DURHAM – GlaxoSmithKline is relocating its offices in Research Triangle Park to the American Tobacco Campus in downtown Durham as the drug giant adjusts to changing demand for office space in the wake of the COVID-19 pandemic.

According to the company, it will relocate the RTP hub to the new space in the first half of 2022.  The space at the American Tobacco Campus (ATC) will fit about 650 employees at maximum capacity, about half of the company’s current workforce based from the RTP facility.

“This is a flexible arrangement that may see people in the new space some of the time and working from home some of the time,” a spokesperson for GSK said.

Adjustments in space also are going to be made in Philadelphia where the company operates another major campus, the company said Monday.

“Since the start of the pandemic, we have had an opportunity to re-evaluate, and ultimately redefine, the ways in which we work. The changes we are announcing today for our corporate hubs in North Carolina and Philadelphia align our offices with how we now function, offering flexibility for our people and optimally sized spaces where teams will continue to engage and thrive,” a spokesperson for GSK said.

No jobs will be lost among the some 1,300 workers affected, the spokesperson added.

The American Tobacco Campus is owned and operated by Capitol Broadcasting Company, which also is the corporate parent of WRAL-TV and WRAL TechWire.

Adam Klein, director of Durham Real Estate for Capitol Broadcasting Company, said the announcement is good news for the ATC, which also has served as a site for GSK operations in the past.

“It certainly reinforces the value of destination spaces like the American Tobacco Campus to large, global companies like GSK and smaller startups alike,” Klein said of GSK’s decision. “Our combination of new restaurants, outdoor green space, and one-of-a-kind buildings inspire workers to gather safely and generate new ideas. Downtown Durham and the American Tobacco Campus continue to attract household names as well as fast growing startups that make for an inspiring place to come to work.”

Major expansion coming for Durham’s American Tobacco Campus

GSK said the move “provides our people flexibility and new spaces that support collaboration, teamwork and innovation.”

“As a company focused on providing innovative medicines and vaccines, we know that discovery, learning and evolution are critical to success,” the GSK spokesperson added.

The company said new office space will “will emphasize team connection, dynamic workflows and recognize a preference for greater flexibility to work from home. The new spaces will have fewer individual workstations and more areas for informal collaboration, new and more advanced technology.”

Companies worldwide have been affected by the pandemic, many implementing work-from-home strategies in order to meet social distancing and other requirements triggered by the pandemic.

GSK also reiterated its continuing commitment to North Carolina where the company operates a manufacturing plant in Zebulon. ViiV Healthcare, which is owned by GSK and focuses on treatment for HIV, also has an operation in RTP.

“GSK remains dedicated to North Carolina, where we have had a presence for nearly 50 years and where we have established important partnerships that support the community where we live and work,” the spokesperson said. “This exciting next step to downtown Durham keeps us in proximity to top academic institutions and brings us even closer to its dynamic attractions and a bustling restaurant scene.”

According to Klein, GSK’s offices will be located in the Fowler and Crowe buildings in the “same general area as Mellow Mushroom and the YMCA.”

Also nearby is an office for tech giant Oracle.

Klein noted that GSK was one of the first tenants at the campus when CBC acquired it more than two decades ago. A significant expansion of the campus was announced in 2020.

“We’re excited to welcome them back to a campus that has grown (and continues to grow) into one of the most recognized and admired mixed-use historic renovations in the country,” Klein said.

The ATC covers more than 1 million square feet of space and is 99% leased, according to Klein.

Demand for office space remains strong in the Triangle, according to commercial real estate data firm Commercial Edge.

“Net absorption was positive for the first time since the pandemic onset and matched levels seen in Q1 2020,” a spokesperson told WRAL . “New deliveries drove vacancy levels higher as pre-leasing on these properties were well below average occupancy. This is likely a byproduct of COVID-19 effects on the market in addition to this market’s tendency to lease around and following delivery of product.”

An earlier version of this story listed the location of a GSK manufacturing facility in Wendell, NC.  The facility is located in Zebulon, NC.