of the time. 

The three new recipients are expected to create 232 new jobs and lease nearly 90K SF of office space downtown. They join three previous recipients: Meridiam, Virtru and Quadrant Strategies. 

“When we think about the city’s economic future, we of course need to focus on the future of downtown,” Mayor Muriel Bowser said at Wednesday's event. “A healthy and vibrant downtown is essential for the District to be able to pay for the investments we’re proud of in all eight wards.” 

She said the District has a “tremendous base of opportunity” to bring in new businesses and said it will continue to work on business attraction, including through the Vitality Fund.

Kellen is shifting its headquarters from Atlanta to D.C. while expanding and extending its lease at the National Press Club building. The firm is doubling its footprint from 15K SF to 32K SF and adding about 70 employees to its existing 40, Kellen CEO Travis Rush told Bisnow at Wednesday’s event. 

The company is also extending its lease for another 11 years at 529 14th St. NW, where it has been since 2008. Kellen has been in D.C. since 1990. 

Kellen is receiving $150K from the city over three years, a spokesperson told Bisnow. The monetary awards for the other fund recipients weren't disclosed.

“The association capital of the world is D.C. The public affairs capital of the world is D.C. D.C. is a unique global city. We’re a unique global company,” Rush said. “It just kind of made all the sense in the world. And then working with the mayor's office and the deputy mayor to facilitate a move really helped out and sped things up.”

Kellen was deciding between Chicago and D.C. for its new headquarters, but the Vitality Fund, which was brought to the company by its broker, Cushman & Wakefield, sealed the deal.

The company has been on the 12th floor and is expanding to the 11th floor, Rush said, a transition that included cutting a hole in the floor to connect the two spaces with a staircase. The headquarters move is an overall reduction in space for Kellen, which is vacating its 32K SF Atlanta office. The firm has a hybrid work schedule with a two-day-a-week in-office requirement.

In her remarks, the mayor acknowledged a major hurdle facing the District amid its pandemic recovery: tax revenue. 

“It’s true that over the last 15 years our revenues went up like this,” Bowser said, positioning her hand vertically. “And a lot of people in this room enjoyed that increased prosperity, didn’t you?” 

Revenues have slowed, but she wants to ensure the District returns to its pre-pandemic annual revenue gains, she said. 

“And that is up to us,” Bowser said. “So what we are doing now and what we will present to the council are interventions that help us bend that curve in the upward direction back to roaring growth, increased prosperity and a greater ability to invest in our people.” 

Also at Wednesday's event, the Washington Metropolitan Area Transit Authority announced it is officially launching requests for two mixed-use Metro-adjacent projects, two of seven stations it had targeted for joint development efforts last spring. 

It plans to put the first out this spring for a development opportunity planned for between 175 and 200 units and 18K SF of retail across 1.2 acres in Deanwood. 

The other solicitation, which WMATA plans to release this summer, is for 450 to 500 units across 500K SF next to the Brookland Metro station.

The Department of General Services also unveiled eight solicitations and development opportunities, including a $110M project to rebuild the Fire and Emergency Medical Services and Office of the State Superintendent of Education Fleet Facility in Ward 8, a $20M project at the Rumsey Aquatic Center and a $115M modernization of Hart Middle School in Ward 8.