After a federal financing package fell through, construction of Blue Star NBR’s medical glove plant in Wytheville has stalled.
Now, Blue Star needs $230 million to start operations, says CEO Scott Maier. “It seems silly for all of this to fall to the wayside,” he says. “We don’t want to just sit and twiddle our thumbs and wait.”
First announced in October 2021, the project broke ground in January 2022 but has since faced funding-related delays. Blue Star anticipated securing a federal loan package from the U.S. International Development Finance Corp. (DFC), an agency that President Donald Trump authorized in 2020 to use funds for two years to support domestic companies producing resources needed during the COVID-19 pandemic.
Blue Star had expected DFC financing to fund NBR and glove production facilities, Maier says, adding that agency officials told him to apply for Department of Defense funding and that DFC would cover any financial shortfall. But then, DFC’s processing of Blue Star’s loan request was delayed, and the agency asked for a revised budget. Finally, DFC’s loan-making authority expired before it finalized the loan, leaving Blue Star in a tight spot.
A U.S. Government Accountability Office study published in November 2021 reported that DFC had received 178 such loan requests, but none were given.
Maier says Blue Star considered seeking private financing, but investors have balked, given the uncertainty of the project’s completion. And the U.S. Export-Import Bank considered the project too risky to underwrite.
Maier says his next, best hope would be getting the remaining funding from the federal government’s 2024 budget, which had not passed as of early December 2023.
These possibilities, Maier says, would involve Congress or the Biden administration directing Health and Human Services to reallocate money toward the project or designating money for the project in a continuing resolution.
A Virginia Economic Development Partnership economic impact analysis estimates Blue Star’s facility would bring 2,500 jobs to Wytheville, says Garrett Murch, founder of GCM Strategies.
In May 2023, Blue Star completed construction of a 30,000-square-foot, 85-foot-tall main factory to produce raw nitrile butadiene rubber. The delayed second phase, which would take nine months, would involve commissioning that facility and starting large-scale NBR production.
Phase 2 also includes building the first glove manufacturing facility, which could begin producing gloves within two months of completion. Within 18 months, the facility could reach full production, making 2 billion to 4 billion gloves annually.
The five-year plan is to have six glove manufacturing facilities.
In November 2023, Maier met with both U.S. senators from Virginia, a discussion that U.S. Rep. Morgan Griffith (R-9th) joined via webcast.
The offices of Sens. Tim Kaine and Mark Warner and Rep. Morgan Griffith said in a statement to Virginia Business: “Upon learning of the issues with the development of the Blue Star plant in Wythe County, Sens. Kaine and Warner and Congressman Griffith teamed up in a bipartisan push to urge the Biden administration and the company to come to an agreement to get the plant on track for completion. They are disappointed that an agreement was not reached. They will continue to look for ways to work across the aisle to support domestic manufacturing and job growth in Southwest Virginia.”
“We’re still hoping the government will finish what it started,” Maier says, but if not, Blue Star will examine alternatives like retooling its facility to produce commercial-grade rubber for gaskets.
Wytheville-based third-party logistics company Camrett Logistics will invest more than $2 million to expand in Pulaski County, creating an estimated 58 jobs, Gov. Glenn Youngkin announced Tuesday.
Camrett Logistics’ investment in its Dublin facility will include construction, renovating existing space and buying new forklifts and electric trucks.
“Homegrown Virginia businesses like Camrett Logistics keep the commonwealth’s economy on the move,” Youngkin said in a statement. “With this expansion and modernization, Camrett will strengthen its operations and Virginia’s supply chain industry ecosystem, securing continued longevity for years to come.”
Founded in 1995, the warehouse and third-party logistics services company operates 11 facilities totaling 1.8 million square feet in West Virginia and Virginia, including locations in Atkins, Rural Retreat, Wytheville, Dublin and Radford.
“This long overdue expansion will help revitalize an iconic World War II facility into a multi-use warehouse and usher the company into its new era as green supply chain experts,” Camrett Logistics President Cameron Peel said in a statement. “With four electric trucks, two electric spotters, a brand-new electric forklift fleet and motion sensor-activated LED warehouse lights, we are focused on sustainability and the future for the generations to come.”
The Virginia Economic Development Partnership worked with Pulaski County and Dublin to secure the project, for which Virginia competed with North Carolina, Tennessee and West Virginia. Youngkin approved a $230,000 grant from the Commonwealth’s Opportunity Fund to assist Pulaski County. VEDP will support Camrett Logistics through its three-year Virginia Jobs Investment Program, which provides cash grant reimbursements for associated human resources costs after a company has had new employees on the payroll for at least 90 days.
Southwest Virginia’s leaders feel confident their region will be home to the state’s next inland port.
“The planets are aligning for us right now,” says state Sen. Todd Pillion, R-Washington County. “Our localities are excited about it. The state seems to be excited about it.”
During the Virginia General Assembly’s regular session, Pillion and two Southwest delegates requested a total of $65 million in state funding to acquire land and build an inland port in the Mount Rogers Planning District, which ranges from Bristol, Virginia, to Wytheville. If built, it would be the state’s second inland port, joining the Port of Virginia’s Virginia Inland Port in Warren County.
The General Assembly adjourned in February without amending the state’s biennial budget, and it was unclear whether legislators would come to an agreement on the budget before reconvening in April. Nonetheless, lawmakers from Southwest Virginia feel confident the final budget will include funds for establishing an inland port, an intermodal terminal where sea cargo moves by road or rail to inland destinations.
As of February, the state Senate’s proposed budget included $10 million for the Southwest inland port, while the House of Delegates’ budget added $55 million to cover preliminary engineering and design for the inland port, as well as property acquisition and construction and equipment costs.
“I think everyone is committed to putting enough money into it so that we can get as far as we can get before the end of the biennium,” and then allocate enough money to finish the project in the 2024-25 budget, says Del. Israel O’Quinn, R-Washington County.
The only question now, according to O’Quinn, will be whether the state’s budget conferees pick a number closer to $10 million or $55 million in the amended budget presented to the full General Assembly. Gov. Glenn Youngkin spoke positively about the idea of a second inland port last fall.
First in nation
Robert Martinez of global advisory firm Moffatt & Nichol found in his research that the idea of an inland port in Southwest Virginia has statewide support. Photo by Mark Rhodes
Virginia was the first U.S. state to build an inland port, when it opened the Virginia Inland Port on 161 acres near Front Royal in 1989. Sitting next to Norfolk Southern Corp.’s Crescent Corridor railway and near the intersection of interstates 66 and 81, VIP is owned by the Virginia Port Authority and connects to the Port of Virginia’s marine terminals in Hampton Roads by 220 miles of rail.
The VIP handled 31,282 containers in fiscal year 2021, and its total economic impact that year was $1.3 billion, with over $360 million in labor income from almost 6,000 indirect workers, according to a report released by William & Mary’s Raymond A. Mason School of Business in 2022. These are small numbers next to the Port of Virginia’s total economic impact of $100.1 billion in 2021, but the inland port is nonetheless an economic driver in the Shenandoah Valley, and a similar facility in Southwest would be, too, proponents hope.
In Front Royal, numerous distribution centers for companies like Home Depot Inc.,
Family Dollar Stores Inc. and Red Bull have opened near the inland port, and Harrisonburg-based InterChange Group Inc. has built a healthy business providing warehouses to national corporations.
Supporters of inland ports tout how the facilities alleviate highway traffic and increase capacity at busy coastal ports.
By enabling freight to travel further by train instead of trucks, “the emissions will be less and you will also reduce congestion on the roads,” points out Ricardo Ungo, director of Old Dominion University’s International Maritime, Ports & Logistics Institute.
Since 1989, numerous other U.S. cities, from Dillon, South Carolina, to Dallas, have followed Virginia’s lead in establishing their own inland ports in hopes of spurring economic development, but not every U.S. inland port has been a success story. The elephant in the room is the $32 million Heartland Intermodal Gateway in Prichard, West Virginia, which opened in 2015. One study promised the port would create between 700 and 1,000 jobs. Instead, the facility shut down in 2019 due to lack of demand.
Moving freight
Del. Israel O’Quinn, who represents Washington County, notes that the proposed Southwest Virginia inland port sites would be within two hours’ drive of six interstates. Photo by Earl Neikirk
Local officials haven’t always embraced the logistics industry in Virginia. In 2008, Montgomery County sued to stop Norfolk Southern from building an intermodal freight terminal in Elliston, arguing that the facility didn’t fit with its long-term goals for smart growth and high-tech jobs. The state had agreed to pay 70% of the $35.5 million price tag.
The Virginia Supreme Court ultimately ruled against the county, but by then market conditions had changed, and Norfolk Southern hasn’t moved forward.
In recent years, state lawmakers asked for funding to study whether an area on U.S. Route 58 near Danville or somewhere in the Roanoke and New River valleys could work as sites for inland ports, but those bills failed to make it out of the General Assembly.
In 2022, though, legislators approved funding for a state study to determine feasibility of a new inland port in Southwest Virginia or the Lynchburg region.
Robert Martinez, vice president for freight and economic development at global advisory firm Moffatt & Nichol, found while conducting the study that the idea of establishing a port in the Mount Rogers Planning Region had statewide support.
“There does seem to be quite a good echo in the General Assembly, including from folks who are not in Southwest Virginia, who say, ‘That’s kind of a good idea for Virginia,’” Martinez says.
Moffatt & Nichol’s data, used by the port authority and the Virginia Economic Development Partnership to complete the report, showed that the Lynchburg area didn’t “currently have the demand to justify the development of an inland port,” but Southwest Virginia meets “enough market-driven and physical conditions to warrant additional assessment.”
A new inland port could help entice businesses that have previously bypassed Virginia for ports further south, points out Will Payne, managing partner of consulting firm Coalfield Strategies LLC and head of business development for InvestSWVA, a business-attraction campaign for the region.
“The real coup would be grabbing freight business from northeast Tennessee that currently heads to Charleston,” he says. “Virginia’s port simply offers a better business proposition. We just need to convince [company executives] of that.”
The study confirmed what O’Quinn already understood.
“We’ve known all along that we are in a really good location for transportation and logistics,” the delegate says. “We’re a day’s drive from 60% of the United States. We’re less than two hours from five different interstates. We’re in a pretty sweet spot here.” continued on page 6
Thoughtful planning
Moffatt & Nichol selected two locations where an inland port would work in Southwest Virginia but did not identify the sites in the study. According to Pillion, one of the sites is Washington County’s Oak Park Center for Business and Industry, a 338-acre property along U.S. 11. He declined to name the second location, other than to say it’s in Wythe County.
The nation’s first inland port, Virginia Inland Port was established in 1989 in Warren County. Photo courtesy Port of Virginia
In January, Washington County’s Industrial Development Authority voted to “donate all acreage necessary” in Oak Park for the new inland port. Later in the month, Washington County supervisors passed a resolution in support of establishing an inland port in the county.
It may be too soon to plan a groundbreaking ceremony, though. Devon Anders, president of Mount Crawford-basedInterChange Group Inc. and a board member for the Virginia Maritime Association, cautions that careful planning will be key to building a successful inland port in Southwest Virginia.
“It’s worthwhile to continue to pursue [it],” he says, but “I would not just go there and put one in just because it looks like it’s a good location on Interstate 81.”
Will Fediw, vice president of industry and government affairs for the Virginia Maritime Association, agrees with Anders’ assessment. “The VEDP and the port authority will now basically have to figure out the best way to thoughtfully move forward with some sort of study in partnership with some of their stakeholders — like the railroad [and] their customers who are moving cargo — to figure out exactly what’s the right design,” he says. “When is the right time for this type of potential inland port?”
The feasibility study noted that an inland port would need to make at least 20,000 freight transfers per year for the port to succeed. In the Mount Rogers area plus the broader geographic market of Giles and Pulaski counties and northeastern Tennessee, the study’s authors say, an inland port in Southwest Virginia could generate that volume.
Spokespersons from both the Port of Virginia and VEDP declined to comment for this story.
O’Quinn says VEDP and the port authority are currently identifying companies that would use a Southwest port, as well as whether they’d provide enough business to make the port cost-effective. As for Pillion and himself, O’Quinn says it’s time for action on a state level.
“We actually just said flat-out to some people, ‘I’ll tell you one thing we’re not going to do and that is study this again, because here it is. The information is fresh. It’s going to work.’”
Before her August performance at Marion’s historic Lincoln Theatre, country singer Lorrie Morgan took an afternoon stroll downtown, stopping at shops and the local farmers market, according to Tracy Thompson, the theater’s director.
Drawing visitors — famous and otherwise — to downtown Marion was the goal back in 2004 when the community raised more than $1.8 million to renovate the Lincoln, which was initially built in 1929 as a movie theater.
Pennington Gap had a similar goal in mind in 2013 when it reopened its Lee Theatre, which dates to 1947 and, like the Lincoln, closed during the 1970s. Now, organizers hope to drive economic development in Wytheville with the soon-to-reopen Millwald Theatre.
Jeff Potts, who came on board as executive director of Millwald Theatre Inc. earlier this year, hopes to finish the venue’s $4.8 million renovation and expansion in time to stage its opening events around Thanksgiving or in early December. “Definitely sometime this year,” he says.
On a busy night, he expects the Millwald to draw 500 visitors downtown.
“They’re going to come early and stay late in downtown Wytheville,” Potts says. “And that, ultimately, is the point of why we’re doing this. It’s not just to save the building, and not just to create a cultural gathering spot. It’s to make money and to spread that throughout our community.”
That’s what’s happened with the Lee Theatre, according to Keith Harless, town manager of Pennington Gap, which has 1,922 residents. The venue hosts events about four times a month.
“When you have an average of 300 people that come to our little downtown, that’s a huge impact for a town of our size,” he says.
While the Lee Theatre screens movies, Marion’s Lincoln Theatre has, until now, stuck to live events. Thornton hopes that will soon change. In June, Gov. Glenn Youngkin recommended that the Lincoln Theatre receive a $69,025 grant from the Appalachian Regional Commission, a federal economic development agency, to purchase equipment to allow the theater to digitally project movies.
The Millwald will also screen films, but Thompson isn’t worried about competition. “The more venues, the more performance opportunities there are in the region, the better everyone is going to do,” she says. “Southwest Virginia, hopefully, will become a really strong arts destination.”
Connecticut-based Blue Star NBR LLC and Delaware-based American Glove Innovations Inc. will invest $714 million to build a manufacturing facility in Wythe County for producing rubber medical gloves — a joint venture expected to create 2,500 jobs, Virginia Gov. Ralph Northam announced Monday.
The operation is expected to produce up to 60 billion medical gloves each year from nitrile butadiene rubber (NBR) — an oil-resistant, synthetic rubber — at the manufacturing plant in Progress Park, the county’s industrial park. The operation is anticipated to occupy more than 200 acres and will have the potential to triple in size in future phases.
“It comes with great pleasure and an even greater sense of responsibility to bring critical medical supply manufacturing back to the U.S.,” Blue Star NBR founder Ken Mosher said in a statement. “The domestic glove industry moved to Asia and we are now perfectly positioned in a fully vertical partnership with American Glove Innovations to have things come full circle and provide a boost to domestic manufacturing employment.”
On May 28, the Department of Defense, on behalf of and in coordination with the Department of Health and Human Services, awarded Blue Star NBR a $123.1 million contract to increase domestic production capacity of NBR.
The first of Blue Star-AGI’s facilities aims to have a launch quantity between 5 billion and 8 billion gloves per year, with plans to reach a peak manufacturing capacity of 60 billion gloves per year. The company will produce gloves for distributors and large end users in the health care, government, retail and hospitality sectors.
The nitrile glove market is expected to grow 9% annually through 2027. Nitrile glove manufacturing is primarily consolidated in Malaysia, Thailand and China, according to a news release. Blue Star NBR and Blue Star-AGI’s vertical integration in Progress Park is expected to help the two companies avoid supply chain disruptions and market fluctuations in the price of NBR latex.
Virginia is investing $8.5 million to upgrade infrastructure at the park, including $3 million to expand the Fort Chiswell Wastewater Plant, $1.5 million to extend public sewer infrastructure and $4 million to build a water tank serving the park.
“These investments are leading to the largest job creation commitment Southwest Virginia has seen in a generation, and it’s a game-changer for the commonwealth,” Northam said in a statement. “This is about investing to bring jobs back to the United States from overseas, and doing it right here in rural America.”
Virginia competed with Tennessee and Texas for the project.
The Virginia Economic Development Partnership (VEDP) worked with Wythe County, the Joint Industrial Development Authority of Wythe County, Virginia’s Industrial Advancement Alliance and the General Assembly’s Major Employment and Investment (MEI) Project Approval Commission to secure the project. The Virginia Tobacco Region Revitalization Commission approved $1.02 million from the Tobacco Region Opportunity Fund to support additional public infrastructure beyond the projects funded from the $8.5 million grant. The company is eligible to apply for benefits from the Railroad Industrial Access Program, administered by the Department of Rail and Public Transportation.
The Virginia Talent Accelerator Program, a workforce initiative created by VEDP and the Virginia Community College System, will provide customizable recruitment and training services at no cost to the company. Blue Star NBR and Blue Star-AGI will partner with Wytheville Community College for workforce training. The companies will also collaborate with Virginia Tech and other local educational institutions to recruit engineering school graduates.
Soon after Todd Wolford became executive director of community revitalization nonprofit Downtown Wytheville Inc. in 2015, he began seeking pictures of the Soda Shop, the Main Street hotspot his grandfather owned in the late ’50s and ’60s.
After locating a couple photos of his grandfather’s packed establishment, Wolford had an epiphany: His job was to bring back that vibrant downtown community his grandfather had once helped to create. “I got really motivated about doing it for the family,” he says.
Wolford went on to oversee a $4.2 million streetscape improvement initiative that has brought improved lighting and sidewalks, new street furniture and a sound system to the downtown area. “That really got things ready for business,” Wolford says.
Since then, two craft breweries and a bakery opened, and an art school expanded. “It really changed the landscape of downtown,” he says. “Then things started to pop up around it.”
The next step for downtown Wytheville’s revitalization is reopening The Millwald Theatre on Main Street, a project essential to downtown Wytheville’s future, Wolford says.
In July, board members of the nonprofit Millwald Theatre Inc. announced they’d closed on a federal New Market Tax Credit allocation provided by national asset management firm Enhanced Capital, as well as a bridge loan to allow construction to begin on the $4.5 million theater renovation, according to Mark Bloomfield, chairman of the group’s board of directors. If construction goes smoothly, the theater could reopen by September 2022.
Once the town’s “cultural and social center,” the 1928 theater hosted vaudeville performances, movies, pageants and town debates, according to its website, before it closed in 2006.
Wytheville’s town government started the ball rolling on the renovation in 2018, allocating $600,000 to purchase the theater. Organizers assembled the rest of the funding via historic tax credits, private donations and grants, including $500,000 from the Appalachian Regional Commission.
When completed, the Millwald will offer seating for 500 patrons, with updated sound and lighting, classrooms and administrative space.
About 2,000 hotel rooms sit near the intersection of Interstates 77 and 81, minutes away from the Millwald, Bloomfield points out. He wants the theater to offer movies, concerts and performances six days a week to draw visitors downtown.
“It’s going to make all the difference in the world in terms of future sustainability for the downtown business district,” he says.ν
Two-Way Radio Inc., a Wytheville-based provider of communications systems and devices for public safety and industrial clients, has been acquired by Spartanburg, South Carolina-based Mobile Communications America Inc. (MCA).
Financial terms of the deal were not disclosed. Both companies are Motorola dealers.
Founded in 1948, Two-Way serves clients in Southwest Virginia, West Virginia, Tennessee, North Carolina and Kentucky. The acquisition marks MCA’s entrance into the Virginia and West Virginia markets.
Two-Way Radio owner Deborah Terry, whose grandfather founded the company, said in a statement, “Becoming part of the MCA family will enable continued growth and product advancements. We look forward to leveraging the resources and capabilities that this partnership will provide. It is exciting to consider how this will benefit our employees and our customers, both of which have always been our top priority.”
MCA CEO Vince Foody said, “We are excited to welcome Two-Way to MCA. Two-Way has over 60 years of experience servicing not only the commonwealth of Virginia, but West Virginia, Kentucky, and North Carolina as well. Their outstanding reputation and customer service strengthen our ability to better serve the region.”
The Birchwood Apartments and AAA Self Storage properties in Wytheville have sold for $4.2 million, Cushman & Wakefield | Thalhimer’s Capital Market Groups announced last week.
The May 14 transaction includes 60 apartments, 139 self-storage units and an 1,800-square-foot office building on adjoining parcels at 125-195 Birch Drive.
Lynchburg-based Deal Properties purchased the property from Wytheville-based Smith Enterprises, which was represented by Clay Taylor with Thalhimer. Deal was selected from a competitive group of buyers based on the company’s experience with managing multifamily residences, Taylor said in a statement.
The towns of Vinton, Warsaw and Wytheville will receive a total of more than $1.4 million in state industrial revitalization fund (IRF) grants, Gov. Ralph Northam announced Friday.
IRF funding provides gap financing for redevelopment projects that can lead to long-term employment opportunities.
“This funding will not only help transform deteriorating or unused structures, it will bring purpose and new opportunity to the surrounding communities,” Northam said in a statement. “With these three projects, we are making important investments in our future. As we focus on recovering from the impacts of the pandemic, our administration remains focused on driving economic growth to every corner of the commonwealth, especially in rural Virginia.”
The three projects receiving funding include:
Gish Mill Redevelopment Project,Vinton, $468,750. The town of Vinton will redevelop the historic Gish Mill into a mixed-use site with a restaurant, speakeasy, seasonal market and lodging rooms. The project is expected to create 37 full-time and part-time jobs.
Warsaw Hardware Building Redevelopment Project, Warsaw, $468,750. The town of Warsaw will build out a mixed-use site with a brewery space, taproom, upstairs event space and patio. The project is expected to create four full-time and five to 10 part-time jobs.
Millwald Theatre Restoration and Economic Revitalization Project, Wytheville, $500,000. The town of Wytheville is rehabilitating the Millwald Theatre as a community auditorium for live and film entertainment and performing arts education. The project is expected to create seven full-time and at least seven part-time jobs.
Projects that showed a high level of blight, economic development impediments and alignment with regional strategies received funding. The level of community distress where the property is located was also considered for funding.
“These blighted buildings oftentimes reflect an economic downturn in the towns’ past, but through revitalization and redevelopment, the community is breathing new life into these neighborhoods,” Secretary of Commerce and Trade Brian Ball said in a statement. “These projects align with the local and regional economic development goals and will leverage additional public and private investment in the towns receiving awards.”
IRF has funded 34 projects since 2012, generating more than $121 million in public and private investment and 485 jobs.
The Virginia Department of Housing and Community Development (DHCD) on Thursday announced the 2020 Virginia Main Street Merit Award winners, with businesses and projects in the Shenandoah Valley and Northern, Southern and Southwest Virginia recognized.
Best Downtown Public Improvement Project: town of St. Paul for the Downtown Comprehensive Infrastructure Project
Best Adaptive Reuse Project: Seven Sisters Brewery in the town of Wytheville
Outstanding Business: Grizzly’s Hatchet House in Danville; Lineage in Harrisonburg
Best Downtown Business Promotion: Historic Manassas Inc. for the Sip and Shop; town of Strasburg for the Grilled Cheese and Tomato Soup Festival
Volunteer of the Year: Holly Redding for Winchester’s Old Town Advancement Commission
The VMS program, which provides assistance and training to communities for economic development of their downtown commercial districts, currently has 26 designated communities in the state and more than 90 commercial affiliates. Last year, VMS communities generated more than $115.5 million in private investment through 523 rehabilitation projects, which created 732 jobs.
“Virginia’s Main Street organizations are continuing to transform our downtowns into vibrant communities through downtown revitalization, entrepreneurial support and innovative events that highlight what makes each community unique,” DHCD Director Erik Johnston said in a statement. “These winners are shining examples of how to do community development right and are on the front lines assisting our main streets and their businesses through the COVID-19 recovery and reopening process.”
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