As Allison Wrabel reports, State Farm Insurance, one of the largest employers in the area, is closing its operations center on Pantops, along with 11 other operation centers across the country, and allowing employees to work from home, something they have been doing since March.

It's unclear now what will happen to the 55.46 acre property, or what kind of impact the closure will have on the Pantops Master Plan that was completed last year, which was designed around data showing current employment and commuting patterns that could now change.

"This would be one sweet space, location for residential development," says local realtor Roger Voisinet, mentioning the recently proposed pedestrian bridge across the Rivanna in the Riverview Park area, which would reach across to the State Farm property. "With the new pedestrian bridge in 2024, that area could be even more attractive," he says. (Wrabel also has an update on the pedestrian bridge proposal)

One curious sidebar to all this, which The DTM spent some time unraveling, are the real estate transactions surrounding State Farm operations centers since 2013. At that time, according to S&P Global, State Farm valued its operations centers around the country at $1.06 billion just before they began an aggressive sale-leaseback initiative involving those centers. LSREF2 Tractor REO (Direct) LLC, an affiliate of private equity firm Lone StateFunds, purchased the Charlottesville State Farm property along with "numerous State Farm operations centers in November 2013,” including “the purchases of 10 operations centers on which State Farm reaped realized gains of $10 million or more apiece," according to S&P Global. However, the biggest gain was on the sale of the Charlottesville center, in which State Farm cleared $52.1 million on a sale price of $69.3 million.

All together, State Farm realized gains of $484 million on the sale of its properties in 2013, the "largest level of realized gains obtained by an individual U.S. insurance company in a calendar year for disposals of real estate," according to S&P Global. In 2017, State Farm also sold 21-acres across the street to Sentara Martha Jefferson Hospital for $6.2 million.

Only months after the Charlottesville sale, however, LSREF2 Tractor REO (Direct) LLC would sell the Charlottesville State Farm property to JDM II SF National LLC, a real estate investment firm, led by former Phoenix Suns owner Jerry Colangelo and partners David Eaton and Mel Shultz, for $72.9 million, making $3.6 million on the deal. JDM still owns the property today.

The two companies did the same thing in Baymeadows, Florida around exactly the same time, according to the Jax Daily Record, when JDM II SF National LLC bought the State Farm operations Center there for $46 million from LSREF2 Tractor REO (Direct) LLC just five months after the company bought the center from State Farm for $43.6 million. Such big flipping gains in such a short time suggests there might be some common partners or ownership across the two LLCs.

State Farm likely sold these centers to real estate investment firms because they needed cash, but now that their employees are working remotely, the company appears to be taking advantage of the situation by getting out of the leases that were part of the deals.

“The facilities have various lease terms, and we don’t intend to renew those leases,” said Gina Morss-Fischer, a public affairs specialist with State Farm in an email to Wrabel, of the various centers across the country, including in Charlottesville. “We will continue to sublease space if possible.”

What will real estate investment firm JDM do with the property? Worth keeping an eye on that.

P.S: other possibilities for the area include a proposed "best in class" apartment complex on 20-acres on the other side of Martha Jefferson Hospital, which DMB manager Coran Capshaw's Riverbend Development bought from the hospital in 2017 for $5.5 million under Presidio Apartments LLC. “There’s a large employment base in both State Farm and the hospital, and we imagine that employees of both these and the surrounding businesses will be likely residents,” a Riverbend spokesperson told Charlottesville Tomorrow at the time, something that might have to be re-imagined now that 800 State Farm employees will no longer be commuting to the office.