Reston defense technology firm Blue Sky Innovators is moving ahead with a $7 million expansion of its Sunset Hills Road headquarters while Northern Virginia grapples with federal job losses.

The company plans to add 175 jobs and build out 20,000 square feet of secure lab space above its existing office at 12120 Sunset Hills Road. The new facility, called SkyLab, will house rapid prototyping, government collaboration and research in artificial intelligence, cybersecurity, quantum computing and space technologies.

Hunter Mill District Supervisor Walter Alcorn featured the project on the district's homepage on July 1, calling the expansion "a great demonstration of the innovation that drives this region forward." Alcorn said he looks forward to the jobs and partnerships the growing team will bring to Reston.

Gov. Abigail Spanberger announced the investment in March and approved an $840,000 grant from the Commonwealth's Opportunity Fund to support it. The Virginia Jobs Investment Program will also fund employee training. The Fairfax County Economic Development Authority and the Virginia Economic Development Partnership worked together to secure the project for Fairfax County, according to the company.

"SkyLab represents our belief that speed, security and collaboration must coexist to meet today's national security challenges," CEO Tim Tkacz said in the company's announcement.

Board of Supervisors Chairman Jeffrey C. McKay praised the project for its potential to strengthen the county's economy and support national defense priorities.

The 175 new positions come as Northern Virginia's job market absorbs significant federal workforce reductions. The region's unemployment rate rose to 3.3% in May, up from 3% a year earlier, and the D.C. metro area lost 100,500 nonfarm jobs year over year, the largest numerical drop of any major metro area, according to federal labor data published Sunday.

Blue Sky Innovators, founded in 2016, serves the U.S. Department of Defense and the intelligence community, with employees across five states. The company specializes in prototyping, electromagnetic spectrum operations, systems integration and emerging defense technologies.