NORFOLK, Va. — TowneBank and Children’s Hospital of The King’s Daughters completed the purchase of the former Norfolk Southern tower that sits in the downtown Norfolk skyline.
Norfolk Southern used to own the building but in 2018 announced it was moving its headquarters to Atlanta.
The adjacent Commercial Place garage from the City of Norfolk was also purchased in the transaction, according to a news release.
The closing on both buildings happened on June 23.
TowneBank and CHKD jointly own the tower and the garage and will share the space. Norfolk Southern will continue to occupy several of the floors until the end of 2021.
“TowneBank and CHKD are both respected corporate citizens and assets to our community,” Norfolk Mayor Kenneth Cooper Alexander said in the news release. “Their significant investment reinforces Norfolk’s downtown as the urban employment hub of the region.”
Nearly 900 people will eventually work in the tower. Several hundred employees from Norfolk Southern are currently working in the building.
CHKD plans to relocate around 475 members of its workforce into the downtown building, including information services, patient financial services, Human Resources, and Health System administration.
“This has been one of those unique circumstances where multiple different entities got together with a common cause," said CHKD President and CEO Jim Dahling.
Dahling said moving non-clinical staff to the downtown building will free up space for mental health services at the hospital.
“When you start bringing children and families in with mental health issues, you need to have space in the hospital for emergency issues, therapy space," Dahling said. "So we were looking for a way to move everyone who didn’t wear a stethoscope or a lab coat - to have a place to go to consolidate those services.”
Upon termination of the Norfolk Southern lease, the building will house the headquarters of Towne Financial Services, which will include approximately 400 team members in TowneBank Mortgage, Towne Insurance, and Towne Benefits, according to the news release.
“We have been looking for a way to bring the Towne Financial Services Executives and Operations Teams together under one roof and had been exploring numerous locations throughout the region,” said G. Robert Aston, Jr., Chairman of TowneBank. “In 2018, when Norfolk Southern announced its plans to relocate, the opportunity to purchase their iconic building was too good to pass up."
TowneBank’s headquarters will remain in the Harbour View area of Suffolk. The bank's Norfolk Main Office and Corporate Banking Group will remain in their current downtown locations.
TowneBank will donate the net proceeds of Norfolk Southern’s lease payments through 2021 to CHKD’s current campaign to build a mental health hospital for children on its Norfolk campus.