New plant employing 2,000 workers only one of new wrinkles in the region
News about American investment and jobs going to China has become routine. That’s why a June announcement put the Richmond region in the international spotlight.
China’s Shandong Tranlin Paper Co. Ltd., a pulp and paper company, plans to invest $2 billion in building an advanced manufacturing plant in Chesterfield County, its first in the U.S. The factory will employ 2,000 people.
At a news conference, Gov. Terry McAuliffe characterized the move as “transformational” for the region’s economy.
Economic change, in fact, already is taking place throughout the Richmond region, despite its longstanding reputation for stodginess.
Downtown Richmond is attracting millennials like a magnet; retail and residential development is booming in Henrico County’s Short Pump area; and Hanover County has become a home for massive distribution centers. This time next year the region will host a nine-day international cycling competition that is expected to attract 450,000 spectators.
Some things in the Richmond area, however, never seem to change. After more than a decade of haggling, there still is no agreement on where to put a new minor-league baseball stadium.
Corn stalks to paper
The ripple effects from the new Chesterfield paper plant could be profound. In addition to creating thousands of jobs — with average annual salaries of $45,000 — the company will buy agricultural “residuals,” corn stalks and wheat straw typically left in the field by farmers. This material will be used to produce paper products ranging from napkins to paper bowls.
Virginia agricultural officials project that the purchase of the residuals could provide $50 million a year for farmers in the Richmond region alone.
Additionally, the spinoff of jobs for suppliers and other small businesses is expected to create a mini-boom.
Chesterfield County Administrator Jay Stegmaier hopes the deal opens the door for more investment. He wants Chesterfield and Virginia to become “trusted partners” for Asian businesses seeking to invest on the East Coast.
Millennials move in
While a Chinese company is helping to drive change in Chesterfield, millennials — people born between the early 1980s and the late 1990s — are redefining downtown Richmond.
RealtyTrac lists Richmond as one of the nation’s top 50 rental markets for this generation. People in their 20s and 30s make up nearly one-third (32.2 percent) of Richmond’s population.
They are giving the old capital city a youthful vibe and, as RealtyTrac observes, they also are fueling an apartment boom.
According to Venture Richmond, a downtown promotion booster group, the downtown area has seen the construction of 2,400 apartments during the past four years.
Lucy Meade, director of marketing and development for Venture Richmond, says the growth trend continues.
“Manchester is on fire,” Meade says, referring to the former independent city on the south bank of the James River, which has been part of Richmond for more than a century.
Tara Carter, the owner and managing member of Luxe Residential Services, a consulting and asset management company, says Manchester is an eclectic area that has great appeal for people involved in the arts and design.
“There’s a lot of buzz in Manchester. People are going there for the energy,” Carter says.
Robin Miller of Miller & Associates in Richmond has been involved in the development of more than 600 residential housing units over the years.
“What keeps the motor running is the demand for quality residential apartments and condos,” he says. “The demand is high in Manchester because it’s such a unique neighborhood … lots of trees and sidewalks, a true historic neighborhood.”
Miller is involved in projects worth more than $50 million — from apartments to midrise towers — in the downtown area.
Another big player in downtown development is Genesis Properties. It has four apartment complexes either under construction, being leased or planned in various parts of the downtown area. Together, they total more than 500 apartments.
VCU art institute
In addition to apartments, a new cultural site also is in the works. Virginia Commonwealth University begun construction on its Institute for Contemporary Art (ICA), a $35 million building at the corner of Broad and Belvidere streets.
At the request of director Lisa Freiman, the thoroughly modern structure also will have a basement.
“You always run out of space. It was a practical consideration,” Freiman says with a laugh, noting that basements often are an overlooked item in a building’s planning, even a building like the ICA, which was designed by Steven Holl, one of the world’s most famous living architects.
The VCU School of the Arts is the No. 1 public art and design school in the nation as ranked by U.S. News & World Report. Its master’s in fine arts sculpture program also is ranked No. 1.
Freiman and others believe the center will evolve into one of Richmond’s most spectacular gateways and a cultural linchpin for the city’s Arts & Culture District.
“I think the ICA is going to be the public face of the School of the Arts in many ways,” Freiman says.
Just as the ICA is expected to bolster Richmond’s arts community, backers of a proposed, free-standing children’s hospital believe it will add a much-needed new dimension to medical care in the region.
The hospital would be independent of the area’s health systems.
Richmond philanthropists Bill and Alice Goodwin have offered to pay as much as a third of the hospital’s cost, an estimated $150 million.
In addition to the Goodwins, the partners in planning the hospital include Bon Secours Virginia Health System, VCU Health System and a physicians group organized as Pediatricians Associated to Care for Kids.
Katherine Busser, a former Capital One Financial Corp. executive, has been hired as the hospital’s CEO. She says she accepted the position to help get the project off the ground.
“There’s a lot of energy and enthusiasm in the community broadly,” Busser says.
Supporters believe that the hospital will become a focal point for regional medical treatment for children. Busser says the facility also will have an economic impact.
“This children’s hospital could be really important in the economic development landscape, not just in the region but in Virginia,” she says. “It will create jobs, and other businesses will be located around it.”
Short Pump thrives
In western Henrico County, one institution changing the economic landscape is the sprawling Short Pump Town Center, which serves not only the county’s 320,000 residents but shoppers throughout Central Virginia.
The Richmond Times-Dispatch reported that Short Pump’s total sales in 2012, the last year for which numbers were available, totaled $352 million, more than double the sales of any of the area’s other malls.
“We lead the state in per-capita taxable sales, and we’re only behind Fairfax [County] in actual taxable sales,” says Gary McLaren, executive director of the Henrico Economic Development Authority.
New residential, retail and office developments continue to spring up in the Short Pump area, facilitated by the web of major highways, including Interstates 64 and 295, as well as state Route 288.
One new development, West Broad Marketplace, is planned for 62 acres between West Broad Street and I-64. Its tenants will include a Wegmans, a sought-after high-end grocery store, and Cabela’s, a well-known outdoor sports retailer, along with at least 10 other shops.
McLaren points out that Henrico is not all about retail. He says it has a mix of other job-producing companies and industries. Altogether, 25,000 businesses call Henrico home.
He notes that the county provides 180,000 jobs, the most in Central Virginia, and is second only to Fairfax County in the commonwealth.
“We’re able to recruit companies from all over the world,” McLaren says. “We have a high quality of life, great schools and great services.”
Nearby Hanover County has had difficulty with one of its biggest development projects, the Winding Brook property off Interstate 95, but it has been very successful in attracting new distribution centers.
Until the recession hit, there were big plans for Winding Brook, a 185-acre development anchored by Bass Pro Shop. To help the project get back on track, the Hanover Board of Supervisors recently agreed to restructure $37.6 million in bonds that were in default.
Better news for Hanover has come from its growing reputation as a distribution site.
Owens & Minor, a Fortune 500 company based in the Mechanicsville area, is acquiring New York-based Medical Action Industries Inc. in a $208 million deal. Medical Action makes custom procedure trays and minor procedure kits. Owens & Minor is a health-care logistics company that distributes a wide range of medical supplies.
Ashland, which is the only incorporated town in Hanover, has landed its second large distribution center in recent years. Republic National Distributing Co., the nation’s second-largest distributor of premium wines and spirits, plans to open a 260,000-square-foot distribution center.
It will be located next to The Vitamin Shoppe’s nearly 312,000-square-foot distribution center that began making shipments to company stores last fall.
Big bike race
Next September, however, the region will be focused on bicycles whizzing down city streets rather than trucks loading up at distribution centers. Richmond will be the host of the 2015 World Road Cycling Championships.
A study by Richmond-based Chmura Economics & Analytics says the economic impact of the international competition on the region could be $129 million.
In addition to drawing 450,000 spectators and a thousand athletes, the event, scheduled for Sept. 19-27, is expected to have a worldwide television audience that could top 300 million.
The organizers of Richmond 2015 warmed up for the big race with the USA Cycling Collegiate Road National Championships in May.
Lee Kallman, vice president of marketing and development of Richmond 2015, says response to the collegiate races from businesses, participants and spectators has been overwhelmingly positive.
But he acknowledges that “a couple of businesses were not happy about things,” because the event failed to attract as many customers as they had hoped.
Some local companies also have expressed concerns about road closures along the routes of the upcoming World Championship races.
Richmond 2015 officials, however, believe businesses will make up in foot traffic what they might lose in vehicular traffic.
Nancy Thomas, president/CEO of the Richmond-based Retail Merchants Association, says its members encountered “no real effect on their businesses” from street closures during the collegiate races.
“Now, we’re helping educate businesses on how to take advantage of the large numbers on the way,” Thomas says.
One goal in hosting the international competition is to promote cycling in the Richmond region.
One example of growing interest in the sport is the construction of the Virginia Capital Trail, a path connecting Richmond and Jamestown.
“It’s like a 52-mile sidewalk,” says Beth Weisbrod, executive director of the Virginia Capital Trail Foundation.
The Capital Trail, which is supported by donations and grants, is scheduled to open Sept. 1.
Although Richmond successfully bid on an international cycling competition, its leaders repeatedly have failed to reach consensus on a location for a new baseball stadium.
Mayor Dwight Jones has proposed an ambitious project involving new development at the site of the existing stadium in North Richmond while building a new stadium plus a hotel, grocery store and apartments in the city’s Shockoe Bottom area. Plans for Shockoe Bottom also include a pavilion commemorating the area’s history as a major slave trading center before the Civil War. The city share of the project would total $79.6 million.
The mayor withdrew the proposal from consideration by City Council where it likely faced defeat because of many concerns about its cost and location.
Jones, however, has not given up on the plan and has dismissed as second-rate an alternative proposal advanced by private developers to build a new stadium near its current site on the Boulevard.
Adding to the debate was the announcement that the National Trust for Historic Preservation named the Shockoe Bottom to its list of America’s 11 Most Endangered Historic Places because of the stadium proposal.
The controversy looks like a replay of the tug of war over a stadium site that began more than 10 years ago. The Richmond Braves, the city’s AAA minor league team for more than 40 years, pulled up stakes and moved to Gwinnett County, Ga., in 2008 when no decision was made about replacing The Diamond, the current stadium, which was built in 1985.
The team that replaced the Braves — the Flying Squirrels, a farm team of the San Francisco Giants — quickly came to the same conclusion, the stadium needs to be replaced.
The team owner has backed the mayor’s proposal but has said he will support “a consensus of the community” in finding a solution.