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As data centers grow, Amazon and Dominion explore small nuclear reactors

With power consumption by data centers and AI projected to more than quadruple in Virginia in the next 15 years, Amazon.com and Dominion Energy Virginia have entered into an agreement to explore potential development of small modular nuclear reactors at North Anna Power Plant in Louisa County, the two companies announced at an event Wednesday at Amazon’s HQ2 East Coast headquarters in Arlington County.

Dominion and Amazon’s memorandum of understanding means the companies will “jointly explore innovative ways to advance SMR development and financing while also mitigating potential cost and development risks for customers and capital providers,” according to Dominion’s announcement.

“This is a milestone along the path,” Amazon Web Services CEO Matt Garman said at Wednesday’s event. “There’s a ton that we need to do between here and there, and there’s a lot of work that needs to go into this, but this is a really important milestone that we’re celebrating today.”

At Wednesday morning’s event, Gov. Glenn Youngkin, U.S. Sens. Tim Kaine and Mark Warner and Dominion Energy Virginia President Ed Baine were on hand, among other state and national dignitaries.

“I am thrilled that Virginia is among the first states to take this big step,” Youngkin said. “Just two-and-a-half years ago, Virginia was literally accelerating on what has been an uninterrupted renaissance in growth, job growth and investment by companies who’ve committed $83 billion to expand or come to Virginia, and hire more people than we’ve ever had working before in the history of the commonwealth.”

He noted that the state is “poised to take this giant step with our partners,” as home to the nuclear Navy, multiple research universities and Dominion.

In his comments, Kaine also mentioned Lynchburg-based nuclear fuel producer BWX Technologies and Framatome Inc., the North American subsidiary of the French nuclear equipment, services and fuel producer, as other significant players in Virginia’s nuclear energy sector. “Amazon is the largest power user in the United States,” Kaine said. “That AWS is here, and that AWS is endeavoring to help us advance our innovation together with these other innovators in Virginia makes perfect sense.”

As of now, only two SMRs are in operation — one in Russia and the other in China — and Virginia likely won’t have its own SMR before the mid-2030s.

Warner, who chairs the Senate’s Select Committee on Intelligence, said Wednesday that energy innovation is important also as a matter of national security, particularly as the U.S. races to catch up with China’s innovations. “National security is not simply the nation state that has the most tanks and guns and ships and planes, but increasingly, it’s going to be who can win the battle in technology competition.” China, he added, is constructing “30 nuclear plants even as we speak. They have a goal of adding 150 more by 2035.”

However, he said, Virginia is “the nuclear capital for the country,” with 100,000 people already working in the nuclear sector in the commonwealth, including sailors, university researchers and employees at BWXT, Framatome, Huntington Ingalls Industries and other companies.

Ambitious plans

Amazon’s agreement with Dominion was just part of its news Wednesday, as the global e-tail giant announced it has signed three agreements to support development of small modular reactors, or SMRs, including one in the state of Washington with Energy Northwest, to develop four advanced SMRs. According to Amazon’s announcement, the four reactors would generate roughly 960 megawatts of electricity at full operation, beginning in the early 2030s. Amazon, which in March acquired a nuclear-powered data center campus in Pennsylvania from Talen Energy, also has committed to invest in SMR developer X-energy, whose reactor design will be used in the Energy Northwest project.

“Nuclear is a safe source of carbon-free energy that can help power our operations and meet the growing demands of our customers, while helping us progress toward our Climate Pledge commitment to be net-zero carbon across our operation by 2040,” Garman said in a statement released Wednesday morning.

Dominion previously announced in July that it had issued a request for proposals to evaluate the feasibility for a small nuclear reactor to be developed at its North Anna power plant, where it has two conventional, large nuclear reactors. Nuclear technology companies received the RFP, which was not a guarantee to build an SMR but would be the first step in exploring whether such a step was feasible, the Fortune 500 utility said in July.

On Wednesday, Dominion Energy Virginia’s Baine said that the “site is well on its way to be able to be developed,” and that he expects Dominion to make a decision on the winning proposal before the end of the year. He also said that X-energy is among the companies that have submitted a proposal.

The RFP, Baine added, will “inform us how we want to move forward with companies for additional small modular reactors as well.”

Virginia Secretary of Commerce and Trade Caren Merrick said Wednesday that she expects Youngkin to soon issue an executive order about accelerating permitting for nuclear sites, and the state has invited X-energy to come to Virginia for manufacturing.

Competitor Google preempted Amazon’s announcement by a day, announcing on Tuesday that the tech company had reached an agreement with Kairos Power to develop and purchase 500 megawatts of power from six to seven SMRs, planned to come online between 2030 and 2035. And in September, Microsoft forged a deal with Constellation Energy to offset power consumption by its data centers by reviving a portion of the Three Mile Island power plant, the Pennsylvania facility that in 1979 experienced a partial nuclear meltdown, the worst nuclear disaster in U.S. history.

Moving toward nuclear in Va.

Over the past couple of years, SMRs have been a big part of Virginia’s energy conversation, especially as data center growth has put more demands on the state’s power grid.

According to Dominion’s Integrated Resource Plan, filed Tuesday with the Virginia State Corporation Commission and the North Carolina Utilities Commission, power demand in Dominion’s coverage area in Virginia and North Carolina is expected to grow 5.5% annually over the next decade and double by 2039. Dominion has previously predicted that the data center industry in the state will demand 13 gigawatts of electricity by 2038, nearly five times the 2.8 gigawatts it used in 2023.

In Virginia, Amazon has agreed to explore the development of an SMR project near North Anna, bringing “at least 300 megawatts of power to the Virginia region, where Dominion projects that power demands will increase by 85% over the next 15 years,” according to Amazon’s news release. Additionally, Amazon signed an agreement to place a new data center next to a nuclear facility in Pennsylvania, a carbon-free energy source to power the data center.

In Loudoun County’s Ashburn area, where more than 70% of the world’s internet traffic courses through a corridor known as Data Center Alley, Amazon Web Services is the biggest fish in a gigantic pool. From 2011 to 2021, AWS invested more than $51.9 billion in Virginia, including building data centers. In January 2023, the company had at least 65 data centers in Loudoun in operation or under development, out of more than 200 data centers in the county, and AWS announced it planned to invest $35 billion by 2040 to build more data center campuses across the state.

Nationally, it’s anticipated that data centers will account for 17% of energy usage nationwide by 2030, according to a Bloomberg Intelligence report. That’s up from 4% in 2022 and 6% in 2026, according to data and projections from the International Energy Agency.

U.S. Secretary of Energy Jennifer Granholm, speaking at Wednesday’s event, called Virginia “the go-to place for the concentration of data centers,” and noted that AWS is the latest company to do “BYOP,” or “bring your own power” for data centers. “And this is the important piece I mentioned, that the technology companies know that in order for these data centers to achieve great community buy-in, bringing their own power with them is an important piece of that, so the rates are not raised on everyday citizens.”

She added that the Department of Energy is announcing $900 million in funding “for those who want to deploy even more … small modular reactors,” referring to applications opening for a program to support the first commercial-use SMR in the United States.

In the past couple of years, as artificial intelligence usage and overall digital use has grown, so has demand on Virginia’s power supply. In a May earnings call, Dominion Energy CEO Bob Blue said that the utility is receiving more requests to power larger data center campuses with larger energy demands of 60 to 90 megawatts per building, or several gigawatts for multibuilding campuses.

Baine said in an interview Wednesday that “there are a number of things that are driving energy demand within Virginia. Data centers [are] absolutely one of the big ones, but there’s also manufacturer electrification that is also increasing demand.”

The Joint Legislative Audit and Review Commission (JLARC) is conducting a study on data centers as some state legislators are pushing for high-volume power users to cover infrastructure costs to keep the state’s power grid reliable. The Virginia General Assembly forwarded all data center-related bills to 2025’s session so lawmakers could take JLARC’s study — expected to be released in November — into consideration.

Freelance writer Courtney Mabeus-Brown and Virginia Business Editor Richard Foster contributed to this story.

Under construction

Amazon.com fulfillment and delivery centers

Virginia Beach

As part of Amazon.com’s growing presence in Virginia, the tech giant is coming to the Virginia Beach area in the form of a 650,000-square-foot fulfillment center and a 219,000-square-foot delivery station. It is an endeavor with $350 million in investments and is expected to create more than 1,000 jobs. Construction remains on track, according to Amazon. The robotics fulfilment center, a five-floor facility with 55 loading docks, is expected to open in 2025. The delivery station, meanwhile, is scheduled to open near the end of 2024.

Photo courtesy Bon Secours

Bon Secours Harbour View Medical Center

Suffolk

After breaking ground in October 2022, construction on the Bon Secours Harbour View Medical Center — an expansion to the existing Harbour View campus in Suffolk — is still on track to be finished in March 2025, with plans to welcome the facility’s first patients in the second quarter of that year.

The $80 million, 98,000-square-foot hospital roughly doubles the size of the facilities on the Harbour View campus. It is a three-story building that will have 18 inpatient beds and four operating rooms, along with associated pre-operative and recovery spaces, and capacity to further expand vertically should need arise.

As of late June, installation of the hospital’s elevators and storefront and facility windows is complete, and the hanging of drywall and installation of sprinkler piping is in process.

 

 

 

Photo by Mark Rhodes

Atlantic Park

Virginia Beach

A $350 million joint project between music and fashion superstar Pharrell Williams and Venture Realty Group, Atlantic Park will span multiple acres and contain a surf lagoon and bungalows; a 3,500-person amphitheater; 300 apartments; more than 100,000 square feet of retail, restaurant and office space; two parking garages; and half a mile of upgraded public streets.

In late August, general contractor W.M. Jordan Co. laid the lowest depths of the Atlantic Park wave pool, which is expected to be open in May 2025. A wave machine is expected to be installed in October. Also, the $54.8 million amphitheater known as “The Dome” is set to be complete for a May 2025 opening.

 

 

 

 

Photo by Mark Rhodes

Fusion @ NEON Apartments

Norfolk

Norfolk real estate developer Marathon Development Group is building a 239-unit, $50 million apartment complex on West Olney Road, part of Norfolk’s Neon District. The apartment complex will contain studio, one-, two- and three-bedroom units ranging in size from 498 to 1,733 square feet. Construction was not yet complete in July, but the project’s developers expected to have initial residents arrive in August, and the leasing office had started accepting applications and offering hard hat tours.

 

 

 

 

 

Photo courtesy Virginia Department of Transportation

Hampton Roads Bridge-Tunnel

Hampton and Norfolk

The commonwealth’s largest transportation project to date — valued at $3.9 billion — is approximately halfway done with construction. The project entails construction, expansion and renovation along the 10-mile stretch of Interstate 64 from Hampton to Norfolk. Half of Hampton’s Mallory Street Overpass has been demolished and replaced with a new bridge of a greater span length. Traffic was set to be shifted there in late summer so work can begin to replace the other half of the bridge. 

Construction on the North Trestle — an eight-lane bridge between Hampton and the HRBT North Island — is also half done. The new four-lane eastbound North Trestle was opened for public use in May and is currently serving two lanes of traffic. North Island was expanded by 15 acres. Both the second halves of the new Mallory Street Overpass and the North Trestle are expected to be complete in 2026, in the fall and summer, respectively.

The South Trestle — an eight-lane bridge between HRBT South Island and Norfolk’s Willoughby Spit — is more than 70% complete. VDOT expects to make traffic shifts onto the structure starting in 2025. Road widening and rehabilitation of the Willoughby Bay Bridge, along with construction for Norfolk roadway spanning from Willoughby Spit to Patrol Road, is also in progress.

Mary, the project’s tunnel boring machine, has finished mining from South to North Island, meaning the first of the project’s two new two-lane bored tunnels is complete. So far, Mary has excavated 7,941 feet and installed 1,191 concrete rings. It will take approximately five months to rotate and reassemble Mary for her second tunnel boring back to South Island. The trip is expected to start late September and finish in summer 2025.

Finally, the expanded bridge-tunnel is expected to be open to traffic in February 2027, with final projects like landscaping expected to be finished in August 2027.

Rendering courtesy Seafood Industrial Park

Seafood Industrial Park

Newport News

The northern portion of the city’s longstanding seafood harbor is set to undergo a harbor dredging, dock replacements, and a seafood market installation. All of the projects are expected to commence construction between January and July 2025.

Demolition of existing 130-feet-long wooden docks and dredging will take place first, followed by the construction of new piers with concrete decking and pilings and safety features. The replacement docks are expected to expand capacity to 10 to 12 boats and have a recreational dock for transient boats visiting the upcoming market.

Designs for the dredging cost $123,000 and are now complete, with dredging work estimated to cost $1.75 million. Designs for the dock improvements cost $239,000 and wrapped up in July. Construction for the dock improvements — estimated to cost $5 million — are expected to begin this coming winter. The planned seafood market will be located near the piers and is expected to span roughly 7,800 square feet. The market’s design cost $802,000, and construction is estimated to cost approximately $9 million.

Dropping anchor

LS GreenLink USA spent two years on site selection, scouring much of the East Coast for the right location to build a 750,000-square-foot factory to manufacture subsea cables for offshore wind farms.

Then it landed on Chesapeake.

Patrick Shim, LS GreenLink’s managing director, cited several reasons for the company’s decision: access to the Port of Virginia, the approximately 15,000 veterans who enter the civilian workforce each year in the region, and the state, regional and local economic development support for companies like his.

“I’ve never seen anything like it in any other region out there,” Shim says.

In July, LS GreenLink, a U.S. subsidiary of South Korea’s LS Cable & System, announced it would build the United States’ first offshore wind subsea cable factory at the Deep Water Terminal Site in Chesapeake, creating an estimated 381 jobs and investing $681 million. 

The port has remained a large attraction for retailers and developers looking to invest in Hampton Roads. Industrial real estate had a 2.3% vacancy rate for the second quarter of 2023, which slipped to 3.6% for the second quarter of 2024, according to Cushman & Wakefield | Thalhimer. But that’s still well below the national rate of 6.6%, according to real estate company JLL.

A national slowdown in imports and rising interest rates are to blame for some of that increase, says Geoff Poston, senior vice president of Cushman & Wakefield | Thalhimer’s industrial group. But it’s not all doom and gloom.

Hampton Roads lagged behind other markets, like Savannah, Georgia, in spec building before the pandemic, but that’s changed in recent years, and more spec buildings are coming online. This contributes to the boost in the region’s vacancy rate, but Poston notes that Hampton Roads remains “in a much healthier position than most other industrial markets.”

That includes Savannah, which posted a 7.9% industrial vacancy rate for the second quarter of 2024.

“We’ve just got through an all-time record historical industrial market, and so this is a little more normal, although the developers, you know, they’d love to have more activity,” Poston says.

The port’s draw

The Port of Virginia’s shipping channel opened to two-way traffic for ultra-large container vessels in March, reducing turnaround time by 15%, according to the port. A central rail expansion that will allow it to handle an extra 455,000 20-foot-equivalent containers (TEUs) a year, bringing the total rail capacity to 1.8 million TEUs annually, was finished in early August.

The port processed 3.5 million TEUs in fiscal 2024, a 2% increase over 2023 and the second best year in its history.

Lang Williams, an executive vice president and principal with Colliers International Virginia and vice president of the Virginia Maritime Association, says trends are reversing, and cargo is beginning to again flow more freely. Coupled with the port’s improvements, he expects the more recent lag in vacancies “will start to go away.”

That could be good news for large projects underway, including more than 3.6 million square feet spread across 11 spec buildings that are either being constructed or anticipated, Colliers reported. That’s on top of four such buildings, totaling more than 1.4 million square feet, completed last year.

Developers Matan and the Rockefeller Group are planning a 5 million-square-foot industrial park on 500 acres in Suffolk, with five spec buildings, two of which are set to be completed by the end of 2025.

“They’re having really good activity for those buildings, and maybe some other activity as well,” Deputy City Manager Kevin Hughes says. Gov. Glenn Youngkin announced in July that the City of Suffolk would receive $30.1 million to widen a 2.3-mile stretch of Route 460 to support the development.

Other high-profile projects are also continuing. Amazon.com is on track to complete a 219,000-square-foot delivery station in Virginia Beach in time for the 2024 holiday season, and a robotics fulfillment center, in an adjacent space, is set to be complete in late 2025, company spokesperson Sam Fisher says.

Also in August, the City of Chesapeake received a $35 million grant from the state’s Virginia Business Ready Sites Program to help extend utility infrastructure to the 1,400-acre Coastal Virginia Commerce Park, according to Steven Wright, the city’s economic development director. The state has looked to the megasite as a possible location for a semiconductor or microchip manufacturer. While Chesapeake is continuing to look for funding for development, Wright says it is close to reaching Tier 4 status.

“Everyone that calls is curious about what is the status of the infrastructure to support the property,” Wright says.

  

Arlington apartment tower sells for $48.5M

A 162-unit high-rise apartment property in Arlington County has changed hands.

Fortis Cos., a Washington, D.C.-based real estate development and investment company, acquired Marlowe Apartments from Equity Residential for $48.5 million, according to Berkadia, a commercial real estate services and mortgage firm, and Arlington County property records.

The 162-unit property located at 400 15th St. S. is located across from Metropolitan Park, the first phase of Amazon.com’s East Coast headquarters, HQ2.

Marlowe Apartments, built in 1986, is connected to the Crystal City Metro station.

Patrick McGlohn, Brian Gould, Miles Drinkwalter and Pat Cunningham of Berkadia DC Metro secured $40.6 million in financing on behalf of the buyer. The financing closed on May 6 in conjunction with the sale of the property. Berkadia DC Metro Institutional Sales, led by Brian Crivella, Yalda Ghamarian and Bill Gribbin, facilitated the sale on behalf of the seller.

231-unit affordable housing development coming to McLean

Construction will begin immediately on the 231-unit first phase of an affordable housing development in McLean backed by Amazon.com, SCG Development announced Wednesday.

Located at 1750 Old Meadow Road, Somos at McLean Metro will be developed in two phases. In the first phase, Tysons-based SCG Development will demolish an abandoned office building on the property and build 231 units, a mix of studio and one-, two- and three-bedroom apartments. The units will be rented to households earning between 30% and 60% of the area’s median income.

The second phase of the development will include 225 units, according to Steve Wilson, SCG Development’s president. The total development cost is about $108 million for the first phase and about $107 million for the second phase, he said.

The property is located within a 10-minute walk to the McLean Metrorail station and less than 10 minutes from Tysons’ new pedestrian bridge.

“Somos at McLean Metro Phase A will bring high quality affordable housing options to families and individuals in a very high barrier to entry market,” Wilson said in a statement.

Amazon.com provided a $28.97 million low-rate loan to the project from the Amazon Housing Equity Fund, a $2 billion commitment to create or preserve more than 20,000 affordable homes for low- to moderate-income families in the Arlington-Washington, D.C., area, Washington state’s Puget Sound region and the Nashville, Tennessee, region, locations where Amazon has offices.

HQ2, Amazon’s East Coast headquarters in Arlington County, began a phased opening in June 2023. Since January 2021, Amazon has committed over $1 billion in loans and grants to create or preserve 7,000 affordable homes in the region, according to the ecommerce giant’s website.

“We embrace opportunities to work in partnership with innovative organizations dedicated to creating much-needed affordable housing that connects individuals and families to transit, employment and other resources across the DMV,” Senthil Sankaran, managing principal of the Amazon Housing Equity Fund, said in a statement.

Virginia Housing, Virginia’s state housing finance agency, committed over $54.5 million in financing and 4% Low Income Housing Tax Credits, which the federal government uses to subsidize the acquisition and construction of affordable rental housing, to the project.

“Our investment towards Somos at McLean provides much needed increased affordable inventory in the Northern Virginia area,” Virginia Housing CEO Tammy Neale said in a statement.

In 2022, the Fairfax County Board of Supervisors approved $33.3 million to acquire the property and support the development of Somos at McLean Metro. The Fairfax County Redevelopment and Housing Authority will own the land and lease the property to affiliates of SCG Development.

“Innovative partnership has enabled us to leverage private equity to convert an unused office building site into hundreds of affordable homes in the Providence District,” Dalia Palchik, a member of the Fairfax County Board of Supervisors, said in a statement.

Shenandoah Valley Year-in-Review: Green valley

Just a couple years later, an $821,000 site development grant awarded to the Shenandoah Valley Partnership by the state’s GO Virginia economic development initiative has already been paying off, says Jay Langston, the partnership’s executive director.

The grant, which paid for work including site evaluation and related environmental reviews and surveys, was focused on improving six regional sites for development. And now, Langston says, two of those sites that the partnership did due diligence on through the 2021 grant are being developed for some of the past year’s biggest economic development announcements — Northrop Grumman’s $200 million advanced electronics manufacturing and testing facility in Waynesboro (see related story) and Leiber’s $19 million plant in Rockingham County.

In fact, the Shenandoah Valley saw $339 million in investments announced last year, with plans to create a total of 793 jobs. “We had a good year,” Langston says.

The region was able to diversify its manufacturing base and strengthen its agricultural business environment, Langston says. “While we are led by food and beverage manufacturing, … we are always working to recruit companies.”

Augusta County

Manufacturing and distribution continue to be the largest workforce sectors in Augusta, boosted by the May 2023 opening of a new 1 million-square-foot Amazon.com fulfillment center in Fishersville, creating 500 jobs. Amazon has opened more than 30 fulfillment and sorting centers and delivery stations in Virginia since 2006.

Speaking at a ribbon-cutting for the center, Augusta County Administrator Tim Fitzgerald said, “It is a testament to making economic development a strategic priority for the county.”

Additionally, early this year, Washington, D.C.-based fast-casual Mediterranean restaurant chain CAVA was poised to open its $30 million, 57,000-square-foot processing and packaging facility at Mill Place Commerce Park in Verona, a project expected to create more than 50 jobs.

“All in all, 2023 was a stable year with some steady growth,” says Rebekah Castle, the county’s director of economic development and marketing.

Culpeper County

Culpeper is carving out a niche in data centers. A pair of rezonings in the town and county paves the way for Peterson Cos. to build a 150-acre, 2 million-square-foot data center campus along McDevitt Drive and East Chandler Street. Additionally, cloudHQ has acquired 116 acres along the same corridor with reported plans for the similarly sized Copper Ridge Data Center Campus.

“In the last two years, we’ve added about 10 million square feet of data space,” says Bryan Rothamel, the county’s director of economic development.

Frederick County

In Frederick, developers are seeking tenants for two large spec industrial parks.

Colliers is marketing One Logistics Park, a $150 million, 2.7 million-square-foot industrial complex being developed by The Meridian Group and Wickshire Group just outside Winchester. Meanwhile, Peterson Cos. is promoting its Valley Innovation Park, a 145-acre industrial park near Interstate 81, which has the potential to house nearly 2 million square feet of manufacturing, industrial and life science facilities.

“The property is already graded. Having large sites project-ready … will give us good options to be competitive,” says Patrick Barker, executive director of the Frederick County Economic Development Authority.

In other county economic development news, packaging manufacturer Monoflo International announced in September 2023 the completion of its new 325,000-square-foot warehouse facility on the border with Winchester. Additionally, ZM Sheet Metal, an HVAC steel component manufacturer, announced plans to expand in Frederick. ZM purchased 23 acres in Stonewall Industrial Park and plans to start construction on a new 160,000-square-foot manufacturing facility in the second quarter of 2024. The company says the facility will be able to accommodate 300 workers.      

Harrisonburg

Farmer Focus, which handles processing, packaging and sales of poultry products for about 100 regional farmers, embarked on a $17.8 million expansion of its Harrisonburg processing plant last year, aided by a $3.6 million U.S. Department of Agriculture grant. The company plans to add 300 jobs by 2025.

“Farmer Focus was a startup in 2014 and has now surpassed 1,000 employees and has become our largest private sector employer in the city,” says Brian Shull, Harrisonburg’s economic development director.

In September 2023, Montebello Packaging, a manufacturer serving the pharmaceutical and cosmetic industries, announced a $12 million expansion with a new production line.

Additionally, Staunton Innovation Hub co-founder Peter Denbigh is renovating the historic Wetsel Seed Complex in downtown Harrisonburg into the $4.5 million Harrisonburg Innovation Hub, scheduled to open by the end of this year. 

Page County

Luray RV Resort on Shenandoah River, previously Outlanders River Camp, opened in August 2023 following a $30 million expansion by its new owner, Blue Water. Campsites increased from 73 to 350.

Rockingham County

“We like focusing on the food and beverage industry because of our agricultural base. It is what comes naturally for our community,” says Joshua Gooden, the county’s economic development and tourism coordinator. 

In September 2023, Leiber, a German manufacturer that processes brewers’ yeast into animal nutrition, biotechnology and nutraceutical products, announced it would invest up to $20 million to establish its first U.S. manufacturing facility in the county’s Innovation Village. It’s expected to create 35 jobs, with plans to open by late 2025.

Also, Veronesi Holding, an Italian cured meats producer, opened its first U.S. production operation for its Negroni deli meats brand in the Innovation Village at Rockingham. The nearly $100 million project broke ground in 2022 and plans to hire more than 150 workers. Currently, the company has 50 employees there.

Among the most anticipated county economic development projects underway is Virginia’s first Buc-ee’s travel center. The Texas-based convenience store chain broke ground on the project in January during a ceremony attended by Gov. Glenn Youngkin and Buc-ee’s founder and CEO Arch “Beaver” Aplin III.

Located at the intersection of Interstate 81 and Friedens Church Road, the 74,000-square-foot center will include 120 fueling positions. Buc-ee’s expects construction to take about 17 months, according to a spokesperson, and it plans to hire more than 200 workers.

Shenandoah County

Shenandoah County continues to see growth in tourism and investment in the downtown Mount Jackson area with retail shops and restaurants.

Alexandria-based Logan Food is investing $15 million to build a meat-processing facility, with plans to add up to 60 jobs. It’s expected to open in 2025, according to Jenna French, the county’s director of economic development. 

Warren County

Last year, Warren County had success with industrial and commercial economic development as well as “re-engaging with the small business market,” says Joe Petty, the county’s director of economic development and tourism.

Nature’s Touch Frozen Foods moved into its new 126,000-square-foot, $40.3 million facility, adding more than 70 employees.

And the Port of Virginia’s Virginia Inland Port (VIP) is partnering with the Virginia Department of Transportation to construct a bridge over the Norfolk Southern Railway on Route 658. The $20 million-plus project is funded by a U.S. Department of Transportation grant and scheduled for completion in 2025.

“This is a huge capital improvement project that will add rail capacity for VIP and, ultimately, uninterrupted access for the community,” says Petty. 

Waynesboro

“I’m very pleased with this past year,” says Greg Hitchin, the city’s director of economic development and tourism. “We’ve had a lot of success on different fronts.”

The city landed the largest deal in the region with global aerospace and defense technology company, Northrop Grumman, investing more than $200 million to build a new advanced electronic manufacturing and testing facility, which plans to hire more than 300 workers over the next five years.

Additionally, Innovation Management, which manages the Staunton Innovation Hub, is opening a 6,000-square-foot innovation hub in Waynesboro in spring 2024 in the former Virginia MetalCrafters building. The hub will provide coworking space, private offices and conference rooms.

“It’s really gratifying to see the reuse of an historic building,” Hitchin says. 

Eastern Va. Big Deal: Prime location

Doug Smith isn’t surprised Amazon.com has extended its reach in Hampton Roads.

The Hampton Roads Alliance president and CEO says Amazon’s expansion in the commonwealth has been a constant since the global e-commerce behemoth announced in 2018 that it would locate its East Coast corporate headquarters, Amazon HQ2, in Arlington County.

The latest push includes two new Virginia Beach facilities — a fulfillment center and a delivery station — announced in September 2023 that will total $350 million in investments and are projected to add more than 1,100 full-time jobs to Hampton Roads.

Amazon says it plans to open the 219,000-square-foot delivery station at the intersection of Harpers and Dam Neck roads in time for the 2024 holiday shopping season, while the company plans for its robotics fulfillment center to come online in late 2025 in an adjacent space. The announcement is tied for the largest jobs announcement in Virginia in 2023, according to the Virginia Economic Development Partnership. Construction has started on both projects.

“I’ve seen [Amazon] officials say, ‘Now that this is our home, we’re going to invest significantly in our home,’” Smith says. “So, I think you’re seeing that.”

Small items like books, electronics and toys will get picked, packaged and shipped from the 650,000-square-foot robotics fulfillment center.

The announcement is just the latest for Amazon, which counts more than 30 fulfillment centers and delivery stations in Virginia, including this announcement. These will be the first of each for Virginia Beach.

Amazon opened its first Virginia facility in Sterling in 2006, and the Seattle-based Fortune Global 500 retailer has been an ongoing boon for the state’s economy. Amazon has invested more than $109 billion in Virginia since 2010, creating more than 36,000 jobs, according to VEDP. The state is also home to Amazon’s Whole Foods Market, Amazon Fresh stores, Prime Now hubs and Amazon Web Services data centers.

“Virginia is a great state for business,” says Amazon spokesperson Ian Allen-Anderson. “For more than a decade, Amazon has called the commonwealth home and is committed to continuing investments in Virginia with our time, resources and community dedication.”

In addition to the jobs it’s created, more than 11,000 independent sellers in Virginia operate through Amazon’s market place, according to the company, and its investments have accounted for more than 200,000 indirect jobs and $72 billion contributed to Virginia’s gross domestic product since the company opened for business in the state. The company is the fifth largest private employer in Virginia, according to the Virginia Employment Commission.

“Amazon’s cutting-edge fulfillment centers generate major capital investment and thousands of jobs and strengthen Virginia’s position as a logistics industry leader on the East Coast,” Gov. Glenn Youngkin said when announcing the Virginia Beach expansion. “We see Amazon’s expanding footprint impacting economic growth and innovation across the commonwealth, and we will continue to compete for additional investment in Virginia.”

For Amazon executives, Hampton Roads’ maritime industry and area workforce were globally competitive standouts, says Suzanne Clark, VEDP’s managing director of communications. Amazon’s recent commitments in the region include a 3.8 million-square-foot robotics fulfillment center in Suffolk with 1,500 full-time employees.

Allen-Anderson points to the region’s strong transportation infrastructure and Virginia Beach’s proximity within 25 miles of the Port of Virginia as major factors in the company’s site location.

That comes as no surprise to Smith, whose regional economic development organization worked to secure the Amazon deal alongside VEDP and the city, which last year approved $22.5 million to support public road and stormwater improvements around the project’s location.

“Our basic DNA is we are a maritime industrial economy, and so, you play to your strengths,” Smith says.

The region’s highly trained workforce is no secret to companies like Amazon, Smith says. More than 13,000 graduating college students and 18,000 graduating high school students join the area’s workforce annually, according to estimates from the National Center for Education Statistics.

But unlike other areas with a comparable workforce of recent graduates, Hampton Roads also sees an annual boost from around 12,000 to 15,000 exiting military members — a yearly number that can jump significantly when including spouses and other family members.

“We’re a regional workforce,” says Norfolk Director of Economic Development Sean Washington. “Companies see what it looks like to leverage the whole [metropolitan statistical area]. They look at talent from the whole MSA, which is why we all continue to communicate with our partners in other cities.”  

Amazon to open fulfillment, delivery facilities in Va. Beach

Amazon.com will launch a fulfillment center and delivery station in Virginia Beach, creating an estimated 1,000 full-time jobs, Gov. Glenn Youngkin announced Monday.

Groundbreaking began Monday, according to Ian Allen-Anderson, an Amazon spokesperson. The fulfillment center will be located at the intersection of Harpers and Dam Neck roads, and the delivery station will be “at an adjacent site.” Amazon declined to disclose its expected capital investment.

Amazon anticipates launching operations at the delivery station in time for the 2024 holiday season and at the 650,000-square-foot robotics fulfillment center in 2025. Employees at this center will pack and ship small items like books, electronics and toys, according to a news release.

“Amazon’s cutting-edge fulfillment centers generate major capital investment and thousands of jobs and strengthen Virginia’s position as a logistics industry leader on the East Coast,” Youngkin said in a statement. “We see Amazon’s expanding footprint impacting economic growth and innovation across the commonwealth, and we will continue to compete for additional investment in Virginia.”

Amazon opened its first fulfillment center in the state in 2006, in Sterling. The Virginia Beach buildings will be the company’s 14th sorting and fulfillment center in Virginia and its 17th delivery station. The e-tailer expects to launch an Amazon robotics fulfillment center in Henrico County, announced in 2021, later this fall. In September 2022, Amazon opened a 3.8 million-square-foot robotics fulfillment center in Suffolk, the second largest building in the state, after the Pentagon. That facility cost $230 million to build, and it employs about 1,500 people.

Along with HQ2, the e-tailer’s $2.5 billion East Coast headquarters in Arlington, Amazon has 15 Whole Foods Markets, five Amazon Fresh stores and three Prime Now Hubs — located in Virginia Beach, Richmond and Springfield and focused on one- and two-hour deliveries to Prime members — in the state.

The Amazon Web Services subsidiary also operates multiple data centers in the state but has not disclosed the number. From 2011 to 2021, AWS invested more than $51.9 billion in Virginia, according to an economic impact statement released in June. In July, the Spotsylvania County Board of Supervisors voted to amend the county’s comprehensive plan to make data centers a targeted industry, and AWS has since filed three rezoning requests within the county and one in neighboring Caroline County.

“Virginia is a great state for business and gives us the opportunity to better serve our customers in the region,” Holly Sullivan, Amazon’s vice president of worldwide economic development and public policy, said in a statement. “We are excited for our future in the commonwealth, and for what this means for our customers as we continue to grow.”

Since 2010, the company has invested more than $109 billion in Virginia and has created more than 36,000 direct jobs and supported 200,000 indirect jobs in fields like construction and professional services, according to a news release, and has contributed more than $72 billion to the state’s gross domestic product.

The Virginia Economic Development Partnership worked with the city of Virginia Beach and the Hampton Roads Alliance to secure the project. The city will fund stormwater and road improvements between Dam Neck Road and London Bridge Road to provide access to the new facilities, and Dominion Energy will provide power to the sites.

Federal Contractors | Technology 2023: BRIAN KENNER

When Amazon.com was scouting for potential locations for its East Coast HQ2 headquarters years ago, Kenner was Washington, D.C.’s deputy mayor for planning and economic development, a position in which he worked hard to lure the e-tailer to the district, although ultimately Amazon picked nearby Arlington County. Now, Kenner works for the Fortune 500 goliath as head of HQ2’s economic development policy throughout the D.C. metropolitan area.

HQ2 opened its first new office tower in May, one of two towers in its first phase, and 8,000 employees are expected to be at work in Metropolitan Park by early October. Meanwhile, Kenner is also involved with Amazon’s in-kind and monetary donations, which have grown to $161 million across the metro region since 2018, Amazon announced in June. He also is a major player in the company’s plans for affordable housing, transportation, education and workforce training.

Before becoming D.C.’s deputy mayor, Kenner worked as city manager for Takoma Park, Maryland, and he also held management positions at Fannie Mae and Ernst & Young. An Iowa native, he has degrees from the University of Iowa and Harvard University’s Kennedy School of Government.

Federal Contractors | Technology 2023: BRIAN HUSEMAN

Huseman is one of the most prominent representatives of Amazon.com in Arlington, where the e-tailer held a grand opening for the first buildings on its HQ2 East Coast headquarters campus in June.

A former U.S. Department of Justice attorney and associate general counsel for the Federal Trade Commission, Huseman leads Amazon’s federal lobbying work and its community engagement efforts in the Western Hemisphere, including a project to make ocean shipping environmentally cleaner. In Virginia, Amazon has more than 36,000 employees, and HQ2’s Metropolitan Park will have about 8,000 workers moved in by the end of 2023.

A graduate of the University of Oklahoma College of Law and the University of Nebraska, Huseman serves on numerous professional and community boards, including the Information Technology Industry Council, Signature Theatre and the Mountain Gorilla Veterinary Project, for which he is board president. He also was part of the Blueprint Virginia 2030 Steering Committee, which created the Virginia Chamber of Commerce’s economic development plan for the state.

FIRST JOB: Working for Walmart in my Oklahoma hometown. It’s where I learned the importance of a customer service mindset.