Business news and intelligence for and about the Virginia business firstname.lastname@example.orgCopyright 20152015-07-29T08:44:00+00:00
Auto supplier to expand in Culpeper
http://www.virginiabusiness.com/news/article/auto-supplier-to-expand-in-culpeper#When:08:44:00ZAutomotive supplier Continental is planning a $49 million investment in its Culpeper County operation.
The investment is part of three-phase project to modernize the facility, designed to increase productivity and add the manufacturing capability of a new type of braking system.
Virginia competed against Mexico for the project, which could create up to 25 jobs.
Gov. Terry McAuliffe approved a $175,000 grant from the Commonwealth’s Opportunity Fund to help Culpeper with the project. McAuliffe also approved a $550,000 performance-based grant from the Virginia Investment Partnership Program, which is administered by the Virginia Economic Development Partnership.
Last August, Continental announced a $152 million investment in its Newport News operations, which was expected to create 500 new jobs.
“Thanks to the generous support of state and local officials, we are please to announce this intended investment,” Jeff Klei, president of Continental North America, said in a statement. “We remain dedicated to advancing technologies in our facilities and enhancing our manufacturing capabilities in North America."2015-07-29T08:44:00+00:00
Rubenstein Partners, Griffith Properties acquire Tysons office building for nearly $28 million
http://www.virginiabusiness.com/news/article/rubenstein-partners-griffith-properties-acquire-tysons-office-building-for#When:20:54:00ZAn office building in Tysons has been sold to two out-of-state real estate companies for $ 27.7 million.
Rubenstein Partners, along with its partner Griffith Properties, said Tuesday they purchased The Rappahannock Building at 1550 Westbranch Drive from Corporate Office Properties Trust, a Columbia, Md.-based REIT that specializes in office and data center properties.
The six-story, Class A office building is fully leased to The MITRE Corp. The company expects to move to its main Tysons campus in 2016. Once MITRE leaves the building, the property will be upgraded and reintroduced to the marketplace since MITRE has been the building's only tenant since it was developed in 2001.
The Rappahannock Building has approximately 152,000 square feet of rentable square feet.
CBRE’s Malcolm Schweiker represented Rubenstein/Griffith during the purchase and also will handle the leasing efforts.
Rubenstein Partners is a private real estate investment firm focused on directing and managing office real estate investments, primarily in the Eastern U.S.
Griffith Properties LLC invests in office, industrial, research and development and retail properties from Boston to Washington, D.C.2015-07-28T20:54:00+00:00
New bipartisan, statewide coalition calls for state incentives to boost regional cooperation
http://www.virginiabusiness.com/news/article/new-bipartisan-statewide-coalition-calls-for-state-incentives-to-boost-regi#When:19:47:00ZSpurred by a sense of urgency due to Virginia’s slow economic growth and recent fall in national business rankings, Virginia government officials, higher education leaders and business executives launched a campaign Tuesday that would use state incentives for regional collaboration to promote economic growth and job creation.
The program, GO Virginia, was announced by the Virginia Business Higher Education Council (VBHEC) and the Council on Virginia’s Future, in a series of events in Norfolk, Richmond, Danville and Blacksburg.
In Richmond, about 80 people turned out for a briefing led by Thomas F. Farrell II, the chairman, president, and CEO of Dominion Resources, and John O. “Dubby” Wynne, the retired president and CEO of Landmark Communications and chairman of the Hampton Roads Community Foundation.
“We are committed to building a broad, bipartisan, statewide coalition that will work to promote private-sector growth in each region and that will campaign for state incentives to encourage regional cooperation,” said Wynne.
He termed the initiative a “game-changing” idea that would provide a new framework for job creation to reverse what he called a “downward spiral.”
In recent years, Virginia’s economy has been hard hit by federal budget cuts to the Department of Defense, whose lucrative contracts have helped boost the state’s economy for years.
“We were shocked to see the drop in our rate of economic growth,” said Wynne. “When you see 48th among the states, we’re not used to that.”
Wynne was referring to the state’s virtually flat real GDP growth in 2014, which placed it 48th among the states, according to the U. S. Bureau of Economic Analysis.
In the years before that, the state’s GDP growth saw a 0.4 percent change in 2013, 0.7 percent in 2012 and 0.6 percent in 2011, with Virginia trailing the federal average all those years.
Virginia, the largest recipient of federal defense dollars, also has dropped in national rankings of best states for business.
In this year’s Chief Executive Best & Worst States for Business, Virginia ranked 14th, a drop of three spots since the 2014 list. The commonwealth came in No. 10 on Site Selection magazine’s annual list of the Top Ten State Business Climates and slipped from No. 1 to No. 4 on Forbes.com’s Best States for Business.
Wynne said the mission of the day was not to release specifics on the new approach but to begin to put in place a long-term structure that would lead to sustained economic success. “We are not talking about new taxes, increasing taxes, mandates or new layers of government,” he said.
In an interview later, Wynne and Farrell said one of the key premises of the model would be that localities with at least one collaborative partner would be able to apply for state-funded incentive grants for new job creation projects.
Asked where the money would come from, Wynne said, “A lot of the money is in there already,” referring to budget allocations for things like workforce development and economic development, that could be repurposed.
According to Mark Hubbard, a spokesman for GO Virginia group, members of the initiative plan to draft legislation for the 2016 General Assembly that would establish the financial resources to incentivize collaboration among regions on job-creation projects.
Gov. Terry McAuliffe, who has made jobs creation his chief priority, was on hand to throw his weight behind the initiative in Norfolk and Richmond. “I’m all in,” he said at the Richmond gathering. “It’s another tool in our tool box,” he said.
Citing Virginia’s past reliance on federal dollars, McAuliffe said “Maybe we didn’t hustle as much as we should have … The economy of the Virginia of old is over. We need to work together to take it to the next level.”
Virginia still has plenty of positives, added the governor, such as a 4.9 percent unemployment rate, a thriving state port and growth in new industries such as cybersecurity and data analytics.
“We need a partnership among business, education and community leaders, local officials and engaged Virginians in each region, all working together to capitalize on the distinctive assets and opportunities in their part of the commonwealth," he said.
Also supporting the effort were college presidents and high-ranking politicians from both sides of the aisle, including Senate President Pro Tempore Walter Stosch (R-Henrico County), House Majority Leader Kirk Cox (R-Colonial Heights) and Senate Democratic Caucus Leader Donald McEachin (D-Henrico County).
Teresa Sullivan, president of the University of Virginia, said, “We see great potential in this initiative, and we are glad to be a part of it.” She added there are many opportunities for collaboration with businesses on workforce development and research that is coming out research schools such as of U.Va.
GO Virginia identified five ways that state-funded incentives can boost private-sector growth:
Innovation. Innovation and growth in each region can be supported through startup grants for projects that promise substantial economic impact.
Investment. The state can encourage cooperation rather than competition among a region’s localities in recruiting new businesses by returning a portion of the state tax revenues generated by projects to regions where localities share economic development-related costs and revenues.
Improvement. Financial incentives for efficiency-enhancing and cost-saving collaboration among local governments, school divisions and higher education institutions are expected to improve performance and reduce pressures to increase the size and cost of government, freeing up tax dollars for opportunity-focused initiatives.
Invention. Inventions and discoveries leading to commercially viable products and services can be encouraged by the state by providing matching-fund support for labs, equipment, and other research-related needs.
Infrastructure. The state can invest in capital projects of regional or broader significance that will produce strong returns in private-sector growth, diversification and job creation through improved education and job-skills training, research, business site development, communications, and other vital infrastructure.2015-07-28T19:47:00+00:00
Reston-based FrontStream acquires BiddingForGood
http://www.virginiabusiness.com/news/article/reston-based-frontstream-acquires-biddingforgood#When:19:41:00ZReston-based FrontStream Holdings LLC, a philanthropy software provider, has acquired BiddingForGood, which is based in Cambridge, Mass.
Financial details of the deal were not disclosed.
FrontStream said BiddingForGood is a widely recognized platform for online auction and event management.
FrontStream said the transaction is the latest in a series of strategic moves made by the company in its effort to develop a comprehensive platform of fundraising and donation processing solutions for nonprofits and corporations.
The two companies provide support for campaigns for organizations in the nonprofit, corporate and educational fields.
“FrontStream has a demonstrated commitment to develop the world’s most diverse, innovative, and efficient suite of integrated tools serving the charitable and business sectors, and we realized some time ago that a single-point solution would never adequately meet that need; this expansion is part of our progression as a more wholistic provider.” Nina Vellayan, the president and CEO of FrontStream, said in a statement.2015-07-28T19:41:00+00:00http://www.virginiabusiness.com/uploads2/_MG_1374.pngMat Dellorso (left) and Fred Bryant laid the groundwork for WealthForge while they were college students. Photo by Jay Paul
Revolutionizing private securities
http://www.virginiabusiness.com/news/article/revolutionizing-private-securities#When:10:00:00ZIt’s not unusual for a business to start out of a college dorm room, but most don’t need to contend with one of its co-founders preparing to go to war just as the business is starting.
Co-founders Mat Dellorso and Fred Bryant started laying the groundwork for their online private securities trading platform, WealthForge, in 2009 when both were business students at the University of Richmond. As an ROTC member, Bryant already was committed to serve four years in the Army.
After graduating in 2010, he entered the Army in preparation for a six-month tour in Afghanistan in 2011. It was virtually the same time that WealthForge was getting off the ground.
“I had limited access to email and an Afghan mobile phone” in Afghanistan, recalls Bryant, a Long Island, N.Y., native who conceived the idea for WealthForge. He won a Bronze Star for his war service.
“It made for some interesting board calls,” says Dellorso, who originally was from Boston.
Fortunately, Bryant’s father was an investor and was able to take his son’s place on the board while he was overseas. After he came back stateside, Bryant worked for WealthForge part time around his Army duties until he returned to WealthForge full time last year.
Now WealthForge has 35 employees and operates out of Paragon Office Park in Henrico County. The company has closed almost $100 million in transactions and has about 50 clients, mostly from commercial real estate development firms (and a few residential developers) but also the technology, energy, agriculture and health-care sectors. It has hosted more than $1 billion in private investment opportunities.
In early May, Bryant and Dellorso won AOL co-founder Steve Case’s Rise of the Rest business competition in Richmond. The company beat out seven other Richmond-area companies to capture a $100,000 personal equity investment from Case in a “Shark Tank”-like pitch contest held at the Gottwald Playhouse at Richmond’s CenterStage.
Each company delivered a four-minute pitch for its business model and then was questioned for three minutes by a panel of judges. They included Case, now the chairman and CEO of Revolution, a Washington, D.C.-based investment firm; Tige Savage, Revolution’s co-founder; former U.S. Chief Technology Officer Aneesh Chopra, who now is co-founder and executive vice president of Hunch Analytics in Arlington; plus Ting Xu, founder and chairman of Evergreen Enterprises; Aaron Montgomery, founder and chief operating officer of CarLotz; and Eric Edwards, chief medical officer of Kaleo, all of Richmond.
“We’re very excited by the accolade of winning the event,” says Dellorso, noting that the press they’ve received has helped raise WealthForge’s profile “with institutional and local investors” as well as potential clients. While WealthForge already had raised about $3 million in capital in previous years, Case’s investment is special because “he’s sort of an idol to me and Fred,” Dellorso says. “He took networking, the ability to communicate, from the real world to the online world with AOL.”
Case’s successful mission to get the vast majority of the nation online was “transformative,” says Dellorso, and “we’re doing something similar in a different sector. We’re getting people who complete private securities transactions in the real world to do that online. [Case’s] successes are sort of a model for Fred and I … We look forward to his help and feedback in the future.”
Dellorso refers to WealthForge as “the PayPal for processing private transactions.” WealthForge provides the technology for developers and startup companies to accept capital from investors and allows them to complete online transactions in compliance with U.S. Securities and Exchange Commission regulations without a lot of paperwork involving broker dealers and lawyers, he says.
WealthForge charges companies a base fee for access to the technology and then charges 100 basis points of the total capital raised. WealthForge also acts as a “virtual back office” and online platform for other financial firms, such as San Francisco-based Access Investors Network. It announced in late May that it will be using WealthForge’s services for its members.
In WealthForge’s Rise of the Rest pitch, Dellorso noted that the private securities business had not changed fundamentally since passage of the federal Securities Act of 1933 — until WealthForge became one of the first to take transactions online. “People can complete securities transactions with better efficiency, more transparency and better compliance online,” he says. “We give them the tools to leverage the Internet to complete their private capital raises and to invest in private securities. … In 10 years we believe almost all private securities transactions are going to happen online.”
Bryant and Dellorso “are so impressive. Their passion really shows through, and it’s really impressive what they’re building. They’re very smart; they’ve thought about every angle of this,” says Herbie Ziskend, director of the Rise of the Rest competition at Revolution, which also provides technical assistance and business advice to competition winners, such as WealthForge.
After the contest, Case said that WealthForge’s “momentum and traction” were leading factors in the panel’s decision to award the $100,000 investment to Dellorso and Bryant.
Ziskend echoes that, saying Case was pleased that “their volume was already pretty significant” and WealthForge also had proven its business model works. In particular, he says, WealthForge is primed to take advantage of equity crowdfunding by small businesses when that provision of the federal JOBS Act moves forward. (At present the SEC has delayed writing regulations to allow the practice.)
So far Case has brought his Rise of the Rest competition to 14 cities, awarding $100,000 to one local company in each location. To be considered, companies fill out extensive applications and create pitch videos. (“There’s a lot of homework before they get on the stage,” Ziskend says.) The competition aims to encourage nationwide entrepreneurship outside of traditional business centers such as New York and Silicon Valley.
Bryant and Dellorso plan to use Case’s investment to add 10 more staff members (mostly in sales and marketing) and to move into a larger office space in one of Richmond’s hot entrepreneurial districts such as Scott’s Addition or Shockoe Slip.
“We’re in growth mode,” Dellorso says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/PresidentTrible.pngCNU has undergone $1 billion in capital construction during Paul Trible’s tenure as president. Photos courtesy CNU
On a fast track
http://www.virginiabusiness.com/news/article/on-a-fast-track#When:10:00:00ZEditor’s note: This is a part of an ongoing series looking at Virginia’s colleges and universities as economic engines.
When Paul Trible became president of Christopher Newport University in 1996, the university was viewed as a commuter school, with most students driving to and from class each day without lingering on the Newport News campus.
Trible immediately set out to change the school’s direction in a bid to make Christopher Newport one of the nation’s pre-eminent, public, liberal-arts universities. Upgrades were made in academic programs and facilities. Dorm space was increased to encourage a larger residential student population, with the school requiring all freshmen, sophomores and juniors to live on campus. Civic involvement also was encouraged as CNU expanded its reach beyond its 260-acre campus.
The university has undergone $1 billion in capital construction since 1996, increased full-time faculty from 166 to nearly 300 and expanded enrollment from 3,500 to 5,200 students, with nearly 4,000 living on campus. CNU’s budget also has grown significantly, from $33 million in 1996 to almost $145 million for the 2015 fiscal year, a 339 percent increase.
“No school has come so far so quickly,” Trible says. “We rejected the notion of incremental progress.” Indeed, 55 years after Christopher Newport College’s beginnings as a two-year branch of the College of William and Mary, the school is making a mark not only on the Peninsula but throughout
Hampton Roads and the commonwealth. In May, the university graduated the largest class — more than 1,200 students — in its history. CNU, as Trible states emphatically, has undergone a “dramatic transformation.”
U.S. News and World Report ranks CNU 17th among regional universities in the South and seventh among public regional universities in the South. In addition, Forbes magazine placed CNU among the top 20 colleges for minorities in STEM fields (science, technology, engineering and mathematics), while the Princeton Review named it one of the country’s best institutions for undergraduate education. CNU is also the nation’s only public institution to receive a perfect “A” from the American Council of Trustees and Alumni based on the strength of the school’s curriculum.
With more than 80 areas of study, CNU focuses on undergraduate education. “We see our role as positioning and preparing students to go off to great graduate programs,” Trible says, adding that the school does offer three, five-year master’s degree programs — in education, environmental sciences, and applied physics and computer sciences. He notes that the overwhelming number of newly minted teachers — who receive bachelor’s and master’s degrees or teaching certification through the program — opt to remain in Hampton Roads.
While remaining dedicated to its liberal-arts emphasis, the university has strengthened its programs in the sciences, with nearly 30 percent of graduates receiving degrees in STEM disciplines. Student demand led CNU to launch a bachelor’s degree in electrical engineering last fall. “Virginia has a shortfall in the number of electrical engineers,” Trible says. “To that end, we saw this as an opportunity to help Virginia meet an important requirement.”
Also last year, CNU began the most ambitious fundraising campaign in its history, seeking to raise $50 million by June 2017. The Defining Significance comprehensive campaign focuses on support for scholarships, faculty and an alumni house. The time is right to undertake such a monumental campaign, Trible says. “We have the students, faculty and a campus that marries Georgian architecture with 21st-century technology,” he adds. “The one thing we need to add is a strong financial foundation.”
The campaign comes on the heels of expansive gifts from plumbing supplier Ferguson Enterprises, which in 2013 pledged $12 million to CNU over the next three decades. The largest gift in the school’s history, the funds will be used to support operation at the Ferguson Center for the Arts, as well as to create scholarships for students in music, theater and dance and to support the university’s Center for Community Engagement. In addition, Smithfield Foods has contributed $10 million during the past decade. The university’s endowment currently stands at about $24.3 million.
Centers for the arts
The Ferguson Center is perhaps the most public sign of the university’s transformation. Designed by renowned architect I.M. Pei, the $70 million facility features a 1,700-seat concert hall and a 500-seat theater. Since opening in 2005, the center has hosted more than 2 million patrons, with more than 70 performances each season, including Broadway plays, symphonies and ballets. “It’s world-class in every respect,” Trible says. “There is nothing like it in Virginia.”
He adds that until the Ferguson Center opened, the Peninsula was the only community of its size in the country without a regional performing arts center. By all accounts the facility has paid off, with patrons spending more than $97 million during the past decade and 3,100 jobs being created. In addition, more than 23,500 performers and support crew have spent $3.8 million for more than 32,000 hotel nights on the Peninsula and $1.2 million on meals.
CNU also plans to build a new visual arts center, following its recent merger with the Peninsula Fine Arts Center, as well as an addition to the university library. The General Assembly has approved the design phase for both capital projects.
Beyond campus facilities, the university is focusing on producing leaders and citizens who can impact Hampton Roads and beyond. Students are encouraged and expected to perform community service. “Service is important,” Trible says. “We are all about leadership, honor and civic engagement.”
Students often parlay their coursework into avenues for assisting local businesses and other agencies. For example, students enrolled in the university’s four-year Bonner Service Scholars program serve 1,200 hours on local site-based teams working on a range of issues, including poverty, homelessness, immigration and projects to reduce high-school dropout rates. “We are not turning a blind eye to the challenges people face,” says Brad Brewer, who directs the Bonner Service Scholars. “We’re training our students to become lifelong active citizens and engage people very different from themselves and listen to different perspectives. While they’re doing that, they are having an enormous impact on the people they serve.”
Brewer also heads CNU’s Center for Community Engagement, which annually funds up to 30 Ferguson Fellowships for Social Entrepreneurs. Working with faculty members, students receive a $1,000 stipend to research a community need, design a plan to address the problem in a new way and implement the plan. Brewer estimates that 148,000 hours of CNU volunteer work has a value of about $3.4 million in the community. “In the long run, it’s a question of whether our community will be known as a healthy, vibrant community with youth and energy and a long-term economic impact,” he says.
Assisting small companies
Strengthening the region’s economy is the focus of CNU’s Small Business Institute, which has provided free assistance to small companies in Hampton Roads for more than two decades. Senior business students spend a semester developing business and marketing plans, conducting market research studies, performing accounting, operational and business systems analysis, and guiding firms through the social-media maze. “The traditional business school curriculum tends to focus on large public corporations, but 84 percent of the world’s businesses are small or entrepreneurial,” says William Donaldson, the institute’s director. “This program gives our students exposure to the real world for life after academia, and is our way of giving back to the community.”
Forty-five to 60 students enrolled in a class on small and family business and entrepreneurship work with five or six companies each semester. Recent projects have included conducting a food optimization and plate cost study for a local restaurant and completing an inventory analysis for a NASA researcher who developed a test to detect cancer. A faculty member oversees each team, but the students are essentially in charge. “It’s really their show,” Donaldson says. “They’re the professional consultants who decide what hours they work.” Donaldson doesn’t attach a dollar value to the students’ efforts, but he believes firms have benefitted. “We have good anecdotal evidence. Clients rave about the experience they’ve had.”
Such praise reinforces the mission of CNU’s Luter School of Business, which has purposefully remained an undergraduate program, accepting about 130 students annually. Earlier this year, the school was reaccredited by the Association to Advance Collegiate Schools of Business International in an especially strenuous process for schools offering only undergraduate business degrees. “Only four percent of business schools are strictly for undergraduates,” says Pamela Pringle, the school’s assistant director. “We are very student-focused, with small classes and lots of hand-on team projects.”
Accounting students gain hands-on experience through a voluntary income tax assistance program in which they help more than 200 low- and moderate-income taxpayers prepare their returns. This year, 20 students volunteered more than 600 hours under the supervision of an accounting faculty member to prepare and file returns.
While Christopher Newport strives to be among the top American universities, its mission remains centered in Virginia. “We believe our job is to educate the sons and daughters of Virginia first and foremost,” Trible says, noting that 90 percent of the university’s students are from the Old Dominion.
But no matter where they go upon leaving CNU, Trible says, students will spread the university’s name and reputation. “The key to our success is students come here and fall in love with this place and share that passion with their friends, neighbors and parents,” he says.
2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Kaplan9843.pngRon Kaplan. Photo by Mark Rhodes
http://www.virginiabusiness.com/news/article/trekking-on#When:10:00:00ZIn 2008, Winchester-based Trex Co. Inc. was in bad shape.
“There were a lot of sharks circling,” says Ron Kaplan, the company’s CEO who was brought in at that time to save Trex, which was plagued by debt, product recalls and lawsuits.
Today, things are looking up for the manufacturer of wood-alternative decking, railing, fencing and trim. The company now is debt-free and profitable. Compared with the same quarter last year, net sales during the first quarter of 2015 were up 20 percent to $121 million, while earnings per share rose 50 percent to 55 cents.
Trex has moved from exporting to a handful of countries to more than 43 today. It also has entered a new industry, making pellets out of recycled plastic and selling them to manufacturers. “That’s why our stock price is up,” Kaplan says. “Rather than buying someone else’s problem, we’ll just invent our way out. American engineers are the best in the world.”
Trex also is getting ready to embark on a new journey, as Kaplan is retiring as CEO in August, passing the torch to James Cline, who has been the company’s CFO. But why step down now, when the company is doing well? For Kaplan, the answer is simple.
“The primary reason is: I’ve done what I’ve been asked to do,” he says. “I was asked to turn the company around. And we’ve done that.”
Kaplan will still play a big role at Trex, serving as its chairman. He says he’s interested in serving on some other corporate boards when he retires. Beyond that, he’s not sure what retirement will bring, but he has a home in Stephens City and a condo in Washington, D.C.; belongs to four gun clubs and a country club; and owns a “beautiful” convertible.
“If I can’t figure out what to do, I’ve got problems,” he says.
Virginia Business interviewed Kaplan at Trex’s headquarters in Winchester, where he discussed the company’s turnaround, its growth and more.
Virginia Business: [What was Trex like when you arrived and what is it like today?]
Kaplan: Well, the company always had a great brand and great distribution, but its operations, financial affairs, quality control were all in a state of disarray and somewhat chaotic. There were a lot of sharks circling. A lot of litigation, product recalls and so on. Now it’s a finely tuned disciplined organization. It is profitable. It is debt-free. It has an expanding market share. It’s the number one producer in the United States, and we’re exporting around the world. So, we went from being highly leveraged to become debt-free, from being unprofitable to being profitable, from being an undisciplined to a highly disciplined organization.
VB: I understand when you came here, you knew the company was in trouble, but [it was] actually on the verge of bankruptcy, and you … found that out later.
Kaplan: That’s right. … I found they were in violation of bank covenants on my second day on the job. And so ... it caused us to act fairly aggressively to reduce our costs and straighten out a lot of things. But it was a little more exciting than I bargained for.
VB: What was your reaction when you found that out?
Kaplan: Somewhere between shock and horror and dismay. But it caused me … to be galvanized in action. I was able to recruit some very, very good people to help me out of the situation. And a lot of cooperation from the bank. BB&T did a great job and stood by us. We started converting inventory into cash, and we changed the compensation systems, reduced the overhead and changed the basic manufacturing methodology to ensure our survival.
VB: One of the first people you brought on was James Cline, right?
VB: So, why did you think he could help turn around the company?
Kaplan: Well, because he’d helped me before. Jim and I have worked together now for over 20 years. We had worked together for well over a decade prior to coming to Trex. I knew what his background was. He’s a CFO with operations in his bone marrow. He understands when he walks through a factory what to look for, and he knows the numbers. And he’s loyal, and he’s hard working. I knew he could do the job. I was very fortunate to be able to recruit him. As luck would have it, he’s now my successor.
VB: Why do you feel now is the right time to retire?
Kaplan: Well, that’s a good question. There’s a number of factors that come into play. But the primary reason is: I’ve done what I’ve been asked to do. I was asked to turn the company around, and we’ve done that. And I said the company’s profitable. It’s debt-free. It’s had a record year, followed by a record quarter. Things are going well. The staff is in excellent shape, and the sign of a good CEO, in my view, is to become superfluous. Everybody here knows what to do. They don’t need me anymore, frankly, which is a compliment to them. And the shareholders are thrilled to death. … [Of the companies in] the Russell 2000 stock index in terms of total return to shareholders since I’ve been CEO, we’re No. 6 in the whole United States. Our stock is up 1,200 percent. That’s almost without precedent, and so there couldn’t be a better time to go. Stock is high. Profits are good. The backlog is full. All systems go. Staff is ready. Got a successor in place. You couldn’t have a textbook design of a better succession plan than the one we’ve implemented. Didn’t have to bring in anybody from the outside.
VB: [What was the key to Trex’s turnaround?]
Kaplan: Well, the Trex situation was so dire that we couldn’t afford the luxury of ready, aim, fire. We had to just go ready, fire. We couldn’t agonize or wring our hands about any one decision ... One of the things we [did], was we overhauled the compensation system. We made it so that management and the rank and file were all in the same bonus pool. If one guy doesn’t make money, nobody makes money. If the company makes money, we all make money. Getting everybody in the same bonus pool had a tremendous effect on morale and motivation. My secretary gets paid on the same basis that I do. That was critical to our success.
After that … we brought some 21st-century manufacturing science to the table. Suave readers read about the demise of American manufacturing. Well, the three top guys, we’re all the same age, we’ve all been in manufacturing for over 40 years. Manufacturing is not dead, and we’re going to prove it by making product that we would ship around the world and put Americans to work instead of somebody else.
VB: A lot of people may not know that you’re a Certified Public Accountant.
Kaplan: Oh, we don’t spread that around too much.
VB: What drew you to the management side of the corporate world?
Kaplan: Well … if you want to get ahead in corporate life, you’ve got to be flexible. I envisioned my life being in finance, and I was working in Pennsylvania for a large corporation. I was in a division as a controller, and it wasn’t doing very well. I never thought about doing anything other than accounting. That’s what I was trained to do. But one day the chairman walked in.
He fired my boss. He looked at me and he said, “You want to be general manager?” So having survival instincts, I said, “Sure.” And the next day I found myself in charge of a forge, a hot-metal forge that extruded high-pressure cylinders. And so, a lot of it is by accident.
I never really went back to finance … A lot of career actions are based on luck. Any guy who tells you they’re not is full of baloney. Being at the right place at the right time with the right skill set. So I’m glad I did it, and [it] seems like yesterday.
VB: Reflecting back over your career, what are you most proud of and do you have any regrets?
Kaplan: My mother wanted me to be a doctor, but I don’t have any regrets. She’s got a regret: She wanted a doctor … I think it worked out pretty good. I didn’t do bad for a kid from Buffalo, N.Y.
VB: And what are you most proud of?
Kaplan: The fact that I’ve been employed for 40 years. That’s an accomplishment in itself.
VB: How would you describe your management style?
Kaplan: Depends on the situation you’re in. It can be collegial or it can be like Attila the Hun. Depends on the environment. But basically you’ve got to be … like a chameleon. You’ve got to have a wide range of emotion. Got to be able to go from euphoric to hostile in a very short period of time. You’ve got to be subservient. You’ve got to be aggressive. All in the same day. Going from department to department … I learned that management style from my parents.
… They could argue with each other. My mother could yell. My father could yell. My mother could throw things. My father could throw things. My mother could curse. My father could curse. But when all was said and done, my mother had one weapon my father didn’t have. She could cry. It was game over. I realized a person who has one more emotion, won. So you find that most CEOs have a wide range of emotion. They can tell jokes, and they can be as hard as nails. So I can pat somebody on the back at 9 o’clock and fire somebody else at 9:30. Got to be able to do it all.
VB: What direction do you see Trex going in the future? Do you see a certain area of growth?
Kaplan: Well, we’ve announced recently in the last few months that we’ve entered a new industry. Trex has only been known as making decking and railing. We have figured out a way of taking our basic skill set of extrusion and recycling and taking recycled polyethylene [plastic] and turning it into a pellet …
So, the point is, we’re no longer just making outdoor decks. Now we’re making specialty materials … We’ve quietly assembled a very large group of really high-standard, highly intelligent, well-educated, young, progressive engineers. And we’ve got them in a [research and development] center, which is secret … But we decided rather than making our future based on financial engineering and mergers and acquisition, that we would make our future based on picking ourselves up by the technical bootstraps and inventing our way out of it. …
VB: You’re making things beyond the … pellets is what you’re saying?
Kaplan: Yeah, we’re working on things we’re not going to discuss yet. We’re not quite ready. But when we’re ready, we’ll announce it.
VB: What do you think are some of the biggest challenges the company is facing?
Kaplan: Well, I worry about things that we have no control over. For example, Greek bank defaults … Middle Eastern wars. High gas prices. Anything that’s going to upset the American consumer is something I worry about. Nobody needs a Trex deck. It’s a luxury item. So, if people figure they’re going to lose their job or have more of their money being spent on gasoline, that’s less money available for vacation, a second car or a Trex deck. Those are the challenges. Make sure the economy stays in a growth mode. People have got money in their pocket and feel good about the future.
VB: [Is recruiting workers to Winchester an issue?]
Kaplan: No. We don’t have any trouble getting people to Winchester. It’s tough getting them out once they get here. But there was a time when Trex was thinking about moving to the Dulles Airport area. That was a disaster. Like 70 people quit their jobs because they thought they were going to have to drive to Dulles Airport. That was before my time. But I’d heard about. So it’s a great workforce. I couldn’t be more proud of the situation which it finds itself. Trex and the Shenandoah Valley.
VB: [Why did you leave your old job for Trex?]
Kaplan: Well, I had a good job. I was … CEO of Continental Global, making mining equipment …As a matter of fact, here’s a picture of my house in Pennsylvania, and just by coincidence I had a Trex deck long before I ever heard of Trex. Before they called me. That’s why I put the photograph up there because it proved I had a Trex deck. But it [gave me a] chance to be in consumer products which is very interesting if you’ve spent your whole life in manufacturing and industrial to be able to put together TV commercials and brands … Plus, I knew it was a turnaround situation. The stock had gone from $50 to $6. So, I knew there was a chance to make a lot of money, to be quite frank about it. Plus, the big factor was all the plants were in the United States. I had sort of gotten tired of those 17-hour flights to Malaysia and China and everywhere else.
VB: What do you do to relax?
Kaplan: I do a lot of shooting sports. I shoot trap and target shooting and I hunt groundhogs. I love to hunt groundhogs … and I play a little tennis. I take long, long walks through Winchester and the countryside. Every day at lunch time I take about a 4-mile walk. And I drive my convertible. I’ve got a fire engine red … Mercedes convertible. It’s a great part of the country just to drive in. Lot more satisfying than playing golf.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/DSC_2389.pngMark Douglas thrives on complex deals.Photo by Rick DeBerry
http://www.virginiabusiness.com/news/article/thalhimer-team#When:10:00:00ZMark Douglas and Eric Robison of Cushman & Wakefield|Thalhimer were driving forces behind some of the biggest commercial real estate deals in Central Virginia last year. Both won two top honors at the Greater Richmond Association for Commercial Real Estate’s 14th Annual Awards ceremony this spring.
Douglas was recognized for best sale transaction/retail for the $130 million West Broad Marketplace assemblage and also with Austin Newman for the 168,500-square-foot, 10-year lease of Deep Run 3 to McKesson Medical-Surgical.
Robison received honors for best sale transaction/office for his work on the $40.6 million sale of the Highwoods suburban office portfolio and with Evan Magrill on the $31.2 million sale of a 502,395-square-foot industrial portfolio, known as the Enterchange in Hanover County and Colonial Heights.
So, how do they get big deals done?
Douglas, a senior vice president with Thalhimer, is a self-described “people” person. At the mall, he “loves watching people,” a trait that serves him well. “This business is very much a people business,” he says.
While focusing mainly on office brokerage, he often works with retail and land sales, too. He’s the first to admit that his work can be extremely challenging. Not only is commercial real estate ever changing but “you don’t make every deal,” he says.
Douglas’ biggest transaction last year — with a $34 million lease value — was the long-term office lease to McKesson Medical-Surgical. The company plans to relocate and expand its headquarters to the building, located off Mayland Drive in Henrico County. The move is expected to create 225 jobs.
Deep Run 3 was part of the former headquarters complex for the now defunct Circuit City Stores.
Asked about his most challenging deal, Douglas points to the complex assemblage of West Broad Marketplace. The 61-acre property now under construction on West Broad Street in the Short Pump corridor of Henrico had seven parcels and multiple owners within those parcels. That meant Douglas had to shuffle different landowners with different personalities. “You become a chameleon … and think on your feet,” he says.
No one was more impressed with Douglas’ work than West Broad Marketplace developer Jack Waghorn, president of NV Retail in Vienna. “Mark knows the Richmond market inside and out. He is one of the most professional brokers I have ever had the pleasure to work with,” he says. “His true strength is that he is a consummate communicator. He addresses issues and problems before they occur.”
One of the most unique aspects of the deal involved a parcel owned by a partnership. One of the three owners lived in a remote area of Costa Rica. “We were able to email her documents because it was more than a three-hour drive for her to get to the post office,” Douglas says.
The woman didn’t have a printer at home. “We had her take pictures of the signature pages of the contracts and amendments,” says Douglas, and then the woman posted her signature on Facebook on a secure page that wasn’t available to the public.
Altogether, he spent 22 months putting the transaction together. “One person not participating in that assemblage could have blown up the whole thing, but everybody was fantastic.”
Douglas says retail development is “on fire” now, especially heading out to Short Pump and Route 288. “We are going to run out of tenants,” he says, with development outpacing the number of retailers who want space.
Despite the complications, Douglas, 53, enjoys real estate. “It’s the thrill of victory, of making the deal,” he says. “And I have to put my four daughters through college.”
Growing up, Robison, 40, always participated in sports, playing soccer and basketball in high school. He relished the excitement and competitive nature of the game. He finds the same qualities in commercial real estate. “I wasn’t going to make it as a professional athlete, and this is the closest thing to sports that I have found. We do this as a team, and that appeals to me.”
As senior vice president of Capital Markets Group, Robison focuses on selling investment properties. He likens his work to a roller coaster. “You never want to get too high or too low. You have the opportunity to win some really big, exciting deals and sometimes you lose them,” he says. “You have to stay somewhat even keeled to be successful.”
Michael Pruitt of Pruitt Associates in Henrico says Robison is client-focused. “I think Eric is hands down one of the best brokers in the business,” he says. “He’s a man of great character, and he is very hard working. He understands and has thorough knowledge of the market he works in.”
Robison’s largest deal in 2014 was the disposition of 11 suburban office buildings in the Highwoods Property Trust in and around the Innsbrook Corporate Center in Henrico. “Highwoods was a great property to sell and a great client. We got a lot of interest,” he says.
Yet a deal for the sale of the 12-story Mutual Building, a historic property in downtown Richmond, turned out to be the most challenging. When he began working on the sale, the building had a tenant, the Christian Barton law firm, that occupied the top four floors. The buyer wanted to develop the property into apartments, but the tenant did not want to leave.
“The buyer couldn’t pass up owning the building because of the potential it had,” Robison says. “He was willing to take on the risk of taking the tenant through the lease term (Christian Barton is still there) and then develop the apartments or find an alternative after the lease was up.”
He believes that business investment sales will continue to be strong even if there are minor increases in interest rates. “Even though our market size is a little smaller and not as deep as Washington, D.C., Charlotte or Raleigh, more investors are looking at our market,” says Robison.
He enjoys bringing in new investors from other parts of the country that might not have Richmond on their radar. “It’s great to have them invest for the first time and see them be successful afterward.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Turok0309.pngVivian Turok leased about 500,000 sq. ft. of space last year for Divaris Real Estate in Hampton Roads. Photo by Mark Rhodes
http://www.virginiabusiness.com/news/article/stay-tenacious#When:10:00:00ZVivian Turok hadn’t been on her public relations job long at Divaris Real Estate Inc. when Chairman Gerald Divaris asked for a favor. He had a conflict and couldn’t show a property. Could Turok do it? To sweeten the deal, he mentioned that she could receive 25 percent of the commission if the prospective tenant leased the space.
From that moment on, Turok was sold. “When the opportunity to show the space for Gerald and earn six times my monthly salary from one commission came along, I knew that was my kind of career,” she recalls of her foray into brokering deals. More than 38 years later, Turok is Divaris’ longest-standing employee and was its top producer last year, leasing approximately 500,000 square feet of space.
She also is one of Hampton Roads’ leading commercial real estate brokers. The Commercial Alliance, a council within the Hampton Roads Realtors Association, gave her the Platinum Commercial Sales and Leasing Achievement Award as one of southeastern Virginia’s top five grossing agents for 2014.
She also received the honor in 2009, becoming the first Hampton Roads woman to attain the Platinum Award level.
A senior vice president and member of Divaris’ Virginia Beach/Southside office team, Turok represents landlords and tenants in office leases. “The key is bringing the needs of both the tenant and the landlord into alignment,” she says. “What I try to do in all my transactions is to analyze the tenants’ long-term goals and objectives so as to enhance their business plan.”
That process played out last year when Turok and her team represented Armada Hoffler Properties in negotiations with USI Insurance for more than 19,000 square feet of office space in Town Center. The deal included a complete modification of the building’s electrical system and plumbing, additional lighting and signage and an extension of the entire front façade. USI kept its corporate office in Norfolk but brought 150 employees to Town Center. “Our team worked so long to find a tenant,” Turok notes. “Town Center is ideal for their needs. Both Norfolk and Virginia Beach scored on this deal.”
A native of South Africa, Turok graduated from the University of Cape Town. Faced with limited job prospects due to the nation’s poor economy, she readily agreed to a three-month trial doing public relations for Divaris Real Estate in Cape Town, a company co-founded by Zimbabwe natives Michael and
Gerald Divaris in 1974. Turok followed her husband, an architect, to Virginia Beach in 1986, where she began work in Divaris’ first U.S. office. “I’ve had the good fortune to work with two great mentors in Gerald and Michael Divaris,” she says. “They saw potential in me in South Africa.”
These days, Turok offers similar encouragement to colleagues entering the business. “When I mentor young people, I always tell them my principles,” she notes. “Life is a journey with its ups and downs, its challenges, its successes, and one should stay tenacious and focus on one’s goals. To try to be perfect is unrealistic, but what is important is to be true to oneself.”
As she closes in on 40 years with Divaris, Turok has no plans to slow down. “I really enjoy what I do,” she says. “I have a passion for this business and love helping companies continue to be successful.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Christopher0298.pngLou Christopher was the lead broker on a deal that kept the Corporate Executive Board in NoVA. Photo by Mark Rhodes
The “senior” guy
http://www.virginiabusiness.com/news/article/the-senior-guy#When:10:00:00Z“Many times, when you bring in a senior guy, it can be risky.” Those were the thoughts of John Germano, executive managing director of the mid-Atlantic region for CBRE, a commercial real estate services giant, before he hired Lou Christopher.
Seasoned hires sometimes put their personal advancement ahead of “the brand,” he says, but not Christopher, who was named Virginia Leasing Agent of the Year in 2014 by the Commercial Real Estate Brokerage Association of Greater Washington (CREBA). A multifaceted headquarters deal that
Christopher negotiated for CBRE in 2014 further earned the association’s vote as the region’s best leasing transaction that year.
Christopher came to CBRE in 2012 from Cushman & Wakefield Inc. with 25-plus years of experience and a reputation as a top producer. “From the day he walked in, Lou had a strategic perspective,” Germano says. “He has been transformational.”
Christopher, now a CBRE vice chairman, demonstrated his worth when he became the point man in finding a new corporate headquarters for the Corporate Executive Board (CEB), a best-practices consulting firm. CEB had been leasing offices in two locations in Rosslyn and wanted to consolidate under one roof. It was considering moving out of state, which would have meant a loss of 1,300 jobs to the NoVA economy,” says Christopher.
Under his guidance, CBRE did labor studies, worked with economic development groups and helped secure almost $10 million in incentives from Virginia, which persuaded CEB to stay in Arlington County and invest $150 million for a new headquarters operation.
The broker also worked with JBG on customizing space for his client in an office tower JBG is constructing in Rosslyn. When that 31-story, 525,000-square-foot building delivers in 2018, CEB will occupy 350,000 square feet or 15 floors of it. The building will be called the CEB Tower.
“It was as complicated as a deal can get,” Germano says. Christopher is “the ultimate professional,” says Paul Adkins, who represented JBG in the negotiations. “He is one of the few brokers who could manage such a complex transaction.”
Being able to customize space to fit CEB’s needs before the lease was signed was critical to the deal, says Christopher. For instance, younger workers, now in the majority at CEB, prefer a collaborative environment. The need for small meeting rooms has grown, notes Christopher, while the need for assigned offices has shrunk.
Work tools also have become so portable that only 50 to 60 percent of employees are in the office on any given day. When they are on site, strategies such as “free address” (unassigned work areas) have reduced the footage each worker needs from about 230 square feet 15 years ago to about 165 square feet today, he adds.
Technology also has transformed Christopher’s ability to manage multimarket clients, but at the price of making his job an almost 24-7 proposition.
“I’m always working — from getting up, to going to bed,” he admits. Yet, he’s still able to spend time boating and skiing with his wife and three children. “I just take a break from my outings to help a client,” he says.
While such dedication has been essential to his success, just as important has been that he is “good to work with,” says his boss. “You can’t have a thin skin around him,” Germano explains. “But he is very self-aware of his shortcomings, and people gravitate toward him.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/DSC_7473.pngMatt Huff, left, and Dennis Cronk of Poe & Cronk Real Estate Group in Roanoke. Photo by Don Petersen
‘Experience and energy’
http://www.virginiabusiness.com/news/article/experience-and-energy#When:10:00:00ZHe’s a real estate stalwart, a 41-year veteran of the business. His name is known throughout the Roanoke Valley where he has been highly visible, serving on many boards.
His protégé and business partner is a self-described spreadsheet junkie with a creative side. He thrives on crafting marketing plans and crunching data.
Thirty-four years separate this real estate broker duo. But a generational divide isn’t stopping them from taking on some of the Roanoke Valley’s highest profile commercial real estate projects. Dennis Cronk and Matt Huff are building a reputation in Southwest Virginia’s real estate community as a formidable team.
“Quite frankly, after working close together, he sometimes knows exactly what I’m going to say before I say it,” Cronk says. “We feed off of each other.”
Cronk, 64, co-founded downtown Roanoke based Poe & Cronk Real Estate Group in 1987. He has a slew of real estate achievements under his belt. Cronk has served as president for both the National Association of Realtors and the Virginia Association of Realtors and was inducted into the Hall of Fame of both of these organizations.
Huff, 30, joined Poe & Cronk in 2008, coming directly from the investments department at Shenandoah Life, a Roanoke insurance company. “I emailed over to the firm out of the blue,” says Huff, a Virginia Tech graduate with a degree in finance. “They didn’t know me. I didn’t know them. I just saw Poe & Cronk signs everywhere.”
His go-getter spirit impressed Cronk, who wanted to attract younger real estate agents to the firm. “It’s an industry that’s really difficult to attract young people, because it doesn’t necessarily provide you the needed security of a salaried position,” Cronk says. “You’re really working on commission, so therefore the risk is high.”
Huff caught onto the business quickly. Before long, Cronk came to Huff with their first team project, and “we really clicked right away,” says Huff.
Since then, the pair’s joint portfolio has grown to more than $100 million, encountering success stories and challenges along the way. About half of their transactions occur together, and they may juggle as many as 20 projects at one time.
In 2013, they worked on a deal that represented the largest single manufacturing investment in Roanoke County. Cronk received a phone call from a company that was eyeing a 640,000-square-foot facility on Hollins Road that previously housed Hanover Direct, a mail order distribution center.
Cronk and Huff, both representing the property seller, worked with Jill Loope, Roanoke County’s economic development director, to advertise the site nationally and globally. Huff was the boots-on-the-ground broker who showed the building to potential buyers. Cronk handled the negotiations.
Loope calls the pair’s teamwork a “blend of experience and energy.” She describes Huff and Cronk as a duo that jumps into a project quickly and with strong effort, taking on multiple tasks at the same time. Huff packaged data to create marketing brochures and materials, while Cronk took on a macro-level role with deal structuring and contracting.
“They work well together,” Loope says. “What I appreciate about them is they value the relationship with local government, and it works successfully.”
The sale turned competitive when two bidders emerged. Ultimately, Ardagh Group, a Luxembourg-based manufacturer of packaging materials for food, beverage and consumer care brands, purchased the facility for $14.5 million, more than its $12.8 million listing price. The company invested $93.5 million, including $80 million for equipment and renovations, and last November opened the plant, which employs about 100 workers.
Another challenging project was the 2014 sale of the former Huff Lane Elementary School in Roanoke to a developer who plans a restaurant and eventually two hotels at the site. The area is adjacent to Valley View Mall, a high traffic retail center.
Despite opposition from neighborhood residents, Roanoke City Council voted to rezone the school property for commercial use. Huff and Cronk, along with others, made numerous concessions to pave the project’s way. For instance, to reduce the height of the five-story hotels from 60 feet to 54 feet, the builder was able to cut into the dirt at the site, lowering the structure.
To get the deal done, Huff worked with the developer, NDRA II LLC, an affiliate of HMP Properties of Williamsburg, for about 2½ years while Cronk attended neighborhood meetings and consulted with city officials. The development is projected to generate more than $1 million in annual tax revenue for the city.
“It was one of those that appeared that it was going to fail several times, and we brought it back to life,” Cronk says.
Cronk and Huff’s teamwork has impressed others at Poe & Cronk. Thom Hubard, senior vice president, says Huff’s grasp of the market has been an asset. Huff now is executive vice president, chief operating officer and a partner at Poe & Cronk.
“He’s a sponge. He retains everything he hears,” Hubard says. “When it comes to deals and his ability to research and find properties and manipulate the Internet, he’s becoming a wealth of knowledge.”
To be sure, Huff and Cronk disagree from time to time. Huff admits that he still has much to learn. “Learning patience has been a challenge for me,” Huff says. “I always want to do and fix and keep pushing forward.”
Cronk can relate. “When I was 22 years old selling real estate, I was about as impatient as you could get,” he recalls. “Things don’t always happen. But sometimes, if you push them to happen, they won’t happen at all. If you nurture them, they will happen.”2015-07-28T10:00:00+00:00
Commercial Real Estate: Power Brokers
http://www.virginiabusiness.com/news/article/commercial-real-estate-power-brokers#When:10:00:00ZMajor commercial real estate deals typically involve major challenges. In our second annual look at the commonwealth’s power brokers, Virginia Business interviews the pros behind some of the state’s recent significant transactions.
Ranging from a broker in Northern Virginia who helped fashion a lease that kept a corporate headquarters and its 1,300 jobs in the region to the man behind a 61-acre land assemblage in Henrico County that’s attracting new national retailers, these vignettes show how deals get done.
In some cases, people work together. In Roanoke, there’s a duo that brings generational strengths to their team, combining the technological savvy of youth with an experienced negotiator.
In Hampton Roads, the first woman to win the highest-level Platinum sales award in 2009 went on to become one of the top five producers in the region by 2014.
These power brokers share tips on what helps them rise to the top of an industry that’s famous for its ups and downs.
‘Experience and energy’ .... Dennis Cronk and Matt Huff, Southwest Virginia
The “senior” guy ... Lou Christopher, Northern Virginia
‘Stay tenacious’ ... Vivian Turok, Hampton Roads
Thalhimer team ... Mark Douglas and Eric Robison, Central Virginia
2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/CFO_Woodward0265.pngPhoto by Mark Rhodes
CFO kept his focus in deals that transformed company
http://www.virginiabusiness.com/news/article/cfo-kept-his-focus-in-deals-that-transformed-company#When:10:00:00ZPUBLICLY TRADED COMPANIES
James F. Woodward
Media General Inc.
James Woodward never thought of himself as being cool under pressure, but people who work with him noticed his calm demeanor during Media General’s epic transformation.
“He keeps things in perspective,” says Stephen Theuer, partner at Deloitte & Touche in Richmond. “He remains calm. He moves things forward and is committed to doing it right.”
Woodward led the series of transactions that transformed Media General from a newspaper company with 18 television stations into the second-largest local broadcaster in the U.S. As a result, the company’s market capitalization rose from $200 million to $2.5 billion.
The company had revenue of $1.4 billion last year and employed 5,300 people.
Woodward believes his focus helped keep him calm through the sale of 63 daily and weekly newspapers (including the 165-year-old Richmond Times-Dispatch) to a Berkshire Hathaway subsidiary and during mergers with TV station owners Young Broadcasting and LIN Media.
(Media General founded Virginia Business magazine in 1986. It was sold to Richmond-based Virginia Capital Partners LLC in 2009.)
As Media General transformed its business model, it went through two CEO changes and two recompositions of its board of directors in three years.
Media General now operates or services 71 television stations in 48 markets in addition to being an industry leader in digital media.
Woodward, a graduate of James Madison University, started his professional career at Media General in 1983. During the past 32 years, he has served in eight different roles, assuming responsibility for various operations including digital media and broadcast technology.
He enjoys the challenge of accepting new responsibilities. “You have to have a strong sense of knowing what you don’t know. Then it becomes less threatening,” he says. “You can say to yourself ‘I don’t know this but I can solve this and figure it out.’”
When he became CFO, Media General was in a tough spot. He was tasked with figuring out how to turn a company with a heavy debt burden into a growing company with stable outlook.
“It was my biggest challenge because of the risk,” he says. “If it had not gone well, I don’t know what would have happened. Getting the company back to its financial health gives everyone from the shareholders to the guy that delivers the mail a sense of security. That was the most critical piece. Now it’s a very healthy company with a good share price. There is plenty of room to grow. We are not done yet.”
In 2014 Woodward won the Distinguished CFO Award from the Media Financial Management Association for his leadership in the company’s changes. The organization’s president and CEO, Mary Collins, and her board members were impressed with Woodward’s history.
“He is a gentleman, and I don’t use that word lightly,” she says. “He is kind, respectful and self-effacing. You look at the things the man has accomplished and he has every reason to be arrogant but he is not that way. He cares about the industry and his community.”
Woodward is the first to acknowledge that nobody “does this on their own.”
“I am blessed to work with terrific people,” he says. One of my jobs is to make those people around me wildly successful. That is a bit selfish, I know, because if I do that, I can be wildly successful.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/CFO_Bowman0010.pngPhoto by Mark Rhodes
Former consultant aided the company’s evolution
http://www.virginiabusiness.com/news/article/former-consultant-aided-the-companys-evolution#When:10:00:00ZLARGE PRIVATE COMPANIES
Charles R. “Chip” Bowman
T. Parker Host and Host Terminals Inc.
Since becoming CFO three years ago, Chip Bowman has become a go-to leader at the Host Companies (T. Parker Host Inc. and Host Terminals Inc.)
“The substantial increase in [the Host Companies’] geographic footprint and in its economic performance in the last few years is due, in no small part, to Chip’s motivational skills and efficient and seamless execution,” says CEO David Host. “Chip’s vision and leadership have helped the Host Companies evolve quickly from a family-run business to an international enterprise with a seasoned and polished management team.”
Founded in 1923, Norfolk-based T. Parker Host is a major international shipping agency, offering port services at cities along the East and Gulf coasts. In 1999, the company established Host Terminals Inc. to provide marine terminal operations and stevedoring.
Since then, the Host Companies have seen tremendous growth, with recent expansion to Philadelphia and Corpus Christi, Texas, in the U.S. as well as Santa Marta and Barranquilla in Colombia. The company now has more than 300 employees, and Host Terminals handles more than 10 million tons of bulk cargo a year.
“Going to the Gulf … is a whole new mentality, a whole new way of doing business,” Host says. “You’re trying to integrate your policies and procedures to a different mentality.”
Host recognized that he needed help after expanding to the Gulf and hired Bowman’s consulting firm, Cypress Advisors, to guide the consolidation of several acquisitions. Bowman’s job was to identify best practices among the company’s offices and then standardize and streamline essential business functions, including accounting.
“What you ended up having was a ton of redundancy and limited control over it,” recalls Bowman of his time as a consultant. “We needed to build the company in a scalable way.”
Host was so impressed with Bowman’s work that he offered him the job of full-time CFO. Bowman couldn’t refuse.
“I loved being a consultant, but I love the company; I love the industry we’re in,” Bowman says. “I found it all very fascinating and rewarding, being able … to be part of a team that’s driving the growth we’re experiencing. I thought it was a once-in-a-lifetime chance. To do that on a 92-year-old family business, I think, is pretty special.”
Since becoming CFO, Bowman has continued to support the company through its growth spurt, which sometimes involves taking on duties outside of finance. For a time, he managed the Host Companies’ human resources efforts.
“He’s helped us on many, many acquisitions and projects, so he really does more than CFO,” Host says. “He has put together quite a team of people, and they are all motivated and know what they are doing, but it’s the systems that he was really able to make work, so everything is very smooth for the customer.”
Streamlining and restructuring the company’s business practices is evidently paying off.
“We’re growing where a lot of other people in the industry aren’t growing or are shrinking,” Bowman says. “Providing exceptional service is resonating extremely well with our customers. You don’t build a reputation of integrity overnight. We’ve built it over 92 years. Those things are converging now at a time when the market is responding very well to our principles and brand.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/CFO_Overholt9973.png
‘Making people feel good’ is executive’s primary goal
http://www.virginiabusiness.com/news/article/making-people-feel-good-is-executives-primary-goal#When:10:00:00ZSMALL PRIVATE COMPANIES
Lori J. Overholt, CPA
Lori Overholt oversees her responsibilities at Virginia Beach-based VSA Resorts with one guiding principle: Always treat people well.
For inspiration, she turns to a quote from the poet Maya Angelou: “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”
“Making people feel good is our core line of business,” Overholt says.
With 2014 revenues of $4.7 million, VSA is a vacation ownership company, involved in the development, sales and marketing of timeshares.
Since starting with the company in 2005, Overholt, a Certified Public Accountant, has assumed the responsibilities of company president as well as CFO. She oversees three resorts in Virginia Beach: Ocean Sands, Ocean Key and The Atrium.
“I owned a timeshare before I came here,” she says, adding that she enjoys the vacation business. “Everybody around you is happy and enjoying themselves. We have had some owners for over 20 years. They love their timeshares.”
She feels that her experience as CFO helps her think more strategically in her role as president. “It helps me make decisions and guides me in the direction we need to go,” she says. “I’ve streamlined a lot of things. I’ve outsourced some of the repetitive tasks, and I’ve focused on customer service. That has made a huge difference in our results.”
Overholt continues to develop the company. In 2013 she started VSA Association Management, a new division that specializes in condo association management. She also purchased some property with plans to develop another resort in Virginia Beach. Under her guidance, the company has made major renovations and improvements to all three existing resorts to improve owner satisfaction.
Dawn Tayman, vice president of CapitalSource in Chevy Chase, Md., is impressed with the exterior transformation of the Ocean Sands. “Lori had this vision,” she says. “They pool their owners to see what they would like, and most of the owners said they would like to see balconies added. They made that come to fruition. I was really impressed.”
Tayman describes Overholt as professional and proactive. “She is real easy to work with. She runs a good, honest operation, and that means a lot,” she says.
The renovation at Ocean Sands was a definite challenge for Overholt. “That has been a huge project, but it’s a huge improvement, and everyone is loving it,” she says.
A graduate of the University of Virginia, Overholt started her career in public accounting, specializing in small business consulting. “I ended up seeing all aspects of the business,” she says.
Overholt found the past year very challenging because of human resources-related regulations and changes, including facets of the Affordable Care Act. “You have to focus on regulations and all the new changes, and that takes away from the core aspects of the business — worrying about what the customer wants,” she says.
In addition to her work at VSA, Overholt serves on the Task Force for Revenue Recognition for the Timeshare Industry for the American Institute of CPAs where she helps set industry standards.
“She is highly regarded technically in that group,” says David Rippy of Dixon Hughes Goodman in Virginia Beach. “She is a leader, not a follower. She looks at the landscape and says, ‘We can do this.’”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/CFO_McAllister0185.pngPhoto by Mark Rhodes
University official cut costs but increased its financial aid
http://www.virginiabusiness.com/news/article/university-official-cut-costs-but-increased-its-financial-aid#When:10:00:00ZLARGE NONPROFIT ORGANIZATIONS
Steven G. McAllister
Washington and Lee University
It’s easy to forget that institutions of higher education have to meet a bottom line, too, just like any other enterprise.
Colleges and universities were not immune to the many challenges posed by the recent economic downturn.
Steve McAllister, Washington and Lee University’s vice president for finance and treasurer, met those challenges head-on by leading the Lexington school, which was founded in 1749, through an important belt-tightening program.
“Like most colleges and universities, we faced that economic downturn in 2007-08, and that required some significant recalibration of our business model,” says Kenneth P. Ruscio, Washington and Lee’s president, who plans to step down next year and return to teaching after a sabbatical. “Steve had to really take the lead role in guiding the university through that recalibration. When you lose a fair amount of expected resources in a very short amount of time, you have to quickly make adjustments, and he was able to do that.”
Years before the recession, McAllister had overseen the creation of a reserve fund that would be crucial to the university’s ability to endure the economic turmoil. When the school’s endowment took a sizeable hit from a sharp decline in the stock market, the university was able to borrow from the reserve fund to subsidize revenue.
“It gave us time to go through and be more thoughtful about how and where to make [budget] reductions,” explains McAllister, who oversees a $126 million annual budget. “The university community recognized the challenges and worked to identify areas in the budget that they could reduce without having a negative impact on academics.”
Unlike some other institutions of higher learning, “we were able to keep all of our faculty through the process,” McAllister says. “Through it all, we never cut positions.”
In fact, the university has been able to increase salaries while also boosting financial aid to students. The university has 852 full-time employees, including 301 undergraduate and law school faculty, and 1,855 undergraduate students.
During the recession, McAllister also oversaw a five-year energy conservation program that’s reduced the university’s energy usage by more than 30 percent. The university spent $5 million to increase the efficiency of its heating and cooling systems and made substantial changes in how buildings are powered and climate controlled when not in use. The money spent to make upgrades has since been recouped in lower utility bills.
McAllister’s many responsibilities include management of the university’s endowment that now stands at nearly $1.5 billion, thanks to a recently concluded $542.5 million fundraising campaign. Revenue from philanthropy now exceeds revenue from tuition in the annual operating budget.
The university has been able to eliminate loans from its financial aid packages, helping students avoid graduating with college debt. In fact, no student from a family with income of less than $75,000 has to pay tuition to attend Washington and Lee.
“Through his dedication, hard work, financial expertise and unwavering support of institutional goals, Steve has helped solidify Washington and Lee University’s position as one of the strongest and most efficiently managed institutions of its size in the field of higher education,” Ruscio says. “He represents the best of management in the world of higher education and the nonprofit sector.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/CFO_Kite0234.pngPhoto by Mark Rhodes
Continuous learner willing to stretch his comfort zone
http://www.virginiabusiness.com/news/article/continuous-learner-willing-to-stretch-his-comfort-zone#When:10:00:00ZSMALL NONPROFIT ORGANIZATIONS
George P. Kite III
Call Federal Credit Union
George Kite III was eyeing Wall Street after he graduated from Radford University until he and his father visited Call Federal Credit Union and serendipitously met its CEO, Roger Ball. “I didn’t know anything about credit unions at all, and he talked to me for about two hours,” Kite says.
Now 34, Kite serves as the credit union’s chief financial officer. Call Federal officials say he has helped the organization expand its services to meet its members’ needs. “Many of George’s strengths come from the fact that he is the epitome of a continuous learner — academically, from a business standpoint, and personally stretching his comfort zone,” says Call Federal board member Bill Poorbaugh.
Founded by tobacco giant Philip Morris USA in 1962, Call Federal now has $350 million in assets and 30,000 members. (The credit union’s name is derived from Philip Morris’ famous advertising slogan, “Call for Philip Morris.”)
Kite takes pride in keeping the credit union well-capitalized. Call Federal ended 2014 with a net worth ratio of 11.99 percent, nearly twice the regulatory requirement of 6 percent. It also saw extremely strong loan growth of 20 percent.
Kite embraces every opportunity the credit union presents to him. He stepped outside his financial duties to head Call Federal’s marketing from 2010 to 2014. “It was an interesting experience. I was using a different side of my brain,” he says. “The biggest thing I did was to bring in some top talent as well as a marketing manager.”
Jerry Dunnavant, vice president of strategic marketing for Access, a marketing and communications firm, worked with Kite on rebranding the credit union. “George has a keen understanding of the other components of business,” he says. “His financial acumen is strong, but his emotional intelligence is strong as well.”
Dunnavant was impressed with Kite’s attention to detail, especially during the early stages of the rebranding project. “He wanted to make sure the branding aspect is who they really are and not just a tagline. It’s really about living the brand for him,” Dunnavant says. “‘Passionately local banking’ describes the credit union and who they are, but I think it’s a reflection of who he is, too.”
Kite’s new responsibilities are human resources and training. “That’s a big challenge, but it’s rewarding,” he says. “I am able to see the bigger picture in terms of how our decisions affect the whole company. Instead of making a decision based on the balance sheet or numbers, I know these people now and their desire to develop with the organization. Knowing them and knowing what their concerns are makes me more attuned and aware as a manager. That impacts my decision making.”
Over the years, Kite has been able to grow in areas where he thought of himself as weak. “I have come out of my comfort zone of being a traditional, analytically oriented person to one who is more creative and can see the bigger picture,” he says.
His biggest reward is being able to put good people in positions where they can shine. His leadership philosophy is fundamental. “Hire really good people, craft a vision of what lies ahead, develop a strategy to get there, remove barriers and provide resources for them,” he says. “Uplift them and motivate them, and then get the hell out of their way.”
As a way to relax, he spends every other weekend with his father helping him run a small beef cattle farm in Nottoway County. “I like to get outside. That is how I recharge,” he says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/AP_692831738737.pngSpeaker of the House William Howell took a hard stance against Medicaid expansion. AP Photo/Bob Brown
Giving legislators cover
http://www.virginiabusiness.com/news/article/giving-legislators-cover#When:10:00:00ZA few months ago, Obamacare supporters in Virginia hoped a win in the U.S. Supreme Court case dealing with federal subsidies would force their opponents into accepting the 2010 law and even expand its reach.
Those now seem like innocent times. Supporters did win the King v. Burwell decision, but opponents remained dug in. “The Affordable Care Act remains deeply flawed, and today’s Supreme Court decision does not change that,” said William Howell, speaker of the Virginia House of Delegates, when the ruling was announced in late June.
Actually, the ruling did change the debate because it left in place a pillar of the law and erased a lot of uncertainty. But in an important way, such realities matter less than perception. Virginia’s option to expand Medicaid — where the real federal money is — has steadfastly been blocked by the state GOP despite the ACA’s legal victories.
So, for ACA supporters, the strategy leading up to next year’s General Assembly session is to find a way to let the losing side win a little and make the fight not seem like a fight. Some GOP-leaning states already have adopted rules that have attracted conservative support, like attaching work requirements to benefit programs that draw on Medicaid dollars under the ACA.
Whatever legislative proposals come out this year have to “give cover to people who went out on a limb and lost,” says Doug Gray, executive director of the Virginia Association of Health Plans.
It’s unlikely there will be another straight expansion push in the upcoming session like the one that Gov. Terry McAuliffe tried without success his first year. (Marketplace Virginia, a 2014 state Senate proposal backed by many business organizations, would have used Medicaid funds to subsidize private insurance premiums.) But if there’s any sales strategy that will work, McAuliffe will find it. “The governor’s been pretty clear he wants to see coverage,” says Dr. William A. Hazel Jr., the state’s secretary of Health and Human Resources. “Folks are going to have to at some point sit down and decide how we’re going to do this.”
What he means is find a way to bring in the federal tax dollars that proponents of expanding Medicaid say the commonwealth is foolish to leave on the table.
Sean Connaughton, president and CEO of the Virginia Hospital and Healthcare Association who previously was Virginia’s secretary of transportation, is one of the biggest advocates for Medicaid expansion. The VHHA cites the financial problems faced by hospitals, especially rural ones. The group said last year that about half the state’s 37 rural hospitals are operating in the red. It also says that this year and next, Virginia’s hospitals will face nearly $1 billion in combined cuts to Medicaid and Medicare.
So a partisan fight is the last thing the group wants. “What we have to do is stop focusing on politics and start focusing on providers” and the effects of funding cuts, which are especially high this year, Connaughton says. “We’re not saying we’re proponents or opponents of the Affordable Care Act; we’re just the ones who have to work with it,” he says. “We need to get folks to face the reality that this law is here to stay.”
A state study group is examining the feasibility of using a tax on hospitals, called a provider assessment, to generate money that would be matched by federal Medicaid funds. Sentara Healthcare, Carilion Clinic and Inova Health System asked the General Assembly last year for a provider assessment after it failed to approve Medicaid expansion. The legislature asked Hazel to lead a study on the issue.
Gray, the health plan association executive, says that, behind the hard line drawn by the GOP, there is support for negotiating a deal that would have some cost-share, so recipients of Medicaid coverage would have to pay something. The conservative opponents of expanding Medicaid “are completely against somebody getting Medicaid without paying anything,” he says.
The white-hot partisanship over Obamacare has made such compromise impossible for the past few years, he says. “But the fundamentals are pretty straightforward. We’re already blowing money taking care of the uninsured, who we would be able to get some funding for” through Medicaid expansion. “Isn’t it smarter to help people get coverage so they can stay healthy instead of waiting until they’re so sick, and then running up the bill?”
Hazel notes that several states recently have gotten waivers from the Centers for Medicare and Medicaid Services (CMS) to set up their own versions of Medicaid expansion. Indiana, for example, won CMS approval in January for a plan that requires premiums from the newly insured and promotes “value-based decision-making and personal health responsibility,” according to a state news release. The new plan extends coverage to 350,000 people. Republican Gov. Mike Pence called the plan “a proven model for Medicaid reform” based on the state’s Healthy Indiana Plan.
Hazel wants Virginia opponents of Medicaid expansion to come to the table with ideas. “Clearly other states have been able to do this,” he says. He also rejects the criticism that Medicaid is a poorly run program. “Medicaid is actually one of the most tightly constructed systems we have,” he says. But, anything connected to Obamacare is a target. “You’d think we could sit down and figure this out, but when you see folks in campaign mode, what are you hearing? It’s all about how bad Medicaid is.”
It’s hard to walk back some of the things that get said in a campaign. Howell just fended off a conservative opponent in a June GOP primary. The challenger accused him of trying to enable Medicaid expansion “and he had to take hard positions on that” to win, Gray says. “Being able to come back and be flexible can be hard to do.”
Howell didn’t respond to an interview request left at his district office in Stafford County.
Hazel says Howell shouldn’t fear attacks from the right because they’re unavoidable. “It doesn’t matter what he does, they’re going to come after him,” he says. “There’s no pleasing these people.”
If the most ardent opponents of more fully implementing the ACA and expanding Medicaid refuse to budge, they might prevail. But in the months to come before the next legislative session, there’ll be a lot of ideas floated.
The budget McAuliffe is drafting now, says Gray, is the first one that will really have his imprint. So in that environment he has more influence than ever and can do some horse trading on a range of policies. What exactly that might mean is unknown. “But it’s definitely being discussed,” he says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/DSC_2255.png“The whole business model is wrong,” says Genworth CEO Thomas McInerney. Photo by Rick DeBerry
An industry makeover
http://www.virginiabusiness.com/news/article/an-industry-makeover#When:10:00:00ZWhen Genworth Financial announced last November that its long-term care insurance business had some serious money troubles, it wasn’t much of a surprise.
In recent years several other big insurance firms have quit the business, and Genworth was facing the same problems of chronically low investment earnings and higher-than-expected claims. Genworth announced last November that it had to increase its reserves against future claims by $531 million for the third quarter of its fiscal year, and its stock price dropped by nearly half. Genworth ended the year with a loss of $760 million.
The company did better in the first quarter of this year, though not great, with a net income of $154 million. Some of that, though, came at the expense of policyholders around the country who were hit with double-digit premium increases.
Genworth CEO Thomas J. McInerney acknowledges the financial strain that customers for Genworth and other insurers are facing but says it can’t be avoided. “The whole business model is wrong,” he says. “While I think long-term care can be a good business going forward, we have to radically change it.”
Long-term care insurance is experiencing a makeover for a lot of reasons. As people like McInerney are quick to point out, the first long-term care (LTC) policies were sold in the mid-1970s, and actuaries then did a poor job of predicting future costs and the rate of return on the investments that insurers use to build up reserves.
So radically changing it means big premium increases for older policies — above 50 percent in Virginia for Genworth customers. It also means newer customers will have different policies offered to them, with more stringent underwriting and different rules for how rate increases are approved.
New state rules
Virginia’s Bureau of Insurance earlier this year approved new rules that are intended to make insurers “take a more conservative approach” in the initial pricing of policies, says Virginia Commissioner of Insurance Jacqueline Cunningham. The rules take effect Sept. 1.
The state began drafting the new rules in 2013 amid complaints from policyholders, but the new rules don’t restrict future rate increases.
That’s a frustration for people like David Notter, 65, a retired professor from Virginia Tech, who protested to regulators last year after he and his wife got a letter from John Hancock saying rate increases were possible on the policies they bought in 2004.
The couple was offered a chance to keep its premiums level — his was $1,000 a year and his wife, Janice, paid $1,500 — if they would drop the rider that made sure their benefits kept up with inflation. They took the deal but weren’t happy about it. “I can be somewhat appreciative of their situation, but you can’t just push all of that onto your customers,” he says. “It’s just not reasonable to do that.”
Low ‘lapse rate’
Yet if you ask insurance brokers, they’ll say people who bought those older LTC policies are sitting on a pile of money, even with the premium increases rampant today.
“I tell clients today that, if they tried to replicate what they have, they’d never get it,” says Linda Caruthers, a Richmond-based long-term care consultant who teaches LTC certification classes for insurance agents and financial planners. “It’s really hard when you have someone screaming about a rate increase, and I say, ‘Okay, so you’re paying $5,000 a year for a policy that will pay you $150,000.’”
Genworth’s McInerney notes that people who bought policies decades ago have stuck with them at a much higher level than expected. That, he says, is one of the reasons insurance companies are under financial strain.
Insurers usually experience a “lapse rate” of about 5 percent, meaning people buy coverage and pay premiums for a while before abandoning the policy. Genworth, however, is seeing a lapse rate for older policies of just 1 percent. That trend, along with underpricing, probably accounts “for 90 percent of all the problems” insurers have today, he says.
Even though many major insurers have abandoned the business, there’s still a need, and the answer will come either from private-sector solutions or Medicaid. The baby boomer generation is well into retirement, and in the near future many of them will develop medical conditions that require intensive long-term care. Only about 8 percent of Americans have such insurance. The rest will depend on personal savings or family income or Medicaid.
Can the market be revived?
So, for those who can afford it, LTC makes a lot of sense. John Spacek, a broker with Dixon Wells who specializes in LTC, says wealthier clients generally buy the coverage. There’s a certain irony in people who don’t need the money still making plans to get it from a source other than their own bank accounts. “They get it, because they understand risk,” Spacek says. “It’s amazing to me how many people who have incredible assets want this.”
What should be done to revive the LTC market? Caruthers wants employers to add LTC to their benefits packages so employees can buy policies for family members. Otherwise, those employees will end up missing work because they have to take care of family members.
McInerney says he’s working with key members of Congress to allow 401(k) assets to be used to pay LTC premiums. They listen to him because he’s Genworth’s CEO. He obviously has a self-interest, but the government has an interest, too. That’s because the burden on Medicaid will be huge in coming years if they can’t get more people to buy long-term care insurance. Both state and federal budgets “are much better off with a robust LTC market,” he says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/EDU_Warner.pngSen. Mark Warner sponsored the bill along with Sens. Marco Rubio and Ron Wyden. AP Photo/Steve Helber
http://www.virginiabusiness.com/news/article/comparison-shopping#When:10:00:00ZAlthough he didn’t speak at SCHEV’s “Quality and Value” summit, Sen. Mark Warner says he is keenly focused on the value of a college education: what it costs, and what comes afterward in terms of job opportunities.
With Sens. Ron Wyden, D-Oregon, and Marco Rubio, R-Florida, Warner has introduced legislation — the Student Right to Know Before You Go Act — that would post online relevant data about colleges that already has been collected.
“This will allow students and families to access comparative information on which colleges and which majors will help them find a good job after graduation,” Warner says.
The senator says he also is concerned about student debt and finding ways to bring down the cost of higher education.
In Virginia, 59 percent of the students of private or public four-year colleges graduated with debt last year. The average debt load was $25,780, according to the Institute for College Access & Success.
“I know as someone who was the first in my family to graduate from college, I wouldn’t have had the business or political success I’ve had without being able to access a student loan program and being able to earn some money so I didn’t come out hobbled with huge amounts of student debt,” Warner says.
Among other initiatives, Warner has proposed legislation to cap student loan repayments at 15 percent of income, so graduates pay less when they’re just getting started and gradually repay more as their income increases.
To help low-income students, such as those mentioned at the Richmond conference by Anne Holton, Virginia’s secretary of education, Warner would allow low-income students to earn early college credits in high school through the Pell grant program.
Warner says those who complete college courses before they finish high school are more likely to graduate from college than their peers who do not.
“Nobody needs to be told just how hard it is for low-income students to afford a college education,” Warner says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/EDU_Edna_Baehre-Kolovani.pngEdna Baehre-Kolovani, president of Tidewater Community College.
Educator or workforce creator?
http://www.virginiabusiness.com/news/article/educator-or-workforce-creator#When:10:00:00ZWhat does business want from higher education, and what are colleges and universities delivering?
If you haven’t considered those questions, you could have learned a lot from “Quality and Value in Virginia’s System of Higher Education,” a conference held in June in Richmond.
The goal of the conference, sponsored by the State Council of Higher Education for Virginia (SCHEV), was to develop a unified vision of the role that colleges and universities play — in educating citizens and creating a skilled workforce.
But at the end of the day, there still were a lot of questions.
The sometimes uneasy partnership between business and higher education is reflected in a study released last year as part of an annual poll by the consulting firm Gallup and the Lumina Foundation.
The poll found that 96 percent of college and university chief academic officers nationally were confident in their institutions’ ability to prepare graduates for the workforce.
By sharp contrast, just 11 percent of business leaders strongly agreed that today’s college graduates have the skills their companies need.
How are colleges measured?
Edna Baehre-Kolovani, president of the 42,000-student Tidewater Community College, expressed her concern about one focus of the conference: the return on investment sought by various stakeholders that colleges and universities serve, including students, the business community and the legislature.
“We serve everybody. We don’t carve out one niche of the population and say that’s the only population we’re going to serve,” Baehre-Kolovani said.
“How do we identify what the value proposition is that we want to communicate?” she asked. “How do we know we’re delivering what we promise, when we’re trying to come to grips with what this value proposition is. And, does it vary from sector to sector, from college to college?”
She also mentioned one of the major issues in the relationship between business and higher education: how the performances of colleges are measured.
“We are not measured on the long-term effects of our graduates in the workplace,” Baehre-Kolovani said. “Our accreditation is based on times to completion and how many students we get through the pipeline.”
Linda Cabe Halpern, vice provost for programs at James Madison University, said every institution of higher education in Virginia needs to be involved with businesses in their regions and to know what those companies’ needs are.
Yet, she suggested, the path to a career and a happy, productive life — on the job and off — is not a narrow one for students. Their overall college experiences — including exposure to ideas outside the classroom and beyond their majors — also are vital.
“It is important for us, I believe, to make the case over and over again and to audience after audience after audience that, ‘Yes, we get it: Employability is important,’ ” Halpern said. “But we have to do all these other things to get [graduates] there.”
Anne Holton, Virginia’s secretary of education, pointed to the issue of rising college costs. She said higher education is not adequately serving students from low-income families.
“That is the moral challenge of our time. [Higher education] is the key way out of poverty, yet we’re failing miserably,” she warned.
Ithaka S+R, a New York-based consulting and research firm, presented a report to SCHEV earlier this year showing that fewer than 25 percent of the lowest-income Virginia students enrolled in a public institution of higher education were attending four-year institutions, compared with 90 percent of high-income students.
“This is particularly troubling since only 5 percent of students who enroll full time in a two-year college earn an associate degree within two years and only 2 percent earn a bachelor’s degree (through transferring to a four-year institution) within four years,” the study said.
Seeking soft skills, too
Several speakers pointed out that, besides technical knowledge and skills, employers are looking for workers with soft skills, such as the ability to communicate or to solve problems in diverse settings.
Debra Humphreys, a vice president with the Association of American Colleges and Universities, relayed a comment made by recruiters at several engineering companies.
“They all said they need good engineers, but they need engineers who can write,” Humphreys said, as laughter rumbled through the room.
Filling the gap
Barry DuVal, president and CEO of the Virginia Chamber of Commerce, praised the relationship between business and higher education in Virginia, but he left no doubt as to what companies in the commonwealth need.
Asked in a survey about their biggest priorities, the response of chamber members was resounding. “What they wanted the governor and General Assembly to focus on was creating a ready workforce,” DuVal says, adding that higher education is a huge part of that effort.
He says if Virginia’s economy grows only 2 percent a year, the state will need 2 million new workers by 2025. Forty percent of those workers will require four-year degrees. The rest will not.
Business leaders, however, stress that an increasing number of jobs require intensive training and education beyond high school to compete in an expanding, global knowledge economy.
The big problem: Virginia doesn’t have enough skilled workers to fill many of the jobs needed to keep its economy humming. “We have a workforce gap, and your institutions play an important role in filling those gaps,” DuVal told educators.
Teresa Sullivan, the president of the University of Virginia and a labor force demography scholar, said that today’s college students still face the ripple effects of the Great Recession, which officially ended six years ago.
She recently taught a freshman seminar in which students read a book titled, “The Coming Jobs War.”
“I asked them, ‘Would you give this book to your parents to read?’ The entire class, as one, shook their heads,” Sullivan recalled.
The book would only add to their parents’ anxiety about the students’ job prospects, they said. “One student told me her mother called her every night and cried on the phone,” Sullivan said.
Despite such worries, one study discussed at the conference, the “Gallup-Purdue [University] Index of Great Jobs and Great Lives,” suggests that certain college experiences can have a great influence on graduates’ lives and their careers.
The 2014 study posited that there is a significant association between six influential experiences and the “engagement” of graduates in the workplace.
“Engagement is more than job satisfaction,” the study said. “It involves employees being intellectually and emotionally connected with their organizations and work teams because they are able to do what they’re best at, they like what they do at work, and they have someone who cares about their development at work.”
Those influential college experiences include:
a professor or mentor who cared about students as persons;
a teacher who made them excited about learning;
a professor or mentor who urged them to pursue their dreams;
an internship or job that helped students apply what they had learned;
an active and meaningful engagement in an organization or extracurricular activity; and
participation in a project that took a semester or longer to complete.
In essence, the proposition is that supportive teachers and learning gained from experience can help graduates be more engaged in their work and carry with them a lifelong sense of well-being.
Timothy Sands, the president of Virginia Tech, cautioned that the relationship between college experiences and engagement in the workplace is still being explored, but he suggested that the implications could be profound. “This is the kind of thing that could really change higher education,” he said.
In the meantime, Leanna Blevins, acting executive director of the New College Institute in Martinsville, urged her higher-education colleagues not to get caught up in theories in discussing their work with businesspeople.
She recalled the blunt comment of one economic development director about college graduates: “He said, ‘I want to know whether they can work and whether they can think — that’s all I want to know.’”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/ROANOKE_side.pngJon Greene stands on the airstrip at Kentland Farms, a drone testing site. Photo by Chelsey Allder, courtesy VirginiaTech
Center of research
http://www.virginiabusiness.com/news/article/center-of-research#When:10:00:00ZWhether it is drone testing, neuroscience research, a futuristic kitchen or football, Virginia Tech draws an international eye to the New River-Roanoke Valley region.
Tech’s drone testing site, one of six selected nationwide by the Federal Aviation Administration, can fly up to 25 research drones at a time, says Jon Greene, the acting associate director of the Mid-Atlantic Aviation Partnership.
The 31,000-student university, which manages $513 million in research, not only is central to the New River Valley, it has a substantial Roanoke presence in the Virginia Tech Carilion School of Medicine and Research Institute.
A new universitywide neuroscience program will be directed by Harald Sontheimer, an expert on the biology of glial brain cells. He and his 18-person lab have been recruited from the University of Alabama to the Roanoke research institute where he will oversee a new Glial Biology in Health, Disease and Cancer Center. Sontheimer’s research already has expanded the treatment of glioblastoma, the deadliest and most common primary brain tumor in humans.
Recognizing the expansion of interest in environment and ecology in the economy, the university has added a new bachelor’s degree in Water: Resources, Policy and Management, the first of its kind in the United States. The program is in reaction to an anticipated 19 percent job growth in positions related to water.
“The timing of this new program could not be better, nor more urgent,” said Brian Richter, director of global freshwater strategies for The Nature Conservancy. “Many corporations are now awakening to the water risks in their business operations and supply chains, and they are looking for help.”
In May, Tech’s futuristic kitchen, FutureHAUS, was part of the “Living Room of the Future” featured exhibit of the American Institute of Architects Convention in Atlanta. The FutureHAUS concept involves complete rooms — including kitchens and bathrooms — built as “cartridges” in factories and shipped to a construction site.
The university extends into the daily economy through its more than 8,000 employees. It also was the main benefactor that refurbished Hotel Roanoke into the Hotel Roanoke & Conference Center. The center contributes some $39 million annually to the Roanoke Valley economy, a total of $600 million since the hotel’s reopening in 1995, notes Larry Hincker, associate vice president for university relations.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/SV09121603V_045.pngThe Roanoke-New River Valley region no longer relies on one industry. Photo courtesy Virginia Tourism Corp.
Railroad legacy fades
http://www.virginiabusiness.com/news/article/railroad-legacy-fades#When:10:00:00ZWhen news came in March that Norfolk Southern would close its Roanoke administrative offices, moving 426 jobs to Norfolk and Atlanta, many city residents feared for the city’s economic future.
After all, Norfolk and Western Railway’s decision to build in Roanoke in the 1880s kick-started the “Magic City’s” growth and long served as its leading industry. Yet, the railroad has waned in influence and employment for decades, shrinking a local workforce of more than 5,000 people at its height to 1,200 today. The closure of the administrative offices continues a process that began in 1982 when Norfolk Southern, formed in the merger of Norfolk and Western and Southern railways, moved its headquarters from Roanoke to Norfolk.
Other closures are testing the economic resilience of the Roanoke and New River valleys. Retailer HSN Inc. will close its Roanoke County fulfillment center next year, eliminating 350 jobs. Banking company BB&T Corp. closed its Roanoke call center, and wireless phone service nTelos shuttered its Botetourt County customer support center for a combined loss of nearly 200 jobs. A staff reduction at Allstate Insurance Co.’s Roanoke County customer support center cost another 185 jobs.
Despite the spate of job losses, however, optimism remains. The region no longer relies on one, two or even three industries. Indeed, Moody’s has ranked Roanoke and Richmond as the cities with the most diverse economies in Virginia — an attribute that helps cushion the blow.
“Any day of the week you’d pick an opportunity to be a broadly based economy, and that’s what we are,” says Beth Doughty, executive director of the Roanoke Regional Partnership. “The foundation of a broad-based economy is you can recover from and withstand the natural cycles of business.”
Health care and small business
Health care long surpassed the railroad as the region’s largest industry. Carilion Clinic employs more than 10,000 people, followed by Virginia Tech with more than 8,000 jobs.
More people, however, work for smaller companies, many of which have grown steadily in recent years. Drawing on an expanding pool of local entrepreneurs and companies that have relocated to or expanded in the Roanoke and New River valleys, there are an increasing number of places to work.
Developers have invested more than $400 million since 2009 in downtown Roanoke real estate, renovating old warehouses and office buildings for apartments, retail space and other uses. Paired with capital investments that have rebooted the City Market district, Elmwood Park and the Main Library, downtown has been transformed from a 9-to-5 weekday work center to a 24-hour neighborhood that attracts singles and families to its restaurants, stores and festivals.
Additionally, major corporate investments announced in the last few years have continued to unfold. New employers include Ardagh Group, a food packaging manufacturer; Korona S.A., a Polish candle maker; Red Sun Farms, a Mexican greenhouse tomato grower; and Falls Stamping & Welding Inc., which provides metal stamping for the automobile industry. Several existing employers, including Volvo Trucks North America; Altec Industries Inc., another truck-related company; and Virginia Transformer Corp. also are expanding.
In May, unemployment stood at 4.9 percent in the Roanoke metro area, down from 5.2 percent the year before. In Blacksburg, the jobless rate stood at 5.3 percent, down from 5.6 percent. The May statistics don’t reflect the Norfolk Southern losses, which won’t wrap up until the end of summer.
Finding a way to stay
After news of the Norfolk Southern announcement broke, Joyce Waugh, executive director of the Roanoke Regional Chamber of Commerce, saw a flurry of activity between local businesses and railroad employees who did not wish to leave the region.
“There were companies here eager to talk to them, and a lot of them stayed,” Waugh says. “Organically, people started reaching out. Meridium got some. Advance Auto got quite a few. Others are with some other, smaller firms.”
Her story illustrates the desire of local companies to recruit well-qualified workers and the attractiveness of the Roanoke and New River valleys.
The region features a low cost of living and high quality of life, plenty of access to outdoors recreation, a central location along the East Coast, cultural amenities in urban and rural settings and many institutions of higher education, including Virginia Tech, Radford University, Hollins University, Ferrum College, Roanoke College and two community colleges, which partner with the private sector to provide specialized workforce development.
Real estate activity
For many of those reasons, Dennis Cronk of commercial real estate group Poe & Cronk says he’s seeing more activity now than he has since the Great Recession.
“Most of our business during the slowdown period from ’08 to ‘12, was primary investment properties,” Cronk says. “There was a lot of investment property because prices had been slashed. It was a buyer’s market. Now you’re seeing more businesses that have been sitting on the sidelines waiting, and they’re in need of capacity to grow their businesses. That’s the positive element I’m seeing this year.”
Industrial and retail properties have been especially hot, Cronk says, to the point where inventory in those sectors is becoming scarce. Those spaces are being filled by smaller companies that are looking to grow.
“We often forget our existing companies are expanding,” says Wayne Strickland, executive director of the Roanoke Valley-Alleghany Regional Commission. “Our economy really is driven by what we call small businesses, with fewer than 500 employees. If you look at our workforce, a good percentage of [workers] are employed by companies with fewer than 50 [workers].”
Particularly since the recession, entrepreneurship has become much more important to the regional economy.
Virginia Tech engineering graduates Jack DuFour and Alley Heffern failed to win funding for their fair-trade backpack business, Taaluma Totes, when they appeared on the television show “Shark Tank” in February, but they benefited from the exposure and attracted investment from other sources. They are among the many entrepreneurs in the region who are building viable companies.
Samantha Steidle founded the Roanoke Business Lounge in 2012 as a place for small businesses and startups to share space and save on operating costs. Last year she moved and rebranded as the Grandin CoLab, which now is home to 107 clients. Some are nearly ready to move to the next level, including Momentum Solutionz, an IT consulting group that was featured this spring in Forbes, and Freak Athletics, which produces athletic training videos that have caught the attention of major brands and millions of YouTube viewers.
Fast-growing companies like these, which are ready for the next step of development, tend to hit the sweet spot for Jonathan Whitt, president and CEO of the Roanoke-Blacksburg Technology Council.
“Our focus is on really helping the smaller companies in that space become big companies,” Whitt says. “The real growth is in the late startup or post-startup that’s ramping up to the next level, or has desire to do so.”
In March, Roanoke received a $600,000 grant to renovate a former hospital building into the Gill Memorial Technology Accelerator, which aims to help growing tech companies make that jump. Whitt says he sees enormous potential in the region’s bioscience, IT, big data and cybersecurity sectors.
Other infrastructure pieces are coming into place as well. The Virginia Department of Transportation is expanding the Interstate 581 interchange at Valley View Mall, western Virginia’s biggest retail center, which will improve access and open 100 forested acres on the west side of the interstate to potential development. Other transportation projects on I-81 and other major merchant routes may boost the region’s profile as a centrally located hub with proximity to major East Coast metropolitan areas.
Local governments are working together to fill other gaps in infrastructure. The Western Virginia Water Authority, formed in 2004 to provide sewer and water service to the Roanoke Valley, has expanded to include new counties, most recently Botetourt County.
More recently, the Western Virginia Industrial Facility Authority was formed to give Roanoke Valley governments more flexibility to strike agreements and work together to attract large business prospects. The authority has compiled a list of the 10 most promising, larger-than-100-acre, potential industrial sites for future growth. The authority was modeled in part on Virginia’s First Regional Industrial Facilities Authority, which includes 13 localities and operates the New River Valley Commerce Park.
The Roanoke Valley Broadband Authority was formed in 2013, five years after the New River Valley Network Wireless Authority. Both work to coordinate public and private efforts to develop fiber-optic cable networks in the region. The authority pitched an $8.2 million, 60-mile fiber project that won approval from Roanoke and Salem, but not Roanoke County and Botetourt County. As a result, the proposal was downsized for the two cities with the hopes of building approximately 46 miles of broadband fiber between them.
Even with occasional hiccups in these regional infrastructure projects, companies continue to grow.
Roanoke-based Interactive Achievement develops software for school systems to help with testing and preparing students for standardized tests. “They’ve been in growth mode like you wouldn’t believe,” says the Technology Council’s Whitt.
Foxguard/Qualtrax, a quickly growing Blacksburg business, oversees smaller companies that develop security software and make computer equipment designed for rugged environments.
Meridium assists clients in more than 75 countries improving their businesses and meeting regulatory requirements. It has offices in Houston, Madrid, Dubai, Bangalore, Singapore, Perth and Johannesburg, with its headquarters located in downtown Roanoke.
Banking on a trend
Crowning Touch Senior Moving Services acts as a one-stop shop for seniors who are downsizing and moving to new living spaces. It handles all aspects of the move: transferring belongings, selling the old house as-is and assisting in disposing of unneeded items through auctions and its consignment store.
Linda Balentine, its founder and president, started the company 20 years ago while living out of two friends’ houses and relying on a single cell phone. Today, she has 22 employees and recently began franchising the company, planning 100 new Crowning Touch locations in the next five years, all in metropolitan areas with 1 million or more people.
“Eighty million seniors over the next 30 years will be moving,” Balentine says, describing the trend as a tsunami of gray hair. These seniors’ “needs are not being addressed by the moving industry. We’re the only moving company in the United States with a consignment shop, auction house and real estate division. There is no business model like this.”
Balentine says she’s been courted by potential franchisees looking to open Crowning Touch locations in Iraq — she turned that one down — and the United Kingdom. A mid-June weekend found her pitching the company at the International Franchise Expo in New York City.
That’s the kind of business growth that economic development advocates say represents the future of the Roanoke and New River valleys.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/BANK_BealeUnion.pngG. William “Billy” Beale, CEO of Richmond-based Union Bankshares Corp.
Waiting and wondering
http://www.virginiabusiness.com/news/article/waiting-and-wondering#When:10:00:00ZFor more than six years, short-term interest rates have hovered near zero, but that could change soon. Federal Reserve Chair Janet Yellen reaffirmed in July the central bank’s plan to start raising interest rates before the end of the year.
If and when that happens, G. William “Billy” Beale, CEO of Richmond-based Union Bankshares Corp., which operates Union Bank, will be thrilled. In anticipation of Fed action, Union has been restructuring its balance sheet to be more asset-sensitive. Its actions have included tying more loans to floating rates, shortening the average life of its investment portfolio and emphasizing lower-cost, less reactive deposit vehicles like negotiable orders of withdrawal (NOW) and money market accounts.
“Essentially, if rates start to rise, our assets will reprice faster than our liabilities, and that would translate into improved profitability for us pretty quickly,” Beale says. “It would be a great thing.”
Unless, of course, the economy isn’t strong enough to absorb the rate hike.
“A quarter point [increase] doesn’t sound like much. A half point doesn’t sound like much,” Beale says. “But a rise in the prime rate will increase the cost of borrowing, and it could put some of our commercial customers under more stress. The question is: Will they be able to handle that increase or adjust their rents or pricing fast enough to not go into a negative cash-flow situation? That’s something we definitely worry about.”
Ups and downs
For all the hopes the banking industry has been putting on rising interest rates, an actual Fed move “will bring a lot of anxiety, in addition to great optimism, for both community and national banks,” says George Morgan, SunTrust Professor of Finance at Virginia Tech’s Pamplin College of Business.
“Everyone is expecting rates to rise, and banks that have effectively prepared will see their returns go up in the short-term,” he says. “Beyond that, though, there are a lot of scenarios that could play out, and there’s no way to predict what will happen.”
The big fear, of course, is that rising interest rates will cause the economy to weaken or even slide into recession resulting in a new round of loan defaults. Another possibility? The Federal Reserve could raise rates too quickly, effectively flattening the yield curve between short- and long-term rates and minimizing profitability for banks. The Fed also could raise rates temporarily and then drop them again, effectively hurting the same banks that the interest rate increase initially helped. And any change could create market volatility.
The last scenario, says Morgan, would play in favor of national banks that offer trading operations, M&A advisory services and other fee-based services. “Increased volatility creates more volume for those kinds of transactions, and so I think they’ll do very well in that environment,” he says.
Fortunately for smaller community banks, the Federal Reserve appears to be fully aware of the danger of moving too quickly, says Chadwick Curtis, assistant professor of economics at the University of Richmond’s Robins School of Business.
In a March speech, he notes, Yellen used the term “gradual” 13 times in describing her expected monetary policy.
“The big news is the speed at which rates are going to increase, which is likely to be a little slower than initially expected,” Curtis says. “It will probably be a quarter percent each time, and that will hopefully give everyone time to adjust, and the economy will withstand it.”
Most community banks have spent the last several years preparing for the possibility of both interest rate hikes and the ongoing uncertainty. Morgan notes that banks with a strategic portfolio of floating rates loans, which will reset quickly in a rate increase, and retail deposits, with rates that will rise more slowly, are sure to fare well when the Federal Reserve initially raises rates.
Reston’s John Marshall Bank is one of those banks. Its asset and liability committee intensively analyzes the interest rate gap and the potential impact interest rate changes will have on various bank operations and metrics. The committee will continue its work in earnest when the Federal Reserve finally acts.
“We try to set the mix of our loan portfolio and our deposit portfolio so it’s as closely matched as possible,” says Bill Ridenour, the bank’s president and chief administrative officer. “The way we’ve structured our assets and liabilities, we expect that when interest rates rise, it will at the very least have a neutral impact and very likely a positive impact on our earnings.”
Over the duration of the low-rate era, John Marshall Bank has controlled its expenses, managed its overhead and maintained one of the highest efficiency ratios in the industry.
“As long as you understand where your portfolio is, and you manage that interest rate risk, then an interest rate hike done in a controlled fashion will likely be very positive for banks, as long you watch what you’re doing and don’t get too far out with fixed interest rates on loans,” says Ridenour.
The fixed-interest rate loans pose a major risk, he says, “as there will continue to be a lot of competition for quality borrowers, and in a rising rate environment, those borrowers will want to get a long-term fixed rate if they possibly can.”
Danville’s American National Bank has spent the past six years restructuring for the inevitable day when rates finally start to rise. CEO Jeffrey Haley says that focus has been on “making everything as short as possible,” including commercial loans and bonds and “trying to squeeze every penny or basis point out of core deposits and vigorously lengthening our maturity of time deposits.”
Taking the long view
Michael Joyce, president and CEO of JoycePayne Partners, a financial management firm in Richmond, says that many banks have used the low-rate era to hedge their bets against future interest rate volatility by adding new sources of non-interest-rate-reliant revenue.
“They’ve done a good job of diversifying, which has stabilized their revenue streams and also allowed them to more easily comply with capital requirements,” he says.
Many smaller banks, for example, have joined national banks in putting an emphasis on fee-based wealth management services. According to data from Fiserv Intelligence Solutions published in American Banker magazine, trust income grew by 21 percent for the banking industry from 2012 to 2014 and accounted for 70 percent of wealth management income in 2014.
Leading the pack was Union Bank, which effectively doubled its trust revenue through its acquisition of Charlottesville-based Stellar One in January 2014.
Beale notes that trust income, along with other fee-generated income, such as mortgage underwriting and service charges, currently accounts for 21 percent of Union Bank’s total revenue.
“We hope to grow that to 25 percent by putting even more emphasis on mortgage and wealth management,” he says. “And it’s where we have chosen to focus a lot of our resources by adding people and trying to build out platforms so we’ll have that more stable, steady income and become less dependent on our margin.”
American National also has added variety to its income stream. The bank has had a Trust Investment Services Department in place since 1927. After the Great Recession, Haley says, the bank took steps to bolster that service, increasing assets from $531 million in 2011 to $750 million today, a 41 percent jump.
The bank also has provided merchant services and bankers insurance, emphasized debit card and debit interchange income, and eliminated fee waivers on commercial analysis and other fee-based services. Officials also have worked to cut expenses, most significantly by encouraging customers to switch from paper to electronic statements.
“We’ve dug way down and made all these little things a major strategic priority, which have all added up to a big number,” Haley says.
As a result of these preparations, Haley, like other bank officials, is guardedly optimistic. “Hopefully, all of us have our balance sheet in order, we have our expense structure in order, and then we can all benefit and the industry will have a nice pickup as rates go up in the short-term,” he says. “At the same time, I’m very concerned about the longer term: Will the Fed continue to go slow, or will rates get out of control and stifle or cut off growth? That’s the big unknown.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/DSC_2446.pngJames Eck, vice president of business development for Dominion. Photo by Rick DeBerry
Getting from here to there
http://www.virginiabusiness.com/news/article/getting-from-here-to-there1#When:10:00:00ZNothing powers an economy quite like a predictable and affordable source of energy. Yet nothing seems predictable these days as the U.S. and Virginia transition away from fossil fuels, the backbone of the country’s energy economy for more than 200 years.
In the face of new federally mandated carbon-reduction stand­ards, there’s a growing consumer urgency along with political pressure to turn to other forms of energy to power homes and businesses.
For proof, one need only look at Amazon Web Services’ decision to use more solar power. A week after cloud customers prevailed on the company to use more clean energy to power its massive data centers, Amazon announced in June that it would purchase energy from an 80-megawatt solar farm that Pennsylvania-based Community Energy Inc. will construct and operate on Virginia’s Eastern Shore.
With the growing trend to put renewables in the mix, some argue that no other industry is in such a transformative and uncertain stage. Tougher antipollution regulations are forcing companies, including Richmond-based Dominion Resources Inc., to close coal-burning plants and coal-ash disposal ponds. Meanwhile, there’s a big push to tap into sources such as solar and wind power and the cheap natural gas flowing from America’s shale gas basins.
Environmentalists say the push is long overdue and that large utilities like Dominion Virginia Power and Duke Energy aren’t moving fast enough. In June Virginia agreed to a $2.5 million settlement with Duke Energy, which spilled 39,000 tons of toxic coal ash in the Dan River last year after one of its coal ash ponds in North Carolina began leaking — one of many developments that seems to have given renewables new legs. Overall, federal prosecutors fined Duke $102 million for the spill.
In Virginia, where the fiber-optic rich Northern Virginia region has become a magnet for massive data centers, Dominion predicts that the state will need nearly 4,000 megawatts of new capacity by 2020. The company plans to add about 3,800 megawatts of power generation with the majority — 2,954 megawatts — coming from new natural gas-fired power plants. The remainder would come from a new solar program and smaller solar applications.
Appalachian Power Co., which serves the western part of the state, also is moving toward more renewable energy, with plans for more than a fifth of its energy to come from the sun and wind in 15 years.
The assurance that energy will be affordable and predictable is critical to the state’s economy, say public officials. “If you’re making a $500 million investment, you want to know that certain things aren’t going to surprise you tomorrow morning, next month or next year for that matter,” says Jerry W. Giles, managing director of business expansion for the Virginia Economic Development Partnership.
While many environmental groups embrace the Environmental Protection Agency’s Clean Power Plan (CPP) — with final regulations expected by the end of the summer — others fear the final plan will cause electric bills in Virginia to spike by more than 20 percent. And they aren’t convinced that clean energy and renewables alone are the best path in the high stakes emerging-energy economy.
“The mix is going to change, but the total demand will continue to grow,” says Michael Thompson, chairman and president of the nonpartisan Thomas Jefferson Institute for Public Policy in Springfield. “That doesn’t mean you cut out all the stuff that works while you try to make the new stuff work.”
If Virginia is going to lessen its reliance on the federal government for jobs, “we have to find other industries that will employ people, and energy is clearly one of them,” continues Thompson. “You have offshore drilling [and] fracking possibilities in this state. We released a study last month on how Virginia could become a worldwide player in the development of nuclear. If you are going to build an economy and grow in population, you need energy, and we’re fighting over a pipeline to just bring in the gas that will allow industry to expand, and natural gas is one of the cleanest energy sources. There seems to be a disconnect on where we need to go and how to get there.”
Advocates of clean energy see it differently. They want clean energy jobs that reduce pollution but not on the backs of individual property owners. Much of the opposition, for instance, to the Atlantic Coast Pipeline — the new massive natural gas pipeline mentioned by Thompson — comes from residents who don’t want to be forced to surrender land for a proposed project they aren’t convinced is necessary.
As utilities and private companies invest in new energy sources, the pressure is on to strike a balance between developmental and environmental concerns. Do the benefits outweigh the harm? That’s become a familiar mantra on nearly every proposed project — from transmission lines to pipelines — that would add to an energy grid that industry observers say already is strained by America’s growing reliance on all things digital.
In Virginia, several initiatives are underway. Three natural gas pipelines have been proposed, with all of them cutting through some parts of the state. They are the Mountain Valley Pipeline, a 300-mile, $3.2 billion project; the Appalachian Connector, a 300-mile project still in the early stages of planning, and the Atlantic Coast Pipeline, a $5 billion, 550-mile natural gas pipeline that would cross Virginia, West Virginia and eastern North Carolina.
Dominion, the parent company of Dominion Virginia Power, the state’s largest utility, heads a consortium of power companies planning to build the ACP. Meanwhile, a hefty price tag may have deflated an offshore wind project off the coast of Virginia Beach, while the sun seems to be shining on solar.
Will solar finally shine?
Richmond-based Dominion, one of the country’s largest energy producers, is gearing up to invest $700 million in the development of 400 new megawatts of solar in the state by 2020. The commitment is part of a deal Dominion cut to gain Gov. Terry McAuliffe’s support for a measure that passed during this year’s General Assembly. It freezes Dominion’s base electric rates until 2020 and eliminates rate reviews by the State Corporation Commission (SCC), the regulatory body over utilities, until 2022.
Base rates represent more than half of a customer’s bill. Dominion Virginia Power and legislators who supported the change said it was needed to prevent potential rate increases as the energy industry responds to the federal CPP. The proposed regulations, issued by the EPA under the authority of the federal Clean Air Act, call for a 30 percent reduction in carbon dioxide emissions from coal- and oil-fired power plants by 2030. In Virginia, the figure is 38 percent.
Solar is the fastest-growing source of renewable energy in the country. According to a recent report from GTM Research and the Solar Energy Industries Association, “By 2016, the U.S. will be generating enough clean solar energy to power 8 million homes …”
During the first quarter, the solar industry also was the top sector for job growth in the country’s clean energy economy with 6,600 jobs in generation and manufacturing at 19 projects across the country, including three in Virginia. However, the expected reduction of a federal investment tax credit from 30 percent to 10 percent at the end of 2016 hangs over the industry.
Compared with other states, Virginia has been slow to embrace solar. Its in-state solar production lags behind neighboring Maryland and North Carolina. The Tar Heel state ranks first in the Southeast with 150 utility-scale solar facilities and about 1,000 megawatts of solar. Virginia’s grand total: about 15 megawatts.
Dominion filed an application with the SCC in January to construct a 20-megawatt solar generation facility near its Remington natural-gas power station in Fauquier County. Dominion operates solar plants in other states, but the Remington facility would be its first utility-scale solar facility in Virginia. It claims the plant could power 5,000 homes when operating at peak.
Falling solar energy prices, combined with tougher federal coal regulations, make this a good time to diversify by adding solar, says James Eck, a Dominion vice president of business development. “Remington is a first step to get experience at doing a larger-scale solar project, but we are actively scouting properties and working with Virginia-based developers to build significantly more megawatts of solar from 2016 to 2020,” he says.
While some environmental groups applaud Dominion’s solar initiative, they claim ratepayers would fare better if Dominion were to seek private development bids rather than absorb the full cost of construction. “We support the Remington project, but Dominion is guaranteed a 10 percent rate of return for the investment. We’re hoping the SCC will look at the project and say, ‘Hey, we like it, but we want you to find another way to finance it,’” says Glen Besa, president of the Virginia Chapter of the Sierra Club.
Private entrepreneurs also are jumping in. 510 Nano Inc. plans to move its headquarters from Durham, N.C., to the Greensville County Industrial Park next year. It will build a 100,000-square-foot, 5-megawatt, manufacturing facility for the production of solar power systems. The $11 million project is expected to create 113 jobs in three years.
The Atlantic Coast Pipeline
The massive pipeline proposition has drawn support and opposition. Residents of Nelson and Albemarle counties, which the pipeline would cross, have waged a vocal and well-organized “all pain and no gain” media campaign. They are among 35 conservation and environment groups in Virginia and West Virginia that oppose the pipeline and its proposed routes, which cut across mountains and national forests.
Supporting the project and the estimated 8,000 jobs it would reportedly create are more than 100 business groups and organizations, including 50 in Virginia along with the state’s chief salesman: Gov. McAuliffe.
Dominion Resources is the lead partner in the joint venture, which includes North Carolina’s Duke Energy as well as Piedmont Energy and AGL Resources Inc., the parent company of Virginia Natural Gas. The ACP is expected to transport up to 1.5 million cubic feet of natural gas per day, extracted largely from huge shale deposits in West Virginia, Ohio and Pennsylvania. If the project wins approval from the Federal Energy Regulatory Commission (FERC) Dominion expects it would go into service in 2019. Dominion expects to file a formal application with FERC by the end of 2015. A decision could be handed down as soon as January 2016.
“One of the drivers of this project is that we’ve closed seven coal units in Virginia over the past several years, both for economic and carbon-related regulatory reasons. Yet Dominion Virginia Power still has a responsibility to keep the lights on 24/7. The way we’re going to meet that obligation is with additional power stations to generate electricity from natural gas,” says Dominion spokesman Jim Norvelle.
As proposed, the ACP would originate in Harrison County, W.Va. It would enter Virginia in Highland County and drop down through Augusta and Nelson Counties, continuing to Buckingham County and extending to Greensville County before entering North Carolina and terminating in Robeson County. A spur off the ACP would extend additional supplies of natural gas to Hampton Roads. Dominion is in the prefiling phase as FERC determines whether the project meets a compelling public need.
Joanna Salidis, president of Friends of Nelson, says her grass-roots group isn’t convinced that an expansion of natural gas is necessary to meet the CPP goals. “Dominion has already gone so far in switching from oil to gas, and efficiency and renewables can make up the rest,” Salidis says.
Asked why her group is so opposed to the pipeline, Salidis responds: “Our mission is to protect the property rights, property values, rural heritage and the environment for all the citizens of Nelson County. We oppose the pipeline because it would negatively affect all these things.”
Nelson residents are very upset, she adds, that Dominion originally sued some landowners over rights to survey their properties without permission, which is permissible under state law. The suits were later dropped when a judge ruled that the landowners were not notified properly.
Landowners in Nelson and Augusta have filed two federal lawsuits challenging the constitutionality of Virginia’s law. Meanwhile, pipeline developers are proceeding with a second round of more than 40 lawsuits against landowners who are denying surveyors permission to come on their properties.
In another recent development, Dominion Transmission Inc., leader of the limited liability company formed to build the pipeline, has proposed changes to the route that would rely more on existing utility rights of way than private property in Southside Virginia, an effort the company is pursuing in other areas of the state. As originally proposed, the pipeline would use existing rights of way for only six percent of its length.
In Nelson, people remain concerned about the possible use of eminent domain. If the project receives FERC approval, the developers could use the law to obtain the 125-foot right of way required for construction and the 75-foot easements that would be needed to maintain the 42-inch underground pipeline after construction.
“I don’t understand why so many people, including our governor, aren’t ashamed of themselves to advocate for a project that purports to build wealth by taking it from some people to give to others,” says Salidis.
Dominion counters that the ACP would benefit many people by delivering low-cost, abundant natural gas from shale fields to Dominion power stations that would be used to generate electricity for its 2.5 million retail electric customers in Virginia and North Carolina.
Dominion has rerouted some of the pipeline based on citizen feedback and field tests so far. For instance, an alternative would bypass the Norwood-Wingina Rural Historic District in Nelson. Also FERC wants the company to avoid the James River Wildlife Management Area in Nelson. Shifting the route to accommodate property owners is not a simple matter. “We repeatedly tell the folks in Nelson County and elsewhere that it’s very important for us to get on the property and do this survey. Without it, we don’t have a basis for saying there’s a reason to move the route,” says Leslie Hartz, vice president of pipeline construction for Dominion Transmission Inc.
Meanwhile construction is underway on Dominion’s Brunswick County Power Station. It would generate 1,367 megawatts of power. Dominion also is seeking approval from the SCC to build a $1.3 billion, 1,585 megawatt natural-gas-fueled power plant in Greensville County that could be operational by 2019. It would generate enough new capacity to power 400,000 homes.
Dominion is proceeding with plans for the new plants despite a Supreme Court ruling in June that reminded the industry of the uncertainty of the times. The court remanded back to a lower court the EPA’s new Mercury and Air Toxics Standards (MATS), limiting toxic emissions from coal- and oil-fired power plants. It said EPA must consider compliance costs before deciding whether regulation is “appropriate and necessary.” Dominion noted that the decision did not vacate the rule or place a stay on its implementation, so the company is not changing plans to close coal-fired plants like the one at Yorktown Power Station.
A bigger price tag than anticipated has stalled an offshore wind project Dominion was planning 24 miles off the coast of Virginia Beach. The company is looking at ways to reduce costs after bids for its construction approached $400 million, nearly double the $230 million Dominion anticipated. The 500-foot-high turbines were projected to generate around 11 to 12 megawatts.
Dominion also has proposed a wind farm on an 8-mile-long ridge called East River Mountain near Bluefield. Dominion owns about 2,600 acres there and has proposed building up to 80 megawatts of wind power. However, the Tazewell County Board of Supervisors recently changed its zoning ordinance to restrict tall structures. The current restriction requires Dominion to file a variance to proceed with the project — an option it is still evaluating.
Some industry watchers say the CPP may give a boost to a possible third nuclear reactor at Dominion’s North Anna Power Station in Louisa County. In its latest 15-year Integrated Resource Plan, which Dominion is required to file with the SCC, a proposal for a third unit was among four options Dominion presented as a possibility to meet demand while responding to new carbon rules. Dominion expects to receive a combined operating license (COL) for the proposed third nuclear unit from the federal Nuclear Regulatory Commission in 2016.
Yet even if it surmounts regulatory hurdles, the earliest possible date North Anna 3 would enter service is September 2027. It’s projected to cost more than $7 billion and would provide an additional 1,453 megawatts of power. Dominion has not committed to building the project and says it will not make a final decision until the COL is issued.
Virginia plans to reduce retail electricity consumption by 10 percent by 2020. McAuliffe moved up the goal by two years when he announced his state energy plan last fall. Since then, he has appointed an Executive Committee on Energy Efficiency to make the goal happen.
The only thing that appears to be certain in today’s energy industry is that finding low-emission fuel sources to replace coal isn’t going to be as easy as flipping a switch.2015-07-28T10:00:00+00:00
People - August 2015
George H. Ebbs, named dean, Joseph W. Luter III School of Business, Christopher Newport University, Newport News. He is the former president of Embry-Riddle Aeronautical University and former dean of the College of Business at Bloomsburg University in Pennsylvania. (Daily Press)
Beaufort LLC, a contract research organization in Norfolk, promoted Clay Gill to president of the company. She was senior vice president, client services. (Daily Press)
Corey L. McCray, named vice president for Workforce Solutions at Tidewater Community College. He was director of The Pruden Center for Industry and Technology in Suffolk. (News release)
Melinda Martin, named director of nursing, Patriots Colony, Williamsburg. She was director of clinical services and assistant executive director at Consulate Healthcare of Williamsburg. (News release)
Toano-based Lumber Liquidators combined the roles of its chief marketing and merchandising officers, naming Marco Q. Pescara to the merged role. Pescara has been the company’s chief marketing officer since 2006. The employment of William K. Schlegel, Lumber Liquidator’s chief merchandising officer, ended June 19. (VirginiaBusiness.com)
Michael P. Skahill, elected to the board of directors of the U.S.-China Agriculture & Food Partnership. He is vice president of global affairs for Smithfield Foods, Smithfield. (News release)
Scott Dittman, university registrar of Washington and Lee University in Lexington, has been elected vice president at large of the American Association of Collegiate Registrars and Admissions Officers. (News release)
Kimberly L. McCray, named executive director of the Virginia Quilt Museum in Harrisonburg. She was previously director of the Port o’ Plymouth Museum in Plymouth, N.C. (The Northern Virginia Daily)
Patrick Nolan resigned as president, Warren Memorial Hospital, Front Royal. He will take on the role of chief operating officer, Inspira Medical Center, Woodbury, N.J. (The Warren Sentinel)
David Simmons, named chief compliance officer at CBM Mortgage in Front Royal. Simmons, who formerly worked at CBM Mortgage, has more than eight years’ experience in the industry. (The Northern Virginia Daily)
Marilyn Ann Solomon, of the Solomon Law Group in Winchester, has been named for the second time Pro Bono Lawyer of the Year by Blue Ridge Legal Services, a nonprofit legal aid society that provides free civil legal assistance to low-income residents in the Shenandoah Valley. (The Northern Virginia Daily)
Mike Grogan , named Martinsville-Henry County Economic Development Corp.’s 2015 Business Person of the Year. He is founder, Southeastern Wood Products, Martinsville. (Martinsville Bulletin)
Valerie Harper , named director of the small, minority and entrepreneurial division, Martinsville-Henry County Economic Development Corp. Harper joined the EDC in 2006 and has served as small business coordinator for the past year. (Work It, SoVa)
Latala Payne Hodges , named director of communications and grants administration, The Harvest Foundation, Martinsville. Prior to joining Harvest, Hodges was a communications specialist at Patrick Henry Community College and a copy editor at the Martinsville Bulletin. (Work It, SoVa)
Joe King plans to retire as Danville city manager Nov. 30. King’s local government career spans 40 years, 13 of which have been with Danville. The city plans to use a search firm to find a successor. (VirginiaBusiness.com)
Chris A. Lumsden , of South Boston, named chair, Virginia Economic Development Partnership board of directors. He has served as administrator and president of Sentara Halifax Regional Hospital since 1988. (The Gazette-Virginian)
Dr. Ross Taylor , named the chief medical officer for Danville Regional Medical Center, effective Sept. 1. He is a board-certified orthopedic surgeon. (GoDanRiver.com)
William E. “Bill” Coleman retired from the Southern Virginia Higher Education board of trustees. Coleman is chairman of the board of directors, interim president and CEO of Halifax County Community Federal Credit Union. (Work It, SoVa)
Jim Barker , promoted to vice president of finance, Corvesta Inc., Roanoke. Barker has worked in leadership positions of increasing responsibility since joining Corvesta in 2003. He succeeds Mike Wise, who recently retired after 23 years with the company. (News release)
Mark Lambert , promoted to senior consultant for communications and college relations at Jefferson College of Health Sciences in Roanoke. He was the coordinator for communications and college relations at the school. (News release)
Thomas H. Miller , an attorney with Frankl, Miller & Webb LLP in Roanoke, received the Local Bar Leader of the Year Award from the Conference of Local Bar Associations, which recognizes continued dedication of bar leaders and close cooperation with the Virginia State Bar. (News release)
J.P. Morga n, a profes sor of statistics and associate dean for strategic initiatives in the College of Science and director of the college’s Academy of Integrated Science at Virginia Tech, named a Fellow of the American Statistical Association. (The Roanoke Times)
Barbara Ryder received the Influential Educator Award from the Association for Computing Machinery’s Special Interest Group on Software Engineering. She is an engineering professor at Virginia Tech and heads the computer science department (News release)
Marc Schillebeeckx , named executive vice president of sales, services and marketing at Virginia Transformer Corp. (The Roanoke Times)
HomeTown Bank announced the following promotions and additions to its staff: Rachel Cripps , promoted to financial specialist at the Colonial Avenue branch; Kimberly Lawrence , promoted to banking officer and assistant branch manager at the downtown Roanoke branch; Carolyn Dearing , floating retail specialist at the downtown Roa noke branch; and Desmond Cornette, retail special ist at the Salem branch. (The Roanoke Times)
C. Daniel Clemente , named vice chair, Virginia Economic Development Partnership board of directors. Clemente is chairman and CEO of Clemente Development Co. Inc. and CDC Consulting Group Inc. in Tysons Corner.
Jennifer Felix , named senior vice president and CFO, Vencore Inc., Chantilly. She was the CFO of Herndon-based Sotera Defense Solutions. (VirginiaBusiness.com)
Chris Ferrier , named executive chef, The National Conference Center and West Belmont Place, Leesburg. Ferrier was the executive chef at The Fairfax at Embassy Row. (Leesburg Today)
Scott Lehr , named president of the Flight Systems Group, Orbital ATK Inc., Dulles. Lehr had been senior vice president of the group since the merger of Orbital Sciences Corp. and Alliant Techsystems in February. (VirginiaBusiness.com)
Carlos A. Ota l, named manag ing partner of Grant Thornton LLP’s Global Public Sector in Alexandria. Otal was managing partner for the firm’s GPS Financial Management Advisory and Audit Services. (VirginiaBusiness.com)
James C. Reagan, named executive vice president and chief financial officer, Reston-based Leidos Holdings Inc. Reagan was senior vice president and CFO of Vencore Inc. (VirginiaBusiness.com)
Todd Stottlemyer, named CEO, Inova Center for Personalized Health, Falls Church. He was CEO of Acentia in Falls Church. (VirginiaBusiness.com)
Richmond-based Cushman & Wakefield|Thalhimer announced in June that Virgil G. Nelson will lead the firm’s Fredericksburg office. Nelson has been a top commercial broker in the Fredericksburg region for more than 30 years. He replaces Jamie A. Scully, who will focus on his clients for sales and leasing transactions and serve as a leader and mentor for the Fredericksburg office. (VirginiaBusiness.com)
Rodney Joffe, tapped to serve a third term on the Federal Communications Commission’s Communications, Security, Reliability and Interoperability Council. He is senior vice president and fellow, Neustar, Sterling. (News release)
Vincent E. Aurentz, named president, HemoShear, Charlottesville. Aurentz was the company’s chief business officer. (VirginiaBusiness.com)
Reginald “Reggie” Jones, a partner at Williams Mullen in Richmond, elected chairman of the board of the Virginia Early Childhood Foundation. He succeeds Ben Davenport, chairman of Davenport Energy and First Piedmont Corp. in Chatham. (VirginiaBusiness.com)
Tom Katsouleas, named provost, the University of Virginia. Katsouleas, formerly the Vinik Dean of Engineering at Duke University’s School of Engineering, will start at U.Va. on Aug. 17. (The Daily Progress)
Dr. Marsha D. Rappley, named VCU’s vice president for health sciences and CEO of the VCU Health System beginning Aug. 15. She has been dean of the Michigan State University College of Human Medicine. (VirginiaBusiness.com)
Chesterfield-based Tredegar Corp. announced in June that its CEO, Nancy M. Taylor, and CFO, vice president and treasurer, Kevin A. O’Leary, had resigned. Taylor also resigned from Tredegar’s board of directors. Former chief executive John D. Gottwald will serve as interim CEO until a replacement is found. (VirginiaBusiness.com)
John B. Walker, named president of the Greater Richmond ARC. He succeeds Marshall Butler, who is stepping down after 37 years but will remain in an advisory role with ARC for several months. Walker was president and CEO of QubicaAMF Bowling Worldwide. (VirginiaBusiness.com)
Dana M. Isaacoff, named chief operating officer, Geoff McDonald & Associates, Richmond-based personal injury law firm. She was chief information officer at Williams Mullen law.2015-07-28T10:00:00+00:00
For the Record - August 2015
Amazon Web Services Inc., an Amazon.com company, has teamed with Community Energy Inc., a solar developer based in Radnor, Pa., to support the construction and operation of an 80-megawatt (MW) solar farm in Accomack County. According to AWS, the project would be the largest solar farm in Virginia. The farm is expected to start generating about 170,000 megawatt hours of solar power annually as early as October 2016. (VirginiaBusiness.com)
Avis Budget Group , which employs 520 workers at a facility in Virginia Beach, decided to outsource part of its operation, affecting up to 150 workers in some way. The effective date is Aug. 1, according to a notification the company gave state officials. Up to 30 of the other workers will be moved to current, open positions within the company, leaving a net job reduction of 70 to 90 positions, said John Barrows, a company spokesman. (The Virginian-Pilot)
Chesapeake-based Dollar Tree Inc. completed its $9.2 billion acquisition of Family Dollar stores in July after federal regulators approved an agreement to meet antitrust concerns. The combined company will be the largest discount retailer in North America, with more than 13,000 stores. Nearly all the Family Dollar stores will maintain their name, but they will undergo improvements, Dollar Tree executives have said. (The Virginian-Pilot)
The Navy awarded Huntington Ingalls Industries Inc. , parent of Newport News Shipbuilding, a $3.35 billion contract for the detail design and construction of the carrier John F. Kennedy. Newport News-based HII also won a $941 million modification to an existing construction-preparation contract to continue material procurement and manufacturing for the ship. It is scheduled for delivery in June 2022. (The Virginian-Pilot)
The Navy is l ooking to hire about 430 civilians over the next six months for professional and skilled positions in Hampton Roads. The vacancies were created, in part, when older workers retired a couple of years ago during a hiring freeze prompted by cuts in defense spending, said Tom Kreidel, a Naval Facilities Engineering Command Mid-Atlantic spokesman. Now the command is catching up and filling those positions. (Daily Press)
The Virginia Beach Development Authority approved an extension of up to one year for exclusive negotiations with the Northern-Virginia based Peterson Cos. on a 230,000-square-foot entertainment project in the resort area, dubbed VA ViBe. It is estimated that 2,380 full-time and part-time jobs will be created, while the total capital investment is estimated to be $100 million. (VirginiaBusiness.com)
A Harrisonburg-based cybersecurity firm is expanding in the city, expecting to create 29 jobs. AXON Ghost Sentinel Inc. (AGS), a portfolio company of AXON Connected LLC, will spend $1.5 million on the expansion. Gov. Terry McAuliffe approved a $75,000 grant from the Commonwealth’s Opportunity Fund (formerly the Governor’s Opportunity Fund) to help Harrisonburg with the project. (VirginiaBusiness.com)
The 2015 Business Excellence: Business Appreciation Awards presented by the Front Royal-Warren County Chamber of Commerce and Economic Development Authority have been announced. This year, Weathervane Graphics received $500 to help the business as it moves to a new location; J oe’s Steakhouse was awarded $750 for some outdoor beautification; and Backroom Brewer received the first-place award of $1,000, which will be used for new kitchen equipment. (Northern Virginia Daily)
More than 600 jobs are expected to accompany a $40 million project coming to the former Avtex superfund site in Front Royal. IT Federal LLC will build an office complex on about 30 acres in a phased pro cess. Construction is expected to begin in third-quarter 2015, with all phases complete in September 2018. (The Warren Sentinel)
Shenandoah Terrace is scheduled to open in December or January in New Market. The 15,000-square-foot-facility will provide memory care services, catering to residents with memory issues, including Alzheimer’s and dementia. Paul Griffin, an owner of the Shenandoah Place Assisted Living Facility on Burkholder Lane, broke ground on the facility on May 26. (The Shenandoah Valley-Herald)
Threshold Enterprises Ltd ., the nation’s second-lar gest distributor of nutritional supplements and natural health and beauty products, announced the opening of a new East Coast distribution center in Winchester. The company currently employs 80 people at its facility in Stonewall Industrial Park. It expects to employ more than 100 workers when fully operational by the end of the summer. It also plans to nearly double the warehouse space to 148,000 square feet as demand continues for its line of products. (VirginiaBusiness.com)
Danville Community College board members approved two new welding programs and upgrades to the welding workshop on campus in June. The first program will allow DCC students to pursue a standard welding diploma. DCC also will debut an advanced certification program for welding. (Danville Register & Bee)
Local middle and high school students will be starting their own businesses in the upcoming school year as the Danville Pittsylvania County Chamber of Commerce prepares to launch the third class of the Young Entrepreneurs Academy (YEA!). YEA! is a program that takes students through the process of starting and launching a real business or social movement over the course of an academic year. (Work It, SoVa)
Dominion Virginia Power is seeking regulatory approval of a proposed $1.3 billion natural gas-fired power plant in Greensville County. The Richmond-based company filed the request in July with the State Corporation Commission. Dominion said construction of the power plant would create more than 1,000 jobs. Forty-five workers would operate the plant. (Richmond Times-Dispatch)
Virginia agreed in June to a $2.5 million settlement with Duke Energy for a 2014 spill of coal ash in North Carolina that floated down the Dan River, depositing tons of the toxic stew into the city of Danville’s waterfront and beyond. In February, Charlotte, N.C.-based Duke also agreed to plead guilty to violations of the Clean Water Act related to the spill and other violations and pay $102 million in fines, restitution and community service. (The Associated Press)
A ribbon-cutting ceremony for the former Henry Hotel, which is undergoing redevelopment, has tentatively been set for July 29, according to Martinsville Assistant City Manager Wayne Knox. Waukeshaw Development Inc. is spending roughly $3.2 million to turn the four-story building at the intersection of East Church and Broad streets into The Henry, a complex of 25 modern apartments and four commercial units. (Martinsville Bulletin)
Monogram Foods was honored by the Martinsville-Henry County Economic Development Corp. as the company with the highest combination of new jobs and capital investment in the previous year. The food products company has added a total of more than 450 jobs and invested more than $50 million in the community since 2009. (Martinsville Bulletin)
The New York Stock Exchange took action in July to delist the stock of Bristol-based coal producer Alpha Natural Resources. The stock, which closed at 24 cents a share on July 15, had been trading at less than $1 since April. Coal producers have faced a depressed market as many power plants switch to natural gas. (News release)
With Cabela’s set to open this fall, the company is accepting online applications for approximately 150 full-time, part-time and seasonal positions at the new Bristol location. Cabela’s will be the first store to open in The Falls, the city’s long-awaited retail center taking shape near Interstate 81’s Exit 5. (Bristol Herald Courier)
St. Petersburg, Fla.-based HSN Inc. plans to close its call center and fulfillment facility in Roanoke County, leaving 350 people out of work. HSN spokesman Brad Bohnert said the closure would not occur until April 2016. HSN, which sells merchandise on TV and online and through catalogs, is moving its fulfillment operations to Tennessee. (The Roanoke Times)
The yearslong search for a new business park site in Franklin County may be coming to an end. The county’s Board of Supervisors has until Nov. 30 to decide whether it wants to purchase Southway Farm LLC, a 350-acre site that would cost the county $7 million if it chooses to purchase the site to serve as a business park, said Michael Burnette, Franklin County’s economic development director. (The Roanoke Times)
A group of 15 media organizations wants to study how drones can be used safely in news gathering. The coalition is partners in a study with Virginia Tech, one of the Federal Aviation Administration-designated test sites for research on unmanned aircraft systems. The project will include controlled flight tests on real-life scenarios that simulate news events. (VirginiaBusiness.com)
Yokohama Tire in Salem will invest $15 million in its facility and keep at least 800 employees over the next three years. In exchange, the city will rebate a portion of the company’s tax payments, according to a new contract between the company and the city. The Salem plant manufactures passenger, high-performance and light-truck tires and is one of Salem’s largest employers.
(The Roanoke Times)
Bow Tie Strategies , a public affairs firm located in Leesburg, named Best Home-Based Business for 2015 at the Town of Leesburg Business Awards. The company’s president and founder is Rusty Foster. (News release)
The Fairfax County Chamber of Commerce threw a party June 9 to celebrate the organization’s 90th anniversary. Del. Tim Hugo (R-40th) presented chamber president and CEO James Corcoran with a resolution from the General Assembly that honored the business group’s contributions over the past nine decades. The chamber donated more than $5,000 obtained from ticket sales to the Children’s Science Center. (Inside NoVa)
George Mason University received a $10 million gift from the Peterson Family Foundation to be used for scholarships in the arts and to complete the construction of a health-sciences building. The gift was announced in June at a groundbreaking ceremony for the health-sciences building that will be named in honor of the Peterson family. Milt Peterson is the founder of Peterson Companies. (VirginiaBusiness.com)
Washington, D.C.-based GovLoop acquired Alexandria-based TMGov, an association of more than 100,000 government talent management leaders, and its TMGovU online university. Financial details were not disclosed. GovLoop said the deal will expand the scope of its GovLoop Academy, a free, virtual training program created for government employees. (VirginiaBusiness.com)
Fairfax-based ManTech International Corp. completed its acquisition of Knowledge Consulting Group (KCG), a cybersecurity advisory firm. Financial details of the acquisition were not disclosed. Founded in 2000 and based in Reston, KCG focuses on anticipating threats and implementing defensive countermeasures. ManTech provides support to national security programs for about 50 federal agencies through approximately 1,100 current contracts. (VirginiaBusiness.com)
Jim Webb, a former U.S. senator from Virginia and Navy secretary under President Ronald Reagan, launched a long-shot bid for the 2016 Democratic presidential nomination in July. Webb, who lives in the Falls Church area, announced the decision on his campaign website. “After many months of thought, deliberation and discussion, I have decided to seek the office of the Presidency of the United States,” he wrote. (USA Today)
The Babcock and Wilcox Co. completed the separation of its companies, leaving Lynchburg as the headquarters of nuclear company BWX Technologies Inc. Charlotte-based Babcock & Wilcox announced last year its plans to spin off its power generation business, which is now known as Babcock & Wilcox Enterprises Inc. That business has remained headquartered in Charlotte.
A U.S. Bankruptcy Court judge has approved procedures for Richmond-based Health Diagnostic Laboratory Inc. to put itself up for sale. The company plans to solicit bids through Sept. 4, hold an auction Sept. 10 and seek court approval at a hearing on Sept. 16. Once one of the region’s fastest growing companies, HDL filed for Chapter 11 bankruptcy protection in June, listing a $49.5 million federal settlement payment as its biggest debt.(Richmond Times-Dispatch)
A mediated settlement in June will keep Sweet Briar College open for the upcoming academic year. The deal involves using $12 million raised by alumnae to keep the women’s college afloat while sweeping out leadership of the 114-year-old school. The school was scheduled to shutter in late August. Leaders of the liberal arts college cited insurmountable financial challenges in March as the reason for the planned closure. (The Associated Press)
The final bill has come due on the abortive U.S. 460 toll expressway pushed by the administration of then-Gov. Bob McDonnell — $260 million, most of it to a private contractor paid by the state without a federal permit to build the road through hundreds of acres of wetlands. Under a settlement announced by Gov. Terry McAuliffe — who halted the project— the state will recover $46 million already paid to US 460 Mobility Partners and avoid paying $103 million in additional claims submitted by the developer under the terms of a contract that critics say shifted all the project’s risks to the state. (Richmond Times-Dispatch)
The merger of paper and packaging companies MeadWestvaco Corp. and Rock-Tenn Co. has been completed. The combined company, now known as WestRo ck Co., began operations on July 1. It is based in Richmond. Steve C. Voorhees, who was CEO of Rock-Tenn, is CEO of WestRock. John A. Luke Jr., who was chairman and CEO of MeadWestvaco, has become non-executive chairman. (VirginiaBusiness.com)2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/NOVA_LidlHQ.pngLidl will establish its U.S. headquarters at this building in Arlington. Photo courtesy CoStar Group Inc.
Lidl announcement boosts Arlington, Spotsylvania
http://www.virginiabusiness.com/news/article/lidl-announcement-boosts-arlington-spotsylvania#When:10:00:00ZArlington officials say landing the U.S. headquarters of Lidl, a Germany-based discount supermarket chain, will help diversify the county’s economy.
One of the largest retailers in the world, Lidl operates nearly 10,000 stores in 26 European countries. It expects to begin opening stores in the U.S. in 2018.
The company will invest $202 million in operations in Virginia. The total includes $77 million for the Arlington headquarters, where it will create 500 jobs, and $125 million for a regional headquarters and distribution center in Spotsylvania County, where it will employ 200 people.
Arlington competed ag­ainst North Carolina during the selection process. The win represents “a real opportunity to have the headquarters of a global company that is growing, has ambitious plans and is reputable,” says Christina Winn, director of the business investment group for Arlington Economic Development. “We look at Arlington as the perfect place to debut their operations.”
Lidl said three factors contributed to its decision to choose Arlington: the county’s young, educated workforce; the area’s regional transit options; and access to a major airport, Reagan National.
While Arlington continues to record one of the lowest unemployment rates in Virginia, federal budget cuts have affected the local economy.
“As we are continuing to diversify our economy, this was a perfect piece, a corporate headquarters that helps with our resiliency and sustainability and signals Arlington’s business-friendly orientation to companies all over the world,” Winn says.
Chris Yakabouski, chairman of the Spotsylvania Board of Supervisors, says Lidl also will give his county a big boost. “This $80 billion organization will build the largest industrial structure in the Spotsylvania community,” he says.
Lidl’s U.S. president and CEO, Brendan Proctor, says the company will introduce U.S. shoppers to a different type of retail experience. “Our philosophy is simple: We are focused on offering customers top-quality products at the most competitive pricing in convenient locations,” he said in a statement to the press.
The Virginia Economic Development Partnership worked with the two counties to secure the project. State incentives included $5 million in grants from the Governor’s Opportunity Fund and $2 million from the Virginia Economic Development Incentive Grant program. The Spotsylvania Board of Supervisors in July approved a $9.7 million incentive package for Lidl. The incentives include an up-front payment of $1.4 million from the county.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Dominion_Blvd_EVW.pngThe Branch Group’s current projects include expansion of Dominion Boulevard in Chesapeake. Photo courtesy Branch Group
Projects keep Branch Group workforce growing
http://www.virginiabusiness.com/news/article/projects-keep-branch-group-workforce-growing#When:10:00:00ZThe Branch Group’s diverse portfolio of projects, from major roadway expansions to institutional construction, keeps the Roanoke-based company on an upward trajectory. “We have seen significant growth in terms of volume pretty much across the board,” says CEO J. William Karbach. The company’s workforce is projected to reach nearly 1,000 this year, up 50 percent from 2010.
The Branch Group is the holding company for Branch Highways, Branch and Associates (construction managers and general contractors), E.V. Williams (prime contractors for highways) and G.J. Hopkins (mechanical and electrical contractors).
Current ongoing projects include the expansion of Route 58 in Carroll County and Dominion Boulevard in Chesapeake as well as the construction of the 155,000-square-foot Cregger athletic center at Roanoke College.
Most of the company’s projects are in Virginia, but Karbach would like to see the company expand its footprint in the Southeast. “We have been multistate in the past. In the 1990s we worked in Mississippi, Tennessee and Pennsylvania. During the downturn, most, if not all, of our projects were in Virginia,” he says. “Now we have a few endeavors in North Carolina.”
The core market for Branch and Associates is institutional construction, mainly the K-12 and higher-education market. Recent projects include construction of Blacksburg and Auburn high schools and Auburn Middle School in Montgomery County. Branch also built the Jerry Falwell Library at Liberty University in Lynchburg. “It’s an iconic showpiece,” Karbach says.
The company also has worked on multifamily housing, health-care, commercial and industrial projects. “They are all primarily in Virginia, but we have also worked in West Virginia and North Carolina,” he says.
The company has completed a number of projects in recent years for the Carilion New River Valley Medical Center in Christiansburg. “We are back there again working on renovations,” Karbach says.
The Branch Group is unusual in its industry because it is entirely owned by its employees. Whenever the company hires employees, it tries to make sure they “can embrace the culture, which is deeply rooted in employee ownership,” Karbach says.2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/doss02.pngEva Doss, president and CEO of The Launch Place. Photo by Steven Mantilla
Seed fund attracts personalized therapy firm
http://www.virginiabusiness.com/news/article/seed-fund-attracts-personalized-therapy-firm#When:10:00:00ZPanacea BioMatx Inc. co-founders Edison Hudson and L. Staton Noel III might not have considered expanding their personalized therapy company to Danville if they hadn’t received a $250,000 seed-fund investment from The Launch Place.
In return for the investment, the company committed to creating at least five jobs paying an average of $50,000 annually within three years.
“Certainly the resources offered through The Launch Place were an important incentive,” says Panacea CEO Hudson. “We looked at the lab and production facilities [in Danville], and the cost compared very favorably to Research Triangle Park” in North Carolina where the company is based. Another plus is that Danville is only an hour’s drive away.
Eva Doss, president and CEO of The Launch Place, has been watching Panacea’s progress for more than a year. She finds it a good fit for the organization, which helps develop entrepreneurs by providing seed money and consulting services. “We try to invest in companies in green technologies, IT, medical device firms and manufacturing,” she says.
Founded in early 2013, Panacea develops and manufactures personalized therapies. It creates personalized dietary supplement formulations in a single easy-to-swallow pouch. “The whole idea behind personalization is that different people have different needs. We personalize to the individual,” says Hudson. “It allows people to take just what they need — the right thing in the right amount.”
The company employs a robotic system in its manufacturing. “We only have one of these now, and it can serve about 8,000 to 10,000 clients per month,” Hudson says. “As we increase our customer base, we will place additional compounding robots in other locations. At some point, we will want to have a formulations robot in Virginia.”
The company’s supplements include vitamins, micro-minerals such as zinc, iron and selenium along with herbals and beneficial oils such as Omega 3. “At some point in the future, we expect to add a limited range of pharmaceuticals,” Hudson says.
The start of the company’s Danville operations will depend on its production rate and how fast it outgrows its current production area. “We will get tight by the end of the year, and then we will be forced to look for more manufacturing space,” Hudson says.
“The potential in the size of their market is huge,” Doss says of Panacea. “They already employ 12 people in Research Triangle Park. They have a solid management team.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/VAL_interchange-corner.pngInterchange expects its Hampton Roads facility to begin operation by the end of next year. Photo courtesy Interchange Group
Interchange develops food-grade warehouses
http://www.virginiabusiness.com/news/article/interchange-develops-food-grade-warehouses#When:10:00:00ZHarrisonburg-based Interchange Group is acquiring a 13-acre site in the Hampton Roads area within 15 miles of the ports. The third-party logistics provider hopes to have a food-grade warehouse in operation by the end of next year. That timeframe would coincide with the completion of the Panama Canal expansion, a project that will double capacity of that trade route.
The new facility “will give us the ability to consolidate operations in that area and provide better service for import and export,” says Terry Cunningham, Interchange’s sales manager.
The company currently has 14 facilities with a total of 1.6 million square feet of warehouse space in Waynesboro, Front Royal, Winchester and Harrisonburg/Rockingham County. Interchange also has a trucking operation, Interchange Express, in Suffolk that transports containers from Hampton Roads ports to locations in Virginia and the mid-Atlantic region.
Interchange’s business is divided equally between providing logistical services and leasing warehouse space. It has domestic and international customers. “We have one Canadian company that handles the repackaging of fruits and vegetables under the Welch’s brand,” Cunningham says, noting that Hershey’s is also a customer.
In addition to its warehouses, the company has two pad-ready sites available for development. Construction on a 126,000-square-foot building on a site across from the company’s existing facility in Front Royal should be completed by the end of summer 2016. Another site at an existing property in Lyndhurst is available for a 204,000-square-foot facility.
“We are staying ahead of the curve when it comes to having land available to build on,” Cunningham says. “We have most of the infrastructure ready to go, and it’s zoned appropriately. If a client comes to us and says they would like to have a building, we can typically get a building up in 10 to 12 months.”
Almost all the company’s buildings are food-grade facilities. Some are equipped for a combination of temperatures. “We adhere to protocols that allow them to store food-grade packaging materials, products and ingredients as well as nonfood-related products,” Cunningham says.
The temperature in the company’s frozen-food warehouse spaces, for example, can go as low as minus 10 degrees Fahrenheit, while its heated spaces, which store products such as coconut and chocolate paste, can be kept at more than 90 degrees.
In the last 10 years the need for temperature-controlled space has grown rapidly, Cunningham says. “We have a niche market in assisting those companies that need to have temperature-controlled space along the I-81 corridor,” he says. “In the last three years when we develop additional space, it has been geared toward temperature-controlled space.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Miller0290.pngMary Miller says the targeted area sees a lot of visitor traffic. Photo by Mark Rhodes
Project aims to increase downtown businesses
http://www.virginiabusiness.com/news/article/project-aims-to-increase-downtown-businesses#When:10:00:00ZMary Miller, president and CEO of the Downtown Nor­­­­folk Council, wants the Granby Street area of downtown Norfolk to be a business showplace.
In May, the group partnered with the digital marketing firm Grow to begin Vibrant Spaces, a program designed to increase the number of street-level businesses in the area.
The targeted area is located near a cluster of popular attractions such as the Chrysler Hall, Chrysler Museum, Scope Arena and Nauticus. “We see a lot of visitor traffic in that area,” Miller says. “This would give visitors more things to do.”
The growth of Norfolk’s downtown residential population is one catalyst for the program. “That gives you the base and critical mass to support these new businesses,” Miller says.
The council came up with the project after receiving input from people who live, work and own businesses downtown. The area already has a growing number of independent restaurants. “We knew we had the opportunity for more retail,” Miller says.
The group’s wish list includes a grocery store or urban market, bakery, farmers market, brewery, bike shop, wine shop, homemade ice-cream parlor, 24-hour diner, live music venue and art-supply, pet-supply and home décor stores.
Phase I of the program will offer six available downtown spaces to new businesses. They will be able to lease spaces at 50 percent of market rate for two years and 75 percent of market rate for the third year. Business owners also will have access to $20,000 kick-start grants ($10,000 on opening and $10,000 at the one-year anniversary).
In another facet of the program, existing downtown businesses can apply for a share of $60,000 in matching grants to be used in making their businesses more attractive. The successful applicants will receive funds equal to up to 50 percent of the cost of their enhancement projects, or up to $10,000 per business.
Businesses will be notified by early August on whether they have been accepted as a program participant.
“This program is one-of-a-kind,” says Miller. “We’ve researched catalyst programs across the country and have not found anything like it.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/Bernie4247.pngPhoto by Mark Rhodes
Vote ‘Yes’ for growth
http://www.virginiabusiness.com/opinion/article/vote-yes-for-growth#When:10:00:00ZWhat do Virginia, Texas, Utah, North Carolina, South Carolina, Georgia, South Dakota and Minnesota all have in common? They’ve all been at the top of one or more “best states for business” lists during the past decade.
The most widely recognized lists are CNBC’s Top States for Business, Forbes.com’s Best States for Business, Pollina Corporate Real Estate’s Top 10 Pro-Business States and Site Selection magazine’s Top US Business Climates.
Virginia has been the runaway leader on these four lists, making it to the top 10 a total of 35 times in the past 10 years, with 12 appearances as the overall No. 1 state by one or more of these rankings.
Nevertheless, things have been more competitive lately. In late June, the most recent CNBC list placed Virginia in 12th place, down from eighth in 2014, fifth in 2013, third in 2012 and first in 2011. While it’s hard to say that placing anywhere close to the top 10 is bad, a declining trend is clear. Other states are getting better.
Virginia’s top-ranking heyday began back in 2007 and 2008, when state rankings for economic development started becoming widespread in the business media. At the time, much of the U.S. was plunging into deep recession. Federal spending, however, was soaring to offset damages wrought by the mortgage-banking crisis and to support military buildups in Iraq and Afghanistan. Virginia was a primary beneficiary of the increase in government spending. Unemployment rates stayed below the national average, and job creation was relatively robust.
Contrast that with the past several years. Budget cuts and a wind-down of military operations have reduced federal spending. While the commonwealth’s unemployment rate remains below the national average, recession-wracked economies in other states have grown faster during the recovery.
Delving into the 10 factors behind Virginia’s 12th-place ranking by CNBC, the commonwealth is strongest on Business Friendliness, scoring third in the nation; Education (sixth); Workforce (also sixth); Access to Capital (12th); and Technology and Innovation (14th).
Virginia scores in the middle of the pack (25th) on Quality of Life, Cost of Living and Infrastructure.
The commonwealth’s lowest scores are in Economy (36th) and Cost of Doing Business (37th).
Moreover, looking back to 2014 to see where our rankings have changed most in the past 12 months — Virginia has dropped seven places in both Economy and Cost of Doing Business and six places in Infrastructure.
Beyond reliance on federal spending, Virginia’s overall economy, cost of doing business and infrastructure are largely functions of the state’s ability to pay for highways and provide funding for education, economic development and other maintenance or growth-oriented programs.
A separate study by the Mercatus Center at George Mason University ranked Virginia 21st among the 50 states in terms of fiscal health. This study looked at five factors: Cash Solvency (30th), Budget Solvency (29th), Long-run Solvency (27th), Service Level Solvency (fifth) and Trust Fund Solvency (15th).
These factors necessitate some explanation. Cash Solvency is the ability to cover short-term obligations. Budget Solvency is the ability to cover planned spending with current-year revenue; in other words, is there a budget shortfall? Long-run Solvency looks at how much asset levels are above long-term obligations. Service Level Solvency asks whether a state is in good position to raise taxes and cover shortfalls without harming the economy — apparently we are. Finally, Trust Fund Solvency looks at things such as unfunded pension liabilities, and, surprisingly, we are in relatively good shape there, too.
Overall, though, a combined ranking of 21st among all states just barely squares with our longheld self-perception of Virginia being above average on all things.
When it comes to economic development, Virginia has many assets that are unmatched by other states. The Port of Virginia, Washington Dulles International Airport and our railroad infrastructure make the commonwealth an unbeatable gateway to the global marketplace.
Still, Virginia can get better. The General Assembly has long taken pride in fiscal conservatism, but, thanks to the proliferation of such conservatism, Washington is now a less reliable source of growth. More needs to happen at the state level.
According to the Mercatus Center study, the good news is there is room to raise state revenues to pay our own way. Being all about “No more taxes” is nice, until it means sacrificing needed services and losing out on economic opportunities.
Diversifying Virginia’s economy away from over-reliance on federal spending is much needed, as is a significantly higher investment in economic development incentives and more transportation funding. Is there political will to do these things? My vote is a resounding “Yes.”2015-07-28T10:00:00+00:00http://www.virginiabusiness.com/uploads2/55vb0615.png
Washington and Lincoln offer better lessons on leadership
http://www.virginiabusiness.com/opinion/article/washington-and-lincoln-offer-better-lessons-on-leadership#When:10:00:00ZTo the Editor,
I am a longtime subscriber and read with interest your June issue article on “The Leader as Learner.” Academics from the various Virginia universities can opine as they will. Leadership is not and never has been about the most current trend in guiding people. It is about men and women who can hire the best people, sublimate their egos and do what is best for their customers, company and his/her employees. It is a simple formula, regardless of whether the milieu is business, the military or politics.
I work for a lower middle-market, private-equity firm that invests in companies with sales usually between $15 million and $50 million. A good CEO makes or breaks companies of this size. The common trait among the successful ones is a personality characterized by confidence without a preening ego and a clear strategy with tactical execution flexibility.
If you want to learn about leadership, don’t read the most recent book from the business consultant du jour. Read a biography of George Washington, Abraham Lincoln or Winston Churchill. These leaders led nations and saved countries, much more challenging than exceeding annual business budgets.
Thomas M. Neale
Managing partner, Patriot Capital
New buzz at Salamander Resort and Spa
http://www.virginiabusiness.com/news/article/new-buzz-at-salamander-resort-and-spa#When:17:58:00ZThings are buzzing along at Salamander Resort & Spa, a luxury resort in Middleburg. The property recently formed a partnership with local beekeeper Britt Thomas, owner of Britt’s Bees, to develop the Salamander Honeybee Program.
As a result, there are 20 hives — with about 50,000 bees in each hive for a total of more than one million bees — now located at the resort. Salamander said it will start producing its own honey before the end of summer.
Since its opening in August 2013, the resort said it has attempted to leave the land as natural as possible, with 200 of its 340 acres in a conservation easement. Additionally, Salamander is committed to sourcing its food, wine and other products from as many local sources as possible.
“We are thrilled to have this program in place at Salamander and are excited to see it mature. Together, our goal is to have twenty or more colonies located around the property over the next few years. Although a small start, we are proud to make a positive impact in favor of honeybees and to continue to produce seasonal ingredients,” Chef de Cuisine Chris Edwards said in a statement.
According to an annual survey released by the Bee Informed Partnership in May 2015, about 5,000 beekeepers reported losing 42.1 percent of their colonies over the last year. This represents the the second-highest annual loss recorded since surveys began in 2010.
With the colony located across the resort’s Grand Lawn, Salamander said it hopes to increase awareness on the plight of honeybees and other pollinators. The bees also will also benefit the resort’s culinary garden where many of the vegetables and herbs featured on its restaurant menus are sourced.2015-07-27T17:58:00+00:00
McGraw Hill Financial to acquire Charlottesville-based SNL Financial for $2.2 billion
http://www.virginiabusiness.com/news/article/mcgraw-hill-financial-to-acquire-charlottesville-based-snl-financial-for-2#When:17:41:00ZNew York-based McGraw Hill Financial said Monday it has signed an agreement to acquire Charlottesville-based SNL Financial for $2.2 billion.
McGraw is the information and analytics company behind the Standard & Poor's Ratings Services and other brands. It has approximately 17,000 employees in 30 countries.
SNL provides data, news and analysis on financial institutions and other business sectors. The company, founded in 1987, has more than 5,000 customers and approximately 3,000 employees based in 10 countries.
"We are enthusiastic about SNL because it is a fast-growing, highly complementary subscription-based business that will enable us to accelerate our strategy to be the leading provider of transparent and independent benchmarks, analytics, data and research across the global capital, commodity and corporate markets," Douglas L. Peterson, president and CEO of McGraw Hill Financial, said in a statement.
McGraw is expected to fund the transaction with approximately $525 million in cash and $1.7 billion in new debt.
The transaction is expected to close in the third quarter of 2015, subject to regulatory approvals and customary closing conditions.2015-07-27T17:41:00+00:00
Apple Hospitality in Richmond acquires three new hotels
http://www.virginiabusiness.com/news/article/apple-hospitality-in-richmond-acquires-three-new-hotels#When:15:41:00ZApple Hospitality REIT Inc. in Richmond recently completed the acquisition of three out-of-state hotels. The transactions, which totaled more than $100 million, boosted the company’s portfolio of hotel properties to 174, with 22,177 guestrooms in 32 states.
The new properties are:
A 156-room Hampton Inn in the Las Olas area of downtown Fort Lauderdale, Fla. Purchase price: about $23 million. The property is near the Fort Lauderdale-Hollywood International Airport.
A 110-room Hampton Inn in Cypress, Calif., located two miles from downtown Cypress and less than seven miles from Disneyland Park. Purchase price: about $20 million.
A new 170-room SpringHill Suites by Marriott in Burbank, Calif., located within walking distance of downtown Burbank and other attractions in the Hollywood area. Purchase price: about $60 million.
Apple Hospitality REIT is a publicly traded real estate investment trust (REIT) that owns one of the largest portfolios of upscale, select service hotels in the U.S. The company went public on May 18 and is listed on the New York Stock Exchange under the ticker symbol of APLE.2015-07-27T15:41:00+00:00
Kmart renews 86,828-square-foot lease in Virginia Beach
http://www.virginiabusiness.com/news/article/kmart-renews-86828-square-foot-lease-in-virginia-beach#When:15:35:00ZKmart Corp. has renewed its lease for 86,828 square feet of retail space at 1205 Fordham Drive in Virginia Beach. Bob King and Larry Hecht of Harvey Lindsay Commercial Real Estate in Norfolk handled the lease negotiations.
In other deals for Harvey Lindsay in the Hampton Roads market:
KCK Industries Inc. leased 31,800 square feet of industrial space at 1345 Taylor Farm Road, No. 106, in Virginia Beach. Glenn Gibson handled the lease negotiations.
Riverside Health System has renewed a 19,3870-square-foot lease for office space at 701 Town Center Drive, Suite 1000, in Newport News. Alex Stern and Clark Baldwin handled the lease negotiations.
Dollar Tree renewed a 17,352-square-foot lease for retail space at 3146 Western Branch Blvd. in Chesapeake. Susan Pender handled the lease negotiations.2015-07-27T15:35:00+00:00
Advance Trailer Systems leases 93,500 square feet in Henrico
http://www.virginiabusiness.com/news/article/advance-trailer-systems-leases-93500-square-feet-in-henrico#When:15:00:00ZAdvance Trailer Systems has Inc. leased 93,500 square feet of space in the Interport Business Center at 4800 Eubank Road in Henrico County.
Evan M. Magrill, Dawn M. Calabrese, and Dean Meyer of Cushman & Wakefield | Thalhimer handled the lease negotiations.
In other deals for Thalhimer in the Richmond region, there was lots of action from the medical sector, with the company handling three lease renewals at Windsor Business Office Park.
Bon Secours Health Systems Inc. renewed a 38,350 square-foot lease of office/service space in Windsor Business Park V at 8555 Magellan Parkway in Henrico. Magrill and Meyer handled the lease negotiations.
In another office building in the same park,Bon Secours also renewed a lease of 15,082 square feet of office/service space.
Neighborcare Pharmacy of Virginia LLC renewed a 31,000-square-foot lease for office/service space in building VI at the park. Magrill and Meyer handled the lease negotiations.
Xerox State Healthcare renewed a 19,697-square-foot lease in Boulders Center at 1011 Boulder Spring Drive in Chesterfield County. Magrill handled the lease negotiations.
Kaléo, a privately-held pharmaceutical company, leased an additional 7,389 square feet for a total of 17,717 square feet in downtown Richmond at the Turning Basin Building at 111 Virginia St. The city of Richmond, Meyer, and Mac Wilson handled lease negotiations.2015-07-27T15:00:00+00:00
CSC and HCL sign agreement to form joint company
http://www.virginiabusiness.com/news/article/csc-and-hcl-sign-agreement-to-form-joint-company#When:19:02:00ZFalls Church-based Computer Sciences Corp. (CSC) has signed an agreement with India-based IT company HCL to form a banking software and services firm.
“The banking industry is taking bold steps toward cloud deployments and digital integration with surrounding applications and platforms,” Anant Gupta, president and CEO, HCL Technologies, said in a statement. “Many of our banking clients are looking for modernization of their legacy platforms while simultaneously managing the increasing demands for data analytics services, multi-channel deployments, and increasing regulatory compliance requirements. The joint entity with CSC is designed to meet those critical demands with new and innovative solutions and to expedite the modernization transformation journey of our banking clients.”
CSC, a provider of IT services and solutions, announced plans earlier this year to separate into two publicly traded companies by October. One company will serve commercial and government clients around the world and the other will serve public sector clients in the U.S. CSC has approximately 70,000 employees and reported revenue of $12.2 billion for the 12 months ended April 3.
HCL Technologies also provides IT services, including remote infrastructure management, engineering and research and development services. HCL has offices in 31 countries and 104,184 employees. HCL, along with its subsidiaries, posted consolidated revenues of $5.8 billion as of March 31.2015-07-24T19:02:00+00:00
Cary Street Partners names CEO
http://www.virginiabusiness.com/news/article/cary-street-partners-names-ceo#When:17:53:00ZRichmond-based financial firm Cary Street Partners has named a new CEO.
Joseph R. Schmuckler, 54, has held executive and senior management roles at global financial companies such as MUFG and Nomura Holding. He has 30 years of experience in investment banking and wealth management.
Schmuckler will be based in Cary Street Partners’ Richmond office.
Cary Street Partners serves clients in the areas of personal wealth management and investment banking. The company was founded in 2002.2015-07-24T17:53:00+00:00http://www.virginiabusiness.com/uploads2/LightFoot_Markeplace_View2_Comp_15_02-16_Smaller.jpg
Cushman & Wakefield | Thalhimer will provide leasing for Lightfoot Marketplace
http://www.virginiabusiness.com/news/article/cushman-wakefield-thalhimer-will-provide-leasing-for-lightfoot-marketplace#When:20:13:00ZCushman & Wakefield | Thalhimer has been selected by Armada Hoffler, in a joint-venture partnership with Williamsburg Retail Investors, to provide exclusive retail leasing services for Lightfoot Marketplace in Williamsburg.
Located on Richmond Road (Rt. 60) and Centerville Road in the Lightfoot area on the site of the former Williamsburg Outlet Mall, the new 128,000-square-foot project will anchored by Harris Teeter. It’s currently under construction and scheduled to be completed in 2016.
The center has access to Route 199, a major thoroughfare in Williamsburg.
The Cushman & Wakefield | Thalhimer team will consist of retail leasing representatives Drew Haynie and Rob Wright.2015-07-23T20:13:00+00:00
Port on track to report first profit in seven years
http://www.virginiabusiness.com/news/article/port-on-track-to-report-first-profit-in-seven-years#When:19:46:00ZIt appears the Port of Virginia will post its first profit in seven years for the 2015 fiscal year.
The port is forecasted to turn a $16.1 million profit, compared to a loss of $15 million last year for the 12-month period that ended June 30.
During that time, the port handled an 8.9 percent increase in cargo to 2.5 million TEUs, or 20-foot equivalent units, setting another record for cargo volume.
In June, the port handled 213,517 TEUs, a 14.5 percent increase over the previous year.
“We’re seeing improvements gained from our ongoing effort to improve operational efficiency, and our strategic investments in equipment, in technology and in people are paying off,” Port of Virginia CEO John Reinhart said in a statement. “There is still much to do, and we are going to forge ahead with our plan to reinvest in infrastructure in order to compete now and in the future.”2015-07-23T19:46:00+00:00
FBR & Co. to acquire MLV & Co. LLC
http://www.virginiabusiness.com/news/article/fbr-co.-to-acquire-mlv-co.-llc#When:18:45:00ZArlington-based FBR & Co. announced Thursday that it has entered into an agreement to acquire New York-based MLV & Co. LLC. Financial terms of the deal were not disclosed.
MLV is an investment banking and brokerage firm focused on equity capital markets and a provider of At-the-Market (ATM) offerings. FBR provides investment banking, merger and
acquisition advisory, institutional brokerage, and research services through its subsidiary FBR Capital Markets & Co.
"MLV's leading market share in ATM execution and its client focused approach to providing corporate finance solutions are both strong complements to FBR's leading presence in initial equity placement and
institutional brokerage," Richard J. Hendrix, FBR’S chairman and CEO, said in a statement.
FBR expects the acquisition to be immediately accretive to earnings.
The board of directors of both companies have approved the transaction. It is expected to close in the third quarter of 2015, subject to customary closing conditions and regulatory approval.2015-07-23T18:45:00+00:00
A new CEO for Kaplan
http://www.virginiabusiness.com/companies/article/a-new-ceo-for-kaplan#When:18:11:00ZFlorida-based education test company Kaplan announced Thursday that its CEO is resigning in August.
Thomas C. Leppert, who has been at Kaplan since 2013, will resign Aug. 21.
Andrew S. Rosen, chairman of Kaplan and executive vice president of its parent company, Arlington-based Graham Holdings Co., will become CEO.
Donald E. Graham, chairman of Arlington-based Graham Holdings, said Leppert “has been a huge contributor to every aspect of Kaplan’s worldwide business. We are sorry to lose Tom, but understand why he wanted to leave; the pace of change at Kaplan will continue.”
The company declined to elaborate on why Leppert was leaving.
Rosen came to Graham Holding’s predecessor company, The Washington Post Co. in 1986 and joined Kaplan in 1992. He became chairman and CEO of Kaplan in 2008 after holding a variety of executive roles.
He left to become executive vice president of Graham Holdings, but remained chairman.2015-07-23T18:11:00+00:00
John M. Ramey III hired as general counsel for Allegiancy
Allegiancy, a Richmond-based commercial real estate asset manager, said Wednesday that it has hired John M. Ramey III as its new general counsel. Most recently, Ramey was a principal at Goodman Allen & Filetti, a law firm in Virginia.
Previously, he was a founder of Ramey-Michael Business Law Group, a boutique business law firm, and he also was a partner at Hirschler Fleischer law firm.
According to Allegiancy, Ramey brings experience in securities offerings, venture capital and “angel” financing, buy-sell agreements, and commercial real estate (leasing, acquisitions, and financing). Since 2005, Ramey has assisted clients in raising more than $1 billion of equity through private placements of securities.
Ramey has held leadership positions in the Virginia Bar Association and the American Bar Association. He holds a law degree from the University of Richmond, and a bachelor’s degree from the University of Virginia.
2015-07-22T20:36:00+00:00http://www.virginiabusiness.com/uploads2/Mary_Kaye_Willis.jpgMary Kaye Willia
Mary Kaye Willis promoted to director property services
http://www.virginiabusiness.com/companies/article/mary-kaye-willis-promoted-to-director-property-services#When:20:21:00ZMary Kaye Willis has been promoted by Cushman & Wakefield | Thalhimer’s Property Services Group to director, property services, and will oversee the western part of Virginia. Thie assiignment includes areas such as Charlottesville, Harrisonburg, Lynchburg, and the Roanoke Valley.
Willis has more than 25 years experience in property management.
Jenny Perkins also has been promoted to portfolio manager. Perkins is a native of Roanoke and has more than ten years experience in real estate accounting and property management. She has been with Thalhimer for more than six years.2015-07-22T20:21:00+00:00
HCA acquires three acres in Chesterfield County for a freestanding emergency room
Chippenham and Johnston Willis Hospitals Inc., HCA owned hospitals, have purchased 3.3 acres of land for $2 million in the Hancock Village Shopping Center in Chesterfield County. The hospitals plan to operate a freestanding emergency room (FSER) at the center located on Hull Street Road at Ashlake Parkway.
The 11,500-square-foot project will be the first emergency department to be operated jointly by Chippenham and Johnston Willis Hospitals and the third FSED owned and operated by HCA in the Richmond area.
According to Cushman & Wakefield | Thalhimer, which brokered the deal, construction on Swift Creek Emergency Room has begun with an expected opening in early 2016.
David M. Smith of Thalhimer handled the sale and closing negotiations on behalf of the purchaser.2015-07-22T20:12:00+00:00
VersAbility Resources will expand recycling operation to Virginia Beach
http://www.virginiabusiness.com/news/article/versability-resources-will-expand-recycling-operation-to-virginia-beach#When:20:06:00ZVersAbility Resources, based in Hampton, will expand its electronics recycling operations to Virginia Beach. The company said the move would allow it to grow both operations and services.
The new location of 130,000 square feet of industrial space at 2600 International Parkway also allows for additional expansion later. The recycling and distribution facility will open this summer, providing employment to individuals with disabilities who will disassemble, sort, and aggregate computers.
At the Virginia Beach site, VersAbility will be a material aggregation hub for CyclePoint – a nationwide framework of nonprofits serving people with disabilites who perform electronics recycles.
Area businesses can contact VersAbility for IT Asset Disposal, including computers, servers, cell phones, keyboards, printers, modems, projectors, video/DVD/Blu-ray players, consumer electronics, household appliances, telephone equipment and televisions.
The Virginia Beach Development Authority approved an Economic Development Investment Program grant in the amount of $30,000 based on the capital investment of $2.25 million in real estate, furniture, fixtures, equipment, machinery and tools.
The facility is located in the YesOceana corridor of Virginia Beach. Christopher E. Todd of the Norfolk office of Colliers International handled the transaction on behalf of VersAbilitity.2015-07-22T20:06:00+00:00
Virginia Poultry Growers Cooperative Inc. expanding in Rockingham County
http://www.virginiabusiness.com/news/article/virginia-poultry-growers-cooperative-inc.-expanding-in-rockingham-county#When:15:21:00ZThe Virginia Poultry Growers Cooperative Inc. said Wednesday it will invest almost $62 million over the next three years to build an 80,000-square-foot turkey processing facility in Hinton.
The move is expected to create six jobs and increase the co-op’s production by more than 45 percent. The company also plans to invest in its feed mill in Broadway and its grain elevator in Linville.
Virginia Poultry Growers formed in 2004. The co-op, made up of 165 member-growers, is the eighth-largest turkey processor in the United States and one of the largest suppliers of organic and antibiotic-free meat. The organization employs 565 people in the region.
The commonwealth competed against Pennsylvania for the project.2015-07-22T15:21:00+00:00http://www.virginiabusiness.com/uploads2/CVA_LedburyWEB.jpgPaul Trible and Paul Watson, the founders of Ledbury. | Ledbury Photo
Ledbury acquires Richmond shirtmaker
http://www.virginiabusiness.com/news/article/ledbury-acquires-richmond-shirtmaker#When:10:00:00ZA Richmond-based menswear company has its first acquisition under its belt.
Ledbury has acquired Creery Custom Shirts, a 100-year-old custom shirtmaker that’s also based in Richmond. Terms of the deal were not disclosed.
The deal will add three employees to its current workforce of around 30. More employees will be hired, as needed.
The move is just the latest made by the company to help fuel growth. Ledbury, which is known mostly for its shirts, was begun in 2009 by two former Oxford University classmates, Paul Trible, now the company’s CEO, and Paul Watson, its COO. The company is seeing double-digit growth each year and expects sales to reach $10 million in the next 12 months.
In addition to the Creery acquisition, Ledbury, which primarily has been an e-commerce business, has started selling its goods wholesale to a handful of wholesale clients, including Nordstrom, a specialty department store chain. By August, the company hopes to work with 30 wholesale customers.
“I think [for] most people, the buzzword is omnichannel,” which allow customers to access a company’s products in a number of ways, says Trible.
Ledbury also expects to roll open two stores this year, likely in Washington, D.C., and somewhere in the Southeast, Trible says. In addition, the company has begun pants and polo shirt product lines.
With the Creery acquisition, Ledbury will be making its shirts in-house for the first time (the company’s shirts also are made in Europe). Ledbury plans to open a custom-shirt store and production facility in September at Creery’s current location in Richmond’s West End where tailors will create a custom shirt pattern for customers. The shirts will then be fitted and made at the new store.
This isn’t Ledbury’s first foray into custom shirts. Earlier this year, the company launched a made-to-measure service at its downtown Richmond store, which allows clients to choose from an existing pattern that’s tailored to a customer’s size.
Watson and Trible aren’t just hoping to fuel growth for themselves. They also are helping other entrepreneurs through their Ledbury Launch Fund.
Last year, during the program’s pilot run, $25,000 was awarded to Kuli Kuli, a California-based company that makes energy bars and powder and tea from Moringa, a plant that is native to parts of Africa and Asia. Ledbury plans to repeat the program soon, hopefully with another business partner, which would allow more money to be awarded.
Trible notes that after Kuli Kuli was announced as the winner of the launch fund on MSNBC’s “Morning Joe,” Kuli Kuli sold more of its products that day than it had in the previous six months.
“That was nice because that was the idea,” Trible says. “It's not just a check. It was a little bit about us talking about our experience with them but also trying to profile their business, drive their traffic, so people could take part in the cool products they're making.”2015-07-22T10:00:00+00:00
Two companies to expand in Virginia Beach
http://www.virginiabusiness.com/news/article/regulus-global-to-expand-in-virginia-beach#When:19:16:00ZRegulus Global LLC, an international provider of procurement and logistics support to global defense, security and intelligence customers, will expand its Virginia Beach headquarters.
The company said Tuesday that it plans to purchase a three-acre site across the street from its current location at 1528 Taylor Farms Road in the Taylor Farms Commerce Park. It will
build a 30,000-square-foot facility, boosting its current footprint of 7,500 square feet of leased space.
This expansion will allow the company to add 25 employees over the next 12 months. Jobs include business development, logistic specialists, sales and marketing, finance and distribution with average annual salaries of $50,000 per year.
Regulus Global’s clients include a broad list of end users and distributors in more than 80 countries. On the list are prime and subcontracting activities for the U.S. Department of Defense, the foreign militaries/police -- either directly or with foreign contractors -- for countries including but not limited to Brazil, Saudi Arabia, Jordan, United Arab Emirates, the United Kingdom, Australia, Nigeria, India and many more. The company also has worked with more than 600 manufacturers in the U.S. and abroad.
“This is a significant local company that is engaged in global trade,” Warren D. Harris, director of Virginia Beach Economic Development, said a statement. “The location in Virginia Beach has allowed them to make important Department of Defense contacts and has stimulated growth in diverse markets. We are extremely pleased they are making a commitment to remain in Virginia Beach.”
Regulus Global CEO Will Somerindyke said the city’s support for the company’s growth was a factor in its decision to remain in Virginia Beach. “We look forward to working with the city not only for this transaction but to also support our significant employee growth projections for the next 3-5 years,” he said.
The Virginia Beach Economic Development Authority has approved an Economic Development Investment Program grant in the amount of $75,000 based on the capital investment of $3.45 million and the number of jobs to be created with the expansion.
In another expansion of an existing company, Marathon Consulting LLC, a Hampton Roads-based provider of information technology and digital marketing solutions, will nearly double in size. The company, founded in 2006, is currently located at 505 S. Independence Blvd. and will move to the Virginia Beach Town Center.
Marathon has entered into a lease for 9,000 square feet of office space in 5 Columbus Center at the center.
The company plans to add 34 full-time employees to the existing 59 in the areas of web and application developers, business analysts and project managers. Marathon also will invest more than $200,000 in business property with this expansion.
“They had an opportunity to look at expansion options outside Virginia Beach, and we are so proud of the decision to keep the corporate headquarters here and to join us in Town Center. They bring a tremendous wealth of technology talent to Virginia Beach, and these new jobs will attract even more. Our department has worked hard to bring more than 600 new high-tech jobs to Virginia Beach over the past year," Harris said in a statement.
The Virginia Beach Economic Development Authority has approved an Economic Development Investment Program grant in the amount of $85,000 based on the number of jobs to be created with this expansion.
Tegna to sell McLean headquarters to Tamares for $270 million
http://www.virginiabusiness.com/news/article/tegna-to-sell-mclean-headquarters-to-tamares-for-270-million#When:14:46:00ZTegna said Tuesday that it has signed a contract to sell its McLean headquarters building for $270 million to Tamares, a London-based private investment group.
The companies expect the deal to close by the fourth quarter of this year. Tamares’ Chairman Poju Zabludowicz said in a statement that the company plans to enhance the property at 7950 Jones Branch Drive to attract new tenants.
Tegna’s corporate headquarters building is nearly 800,000 square feet and sits on a 17-acre site. The facility, completed in 2001, features two glass wrapped office towers, a plaza and landscaped terraces with cascading water features and a reflecting pool.
Tegna will continue to occupy a portion of the building for 18 months. The broadcast and digital company, which was named Gannett until it spun off its publishing division, “remains committed to staying in the Washington, D.C., area and a process is underway to find the most appropriate space to meet our company needs,” President and CEO, Gracia Martore, said in a statement.
Tamares makes investments in real estate, technology and leisure industries. Its holdings include 1500 Broadway in Times Square in New York; the 27-acre Plaza America complex in Reston and hotel properties and land in downtown Las Vegas.
The deal was brokered by Los Angeles-based CBRE Group Inc.2015-07-21T14:46:00+00:00
Hardywood Park Craft Brewery expanding to Goochland County
http://www.virginiabusiness.com/news/article/hardywood-park-craft-brewery-expanding-to-goochland-county#When:19:10:00ZRichmond-based Hardywood Park Craft Brewery announced plans Monday to expand and open a brewery in Goochland County.
The company said it plans to invest $28 million and create 56 jobs over the next five years in the new venture.
Hardywood says the Goochland operation will complement its current facility in Richmond. The Goochland location will include a 60,000-square-foot brewery, packaging and distribution hall, a taproom, an amphitheater, garden and equipment to increase production of its craft beer.
“We're extremely proud of the jobs and ongoing tax revenue we'll be able to create through this project, and we're confident we found the right home for our new brewery in Goochland County, Virginia,” Eric McKay, Hardywood president and co-founder, said in a statement.
Gov. Terry McAuliffe approved a $500,000 grant for the project. He also approved a $400,000 performance-based grant from the Virginia Investment Partnership program. Hardywood also will receive a $250,000 grant from the Governor’s Agriculture and Forestry Industries Development Fund. Goochland County has committed up to $1 million in matching funds over a period of up to 10 years.
The Virginia Jobs Investment Program also will provide funding and services for the company’s employee training.
Hardywood was founded in Richmond in 2011. The company currently distributes throughout Virginia, Washington, D.C. and eastern Pennsylvania. Its new production facility will allow Hardywood to continue to meet the growing demand from its existing markets, as well as enter new ones.
Virginia competed against North Carolina for the project.2015-07-20T19:10:00+00:00http://www.virginiabusiness.com/uploads2/Waterside-Live%21_RenderingSMALL1.jpg
Norfolk sets groundbreaking for Waterside Live!
http://www.virginiabusiness.com/news/article/norfolk-sets-groundbreaking-for-waterside-live#When:15:58:00ZThe city of Norfolk and The Cordish Cos. have scheduled a groundbreaking ceremony for Waterside Live! for Aug. 26. They are hailing the event as the beginning of a new era for the old Waterside Festival Marketplace, a waterfront indoor mall project that will be renovated into a $38 million regional dining and entertainment venue.
“We are pleased to welcome Cordish as they begin construction on Waterside Live!, which will create hundreds of new
jobs, bring more energy downtown, and generate millions of dollars of revenue for the city,” Norfolk Mayor Paul D. Fraim, said in a statement.
According to the city, the project is expected to provide 800 new jobs, $93 million in direct revenue over 30 years and $850,000 in parking revenue.
Waterside Live! is set to open in spring of 2017. It will be a key structure in Town Point Park, an urban waterfront park, located on the Elizabeth River in downtown Norfolk.
Officials from the city and Cordish, based out of Baltimore, Md., will be on hand for the ceremony.2015-07-20T15:58:00+00:00
JLL expands space and staff in Hampton Roads
http://www.virginiabusiness.com/news/article/jll-expands-space-and-staff-in-hampton-roads#When:15:54:00ZAfter landing a 2-million-square-foot property management and leasing assignment from First Potomac Realty Trust, the Hampton Roads office of JLL has expanded its staff and space.
The company said it has increased its space at 101 W. Main Street location in Norfolk to 5,557 square feet and added 15 leasing and property management professionals to oversee the First Potomac office portfolio as well as other expanding property management work in the region.
"Our partnership with First Potomac Realty Trust and the addition of 15 people to our team builds on JLL's growth in Hampton Roads. We are thrilled to be able to offer our clients a more comprehensive suite of capabilities,” Deborah Stearns, senior vice president, JLL, said in a statement.
First Potomac’s Hampton Roads portfolio consists of 19 buildings ranging in size from 30,000 square feet to 375,000 square feet. According to JLL, the average leased rate of the portfolio is approximately 93%.
First Potomac is a real estate investment trust based out of Bethesda, Md. It recently exited from the Richmond market with the sale of six business park properties for $60.3 million. The sale of the Richmond portfolio was a continuation of First Potomac's capital recycling plan, which is focused on disposing of non-core properties and reinvesting in high-quality, multi-story office buildings in the Washington, D.C., region.
Among those joining the JLL team in Hampton Roads:
Hal Yuill, a veteran with more than 15 years of experience in the Hampton Roads commercial real estate market, will be a vice president and will spearhead the leasing of the First Potomac portfolio.
Emily Hueber has been named vice president of property management and will oversee the First Potomac Realty portfolio and expand the firm’s property management portfolio in the region.
With the expansion, JLL said its Hampton Roads office represents more than 7.5 million square feet of office and industrial properties for sale or lease.2015-07-20T15:54:00+00:00http://www.virginiabusiness.com/uploads2/NORFOLKSOUTHERN.jpgThe 11-story, Class A building was built in 1992 for Norfolk Southern.
Poe & Cronk and Colliers International will market Norfolk Southern headquarters building in Roanoke
http://www.virginiabusiness.com/news/article/poe-cronk-and-colliers-international-will-market-norfolk-southern-headquart#When:15:15:00ZPoe & Cronk Real Estate Group in Roanoke and Colliers International will represent Norfolk Southern in the sale of its regional headquarters office building in Roanoke.
The 203,632-square-foot building is on the market following Norfolk Southern’s decision to move 426 jobs from Roanoke to Norfolk or Atlanta.
The Norfolk Southern Building, located in the heart of the city’s downtown Central Business district at 110 Franklin Road SE, is one of Roanoke’s landmark office assets. Situated on 1.4 acres, it’s visible from nearly all points downtown and nearby I-581.
The 11-story, Class A building was built in 1992 for Norfolk Southern. It offers an elegant entrance lobby, executive offices, conference rooms and open work stations.
The building is constructed of granite and concrete and can be configured for either a single user or as a multi-tenant building.
“The availability of this property is an exceptional opportunity for Roanoke. Our marketing efforts will target prospects around the world…” Matt Huff, executive vice president & COO of Poe & Cronk, said in a statement.
The property’s marketing team consists of Huff, Ken Campbell of Colliers International in Richmond, and Phillip Parsons and Hobart Joost Jr. of Colliers International in Jacksonville.
Photo courtesy Poe & Cronk, Colliers International 2015-07-20T15:15:00+00:00
Dick’s Sporting Goods to open first women’s fitness store at Tysons
http://www.virginiabusiness.com/news/article/dicks-sporting-goods-to-open-first-womens-fitness-store-at-tysons#When:14:57:00ZDick's Sporting Goods said Monday that it would launch a specialty women’s fitness and lifestyle boutique store in Virginia. The first Chelsea Collective location will open in August at Tysons Corner Center in Tysons, just outside of Washington, D.C.
Named for the diverse and eclectic Chelsea neighborhood of New York City, Chelsea Collective will provide an assortment of apparel, equipment, footwear, accessories and beauty products.
Dick’s said the store will feature brands such as Nike and Calia by Carrie Underwood, along with niche brands such as Lorna Jane, Spiritual Gangster and ALALA.
A significant portion of theassortment will be devoted to footwear, accessory and beauty brands such as Brooks, Hunter Boots, Pure Vida, Le Sport Sac, Evian and Philosophy.
“As leaders in sporting goods and fitness apparel, we wanted to provide a destination for women who are on their own personal fitness journeys; a store where they can come in and feel part of a community that understands them and their needs,” Lauren Hobart, a senior vice president and Dick’s Sporting Goods and general manager, Chelsea Collective, said in a statement
While owned and operated by Dick’s Sporting Goods, Chelsea Collective locations will operate as small boutique shops. The new Tysons store is currently hiring for associate positions. To learn more about employment, people can email email@example.comT14:57:00+00:00http://www.virginiabusiness.com/uploads2/IMG_1342.JPG
Albemarle Estate at Trump Winery open for business
Through the rolling hills of Albemarle County, past Monticello and in the shadow of the Blue Ridge Mountains, regal Albemarle Estate at Trump Winery offers a gracious refuge to people in search of a luxury boutique hotel.
The property, the former home of John and Patricia Kluge, is now part of the Trump Hotel Collection. Trump purchased the property for $6.5 million in 2012 after the creditor for the property repossessed the 45-room mansion and filed a foreclosure lawsuit after Patricia Kluge defaulted on millions in loans.
The year before Trump purchased Patricia Kluge’s winery, also on the property, for $6 million at a foreclosure auction. It includes hundreds of acres in a private setting with spectacular scenery.
Following a multi-million dollar renovation, Albemarle Estate had a soft opening in May. Trump, who is running for the 2016 Republican nomination for President, and his son, Eric, attended a grand opening last week for the property.
The Neo-Georgian mansion, built in 1985, offers 26,000 square feet of space and a peek into the lifestyle of the rich and famous. It was here that Kluge, a well-known socialite, entertained guests from former presidents to Virginia governors and international royalty. Derek Hunt, director of hospitality, said during a tour of the home with Virginia Business that, “We tried to keep everything that was here before the same as it was.”
The first-floor rooms at what was formerly known as Albemarle House are grandiose with crystal chandeliers, marble floors, and columns embellished with intricate moldings. The dining room still has the wallpaper that Patricia had designed in Paris and hand painted in India. Hunt says guests like to relax in the library, with its billiards table, leather sofas and English wood that Patricia imported from England.
Guests can select from five rooms in the main house or four rooms off the pool house area. All the rooms are named after presidents. There’s also a separate cabin that another tour guide referred to as the late John Kluge’s “thinking room.” It’s set apart from the house in the woods with a screened porch that offers mountain views.
The last person to live in the home was Patricia. She founded the Kluge Estate Vineyards and Winery in 1999, following her divorce from the late John Kluge, a billionaire who made his fortune in the communications industry. After some years of success that produced award-winning wines, she lost the winery in 2011 when Creditor Farm Credit Bank foreclosed on a loan of $34.8 million. By then, she was married to Bill Moses, and the two were active in Virginia’s wine industry.
Originally the house included eight bedrooms, 13 bathrooms, a media room with silver disco ball, a grotto, the pool area with outside pizza kitchen, a wine cellar and a helicopter landing pad.
It sat vacant for a few years, Hunt said, and some repairs were needed during the renovation.
According to the property’s Website, rooms cost more than $400 a night, with the fee including a complimentary breakfast. The property is not offering lunch or dinner at this time, but operating more as a bed and breakfast. However, Hunt said the property plans to add more services later.2015-07-19T22:06:00+00:00
Virginia Center for Architecture changes its name
http://www.virginiabusiness.com/news/article/virginia-center-for-architecture-changes-its-name#When:19:26:00ZThe Branch Museum of Architecture and Design is the new name of the Virginia Center for Architecture in Richmond.
Helene Combs Dreiling, the executive director of the museum, said the change was made in honor of the Branch House, the Monument Avenue building where the museum is housed.
The Tudor revival home, built in 1916, was designed as the Branch family residence by noted architect John Russell Pope.
“We have also broadened our mission and vision statement to encompass design as well as architecture, so look for new innovative exhibitions, educational programs and partnerships here that will elevate our understanding of design and its influence on our lives,” Dreiling said in a statement.
The Branch Museum is open to the public Tuesday through Friday from 10 a.m. to 5 p.m.; Saturday and Sunday from 1 to 5 p.m. Learn more at http://www.branchmuseum.org.2015-07-17T19:26:00+00:00
Indian company establishing manufacturing operation in Wise County
http://www.virginiabusiness.com/news/article/indian-company-establishing-manufacturing-operation-in-wise-county#When:18:54:00ZAn Indian manufacturer of conveyor belts has chosen to locate its first manufacturing operation in Wise County.
Dhiyo House Inc. will invest $6.1 million in the operation, which is expected to create 80 jobs in Southwest Virginia.
The company has been in the United States since 2008, selling conveyor belts made in India. The expansion will establish a 40,000-square-foot manufacturing facility in the Wise County Industrial Park to produce belting in the U.S. and expand production with additional products.
Dhiyo House’s owner, Deepa Luthra, said in a statement that the company chose Virginia because of its location and support from the coal industry and local government.
Gov. Terry McAuliffe approved a $250,000 grant from the Commonwealth’s Opportunity Fund for the project. The Virginia Tobacco Region Revitalization Commission approved $645,000 in Tobacco Region Opportunity Funds. The company also is eligible to receive state benefits from the Virginia Enterprise Zone Program. Funding, and services to support Dhiyo House’s employee training will be provided through the Virginia Jobs Investment Program.
Virginia competed against Georgia, Kentucky, West Virginia and Tennessee for the project.2015-07-17T18:54:00+00:00
Virginia Tech to conduct drone test in Wise on Friday
http://www.virginiabusiness.com/news/article/virginia-tech-to-conduct-drone-test-in-wise-on-friday#When:19:49:00ZVirginia Tech on Friday will conduct research flights to deliver supplies to a free medical clinic in Wise County.
The Mid-Atlantic Aviation Partnership at Virginia Tech received a Federal Aviation Administration Certificate to conduct the flights.
“This is an example of using UAS technology for a socially significant purpose while also opening up economic opportunities,” Jon Greene, the acting associate director of the Mid-Atlantic Aviation Partnership, said in a statement. “It is a win-win solution.”
A fixed-wing aircraft operated by NASA Langley Research Center pilots will deliver medical supplies to Lonesome Pine Airport. The cargo then will be transferred to smaller packages to aircraft operated by Flirtey Inc. for delivery to the Wise County Fairgrounds.
Each aircraft weighs only 10 pounds and will lower its cargo via tether.
Flirtey is an Australian startup company specializing in “last-mile” delivery using drones, or unmanned aircraft systems.
The deliveries are taking place during the annual free clinic run by Remote Area Medical and the Health Wagon, a local health-care outreach organization. The clinic typically serves around 1,500 patients.
“This is a Kitty Hawk moment not just for Flirtey, but for the entire industry,” said Flirtey CEO Matt Sweeny. “Proving that unmanned aircraft can deliver lifesaving medicines is an important step toward a future where unmanned aircraft make routine autonomous deliveries of your everyday purchases.”2015-07-16T19:49:00+00:00
Apple Hospitality buys three hotels
http://www.virginiabusiness.com/news/article/apple-hospitality-buys-three-hotels#When:19:47:00ZApple Hospitality REIT has bought three hotels in Florida and California.
The Richmond-based real estate investment trust purchased the 156-room Hampton Inn in downtown Ft. Lauderdale, Fla. for $23 million, the 110-room Hampton Inn in Cypress Calif. for $20 million and the 170-room SpringHill Suites by Marriott in Burbank, Calif. for $60 million.
Apple Hospitality’s portfolio includes 174 hotels in 32 states.2015-07-16T19:47:00+00:00
Dollar Tree names COO
http://www.virginiabusiness.com/news/article/dollar-tree-names-coo#When:18:30:00ZChesapeake-based Dollar Tree has named Michael Witynski COO.
Witynski, 52, has been Dollar Tree’s senior vice president of stores since joining the company in 2010.
In his new role, Witynski will be responsible for store operations and real estate of Dollar Tree stores in the United States and all retail and real estate operations in Canada.
Prior to joining the company, Witynski held executive positions at Shaw's Supermarkets and Supervalu Inc.
Bob Sasser, Dollar Tree’s CEO, said the appointment is part of the company’s integration since it acquired Family Dollar earlier this year.
Dollar Tree operates more than 13,600 stores in the United States and Canada. It operates under the brands of Dollar Tree, Dollar Tree Canada, Deals and Family Dollar.2015-07-16T18:30:00+00:00
Ryan Schilling named senior sales manager for Quirk Hotel in Richmond
http://www.virginiabusiness.com/companies/article/ryan-schilling-named-senior-sales-manager-for-quirk-hotel-in-richmond#When:21:24:00ZQuirk Hotel in Richmond has hired Ryan Schilling as senior sales manager. Schilling, a Richmond native, comes to Quirk with more than 12 years of hotel and resort industry sales experience.
Most recently, he was national sales manager at The Boar’s Head Inn in Charlottesville. Before that, he spent 11 years as corporate sales manager for the Jefferson Hotel in Richmond.
Quirk is a 75-room boutique hotel on West Broad Street in the city’s arts district that’s scheduled to open in September. Locally owned by Ted and Katie Ukrop, the hotel will be managed by Destination Hotels & Resorts, the largest operator of independent hotels and resorts in North America.2015-07-15T21:24:00+00:00http://www.virginiabusiness.com/uploads2/WallaceC_1.5x1.5_300dpi_RGB.jpg
Christopher Wallace promoted to senior vice president for Colliers
http://www.virginiabusiness.com/companies/article/christopher-wallace-promoted-to-senior-vice-president-for-colliers#When:20:48:00ZChristopher C. Wallace, director of office brokerage for the Richmond office of Colliers International, has been promoted to senior vice president.
Wallace has worked for the company for more than 10 years and serves on the board of directors for Harrison & Bates. He specializes in office facilities for local, national and international clients. Clients have included the Federal Reserve Bank of Richmond, Better Business Bureau, ITT Institute, BB&T and Dominion Resources.2015-07-15T20:48:00+00:00
Skanska USA announces new speculative office building for D.C.’s Capitol Riverfront Submarket
http://www.virginiabusiness.com/news/article/skanska-usa-announces-new-speculative-office-building-for-d.c.s-capitol-riv#When:20:45:00ZSkanska USA Commercial Development announced plans Wednesday to start speculative development for 99M, an 11-story, 234,000-square-foot Class A office building with ground-floor retail/restaurant space in Washington’s Capitol Riverfront submarket.
Skanska is self-financing the development costs, which are $116 million. Skanska also will serve as the project’s construction manager with work scheduled to begin later this summer. The building is expected to be completed in the fourth quarter of 2017.
Located at the corner of First and M Streets Southest, 99M will include about 220,000 square feet of office space, with approximately 11,000 square feet of retail/restaurant space on the ground floor. 99M is designed to LEED (Leadership in Energy and Environmental Design) gold standards.
“99M’s location, design and amenities capture the vitality of the area, and the energy and personality of the Capitol Riverfront,” Rob Ward, executive vice president for Skanska USA Commercial Development, said in a statement.
The typical office floor will be about 22,000 square feet. Amenities will include a 4,300-square-foot, tenant-only health club and locker room, a 4,750-square-foot rooftop terrace with covered and outdoor collaborative areas, bicycle storage and a maintenance station, an electric car-charging station and Wi-Fi.
Carbon dioxide sensors that monitor and regulate fresh airflow and an extensive green roof to allow for filtration and storage of storm water will be among the building's sustainable features.
Skanska USA Commercial Development invests in and develops office and multi-family properties in Boston, Houston, Seattle and Washington, D.C. Since 2008, Skanska said it has invested about $1 billion in nearly a dozen projects in its select markets.2015-07-15T20:45:00+00:00
Gannett names its first chief revenue officer
http://www.virginiabusiness.com/companies/article/gannett-names-its-first-chief-revenue-officer#When:20:42:00ZMcLean-based publishing company Gannett Co. Inc. has named Kevin Gentzel its first chief revenue officer (CRO).
Gentzel was head of advertising sales, North America at Yahoo! Before joining Yahoo!, Gentzel served as CRO of The Washington Post .
Gannett, a former publishing division, recently was spun off as a separate, publicly traded company. It kept the name of its former parent company.
The parent company retained its broadcast operations in the split and changed its name to Tegna.2015-07-15T20:42:00+00:00
CounterTack acquires ManTech software division
http://www.virginiabusiness.com/news/article/countertack-acquires-mantech-software-division#When:20:31:00ZWaltham, Mass.-based CounterTack has acquired ManTech Cyber Solutions International (MCSI), a commercial software division of Fairfax-based ManTech International Corp.
Financial details of the deal were not disclosed.
CounterTack said the acquisition will enhance its position in the endpoint detection and response technology market. ManTech will become an equity investor in CounterTack as well as a global distribution partner.
This ManTech deal follows CounterTack’s recent $15 million Series C round of funding, led by TenEleven Ventures with other new investors, including EDBI (the corporate investment arm of the Singapore Economic Development Board).
CounterTack said its products dramatically reduce the impact of advanced attacks in real-time, giving response teams an opportunity to defend the enterprise before incidents escalate.2015-07-15T20:31:00+00:00
Snagajob opens Arlington office
http://www.virginiabusiness.com/news/article/snagajob-opens-arlington-office#When:19:54:00ZHenrico County-based Snagajob has opened an office in Arlington County.
The new location is the firm’s first outside of the Richmond area.
Snagajob, a website that connects workers with hourly jobs and vice versa, says the office was opened to tap into the D.C. metro-area talent pool and grow brand awareness about hourly-paid work from Richmond to Baltimore.
The company says its website has almost 400,000 active registered workers who are looking for hourly positions. It also has 650 clients in the Washington area, including CVS, Dunkin’ Donuts and Macy’s.
It also has several positions at the new office that can be viewed here.
The new space is located at 1110 North Glebe Road, Suite 220.2015-07-15T19:54:00+00:00
Virginia launches alliance to increase exports
http://www.virginiabusiness.com/news/article/virginia-launches-alliance-to-increase-exports#When:17:59:00ZGov. Terry McAuliffe announced Wednesday the creation of what he is calling the nation’s first public-private initiative to increase exports.
The Virginia International Trade Alliance (VITAL) is designed to grow Virginia exports by expanding the number of companies currently being served by the commonwealth’s trade programs, McAuliffe said Wednesday at the Omni Hotel in Richmond.
“It is a global marketplace,” McAuliffe told a group gathered for the VITAL launch and the graduation of companies in the Virginia Economic Development Partnership’s (VEDP) two-year VALET (Virginia Leaders in Export Trade Program). “Selling our goods to other countries around the globe is how you build a new Virginia economy.”
Diversifying the economy is especially important as the Virginia faces the effects of defense budget cuts and the impending sequestration cuts, McAuliffe said.
Over a five-year period, VITAL aims to grow Virginia exports by $1.6 billion, create 14,000 trade-supported jobs and increase the number of companies being served by VEDP’s international trade programs each year to 390.
The program will expand Virginia’s existing trade-assistance programs that include targeted market research, face-to-face meetings with foreign businesses and the VALET program, according to Paul Grossman, vice president of international trade for VEDP.
Private partners and public universities in the initiative will help identify companies that can start or expand international trade projects. The partnership includes: the Virginia Chamber of Commerce, Virginia Manufacturers Association, Northern Virginia Technology Council, Virginia Maritime Association and nine of the commonwealth’s public universities.
“If we’re going to ramp up our programs without adding staff, we need the help of private partners,” says Grossman.
The initiative is being funded by $1 million being diverted from other economic development funds in the state budget under flexibility given to the administration during the last session of the Virginia General Assembly. No new staff will be added under the program.
“This is going to be one of several pieces of our goal to help our companies meet our consumers abroad,” Virginia Secretary of Commerce and Trade Maurice Jones said after the event. “This is in our economic interest. If we’re going to grow and help businesses create more jobs, we need to help them sell overseas.”2015-07-15T17:59:00+00:00
2015 RIMS Survey points to important trends in data security and cyber Insurance
http://www.virginiabusiness.com/opinion/article/2015-rims-survey-points-to-important-trends-in-data-security-and-cyber-insu#When:16:43:00ZThe Risk Insurance Management Society (RIMS) recently published the results of its 2015 Cyber Survey. The survey of RIMS members provides important benchmarking information for risk managers as they continue to grapple with data security and the procurement of cyber insurance.
Notable among the survey’s findings:
• Nearly 51 percent of RIMS members purchased standalone cyber insurance.
• Of those not buying standalone cyber insurance, the majority do not have it at all.
• Nearly 75 percent that do not have cyber insurance are considering it within the next two years.
• Most companies are spending less than $100,000 a year on cyber security.
• The largest percentage of companies purchase cyber with limits between $5 million and $19 million.
• Over 90 percent of participants have breach notification as a covered aspect in cyber, with cyber extortion second.
• 58 percent of respondents transfer cyber risk to third parties.
• The top first-party cyber insurance concern is reputational harm — not data breaches.
• The top third-party concern is disclosure of personal information.
• Just over 51 percent of respondents are concerned with cyber extortion.
Planning and responsibility
• 89 percent of respondents have a plan in the event of a cyber crisis.
• Most companies place responsibility for cyber with the IT department.
These statistics are just a few of the high points from the 15-page survey, but here are three key takeaways:
• In the wake of massive data breaches experienced by companies such as Target, Anthem and Sony, most companies either have standalone cyber insurance or are considering a purchase within the next two years. Companies of all sizes must consider cyber insurance as part of the overall risk management program.
• The two largest-spending categories related to data security are “below $100,000” and “over $1 million per year.” High-target industries such as banking, health care, hospitality and retail are likely to pay a premium for protection. As the scope and sophistication of cyber attacks increase, so, too, will spending on data protection.
• Companies must carry appropriate limits on their cyber insurance. Having first-party as well as third-party coverage is critical. As the survey results show, the low end of the limits spectrum is $5 million — a policy limit that is likely too low for a vast majority of companies. Buyers should pay particular attention to the sublimits. In many respects, the overall policy limit is not as important as the respective sublimits for the more critical areas of coverage.
Here are some additional areas to consider for policyholders when placing cyber insurance.
The definitions. Since insurers use different forms for data breach and privacy insurance, the definitions used in the policy are critical to the scope of coverage. Remember, cyber attacks can take numerous forms, so your policy must be comprehensive.
Cyber policy exclusions. Cyber policies contain a litany of exclusions. Prospective buyers must pay particular attention to the exclusions. Matching up the definitions in the policy to the exclusions may reveal some importance gaps in coverage. Be sure every base is covered through a comprehensive analysis of the specimen policy.
The retroactive date. A 2013 survey by Mandiant, a FireEye Company, noted that the average number of days a hacker is in your system before discovery is 229. Breach detection is still a major issue for many businesses. To account for a potential lag in breach discovery, ensure your policy has a retroactive date of at least one year, but ideally two years is the minimum one needs.
Cyber insurers’ vendors. For insurers, one of the key selling points of cyber coverage is the network of resources made available to close a breach. From forensic information technology vendors to credit monitoring and PR experts, your insurer can make one call to marshal these resources for your benefit. But, how well do you know these vendors? Will they do more harm than good? Policyholders should vet the insurer’ panel of vendors; if they are not best in class, negotiate.
Time spent upfront on an in-depth analysis of cyber policies may prevent a coverage fight with the insurer should a breach occur. Working closely with your broker and coverage counsel can help companies avoid unwanted litigation and eliminate gaps in coverage from the outset.
Collin Hite is the practice leader of the Insurance Recovery team in Hirschler Fleischer's Richmond office. Contact him at (804) 771-9595 or firstname.lastname@example.orgT16:43:00+00:00http://www.virginiabusiness.com/uploads2/WINE.jpgAaron Brooks, general manager of Henrico County’s Southern Season.
Southern Season plans to ramp up message about gourmet offerings
http://www.virginiabusiness.com/news/article/southern-season-plans-to-ramp-up-message-about-gourmet-offerings#When:19:42:00ZAs its one-year anniversary approaches on July 31, Aaron Brooks, general manager of Henrico County’s Southern Season, said the gourmet store needs to do a better job of explaining who it is and what it does.
The store’s opening last summer drew hordes of curious people to what was the third location for a Southern Season store in the country, and 2014 also saw a busy holiday shopping season. “We’re very happy with the reception that we have had here,” said Brooks.
Yet he and other store personnel continue to meet customers who tell them they are visiting the store or the store’s restaurant, Southerly, for the first time.
The 50,000 plus-square-foot store is located at Libbie Mill, an urban mixed-use development under construction off Staples Mill Road near its intersection with Broad Street.
“We still have folks coming up on a year now that haven’t come into the store,” said Brooks during a media tour Tuesday.
To help change that, Brooks says Southern Season plans special activities and new advertising as part of its one-year anniversary celebration. It seemed to be trying out some of its themes during the media tour, which included tastings of exotic offerings such as curried banana foam on a roasted beet salad.
Southern Season is not a grocery store, Brooks told the group. It does not stock fresh produce. It’s a gourmet marketplace, with a cooking school and restaurant where people can expect to find exclusive, one-of-kind items that they can’t find anywhere else.
“If you’re looking for that one dazzling item or ingredient, this is the place to come, “said Brooks. “We have more than 80,000 items in this store typically – many that you won’t find at any other grocery store."
About 15 to 20 percent of the items are local or Virginia products, he adds.
For instance, the store stocks 32 linear feet of barbeque sauce, 1,000 bottles of wine, including a rare wine section, and cheeses from as close as Grayson County to the Sternschnappe alpine cheese from Germany. There also are taps for craft beers along with a large, prepared food section and tasting station where cooking demonstrations are typically held on Saturday.
Plus, there’s a coffee and tea bar, where customers can take home a growler of coffee. Throw in cooking classes, on everything from biscuits to advanced knife skills, and a special events coordinator, Naomi Conklin -- who helps clients with corporate and social events -- and it’s easy to understand why Southern doesn’t fall into the typical grocery store category.
Southern Season is based out of Chapel Hill, where it has a 60,000-square-foot flagship store. It also has a store in Charleston, and a smaller store in Raleigh. It plans to open a 5th store in the Buckhead area of Atlanta next year, said Brooks, as it looks to expand to a total of 10 stores. It’s also considering other locations, he added, such Northern Virginia, Nashville, Tenn., and Florida.
As Libbie Mill builds out, Brooks looks for new developments in the 80-acre project to bring more people to the store. A new public library is going up on a three-acre site nearby that was donated by developer Gumenick Properties.
Gumenick is located in an office/retail complex across from Southern Season, and work has begun on a second office/retail building. Also expected soon is activity on the first of the community’s 2,000 housing units.
Libbie Mill was recently named one of the top commercial real estate projects of the year for the Richmond region.
Meanwhile, there’s more upscale grocery store competition on the way. Wegmans plans to open two new stores in the region, one in Chesterfield County and the other in western Henrico. Whole Foods, Brooks’ previous employer, also has announced that it will locate a 40,000-square-foot store near Virginia Commonwealth University.
Asked how those openings might affect Southern Season, Brooks said, “Everyone takes a bite.” On the other hand, the more stores, the better it is for the community, he added.2015-07-14T19:42:00+00:00http://www.virginiabusiness.com/uploads2/MichaelK_LoRes-1.jpg
John Marshall Bank names senior vice president
http://www.virginiabusiness.com/companies/article/john-marshall-bank-names-senior-vice-president#When:17:45:00ZMichael Kuhns has been named senior vice president/commercial lending at John Marshall Bank.
He will be based at the bank’s main office in Reston.
Kuhns has been a banker in the Washington, D.C., area for more than 40 years. He holds a bachelor’s degree in finance from American University’s Kogod School of Business.2015-07-14T17:45:00+00:00
Boost the value of your small business before it’s time to sell
http://www.virginiabusiness.com/opinion/article/boost-the-value-of-your-small-business-before-its-time-to-sell#When:14:35:00ZA survey of 230 of America’s fastest growing companies (according to Inc.) indicated that more than one in three business owners plans to sell their company within five years. Yet a recent survey by Securian Financial Services found that more than 60 percent of business owners don’t have an exit plan, and 78 percent anticipate the need for the business sale to fund their retirement.
It’s time to get smart. Five years may sound like a lot of time to develop an exit plan, determine the value of your business and find the right buyer. I can tell you, though, from my years of working with businesses of all sizes—it’s not. Selling a business is hard work. Waiting until you’re actively selling should not be the first time you think about how much your business is worth.
While this may seem counterintuitive, the ideal time to start thinking about your business valuation — and planning your exit strategy — is when you start your business, especially if you have one or more partners. And if that ship has already sailed, then the time is now.
You may be thinking, “But I just started!” or, “I’m going to pass this business down to my children, and their children.” Or, like many owners, you may believe YOU are the source of any value your business might have — you see yourself as the “secret sauce.”
The truth is, this kind of thinking too often means business owners leave money on the table, missing key opportunities to increase the value of their business that could lead to bigger profits when it’s time to sell. Another scenario we see all too often is a business owner closing up shop without exploring the possibility of selling the business, ultimately losing out on a major liquidity event they have been working towards for many years.
What are some things a small business owner can do to increase the value of the business now, in order to maximize its potential down the road (ideally three to five years out)?
1. Understand your “magic number.” To fully fund your retirement goals you must understand the amount of funds you need overall to live off of into retirement (aka your “Magic Number”).
2. Understand company value now. Studies show that for most entrepreneurs, their business is their largest asset in their portfolio. Armed with your magic number, the next critical piece of information is understanding what your business is worth. In a best-case scenario you’ll find that you can comfortably retire today.
3. Gap analysis and value enhancement. You’ve found that exiting your business will not fully fund your retirement. It’s time to quantify the extra value you need to build into your business and implement a plan to achieve it. This might include revenue growth, new product development, or simply risk reduction in certain critical areas.
Now that you have a sense of how much additional value you may need, it’s time to think strategically about HOW to boost value.
Strategies for boosting value.
1. Clean up your financial statements. This is particularly important if you are starting to think about selling. Regardless of the method used to value a company, the number one concern for a buyer is the ability to generate profit. Period. The most reliable indicator of this ability is your company’s past performance. Often obscured in past performance are items like “non-operational” expenses, one-time or unusual expenses, personal expenses run through the business, shareholder perks, etc. A valuation professional can work with you to document those and build them back into the value of your business. This has a direct, significant impact on increasing both actual and perceived value.
2. Implement your value enhancement plan. Grow revenue. Add product lines. Reduce unnecessary expenses. At the most basic level, the keys to enhancing value are increasing profits and reducing risk. Begin every major business decision by asking: “How will this increase profitability? And how does it impact our risk profile?” Overall: execute, execute, execute.
3. Control costs and keep your financial statements in good order.
4. Market the business, not the business owner. This speaks to risk as well. It may seem counterintuitive, but the more important an owner is to the business personally, the more that detracts from enterprise value. The goal should be working your way out of a job to facilitate a smooth buyer transition.
5. Hire the right employees, and recognize their efforts. Retaining great people is far less expensive than recruiting and training new ones.
6. Develop and embody an organizational culture and brand that is authentic, consistent and resonates with your clients, employees and other stakeholders. A company that feels solid and is built on a sound culture helps mitigate risk as well, which of course enhances value.
About the author
Dan Doran is principal of Quantive Business Valuations, a professional business valuation practice based in Alexandria, specializing in small to medium-sized closely held and family owned businesses.2015-07-14T14:35:00+00:00
Aerojet to expand in Orange County
http://www.virginiabusiness.com/news/article/aerojet-to-expand-in-orange-county#When:08:36:00ZAerojet Rocketdyne is expanding its operation in Orange County, creating an estimated 100 new jobs.
Orange was selected for the expansion from 14 potential sites in multiple states.
Aerojet produces propulsion systems and operates a technology development center and laboratories for solid propulsion and test facilities for rocket motors.
Orange is receiving a $300,000 grant from the Commonwealth’s Opportunity Fund to help with the project.2015-07-14T08:36:00+00:00
Marker Test Diagnostics moves U.S. headquarters to Arizona
http://www.virginiabusiness.com/news/article/marker-test-diagnostics-moves-u.s.-headquarters-to-arizona#When:20:55:00ZMarker Test Diagnostics Inc. announced Monday it has moved its U.S. headquarters from Leesburg to Chandler, Ariz.
The company, an international supplier to the drug testing industry, established its U.S. headquarters in 2013.
“As we continued our expansion in the U.S., there was a clear need to consolidate the company’s operations in a single geographic region that would be easily accessible to the company’s leadership team,” Marker Test CEO Kim Christensen said in a statement.
The relocation creates an operational hub for the company’s CEO, general counsel; CFO; controller and marketing, warehouse and distribution functions in Arizona.
"We believe these efforts will bring stability, efficiency and significant cost savings to our operations and allow our leadership team to operate in a much more streamlined manner,” Christensen also said.
Marker Test Diagnostics produces UR Code, a urine marker for the drug testing market.2015-07-13T20:55:00+00:00
The Radiant Group acquires Arlington company
http://www.virginiabusiness.com/news/article/the-radiant-group-acquires-arlington-company#When:19:05:00ZThe Radiant Group Inc., a Chantilly-based provider of technical solutions and services to the federal government, has acquired The Human Geo Group LLC, an Arlington-based data analytics and software development company.
Terms of the agreement, which involved cash and stock, were not disclosed. The deal was completed on July 8.
HumanGeo will retain its name and leadership team.
Founded in 2011, HumanGeo provides advanced data analytics and software development services to more than a dozen organizations across defense, intelligence, and commercial markets.2015-07-13T19:05:00+00:00
Retired admiral joins ATAC board of directors
http://www.virginiabusiness.com/companies/article/retired-admiral-joins-atac-board-of-directors#When:18:54:00ZRetired Admiral Timothy Keating has joined the board of directors at ATAC, a major provider of outsourced tactical aviation services.
During his Navy career, Admiral Keating served as commander of Carrier Group Five, the U.S. 5th Fleet, the U.S. Northern Command and NORAD, and U.S. Pacific Command.
He retired in 2009 after more than 38 years of service.
Operating since 1996, ATAC has offices and flying bases in Virginia, California, Hawaii, Japan and Germany.2015-07-13T18:54:00+00:00
Armada Hoffler Properties Inc. closes on retail center in Virginia Beach
http://www.virginiabusiness.com/news/article/armada-hoffler-properties-inc.-closes-on-retail-center-in-virginia-beach#When:14:48:00ZArmada Hoffler Properties Inc. said Monday that it has closed on the acquisition of Columbus Village, a 65,000-square-foot retail center in Virginia Beach. It sits on five acres adjacent to the Town Center of Virginia Beach.
According to Armada Hoffler, the site is a prime target for redevelopment and integration into the Town Center, an Armada project and also the location of its headquarters.
“The opportunity to acquire and control additional income producing real estate contiguous to Town Center will allow us to expand on the success of our flagship asset through additional development in the future,” Louis Haddad, Armada’s CEO said in a statement. “The fully leased center enjoys strong cash flow and is a positive addition to both our portfolio and future growth.”
Columbus Village is anchored by Barnes & Noble and other tenants including ULTA Beauty, Five Below, and LensCrafters.
The company said it acquired the property for 1.28 operating partnership units and the assumption of $8.8 million of debt. Of the equity that will be issued in this transaction, 1 million units will not earn or accrue distributions for 24 months and 275,000 units will not earn or accrue distributions for 30 months.
The interim distributions that would have been paid on these operating partnership units at the current dividend rate – approximately $1.8 million – will positively impact the company’s dividend payout ratio over the next three years.2015-07-13T14:48:00+00:00
Wheeler Real Estate Investment Trust buys shopping center on Eastern Shore
http://www.virginiabusiness.com/news/article/wheeler-real-estate-investment-trust-buys-shopping-center-on-eastern-shore#When:14:46:00ZWheeler Real Estate Investment Trust Inc. in Virginia Beach has acquired Chesapeake Square Shopping Center, a 99,848-square-foot, grocery-anchored center in Onley.
The REIT said it acquired the property from an affiliated entity of the company for about $6.3 million, or $63.49 per leasable square foot. The company used a combination of cash and operating partnership units to purchase Chesapeake Square, its 10th property in Virginia.
“The Commonwealth of Virginia is home to us, our headquarters is here, and we have nine other properties located throughout the state. Chesapeake Square is located in a growing community and with the expected opening of the nearby Riverside Shore Memorial Hospital in the fall of 2016 we anticipate traffic will increase at Chesapeake Square,” Jon S. Wheeler, Wheeler’s chairman and CEO said in a statement.
Chesapeake Square was built in 1987 on Virginia’s Eastern Shore in Accomack County. According to Wheeler, the property is 83.4 percent leased. Major tenants include Food Lion, Rite Aid, Sears, Cato and Subway.
Chesapeake Square is located on Route 13, a major throughway that runs along the coast between Norfolk and Dover, Del.2015-07-13T14:46:00+00:00http://www.virginiabusiness.com/uploads2/Dennis_Richardson_3x4.jpg
Dennis Richardson named president of Harvey Lindsay’s Development Services Group
http://www.virginiabusiness.com/companies/article/dennis-richardson-named-president-of-harvey-lindsays-development-services-g#When:14:12:00ZDennis L. Richardson has been promoted to president of Harvey Lindsay Commercial Real Estate’s Development Services Group. Dennis served as director and senior vice president of the group for 14 years before being named its leader.
According to the company, Richardson was instrumental in previous HL Development projects, including City Center at Oyster Point, Old Dominion Higher Education Center (MAST Center), Maersk Logistics and the Eastern Virginia Medical School.
Prior to joining HL Development, Dennis worked for Norfolk’s Redevelopment and Housing Authority for about 30 years. He is a graduate of Virginia Tech and a resident of Norfolk.
HL Development provides the vision, planning, and implementation services to advance development initiatives. In recent years, Harvey Lindsay has become a leader in the field of mixed-use development.2015-07-13T14:12:00+00:00http://www.virginiabusiness.com/uploads2/IMG_6485.JPG
Dashboards for driving in the business world
http://www.virginiabusiness.com/opinion/article/dashboards-for-driving-in-the-business-world#When:13:00:00ZThe average American travels well over 10,000 miles per year by automobile. How many of us would take a trip by automobile without a dashboard? We might consider a short trip to the store, but I doubt we would consider any long-distance journey without a fully operating dashboard. Why is that? Because dashboards serve as the main communication between the driver and the vehicle, sharing the status of all the components of the automobile necessary to get to one’s destination, like speed, oil pressure, battery, gas and tire pressure.
Of course, most drivers are no longer content with just a dashboard, but also utilize sophisticated navigation systems. With navigation systems, the driver not only sees the overall direction the driver is traveling, but also has turn-by-turn directions alerting the driver of potential delays from traffic or construction and suggesting detours along the way.
Similarly, drivers in the business world need reliable, regular financial communication and information to base sound business decisions. Therefore, the most effective CFOs and their teams provide meaningful financial information often times referred to as “dashboards” to keep tabs on various financial or key performance indicators — not only to help monitor the business, but also help with the overall goal of gearing the business towards operating at its peak efficiency.
Dashboards have evolved from the formal more traditional financial statements (balance sheet, income statement and statement of cash flows). Dashboards are normally faster and more granular in nature, allowing businesses to be more responsive in decision making. They also tend to be more user-friendly, more understandable by a manager who may not have an accounting or finance degree. It is so important for all managers, including non-accounting professionals, to stay abreast of the business metrics — especially those that may be included on a dashboard.
For instance, a financial institution’s dashboard might include information such as number of customers, average deposits per customer, number of loans, average loan balance to customer, number of relationships per customer, number of branches, number of ATMs, asset size, new deposits to date, loans approved, loans funded, write-offs, recoveries, etc. The dashboard also may include budget information so that variances can be easily identified. By checking this information on a regular basis, the financial institution can be more in touch with the business metrics that lead to its success. This may mean interest-rate changes to products and services to either encourage or slow growth, depending on the data received.
Of course, most successful businesses provide more detailed statements and can include department performance and drill down further to the product or service level. This allows managers to obtain a clearer understanding of what drives performance with a product or service and consequently what can improve performance. In many cases, the mere monitoring of certain financial data like balances, ratios, days of inventory, interest rates, losses, etc., is enough to bring the data point in line with expectations.
The most successful CEOs understand that financial information is the key component to practically all business decisions. For that reason, in many businesses the CFO serves as the CEOs right hand, no longer only the chief “bean counter” as in yesteryear. In order for the CFO to be effective in this key role, it is imperative that the CFO have a finance team that operates like a well-oiled machine, not only by generating timely and accurate financial statements, dashboards, etc., but staying well connected to all business operations, understanding all the intricacies of each service or product. This knowledge helps create meaningful reporting that helps drive better business decisions each and every day.
Anne Hagen, CPA, is the CFO at the Masonic Home of Virginia and a member of the Virginia Society of Certified Public Accountants.
Harris Corp. will keep headquarters in Florida
http://www.virginiabusiness.com/news/article/harris-corp.-will-keep-headquarters-in-florida#When:20:46:00ZHarris Corp. announced Friday that it will keep its headquarters in Melbourne, Fla.
The technology company recently acquired McLean-based defense contractor Exelis Inc. for $4.75 billion, leading to speculation that Harris would move its headquarters to Virginia.
Harris is reorganizing itself into four “market-focused segments,” but the company said its headquarters would stay in Florida where it has been since 1978. The company employs about 6,000 people in the Sunshine State.
Two of the company’s new business segments also will be based in Florida, but its new Critical Networks segment will be based in Herndon.
The Virginia division will combine elements of Harris and Exelis businesses. It will provide managed services supporting air traffic management, energy and maritime communications, and ground network operation and sustainment, as well as IT and engineering services.
Harris has operated in Virginia for more than 40 years and has about 3,000 employees in the commonwealth.
Harris’ Electronic Systems and Space Intelligence Systems segments will based in Palm Bay, Fla., while its Communications Systems segment will be in Rochester, N.Y.
Harris has about 23,000 employees and $8 billion in annual revenue.2015-07-10T20:46:00+00:00
Report gives Virginia high ranking on Internet connection speed
http://www.virginiabusiness.com/news/article/report-gives-virginia-high-ranking-on-internet-connection-speed#When:18:33:00ZVirginia ranks among the top states for peak average Internet connection speed, according to Akamai Technologies Inc., a content-delivery network services company.
Akamai’s first quarter “2015 State of the Internet” report found that the average peak connection speed for Virginia was 79 Mbps, (megabits per second), placing the commonwealth third behind Delaware at 85.6 Mbps and the District of Columbia at 79.2 Mbps.
Cambridge, Mass.-based Akamai considers the average peak connection speed to be the best measure of Internet capacity.
Trailing Virginia among the top 10 states were Rhode Island, Massachusetts, Utah, North Dakota, Washington state, Maryland and California.
The Akamai report found that Virginia’s connection speed during the first quarter had improved 7.5 percent compared with the fourth quarter of 2014 and 47 percent over a 12-month period.
Delaware’s connection speed had improved 14 percent quarter to quarter and 65 percent year to year.
Worldwide, Virginia has the fifth-fastest peak broadband speed by region. Ahead of Virginia, in addition to Delaware and District of Columbia, were Singapore and Hong Kong.
Singapore’s speed was 98.5 Mbps while Hong Kong’s was 92.6 Mbps.2015-07-10T18:33:00+00:00
Project HOPE names health official its president and CEO
http://www.virginiabusiness.com/news/article/project-hope-names-health-official-its-president-and-ceo#When:18:00:00ZProject HOPE, an international health care organization based in the Shenandoah Valley, has named Dr. Thomas Kenyon, a Centers for Disease Control and Prevention official, its president and CEO, effective Oct 1.
Dr. Thomas Kenyon has worked for the CDC for more than two decades and currently is director of the organization’s Center for Global Health.
Kenyon succeeds Dr. John P. Howe III, who led Millwood-based Project HOPE for 14 years until his retirement in March.
According to a news release, Kenyon was a key member of the U.S. government team that coordinated the White House’s mobilization against Ebola and is a veteran of the worldwide fight against HIV/AIDS.
Kenyon was the principal deputy global AIDS coordinator and chief medical officer for PEPFAR (the President’s Emergency Plan for AIDS Relief) at the U.S. Department of State.
He also served as a director for Project HOPE in Swaziland from 1987 to 1992 and as a consultant pediatrician for a HOPE program in Grenada for two years in the mid-1980s.
Kenyon earned a bachelor’s degree in zoology from Indiana University and a master’s degree in public health with a focus on international health from the Johns Hopkins School of Hygiene and Public Health. He received his medical degree from the University of Missouri-Columbia.
Project HOPE conducts medical training and health education in more than 30 countries.2015-07-10T18:00:00+00:00
Deal announced to eliminate tolls in Portsmouth
http://www.virginiabusiness.com/news/article/deal-announced-to-eliminate-tolls-in-portsmouth#When:16:45:00ZThe commonwealth will use $78 million previously budgeted for a now-cancelled highway project to buy out tolls in Portsmouth.
Gov. Terry McAuliffe on Friday announced an agreement that he said ensures no tolls will be collected on the Martin Luther King (MLK) Freeway extension project. Money for the tolls had previoiusly been set aside for now-canceled Route 460 improvements in Southeast Virginia..
The governor’s office said the agreement also includes provisions designed to ease the burden of tolls connected to Midtown and Downtown tunnels projects. These provisions would aid residents who struggle to pay tolls because of financial or medical problems or other circumstances, officials said.
The MLK extension, a new Midtown Tunnel now under construction, and the rehabilitation of the Midtown and Downtown tunnels are collectively known as the Elizabeth River Tunnels project.
In a statement, McAuliffe said the Elizabeth River Tunnels project was necessary to reduce congestion, increase safety and improve the economy, but is "a bad deal reached under the prior administration.”
“We have worked with our private-sector partner to ensure there will be no tolls on the MLK extension. Imposing a toll to finance the improvements would have placed an unfair burden on the citizens of Portsmouth,” he said. “It is not good policy for Portsmouth to bear the cost of this project when it is also sharing the tolling burden with other motorists in the region who travel the Midtown and Downtown tunnels.”
In connecttion with the Midtown and Downtown tunnels, Transportation Secretary Aubrey Layne said the project contractor, Elizabeth River Crossings (ERC), has agreed to pay $500,000 a year for 10 years to help offset the cost of tolls to those users who are the most financially stressed.
“I have directed Deputy Secretary of Transportation Grindly Johnson to lead this effort and work with the local community to ensure these monies are invested in the most beneficial way to ease the financial burden of tolls on those residents who need the help the most,” Layne said in a statement.
The cost for toll violations will be capped. The highest amount that ERC can charge for violations regarding unpaid tolls, fees and court costs cannot exceed $2,200.2015-07-10T16:45:00+00:00
Alpha may idle six mines and a processing plant before their sale
http://www.virginiabusiness.com/news/article/alpha-may-idle-six-mines-and-a-processing-plant-before-their-sale#When:21:06:00ZBristol-based Alpha Natural Resources Inc. has told nearly 300 employees that mining operations where they work could be idled and then sold.
The company said it may sell substantially all of the operations of six mines and a processing plant operated by three Alpha affiliates in Southwest Virginia and Eastern Kentucky.
In accordance with requirements of the Worker Adjustment and Retraining Notification (WARN) Act, the operators notified 292 employees of the expected idling of the facilities in anticipation of their potential sale.
‘This action is consistent with steps Alpha Natural Resources has taken in the past to build a sustainable portfolio of mining assets across the company's operational footprint," Alpha Executive Vice President of Mining Operations Keith Hainer said in a statement.
The mining operations affected by the WARN notice are:
• Mill Branch Coal Corp.'s Dorchester and Osaka deep mines in Wise County, Va., which have 134 employees.
• North Fork Coal Corp.'s North Fork No.6 deep mine in Letcher County, Ky., and the Panther No. 1, Stillhouse No. 1 and North Fork No. 7 deep mines, which are currently idled. A total of 111 employees work at the No.6 mine or perform maintenance at the idled operations.
• Pigeon Creek Processing Corp.’s Plant No.1 in Wise County, which has 31 employees.
• Maxxim Shared Services' support personnel for the mining operations, totaling approximately 16 employees.
Alpha is one of the largest coal suppliers in the United States, with mining operations in Virginia, West Virginia, Kentucky, Pennsylvania and Wyoming.2015-07-09T21:06:00+00:00
JLL begins online commercial real estate marketplace in Washington
http://www.virginiabusiness.com/news/article/jll-begins-online-commercial-real-estate-marketplace-in-washington#When:20:10:00ZThe commercial real estate firm JLL has introduced on an online transactional marketplace for small tenants in the Washington, D.C., area.
The Chicago-based company’s Web platform, HiRise, which was launched Thursday, allows tenants and landlords to connect and complete real estate transactions online.
JLL said HiRise is expected to create a leasing arena previously not available to tenants needing less than 5,000 square feet of space.
"A huge block of tenants is being underserved,” Andy O'Brien, a JLL senior vice president who is co-founder of HiRise, said in a statement. “Long leases, large square footage requirements and strict terms are prohibitive and resource-intensive for small- to mid-sized businesses, especially high growth startups.”
JLL said its research has found that more than 500,000 U.S. businesses occupy office spaces of less than 5,000 square feet.
In the Washington, D.C., area, these companies outnumber large tenants three to one, the company said, and the average transaction size has dropped 35 percent since 2010. In contrast, the number of office leases larger than 10,000 square feet have been reduced by half in that timeframe, with the average lease size falling to 4,100 square feet.
HiRise features office space in 10 Washington neighborhoods and five submarkets, including Arlington’s Crystal City and Alexandria in Virginia.
JLL said Washington was picked as the platform's first market because of the city's evolving transaction size and its mix of startups, small businesses and government contractors.2015-07-09T20:10:00+00:00http://www.virginiabusiness.com/uploads2/JEFFERSONPIC1.jpg
Greysteel arranges $10 million in financing for Falls Church apartment community
http://www.virginiabusiness.com/news/article/greysteel-arranges-10-million-in-financing-for-falls-church-apartment-commu#When:15:28:00ZThe Greysteel Co., a boutique real estate investment services firm, served as exclusive advisor and agent to Capital Investment Advisors LLC in arranging $10 million in joint venture equity financing in connection with Capital Investment’s acquisition of The Jefferson Apartments in Falls Church. The purchase price was $52 million.
The 310-unit, apartment community, built in 1962, is located inside the Washington D.C., Capital Beltway in the Seven Corners submarket. The property was acquired from BVF-II Prestwick LLC, an affiliate of Berkshire Property Advisors, as part of an end of fund life disposition.
Besides its accessible location, the property includes more than 13 acres of developable land that “presents long-term development potential rarely seen in a major gateway market such as the greater Washington, D.C., MSA,” Mark Bittenbender, director of Greysteel's Capital Market’s Group, said in a statement. He works out of the company’s Bethesda, Md., office.2015-07-09T15:28:00+00:00
SRA plans initial public offering
http://www.virginiabusiness.com/news/article/sra-plans-initial-public-offering#When:21:26:00ZSRA Companies Inc., parent company of Fairfax-based IT services company SRA International Inc., plans to hold an initial public offering of its common stock.
The company hopes to raise up to $100 million in the IPO.
BofA Merrill Lynch and Citigroup will act as joint book-runners of the proposed offering, which will be made only by means of a prospectus.
A filing with the Securities and Exchange Commission showed that the company had adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $178 million for the fiscal year ending June 30, 2014.
Its nine-month EBITDA for the period ending March 31of this year was $140.7 million.
SRA’s primary customer is the U.S. government. According to the filing, 70 percent of its revenue comes from IT services, including software and systems development, network infrastructure, cloud services and cybersecurity.
The remaining 30 percent comes from professional services in the areas such as intelligence analysis, bioinformatics and health sciences, energy and environmental consulting and enterprise planning and resource management.
The filing said the federal government spent $125 billion in fiscal year 2014 with third parties on the types of IT and professional services that SRA provides.2015-07-08T21:26:00+00:00http://www.virginiabusiness.com/uploads2/Aerial_Photo_of_Tread.jpg
Tread Corp. sells its manufacturing facility in Roanoke for $2.7 million
http://www.virginiabusiness.com/news/article/tread-corp.-sells-its-manufacturing-facility-in-roanoke-for-2.7-million#When:21:02:00ZThe Tread Corp. has sold the 74,724-square-foot manufacturing facility in Roanoke where it has been located since 2004 for $2.7 million. However the company signed a long-term triple net lease to remain in the building, according to Poe & Cronk Real Estate Group, which brokered the sale-leaseback deal.
The building is located at 176 Eastpark Drive.
Dennis Cronk and Matt Huff represented the Tread Corp. which serves the mining, quarry and construction industries with bulk explosive-handling equipment.
Doug Wright of Harris Commercial in Christiansburg represented the buyer, Lester Development Corp., based in Martinsville.2015-07-08T21:02:00+00:00
SVN/Motleys coordinating sale of 150 Virginia properties
http://www.virginiabusiness.com/news/article/svn-motleys-coordinating-sale-of-150-virginia-properties#When:19:42:00ZRichmond-based SVN/Motleys, a founding member of Sperry Van Ness Auction Services, is coordinating the accelerated sale of more than 150 revenue-generating and development properties in areas south and east of Richmond.
The sale includes commercial properties, rental assets, multi-parcel development opportunities and commercial-and residential-zoned building lots in southern Chesterfield County, Colonial Heights, Chester, Petersburg, Waverly, and Dinwiddie and Prince George counties.
Individual properties will be offered in an online bankruptcy auction starting July 15 with all sales ending by July 30.
According to SVN/Motleys, the U.S. Bankruptcy Court recently ordered the sale of the properties owned by Roadrunner Enterprises Inc. of Chesterfield County. SVN/Motleys is representing the debtor.
“From turnkey income-producing rental to development opportunities, there is a wide spectrum of properties available for experienced investors, developers and individuals interested in entering the market,” Tim Dudley, senior advisor with SVN/Motleys, said in a statement.
Among the properties listed for sale are several high traffic parcels on U.S. 1 (Jefferson Davis Highway), a convenience store, a 60-lot subdivision and a 49-unit, self-storage facility.
Most recently, SVN/Motleys coordinated the bankruptcy sale of the River City Renaissance Properties in Richmond, which sold for $37.3 million.
Many of those properties were apartments.2015-07-08T19:42:00+00:00
First Bank names president and chief operating officer
http://www.virginiabusiness.com/news/article/first-bank-names-president-and-chief-operating-officer#When:20:46:00ZDennis A. Dysart has been named president and chief operating officer of Strasburg-based First Bank.
Before his promotion, Dysart was the bank’s senior executive vice president and COO.
He joined the bank in 1993.
Scott C. Harvard will continue to serve as CEO.
During Dysart’s career with First Bank, his responsibilities also have included: chief credit officer from April 2012 to August 2014, COO from May 2011 to March 2012, interim CEO from January to May 2011, and executive vice president - chief administrative officer from 2005 to March 2011.
First Bank recently completed the acquisition of six bank branches that expanded its Virginia footprint south on the I-81 corridor to Staunton and east to Farmville.
The bank now has 18 offices. First National Corp. is the parent company of First Bank.2015-07-07T20:46:00+00:00
Alexandria-based Fishbowl acquires Czar Metrics
http://www.virginiabusiness.com/news/article/alexandria-based-fishbowl-acquires-czar-metrics#When:20:43:00ZAlexandria-based Fishbowl, a restaurant industry marketing analytics company, has acquired Czar Metrics.
Financial details on the deal were not disclosed.
New York-based Czar Metrics uses proprietary models and historical data to guide customers in decisions for menu and price engineering, promotions performance, site selection, loyalty program economics and sales forecasting.
Fishbowl officials said the addition of Czar Metrics will help customers use guest information to maximize profitable decision-making.
Michael Lukianoff, the CEO of Czar Metrics, will become Fishbowl’s chief analytics officer with responsibility for oversight and delivery of analytics solutions to its customer base2015-07-07T20:43:00+00:00
Cetrom reinvests more than $1 million for planned growth
http://www.virginiabusiness.com/news/article/cetrom-reinvests-more-than-1-million-for-planned-growth#When:17:15:00ZVienna-based cloud services provider Cetrom Information Technology Inc. announced Tuesday it has reinvested $1 million in the company for planned growth.
The money mostly will be used for hardware upgrades. Cetrom plans to use the capital to set up and implement Storage Area Networks and servers.
The move to the new networks and servers will be completed over the next quarter. Client’s existing service will not be disrupted.
Cetrom’s customers include accounting and CPA firms, associations and nonprofits, law offices, and travel management companies. In addition to its headquarters in Vienna, Cetrom has offices and data centers across the United States.2015-07-07T17:15:00+00:00
Tegna announces $1.32 billion revolving credit facility, $200 million loan
http://www.virginiabusiness.com/news/article/tegna-announces-1.32-billion-revolving-credit-facility-200-million-loan#When:21:19:00ZMcLean-based Tegna Inc., formerly Gannett Co. Inc., has entered into a $1.32 billion revolving credit facility that matures in June 2020.
The company also has a new five-year, $200 million term loan. Both facilities became effective with the completion of the spinoff of the company’s publishing business, which kept the Gannett name, on June 29.
According to a filing with the Securities and Exchange Commission, the lenders involved in the deal include JPMorgan Chase Bank, Citibank, Barclays Bank PLC, Mizuho Bank Ltd., SunTrust Bank, The Bank of Tokyo-Mitsubishi UFJ Ltd. and U.S. Bank.
“We are very pleased with the terms of our revolving credit facility and term loan, both of which reflect the financial strength and projected growth trajectory of Tegna,” Gracia Martore, the company’s president and CEO, said in a statement.
Tegna Media includes 46 television stations, including those serviced by the company. It is the largest independent station group of major network affiliates in the top 25 markets, reaching approximately one-third of all television households nationwide.
Tegna Digital includes Cars.com, an online destination for automotive consumers; CareerBuilder, a major provider of human capital solutions; and other brands such as G/O Digital, Clipper and Sightline Media Group.2015-07-06T21:19:00+00:00
TransForce bought by equity group
http://www.virginiabusiness.com/news/article/transforce-bought-by-equity-group#When:18:25:00ZPalladium Equity Partners LLC has purchased TransForce Inc., a staffing and recruiting company for truck drivers.
TransForce, based in Alexandria, has 47 branches in 24 states and dispatches more than 2,500 drivers daily to logistics companies, private fleets and trucking companies.
"Palladium shares our vision for TransForce and has significant experience providing companies with the necessary resources to accelerate growth,” David Broome, president and CEO of TransForce, said in a statement.
The purchase price was not disclosed.
Palladium is a middle-market, private-equity group in New York with more than $2 billion in assets under management.2015-07-06T18:25:00+00:00
Franklin Johnston Group buys 15-acre tract in Virginia Beach for $6.5 million
The Franklin Johnston Group, a multifamily management and development company based in Virginia Beach, has purchased nearly 15.7 acres of land at 2637 Princess Anne Road in Virginia Beach from First Lynnhaven Baptist Church for $6.5 million.
The Church retained 4 acres for future development.
Brian C. Baker and John Katsias of The Katsias Co. represented the seller and Bill Overman and John Wessling of S.L. Nusbaum Realty Co. represented the buyer in this transaction.
In another sales transaction for S. L. Nusbaum, Wythe Holdings I LLC purchased a 13,412- square-foot retail building located on Richmond Road in Williamsburg from E.W. Crawford Jr. and Clinton O. Crawford Jr. for $1.4 million. Michael Myers handled the transaction.
The deals were part of $23.3 million in sales and lease volume on 103,630 square feet of commercial property and 35.6 acres of land for S.L. Nusbaum Realty Co. for the month of June.
NOTE: This article has been corrected from an earlier version. 2015-07-06T16:06:00+00:00
Smith Packett buys 8.43 acres in Yorktown
http://www.virginiabusiness.com/news/article/smith-packett-buys-8.43-acres-in-yorktown#When:14:48:00ZSmith Packett Med-Com LLC has purchased 8.43 acres in Yorktown for $1.16 million.
The Roanoke-based senior living real estate developer plans to build an assisted living facility on the site. The land, located at Hampton Highway and Victory Boulevard, was purchased from HR Ashe.
David M. Smith of Cushman & Wakefield | Thalhimer handled the sale negotiations on behalf of the buyer.2015-07-06T14:48:00+00:00