Herald building tenants raise fortunes of downtown area

The former Tri-City Herald building, the largest and newest privately-owned office building in downtown Kennewick, has new tenants.

Vivid Learning Systems, owned by private equity-backed Health & Safety Institute, leased space at 333 W. Canal Drive, a decision that promises to bring more professionals to downtown Kennewick and bolster the fortunes of businesses in the city’s historic heart.

In a separate deal, a third-party distributor for Amazon leased 13,000 square feet of warehouse space attached to the office building.

The Herald building is owned by D9 Contracting, a family-owned drywall business that bought the property from McClatchy, the Herald’s parent company, in 2019.

Vivid provides online safety education programs for employers. It spun out of the U.S. Department of Energy in the late 1990s with a focus on the Hanford site and has been owned by HSI since 2018. HSI in turn is majority-owned by Waud Capital Partners, a $3 billion private equity firm.

Vivid leased the space to consolidate the 80-100 local employees who had been crowded in three locations, said Duane Tumlinson, vice president of sales operations.

Tumlinson said Vivid wasn’t focused on a particular city, but the Herald building had the space and amenities it needed and was move-in ready.

Vivid’s impact won’t be felt until the Covid-19 pandemic is past. Most employees are working from home, though members of its accounting and information technology team have moved into second-floor space that includes a break room and west-facing balcony.

Tumlinson expects to take over more of the second floor, including the former newsroom, when the pandemic lifts and workers come back to the office. It is unclear how many people that will be. He noted that like many employers, Vivid expects some to continue to work from home in the future.

Vivid was not looking to be a catalyst for downtown, but it embraces its new neighborhood.

“I think downtown Kennewick could be the coolest downtown in the area,” he said.

When workers do return, they will be welcomed by downtown’s mix of restaurants, shops, professional services, salons and tattoo parlors.

The city and a key downtown business association are thrilled.

More workers in downtown means more customers and energy, said Evelyn Lusignan, the city’s spokeswoman.

“This great location is a key component to advancing and sustaining that vibrancy by having workers in the heart of our historic downtown,” she said.

The Herald building consists of two parts. The 49,000-square-foot Class A office opened in 2004, attached to an older 60,000-square-foot warehouse and press room.

For a time, the building was filled with 175 or more newspaper employees. But the headcount sank as challenging newspaper economics forced McClatchy into successive rounds of layoffs that left large areas of the building unoccupied.

The warehouse, once crammed with a printing press, stacks of giant newsprint rolls and other equipment, emptied when the press shut down and was dismantled and sold for parts.

The trucking firm, operating in a part of the space, receives several semitrucks filled with Amazon packages a day and distributes them via a fleet of about 15 trucks to a large swath of the Mid-Columbia.

McClatchy sold the property to D9 Contractors in October 2019 for about $4 million.

D9 moved its own corporate offices and operations into the building while marketing the rest to tenants. Mike Detrick Sr. of D9 said the family is pleased with the leasing activity to date and looks forward to Vivid expanding its footprint in the future. It spent more than $9 million to build it in 2004.

The Herald remained in its namesake building for 10 months after the sale. In August, it moved a new, smaller office on 24th Avenue in Kennewick’s Southridge area.

The Historic Downtown Kennewick Partnership misses the Herald, an iconic downtown business. It was a terrific partner for downtown, said Stephanie Button, executive director. 

“We miss the proximity of having the paper nearby,” she said. Reporters and photographers often reported on what they saw happening in their neighborhood. “They were such a great neighbor.”

But the Detricks and Vivid are welcome neighbors.

“We are thrilled to see the Herald building continue to play a professional role in downtown,” she said. HDKP promotes the downtown area through improvement efforts, public events and recruitment drives. That includes helping D9 woo more tenants.

The interior layout includes a mix of private offices, conference rooms and large open office spaces, once home to the Herald’s first-floor advertising department and second-floor newsroom.

The first and second floors wrap around wide, open hallways with curving blue carpeting, designed as a nod to the area’s three rivers. A long, elevated dormer with transom windows down the middle draws light to the middle of the building.

Button called it fantastic office space and a great way for professional organizations to get a foothold in downtown.

Scott Sautell of SVN Retter & Company Commercial Real Estate is the leasing agent for the building. Office space is available for $15 a square foot and warehouse space for $7 a square foot on a triple net basis, meaning tenants pay taxes, insurance and other occupancy costs.

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