Inside of the vacant, seven-story Chesterfield cigarette manufacturing plant in downtown Durham, rainwater gushes down to the bottom floor that’s beginning to resemble a muddy pond.

Yellow caution tape wraps around the support beams in the middle of each floor of the building to mark where a future, sun-filled atrium will soon be exposed.

All of the old cigarette manufacturing equipment that had been sitting idle for decades has already been chopped up, carted out and re-sold to help pay for the millions of dollars of demolition work that’s already been underway for months.
But after several years of fits and starts by at least three different real estate development groups that has wanted to make the iconic building at the corner of Main and Duke Streets usable again, owner Baltimore-based Wexford Science + Technology is the process of transforming the property into a centerpiece of Durham’s life science community.

Wexford, a subsidiary of BioMed Realty Trust (NYSE: BMR), has confirmed that it has signed major pre-lease deals with both Duke University and with a new entity called BioLab NC to occupy about half of the 273,000 square feet of new office space that will open up when the redevelopment of Chesterfield is completed in the first quarter of 2017. Chesterfield will also have about 11,000 square feet of street-level retail and restaurant space.

The Chesterfield is one of the last remaining undeveloped pieces of the former Liggett & Myers Tobacco Co. complex now known as West Village.

Duke University has committed to leasing 100,000 square feet at Chesterfield that it will use for various life science groups affiliated with the university that need more office and laboratory space for expansion.

BioLab NC will lease 42,000 square feet at Chesterfield as a shared lab space model for startup and growing life science companies. BioLab NC is affiliated with Massachusetts-based LabCentral that operates a 28,000-square-foot innovation hub facility in Cambridge. BioLab NC will be the group’s second hub location for life science companies.

“BioLab will be to life science companies like what American Underground has been to technology companies,” explains Justin Parker, senior project manager for Wexford.

 While Wexford executives have been optimistic about the project since before buying the building in late 2013, Wexford Senior Vice President Dan Cramer says both pre-lease deals were crucial for getting financing and approvals to begin construction on the building, a project that is estimated will cost about $128 million to complete.

“We needed enough to justify kicking off this building,” he says. “But I know it takes a little imagination right now.”

Because the concrete and brick building was designed for manufacturing and not for office work stations or life science laboratories, Cramer says they are in the process of building out an atrium with an expansive skylight in the center of the building – essentially cutting out the center of the roof and crushing through six floors of 8-inch-thick concrete to allow more light into each floor of the building.

Construction crews and subcontractors for the Whiting-Turner Construction company have been using a remote-controlled machine that continuously punches powerful holes into the concrete until the floor below is exposed. It’s taking about a week and a half per floor, they estimate.

“When they built this building, I think they thought manufacturing equipment was going to continue grow in size and so it was built with a load-bearing capability for bigger than what they were using,” Parker says. “But what we all know happened is everything started getting smaller.”

About a block away, Wexford will also be building a parking deck at the corner of Pettigrew and Gregson streets to accommodate the nearly 700 employees that its developers estimate could be utilizing the building once its office, lab and retail spaces are fully occupied.

Durham City Council in October approved a $6 million incentive package to help Wexford pay for construction of the new parking deck.

The entire Chesterfield project is expected to be completed in the first quarter of 2017.

Source: Triangle Business Jounrnal by Amanda Hoyle