Will Washington swallow Richmond?
Demographers expect metro area to span from Baltimore to Petersburg

by Joan Hennessy
for Virginia Business
August 2006

Tamera Stephenson knew what she was up against when she and her husband, Ted, decided to live in King George County. The 35-mile commute from their home to her nursing job at the Family Health Center of Woodbridge means a daily battle with traffic-choked Interstate 95.

But she says their Colonial-style home makes up for all that. It sits on a hill in a subdivision off a winding country road. In the evening, as the Stephensons work in the yard, no sirens or truck engines shatter the evening peace.

The family considered homes closer to Woodbridge when they moved to Virginia from Hawaii. But Ted Stephenson, a Naval officer at the Dahlgren division of the Naval Surface Warfare Center, says the couple couldn’t pass up the bucolic setting they found in King George. “When you get here, it’s like this.” He puts his hands out, palms up. Seemingly on cue, birds chirp.

The Stephensons are part of a wave of Washington-region families who are continually stretching the metropolitan area south in their search for affordable homes and quiet neighborhoods. New subdivisions catering to Northern Virginia commuters now are popping up as far south as Caroline County, territory that is considered to be part of the Richmond metropolitan area. In fact, demographers say the Washington and Richmond metro areas are poised to merge. In 2010 or soon after, Richmond could become part of a massive “combined statistical area” that extends from Baltimore through Washington all the way to Petersburg.

By the government’s definition, a combined statistical area groups metropolitan and micropolitan areas with economic ties — meaning that at least 15 percent of residents live in one county and commute to work in an adjacent metropolitan area. The designation can be significant, considering that some federal and local government agencies base program and funding decisions on these areas. “It means that the fate of Richmond and Washington are linked,” says Robert E. Lang, director of the Metropolitan Institute at Virginia Tech in Alexandria. “Housing markets, labor markets, various things that define economic development are related.”

Washington is “bumping into Richmond,” says Lang. “Richmond benefits, because Washington is one of the greater economies to be part of.”

From 2000 to 2005, Virginia added about 152,000 jobs. Of that number, 118,000 jobs — 78 percent — were in Northern Virginia, says John McClain, senior fellow and deputy director for the Center for Regional Analysis at George Mason University’s School of Public Policy. Much of the growth came after the terrorist attacks of Sept. 11, 2001. “A lot of companies located in the region have seen huge increases in federal contracts,” explains McClain.

Many of these new jobs are going to high-paid consultants. For example, the McLean-based management and technology consulting firm Booz Allen Hamilton announced in late 2004 that it was adding 4,600 jobs with an average salary of $79,000.

Plentiful jobs and rising incomes in Northern Virginia have created huge demand for homes in the region. “That plus the phenomenon of low interest rates have made housing prices go through the roof,” says McClain. The average home sale price in Northern Virginia was $552,621 in December, a 16 percent increase over 2004, according to the Northern Virginia Association of Realtors. By comparison, the average price of Richmond-area homes last year was $253,392, and the state average was $272,761.

Little wonder then that middle-income Washington-region families are searching beyond the close-in suburbs for a slice of the American dream. Their migration south along I-95 is stimulating housing markets and creating traffic jams in formerly rural areas. Business and economic development officials, meanwhile, are contemplating the potential effects on this emerging mega-metropolis.

The macro view
As a boy, Gregory Wingfield left his St. Louis home once a year to visit his grandmother in Washington. He remembers stepping off the train at Union Station and thinking, “Man, this is the slowest-moving Southern backwater town I’ve ever been in.”

That was the early 1960s. Wingfield, now the president and chief executive officer of Greater Richmond Partnership, has witnessed the transformation of the Washington region as it expands in Richmond’s direction. “I’m reading the same trends you are, that we’re coming together by 2010. In some cases, we already are merged,” he says.

In fact, some homeland security firms have considered locating in Richmond rather than the nation’s capital. “We’re out of the blast zone. We’re at 100 miles out [of Washington], and our cost of business is lower,” says Wingfield.

He predicts that the emergence of a Washington super region won’t overshadow the distinctive business character of the localities within its borders. Baltimore will still be known for financial services, while Northern Virginia will retain its reputation for security and technology. “Richmond will still have its headquarters,” says Wingfield, noting that the area has a diverse economy. (The Richmond area expects to have nine companies on the Fortune 500 list next year with the recent relocation of Mead-Westvaco Corp. from Connecticut.)

Currently, about a third of the state’s 7.6 million residents live in Northern Virginia, and another million live in the Richmond area. Nonetheless, business officials don’t think that a combined Washington-Richmond region would dominate the state’s economy. Hugh Keogh, president and CEO of the Virginia Chamber of Commerce, points out that Virginia’s economy is remarkably varied. “It’s important to note that most of the Virginia economy is detached from Washington and defense-related activity,” says Keogh. “It would be wrong to say the balance of the state is going down the tubes and only Northern Virginia will survive.”

The micro view
As Washington and Richmond grow closer, an increasing number of workers might be tempted to follow the example of Charlie Kopitzke. She lives in Richmond but telecommutes for VIP Desk Inc., a customer service provider based in Alexandria. “I like Richmond,” she says. “The cost of living is lower. We can afford the price of our home in Richmond.”

Telecommuting already is growing in Northern Virginia in reaction to the area’s congested roads. The state government, in fact, has challenged its managers throughout the Old Dominion to find a way for 25 percent of eligible workers to work from home one or more days a week by 2009.

But Jeff Anderson, executive director of the Virginia Economic Development Partnership, says an increased emphasis on telecommuting in a Washington-Richmond region raises new questions. “Do we have the broadband to support people working at home? Do we have a complete strategy?” he asks.

For many workers in the region, however, commuting likely will remain a way of life, adding to its intensifying transportation problems. The Washington area already has one of the most congested traffic systems in the nation, with rush-hour travelers stuck in traffic an average of 69 hours over the course of the year, according to a national study by the Texas Transportation Institute.

Nonetheless, Willie Brown says he doesn’t mind the 37.4-mile commute from King George County to his job at UtiliQuest in Fairfax County. “They’re packing the homes so close [in Northern Virginia], you have no elbow room,” he says.

Some commuters looking for elbow room are considering Caroline County where a sign advertises “custom homes” from the $300,000s. “Most of our market is coming from Northern Virginia,” says the developer, William Beach of W.R.B. Homes of Ruther Glen.

New residents are looking for “an easier way of life,” he explains. They seek an easier mortgage, too. “We’re offering $75,000 to $150,000 difference in pricing,” he says, comparing his houses to similar homes in Northern Virginia. “That makes you think.”

In fact, in the four-month period that ended in April, Caroline County issued 67 building permits for single-family homes and King George County issued 96, according to U.S. Census Bureau figures. During the same four-month period in 2000, Caroline County issued just 38 permits and King George issued 44.

The uptick in residential growth has brought growing pains to the traditionally slower-paced counties. A combination of traffic jams and gas prices have forced Brown to curb social visits to the Washington area. At around 5 p.m. on a recent weekday, in fact, Caroline County looked like a Northern Virginia suburb, with bumper-to-bumper cars at the red light near a mammoth subdivision.

One possible solution to the growing transportation problem could be greater use of passenger rail. Already, an increasing number of commuters are using the Virginia Railway Express, which runs from Union Station to Fredericksburg and from Union Station to Broad Run Airport in Bristow. In 2005, the average number of daily riders on the Virginia Railway Express rose 5.1 percent to 15,086. “We have tentative plans to examine the potential to get to the Richmond market,” says Mark Roeber, manager of public affairs and government relations for the VRE. “We believe it is one [market] that would be well served. But we need to work with the commonwealth, along with CSX to make capital improvements to the track south of Spotsylvania in order to make that happen.”

The demand for high-speed rail is growing, says Nancy Finch, executive director of Virginians for High Speed Rail. “We are in serious need of leadership — national leadership and state leadership on the rail issue,” she says. “The public wants relief right now. That’s one of the complications with rail. It’s not an immediate tool. Fortunately, there is planning available in place. If sums were available it could happen quickly.”

But if the merger of the Washington and Richmond areas is inevitable, the frantic current pace of growth is not. Any number of factors ranging from oil prices to the federal deficit could slow the regional economy. The job growth experienced in the Washington area in recent years probably won’t be sustained, says McClain of George Mason. That means housing prices will stabilize. Already, the market has slowed in recent months in Northern Virginia. In May, 2,069 homes were sold, down 32 percent from the 3,045 homes in same month last year. “If we can get some transportation infrastructure built, we’ll get back to better times,” McClain says. “If we slow down, we might have time to catch up with some of these things that have not kept pace with the growth in jobs.”

There may be other shifts, too. While Tamera Stephenson has no plans to move from King George, she has thought about pursuing another employer. She enjoys her job in Woodbridge but easily could find work closer to home. “I love this entire environment,” she says, standing on the hill in front of her home. “This is my comfort level.”