In Search of Talent and Affordability
With its Washington, D.C., headquarters at capacity and major growth plans on the horizon, CoStar Group needed to not only find a new space for its expanding research team, but also a new city – and one with a smaller price tag. The largest real estate data firm in the U.S. wanted a home that will attract new college graduates – the majority of its workforce – and be affordable enough to retain talent. After surveying locations from the East Coast to the Rocky Mountains, CoStar shortlisted Kansas City, Missouri; Charlotte, North Carolina; and Richmond, Virginia.
The Virginia Solution
Education, Affordability, Location, and Quality of Life
With a bounty of recent college graduates and a competitive cost of living, the Commonwealth’s capital city checked all the boxes for CoStar’s research headquarters. Home to Virginia Commonwealth University, the University of Richmond, and Virginia Union University, and within a few hours’ drive of some of the nation’s best-ranked colleges – the University of Virginia, William and Mary, and Virginia Tech – Richmond is a magnet for new grads. The Commonwealth is among the most educated states in the nation, with more than 528,000 students enrolled in over 219 campuses of in-state institutions of higher education. As a leading research and technology company, CoStar can directly benefit from Virginia’s highly technical workforce. The company will also benefit from the region’s growing pool of millennials. In 2017, Time magazine reported that Richmond was the No. 2 urban area in the U.S. that millennials (ages 25-34) are moving to.
Nestled along the James River and boasting historic neighborhoods, cobblestone streets, and a nationally acclaimed food and beverage scene that includes more than 20 breweries, Richmond offers small-town charm and the amenities of a big city without the expense and traffic; the cost of living in the region is 5% less than the national average. While skyrocketing housing costs often force 20-somethings to live outside the center of larger cities, Richmonders can afford to live in the heart of the city without giving up the majority of their paychecks, a critical factor for companies like CoStar, which want to retain young college graduates. “Richmond is a compelling place to build a career over a decade or more,” said CoStar Group CEO Andrew Florance. “It’s half the cost and 1/20th the traffic congestion [of Washington, D.C.].”
In addition to renowned quality-of-life assets, Richmond’s central location on the East Coast is easily accessible to a variety of outdoor settings. Beaches, mountains, and the nation’s capital are approximately two hours or less from Richmond, thanks to Interstate 95 and Interstate 64 running directly through the city. Richmond International Airport, located less than 20 minutes from downtown, and two Amtrak stations provide access to the rest of the nation.
Richmond also provides CoStar Group a modern office space right on the James River, home to the only Class III & IV urban rapids in the U.S., set prominently at the forefront of the downtown Richmond skyline.
CoStar Closes on Richmond
After a yearlong search, in October 2016, CoStar Group announced plans to invest $8.17 million to locate its single-biggest operations and global research center in the City of Richmond, creating 732 new jobs.
CoStar opened jobs postings the day the project was announced and moved into its state-of-the-art downtown space shortly after. The company has ramped up faster than anticipated, as more than 650 employees, or approximately 90% of the announced jobs, have been hired in Richmond, three years ahead of schedule. CoStar has an option to build out an additional floor in its office and will likely reach its contracted metrics before the 36-month program period ends.
CoStar has immersed itself in the city as a valuable employer and philanthropist. In 2017, CEO Andrew Florance announced a $2.5 million gift to the VCU School of Business to create the CoStar Group Endowed Chair in Real Estate Analytics.