Focus is on keeping businesses happy, growing
With COVID-19 limiting travel and site visits for companies considering coming to Hampton Roads, economic development officials focused on shoring up existing businesses in 2021. That strategy appears to have paid off, judging by the number of companies expanding throughout the region.
“2021 has been a banner year for us,” says Norfolk Economic Development Director Jared Chalk. “We’ve had a really great year in terms of business expansions and retentions. We have a lot of talent and companies here and need to grow what we’ve got.”
Chesapeake’s economic development department followed a similar approach. In addition to offering virtual tours of available business and industrial space, the department dealt with COVID-imposed constraints by administering a small business grant program that awarded $5 million to assist firms affected by the pandemic.
“Chesapeake has long been a community that aggressively goes after international foreign direct investment,” says Steven Wright, Chesapeake’s economic development director. “COVID grounded our efforts in that regard, but it gave us an opportunity to look inward into our existing business community.”
However, Vinod Agarwal, Old Dominion University professor of economics and director of the Strome College of Business’ economic forecasting project, notes that Hampton Roads’ recovery from the pandemic continues to trail the rest of the state and the nation. He adds that the region’s growth in 2022 hinges on private sector economic expansion. “Unless the private sector kicks in, we will still lag.”
Regional collaboration is key to attracting new businesses to Hampton Roads, Agarwal says. “Working together as a region will go a long way. It doesn’t matter where a firm is located as long as it locates in Hampton Roads.”
Along with private sector job creation and Department of Defense spending, collaboration among Hampton Roads’ 17 municipalities will strengthen the region’s economy in 2022, Agarwal says. “Barring an unforeseen COVID situation, it should be a better year than 2021.”
With CMA CGM Group’s decision to keep its North American headquarters in Norfolk and $36 million expansion in Hampton Roads and Northern Virginia, “That solidifies us as a maritime hub on the East Coast,” Chalk says, noting that the bulk of the more than 400 jobs CMA CGM is adding in Virginia will be in Hampton Roads. The French shipping and logistics company’s 1,300-foot container ship Marco Polo stopped at the Virginia International Gateway last May.
International logistics firm Katoen Natie is also enlarging its plastics and polymers warehousing and distribution operation. The $61 million expansion includes creating 35 jobs at the company’s assembly plant.
Other companies announcing expansions include Lyon Shipyard Inc., adding 119 jobs and investing $24.4 million to build a new marine travel lift and larger waterfront dry dock on the Elizabeth River; communications equipment producer Tabet Manufacturing Co. Inc., adding 68 jobs when it opens a new $6.5 million facility next to its current Ballentine Boulevard operations this spring; and California-based Dante Valve Co. Inc., undergoing a $1.9 million expansion and adding 40 jobs.
Groundbreaking for the $500 million HeadWaters Resort & Casino took place in December 2021 on 14 acres adjacent to Harbor Park, and builders say the project is supposed to be finished by late 2023. The Pamunkey Indian Tribe’s project is expected to produce 2,500 permanent jobs, along with 2,000 construction positions.
HeadWaters isn’t the only Las Vegas-style casino coming to Hampton Roads. In December 2021, Rush Street Gaming broke ground on a $300 million gaming and entertainment complex near Tidewater Community College in Portsmouth. Rivers Casino Portsmouth is slated to open in early 2023, bringing 1,300 permanent jobs to the area and adding $16.3 million in annual tax revenues to the city’s coffers.
Portsmouth also scored a major economic development deal last fall when Siemens Gamesa Renewable Energy S.A. announced that it will build the nation’s first offshore wind blade factory at the Portsmouth Marine Terminal. The Spanish wind turbine manufacturer will invest $200 million to build the factory on an 80-acre site at PMT. The project will create 310 jobs, including about 50 to support Dominion Energy’s Coastal Virginia Offshore Wind project. (See related story.)
In June 2021, the General Services Administration announced that it will build a $251 million Veterans Administration health care clinic adjacent to Chesapeake Regional Medical Center. Construction on the two-story outpatient facility is expected to begin in late 2022, with opening slated for fall 2024.
“That certainly was a big win for us,” Wright says, noting that the clinic is expected to bring 100 jobs to the city. “It’s privately owned but fully taxable. That’s a significant investment being made.”
Meanwhile, Chesapeake-based government contractor Prism Maritime LLC built two $4 million, 12,000-square-foot fabrication and welding facilities and added 166 jobs in the Greenbrier North Commerce Park in 2021.
Naval Air Station Oceana inked a deal with the city last fall to lease about 400 acres of the jet base to private businesses, giving Virginia Beach highly sought-after land for economic development. In exchange, Oceana will receive up to $3 million in in-kind infrastructure projects and maintenance.
Nearby, agriculture startup Sunny Farms LLC is building a $59.6 million, 32-acre hydroponic operation and creating 155 jobs over three years off Dam Neck Road. During the first phase, the growing, cleaning and packing operation is building a 120,000-square-foot greenhouse, one of the largest on the East Coast. In phase two, the facility will expand to 640,000 square feet and to 1.2 million square feet in phase three.
In November 2021, Celadon Development Corp., which recycles brown pulp, announced it would invest nearly $6.8 million to establish operations in Suffolk. The company plans to hire 60 employees.
Kansas-based Flint Development purchased 72 acres in Coastal Logistics Park for $4.1 million last summer. The industrial developer plans to construct an 813,721-square-foot speculative logistics center by September 2022.
“It’s one of the larger speculative buildings in the city,” says Gregory Byrd, Suffolk’s interim economic development director. “Suffolk has the good fortune of having quite a number of industrial parks primed for construction of larger distribution facilities.”
Three new buildings are planned at the Virginia Port Logistics Park off U.S. Route 58. A 348,500-square-foot building leased by GXO Logistics Inc. was scheduled to be completed in February, while the other two buildings are expected to be completed later this year.
Hampton and Newport News
Smithfield-based Pack Brothers Hospitality LLC is investing $40 million to build a conference center, hotel and 500-seat restaurant and revamp the Old Point Comfort Marina at Fort Monroe. The company signed a 40-year lease with the Fort Monroe Authority. The project is expected to be completed in about four years.
In Newport News, modular housing manufacturing indieDwell will invest $2 million and bring 220 jobs to the city when it opens its first East Coast factory in late 2023 or early 2024.
Defense contractor Aery Aviation LLC announced a $15.3 million expansion of its headquarters and the addition of 211 jobs. Construction on a 60,000-square-foot hangar and an engineering technology center began in the fall, with completion scheduled for the fourth quarter of 2022.
Global Concentrate, a New Jersey-based supplier of traditional and organic fruit and vegetable juice concentrates, announced that it is investing $121 million to establish its largest U.S. processing operation at Pretlow Industrial Park in Franklin. The company purchased 170 acres at the park and is starting construction on a 2-million-square-foot facility by this spring. Fifty full-time jobs are expected to be created over the next three years.
Concrete ready mix maker Coastal Precast Systems is investing $7.5 million to expand a decades-old concrete plant it has operated since 2019 in Cape Charles, adding more than 40 jobs to its Eastern Shore operations.
Nestlé Purina PetCare Co. is investing $182 million to expand its manufacturing operations in King William County. The expansion, including 138,000 square feet to increase capacity and enhance business operations and 100,000 square feet of additional warehouse space, is scheduled to be finished by late 2023.
Eastern Virginia’s recent deals
CMA CGM Group
Southside Veterans Administration Clinic
Siemens Gamesa Renewable Energy S.A.
Aery Aviation LLC
Celadon Development Corp.
Prism Maritime LLC
Sunny Farms LLC
Lyon Shipyard Inc.
Tabet Manufacturing Co. Inc.
Source: Virginia Economic Development Partnership