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Jax Daily Record Monday, Jan. 29, 201805:55 PM EST

McKesson to lease at Southside Quarter, move 428 employees into new building

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Company confirms it is “Project Milan.”

McKesson Corp. agreed to anchor the proposed Hines office building planned at Southside Quarter along Gate Parkway at southwest Interstate 295 and Butler Boulevard.

Houston-based Hines announced Monday that it will lease the four-story building to McKesson’s Medical-Surgical business.

McKesson will lease the entire building, said Hines Senior Managing Director Lane Gardner. 

Lane Gardner

Site work will start in the spring and McKesson will move into the structure in the summer of 2019. 

Hines said the building will be designed with glass accent features and overlook a central lake in the mixed-use development. 

The building is designed by Rule Joy Trammel + Rubio of Atlanta. It will occupy about 7.8 acres. No contractor was announced and the construction cost was not disclosed.

“McKesson’s new facility will include a modern workspace that promotes collaboration and wellness features for our employees,” said Michael Huaco, senior vice president and global head of real estate for McKesson.

The office building, the first of two planned at Southside Quarter, will be developed at Gate Parkway and Commerce Village Drive.

Gardner said Hines was “pleased to kick off the office component with a high-quality, Fortune 500 company.”

McKesson Corp., based in San Francisco, bought Jacksonville-based PSS World Medical Corp. in 2013 and continued to lease the PSS space in Southpoint. 

PSS distributed medical products and services to physicians and caregivers throughout the United States.

McKesson Medical-Surgical, a McKesson operating unit, announced in October 2013 it agreed to extend the Southpoint lease.

McKesson confirmed it is Project Milan, a company code-named in city documents that described a health care company that needed 90,000 to 95,000 square feet of office space and expected a capital investment of $28.5 million.

City Council adopted a resolution in August for a $700,000 Recapture Enhanced Value grant for Milan. The project was described as an expansion of an existing company.

The city legislation says Milan committed to retain 428 jobs and create at least 10 more full-time positions by Dec. 31, 2021.

The development agreement said Milan will add 10 financial and IT positions with an average salary of $45,562.

The project summary said 10 was the minimum number of jobs to be added and the company could create 50 more jobs by year-end 2022 at an average wage of $77,000.

The agreement states construction must start by June 30 and be completed by year-end 2019.

The cafe area of the new office building.

McKesson spokeswoman Kristin Hunter Chasen said Monday the company intends to move into the new building in mid-2019 and the 428 employees at its Southpoint Boulevard location will relocate there.

“The new location will provide McKesson with a larger, improved workspace for its Jacksonville employees within a walkable, mixed-use development. It will also allow for future growth,” she said.

The 110-acre Southside Quarter is master-planned for retail, high-density single-family residential, commercial, hotel and office uses. 

Already under construction are 306 luxury apartments by Hines and 135 single-family and townhomes by David Weekley Homes under its Central Living brand

At build-out, Hines expects Southside Quarter to have up to 350,000 square feet of office space, 1,100 residential units, 140 hotel rooms and 100,000 square feet of restaurant and retail space.

Hines is a privately owned global real estate investment firm that was founded in 1957 and has a presence in 201 cities in 21 countries.

Hines, through S-15 Land Holdings LLC, bought 47.38 acres this month for $12.63 million along Gate Parkway for the second phase of Southside Quarter and now controls the entire site. For the first phase, Hines paid $20 million for 69 acres in October 2016.

Southside Quarter is near the Town Center One and Two buildings under construction for VanTrust Real Estate. Two Jacksonville-based companies — Availity LLC and Web.com — will anchor the Town Center office buildings.

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