When Brad Brinegar signed a lease at the American Tobacco campus in Durham, North Carolina, it was a risky move by two measures.
As Chairman and CEO of McKinney, he made the decision to relocate the national creative agency—not just into an abandoned factory that had trees growing through its roof, but also into an area that was far different from the company’s previous location.
McKinney and its 110 employees were based in Raleigh, the state’s capital, which was busy with activity in 2002, Brinegar says. They were moving into downtown Durham, which was largely devoid of investment at the time.
“We were the first well-known and established company outside of Durham that chose to go to Durham,” Brinegar says. “I think that signal—that decision on our part as a creative agency—made people confident that the whole idea of a renewed Durham made sense.”
The American Tobacco campus was completed in 2004 with more than 1.2 million square feet of office space in 13 buildings on an 11-acre campus in downtown Durham.
Today, it is a creative hub for the Research Triangle in North Carolina that has sparked renewal, not just on the campus itself, but in the city around it, making the project a poster child for similar developments around the country.
As Fort Wayne plans to renovate its old General Electric campus into Electric Works, city leaders are looking at the American Tobacco campus as an example of what’s possible. As such, regional business leaders might be able to learn from early investors in the project, too.
Input Fort Wayne sat down with Brinegar to learn more about McKinney’s experience as one of the first tenants in the American Tobacco campus.
Brad Brinegar, Chairman and CEO of McKinney
IFW: Tell us a little bit about the background of McKinney and its previous location in Raleigh, North Carolina.
BB: McKinney was founded in 1969 by Charles "Chick" McKinney in Raleigh. It was one of the first creative powerhouses outside of Madison Avenue. It was a time when agencies were starting to believe you didn’t have to be in a major metro to attract talent and do great work.
In North Carolina, Raleigh is part of the Research Triangle, which is really three cities: Raleigh on the East, Durham on the Northwest, and Chapel Hill on the Southwest.
Raleigh is the state capital. It’s not a particularly diverse city, which is very different from Durham, where there is a lot of socioeconomic and racial diversity.
Durham is an old factory town that had challenges with displaced workers, but also had universities like Duke nearby. It was a very interesting place.
When I moved from Chicago to the Triangle, I actually chose to move to Durham. I was moving from a homogeneously white affluent suburb, and I wanted my kids to grow up in a place closer to what America is and is going to be like. So the diversity of Durham, combined with the appeal of Duke, made it interesting to me.
I saw that there was potential there.
IFW: Why did you relocate McKinney to Durham?
BB: It was 2002 when I started to look at a relocation. Part of the reason is the agency was in a building with very small floorplans in Raleigh. Everybody was spread out on five floors, so for me, it started with wanting to get as many people as I could on the same floor.
At that time, the only option other than building a building was to place a bet with the American Tobacco campus.
IFW: Was there resistance to the move, initially?
BB: Obviously, the space needs, everybody understood. We all wanted a more collaborative space.
But there’s no question we got pushback the day I announced we were going to sign a lease at the Tobacco campus.
When we started talking about the campus, Durham was in far worse condition than I think Fort Wayne is now. Really, the only thing that was drawing anyone to downtown at the time was the Durham Bulls. On the other side of the tracks, which is where the core of downtown is, it was almost totally vacant.
It’s about a half hour between Durham and Raleigh, and everybody at McKinney had really built their lives within five minutes of the Raleigh office.
Downtown Durham also had a reputation for crime, so I had a number of people asking me why I was putting their lives at risk.
To convince them otherwise, we compared crime data in Durham and in Raleigh for about 12 blocks around our office spaces on each side. Then we said, “Look, there’s more crime around our current offices in Raleigh than there is around American Tobacco.”
Eventually, everyone besides one of our employees came over to work at the American Tobacco campus—109 out of 110 employees.
IFW: Despite these concerns, what gave you confidence in the American Tobacco campus early on?
BB: I really trusted the owners of the American Tobacco campus, Capital Broadcasting, and Jim Goodmon there. They own the Durham Bulls, and they’re the ones who looked across the street and said, “This is not a good experience to see a rundown complex in downtown Durham when you’re at a game.”
Jim never looked at this as a real estate project; he looked at it as an urban renewal project. He wanted to make a difference. He was great about having our entire company over several times in the process of building out the space.
I was also inspired by the collective vision of the leaders in Durham. When I talked to the leaders of Raleigh about their vision for the future of Raleigh, the answer I got was, “We would like to grow.”
But when I talked to equivalent groups in Durham, they were all very united in their vision that Durham could be the creative capital of the Triangle. That very well-organized public-private alignment around a common goal made us confident that the campus was going to be more than just an island downtown.
One of the things they said was: “We’re going to have a performance arts center in downtown Durham within five years.” And we initially thought, “That’s nice, but we’re not going to make this decision based on that promise."
But once the fire was lit at the American Tobacco campus, they were in full gear to get that performing arts center completed.
Now it’s literally across the street from our office. It was completed in four-and-a-half years, and recent studies say it’s one of the highest grossing theaters in North America. “Hamilton” is coming in November.
All of the shows at the theater have created the need for restaurants, and the restaurants have created opportunities for apartments, and so on.
The momentum has been feeding off itself. All of the development we’ve seen in recent years wouldn’t have happened without the American Tobacco campus as the first spark.
IFW: Fort Wayne’s Electric Works project has plans for residential, restaurants, retail, and more on the campus itself. Does the American Tobacco campus have multiple uses onsite, as well?
BB: The American Tobacco campus itself has very limited residential. It’s predominately an office environment with some entertainment and dining. There’s also a green space in the middle where there are concerts. You can get about 1,200 people out in the lawn, and they do that quite a bit.
But it I think more importantly, in many ways, is that it lit a fire under redevelopment of everything else in downtown Durham.
There’s residential going in all over. There’s shopping and dining all over. It’s not limited to the American Tobacco campus. It just was sparked by American Tobacco.
IFW: How has McKinney’s experience at the campus been since the move?
BB: We moved in August of 2004, and it’s been transformative for us ever since.
First of all, we ended up with a space that I still give tours of 14 years later. We spent a year and a half designing it to support how we needed to work to be a modern agency. The result was a space that happens to cool and exciting, too. It’s met the test of time because it works, and it's helped us attract talent more easily.
It also dramatically transformed us in the eyes of our clients.
At our space in Raleigh, I was unable to get clients to come down and visit. One of the things you should know is, we have a national client base as far west as Denver and as far east as New York. We have always traveled to our clients, and we still do that quite a bit. But in Raleigh, our office was such that clients didn’t feel like it was worth making the trip.
Now, I have clients in the agency two or three times a week because they just love being here.
IFW: Along with a cool space, another benefit Electric Works promises future tenants is the creation of an innovation district, with creatives in close proximity so they are rubbing shoulders and making connections. Have you seen that happening in Durham?
BB: That’s definitely happening. One of the things that Capital Broadcasting did early on was launch a startup incubator called American Underground at the American Tobacco campus.
The first 10 years, it was literally in the basement of our building, which is why it was called “underground.” Now, it is serving more than 250 startups a year, and that includes bioscience, software, and more recently, consumer goods.
There have been some very successful launches there, and the American Tobacco campus has played a role in that, as a creative center. But it’s really the whole city of Durham developing that and supporting it that has made it possible.
Then, of course, there’s all of the benefits of having Duke University nearby.
IFW: What would you say to business leaders in Fort Wayne considering a future at Electric Works?
BB: Not knowing as much as I wish I did about Fort Wayne, I think you absolutely need to get the business community aligned around the value and potential of this project.
I think the thing that made the American Tobacco campus move forward was a real public-private partnership. All of the constituents and stakeholders in Durham got together and worked closely to make that vision happen.
I also go back to Jim Goodmon. He didn’t cut corners; he wasn’t looking for the cheapest way to make a place. He had a bigger vision for it than just a million square feet of real estate. He was trying to do what he could to change the fate of the city.
Because of that—and the willingness of other people to get behind that vision—it’s always been a lot more than just a place to work. It’s a place people go to make a difference and make the city stronger.
Today, we are facing some of the same problems any growing city has with affordable housing becoming an issue because people who have resources are now coming here. But that’s a smaller problem compared to everybody suffering downtown before this happened.
I never thought that being able to affect the course of the city was something we could have a chance to do here (at McKinney), but we have, and we’re investing in the continued success of Durham.
I hope for Fort Wayne’s sake, there are people willing to make that investment.