Please ensure Javascript is enabled for purposes of website accessibility

Wait till next year

New Year’s Day is still more than six months away, but 2017 already is shaping up to be a banner year for Hampton Roads. After years of planning and hurdling obstacles, the region is preparing to open a slew of prominent new and revitalized venues while starting construction on several big-ticket projects.

Construction cranes, in fact, have become a regular fixture on the Hampton Roads skyline. A high-tech luxury hotel is going up in downtown Norfolk, while around the corner the Waterside Festival Marketplace is getting a long-awaited face-lift.  Also in Norfolk, construction gets underway in May on a long-awaited, $75 million outlet mall. Meanwhile, Virginia Beach’s oceanfront is witnessing the rebirth of the iconic Cavalier Hotel, and in Newport News, a mixed-use center will house high-tech firms along with retail and luxury apartments.  The construction signals a regional revitalization as Hampton Roads continues to work its way out of the 2007-09 recession.

That’s especially true for Norfolk, whose rebirth began downtown and is now spreading to other areas of the city, sparking interest from millennials and entrepreneurs. “We are a very aggressive, forward-looking city,” says Chuck Rigney, the city’s economic development director. “We’re putting together an executable plan and going after it.”

The Main and The Cavalier
Developer Bruce Thompson, CEO of Gold Key/PHR Hotels and Resorts, is making his first foray into his hometown with The Main, a $164 million public-private investment project. Scheduled to open downtown next March, the 300-room hotel bearing the Hilton brand will feature three full-service restaurants. Its major selling point is The Exchange, a 105,000-square-foot conference center that city leaders say will allow Norfolk to attract larger meetings and conventions. “We knew we were missing the tourism market and the ability to host signature conferences that need the setting and experiences that The Exchange can provide,” Rigney says. “It will be the most technologically advanced conference center in the U.S.”

The Main will provide a high-energy eclectic hospitality experience, says Michael Woodhead, Gold Key’s vice president of marketing. A premium seafood restaurant will be on the first floor, while the second floor will feature an Italian eatery along with a piano bar. The Grain, a rooftop bistro overlooking the Elizabeth River, will become a downtown destination, Woodhead adds. “It’s going to pull people from all over Hampton Roads. Between these three restaurants, there’s something for everybody going on in downtown Norfolk. If we weren’t supremely confident that all three will quickly become local favorites, we wouldn’t be doing it.”

While Gold Key brings a contemporary flair to downtown Norfolk with The Main, the company is evoking old-style grandeur on the Virginia Beach oceanfront with the restoration of the 89-year-old Cavalier on the Hill. The hotel will reopen as a five-star member of Marriott’s Autograph Collection in 2017. Its sister property, the Cavalier Oceanfront Hotel, will be replaced by a 300-room Marriott hotel, with the opening targeted for 2018.

Gold Key also is building 82 homes on the grounds of the Cavalier on the Hill.  The project is expected to generate $41 million to $52 million in new taxes during its first two decades, while creating 200 year-round jobs and 330 seasonal positions. 

Norfolk’s Waterside Festival Marketplace also is undergoing extensive renovations. The Cordish Cos., a Baltimore-based developer, is fronting the nearly $40 million public-private project scheduled to open next spring. “This will bring a new visitor experience onto the riverfront,” Rigney says. “The city leadership wants to create the greatest urban waterside park in the U.S.”

Also downtown, developer Buddy Gadams is converting the 24-story Bank of America office building into 275 luxury apartments, a ground-floor restaurant and a fitness facility. Tagged the Icon at City Walk, the $100 million project will bring 500 additional residents to downtown when it opens next year.  “It will be a great address for residents and removes largely vacant office space from our inventory,” Rigney says.

As part of the City Walk project, Gadams is renovating the adjacent vacant office building for Automatic Data Processing (ADP). The New Jersey-based  human-resources firm announced in March that it will invest $32.5 million to open a customer-service center in the space, bringing nearly 2,000 jobs downtown. With the influx of ADP jobs, Hampton Roads anticipates annual regional earnings of about $158 million as the overall economic impact climbs to almost $465 million. Nearly half of the ADP jobs are expected to be in place by the end of the year, with the rest filled by mid-2017.

“Together, ADP, the Main, the Waterside District and Icon at City Walk will be a game changer for downtown,” Norfolk Mayor Paul Fraim said in his “State of the City” address in March. “They will dramatically enhance downtown’s vibrancy and help boost and diversify the economy, creating more investment opportunities.”

Outside of downtown
While the downtown district has seen the lion’s share of economic development projects, Norfolk leaders stress that the wealth is being spread around. “We had to fix downtown because, if the apple is rotten at the core, the rest of the apple will die as well,” Rigney says.

He points to Movement Mortgage’s plans to bring more than 800 jobs to the former J.C. Penney building at Military Circle. “There’s a tremendous opportunity to reshape Military Circle. That area can be a significant place for businesses and jobs to locate.”

In addition, Simon Property Group will break ground in May on the $75 million Norfolk Premium Outlets at the former Lake Wright Golf Course. Slated to open next year, the mall is expected to create 800 permanent jobs and generate upward of $3 million in annual tax revenue.

Private employers like ADP, Movement Mortgage and Simon Property Group are expected to enhance the stability of the region’s economy, which has largely depended on Department of Defense spending. That dependence becomes a volatile relationship during times of federal spending cuts.

“The private sector has to start filling in, but it has been slow to do that,” says Vinod Agarwal, director of Old Dominion University’s Economic Forecasting Project. Hampton Roads gained 7,000 jobs last year, reaching a total of 765,383. That number, however, still is below its pre-recession peak of 775,500 jobs.

To be successful, Hampton Roads must start thinking of itself as a regional economy, Agarwal adds. “We can’t think about Norfolk only … or only worrying about Virginia Beach. We depend on each other way too much,” he says.

Virginia Beach arena
Virginia Beach is betting that an 18,000-seat entertainment and sports arena will be a significant generator of new jobs, events and visitors. Developer United States Management is aggressively working to secure financing for the project. “The goal is to have the loan closing in 2016 with construction starting by the end of the year and the grand opening in late 2018,” says Brittany Jeffries, a USM marketing associate.

The Virginia Beach City Council approved the $200 million, privately financed project near the oceanfront late last year, with the city footing the bill for infrastructure improvements. “We see this arena as an iconic symbol for Hampton Roads, not just an amenity for Virginia Beach,” Jeffries adds. “It will not only provide a lot of activities and entertainment opportunities for the city but also attract people from outside the area to experience the region and create jobs and more year-round activities for the region.” The project is expected to generate 2,300 jobs during construction and 440 positions once the arena is in operation.

A sticking point, however, has been the lack of a major athletic team to call the arena home. USM believes that will come in time. “The key to landing a sports team is to have a facility,” Jeffries says, adding that the arena can succeed without a team. “When you have a team, it fills up a lot of the schedule and collects a large portion of revenues. Without a team, you have a lot more prime dates that you can fill with other events.” 

Meanwhile, Stephen Ballard, president of S.B. Ballard Construction Co., submitted an unsolicited proposal in March to Old Dominion University for another athletics venue.  Ballard wants to demolish ODU’s existing football stadium in Norfolk, Foreman Field, and replace it with a 25,000-seat facility that would open in 2018.  The proposal includes five stadium configurations, the most expensive of which would cost $124 million.

Tech Center in Newport News
On the Peninsula, construction continues on the Tech Center Research Park adjacent to the Thomas Jefferson National Accelerator Facility.  The project includes 1.1 million square feet of office and lab space, along with a marketplace featuring national retailers making their first foray in the Peninsula, an urgent-care center operated by Children’s Hospital of the Kings Daughters and 284 upscale apartments. W.M. Jordan Co. is developing the $450 million, privately financed project. The mixed-use community emphasizes environment, nutrition and fitness, says John Lawson, W.J. Jordan’s president and CEO. “We want to get people in an environment where they’re collaborating. To do that, we have to provide really interesting retail and entertainment and a great place to live.”

A $1 billion ion collider also wouldn’t hurt. The Jefferson Lab is competing with Long Island’s Brookhaven National Laboratory to become the site for the collider, a coup projected to have about a $4 billion economic impact on the region. Lawson believes the tech center would benefit from the collider and its resulting jobs. “This would be a big attraction to people moving here and hired to work for the construction and operation of the ion collider,” he says. The U.S. Department of Energy is expected to announce in the next two years which site will get the collider.

New construction also is underway at several of the region’s medical facilities. Bon Secours Hampton Roads Health System will open a $20 million medical plaza in Suffolk’s Harbour View this fall that will house the Bon Secours Cancer Institute. Meanwhile, Sentara Norfolk General, ranked as a top hospital in Virginia by U.S. News and World Report, is launching a $199 million expansion. The five-year project will add three floors to the hospital, modernize and expand 18 operating rooms and enlarge the emergency department. With the expansion of its Ambulatory Surgery Center, Sentara Leigh Hospital is in the final phase of a massive, eight-year construction project that saw the construction of two five-story patient towers and an employee parking deck.  

Overall, as Norfolk’s Rigney says, the projects represent pieces of a larger puzzle designed to invigorate the region with new — and diverse — economic activity.

Importing Orlando magic

He brought thousands of jobs and millions of dollars in investments and revenue to Orlando, Fla., and North Carolina’s Research Triangle Park. Now Rick L. Weddle is gearing up to achieve similar results in Hampton Roads.

The new president and CEO of the Hampton Roads Economic Development Alliance, Weddle is tasked with attracting new business and industry to set up shop in the 11 localities the organization represents. Despite hanging out the welcome mat, the region continues to be plagued by identity issues and its dependence on government spending as it works its way out of the lingering effects of the Great Recession. But with revitalization and new construction underway and new companies poised to move in, Weddle believes Hampton Roads can make a strong comeback. 

“Hampton Roads has unrealized potential,” he says, noting the region did not come out of the recession as strong as other areas in the U.S. “Hampton Roads hasn’t had the right momentum to grow at or faster than the national average. Part of my job will be to figure out how to get it positioned to do better.”

This will include finding a way to pull the region together into a more cohesive unit, a goal that has eluded business and community leaders for much of Hampton Roads’ 400-plus-year history. A region that includes 16 cities and counties —  including two localities in North Carolina — Hampton Roads is the 37th largest metropolitan area in the country. Power plays among the municipalities, however, often have stymied attempts to give the region a cohesive economic and cultural identity.

“We haven’t had a consistent vision for Hampton Roads, and sometimes that confuses site developers,” acknowledges John D. Padgett, who chairs the HREDA’s board of directors and led the national search for the new CEO. “Companies don’t even know what Hampton Roads stands for or where it’s located.”

That’s why the HREDA sought a transformational CEO with a robust economic strategy to unite its members. From all indications, the group has found that in Weddle, who describes himself as a game changer. “It’s premature for me to say I’ve got all the answers, but I know how to pull people together,” he says.

As CEO of the Orlando Economic Development Commission, he transformed the five-county region from a dependence on tourist dollars to a magnet for corporate headquarters. As president and CEO of the Research Triangle Foundation, the developer of Research Triangle Park, Weddle led the way in attracting more than $800 million in direct investments and the creation of more than 6,200 jobs.

Weddle wasn’t looking for a new job, but he was impressed by the commitment to regionalism shown by local leaders. “They have the desire to move beyond where they have been in the level of cooperation and make regionalism more effective,” he says.

Joe Bouchard, vice chair of Future of Hampton Roads, a volunteer group, believes Weddle has his work cut out for him. “Economic development efforts in Hampton Roads are weak and fragmented,” he says. “HREDA in the past has focused on attracting companies from outside the region, but their success has been disappointing.” 

The 120 member of Future of Hampton Roads represent all segments of the community, including businesses, nonprofits and the military. The group meets regularly to discuss approaches to economic development and ways to fuse best practices and lessons learned. ‘That’s one of our strengths,” adds Bouchard, who came to the region in 2000 as commanding officer of Naval Station Norfolk. “No other organization in Hampton Roads can bring this diverse of a group to the table to explore an issue.”

Weddle, who took charge of the HREDA in April, is spending his first 120 days on the job meeting with groups like Future of Hampton Roads to learn more about the region and how all its pieces fit together.  “I really think the best days of Hampton Roads in the modern era are ahead,” he says. “There will be winners and losers in regional economic growth in the next few decades. We’re going to have to win more deals than lose them, but if opportunities are done correctly, they will generate really big deals.”

Responding to business needs

Editor’s Note:  This is a continuing series profiling Virginia’s colleges and universities.

Whether training technicians employed by a major local manufacturer, nursing assistants for a major health-care provider or welders seeking maritime jobs in the burgeoning shipbuilding and ports industry, Tidewater Community College has become a key player in supplying Hampton Roads industries with highly skilled workers.

Enrolling nearly 40,000 students annually, the college is the region’s largest provider of higher-education and workforce services. Founded in 1968, TCC is the second largest of the 23 schools in the Virginia Community College System, the 11th largest public community college in the U.S. and the 17th largest associate degree producer among the nation’s two-year institutions. In addition to campuses in Virginia Beach, Chesapeake, downtown Norfolk and Portsmouth, TCC hosts five regional centers in advanced technology, health professions, automotive, military and veteran education, and workforce solutions.

“We strive to be responsive to the needs of the community,” says TCC President Edna V. Baehre-Kolovani, who in 2012 became TCC’s fifth president. “In the last 30 years, we’ve had a much greater focus on workforce training, and we’ve become more flexible and responsive to the business community in ensuring that our curricula and degrees meet the needs of the economy of our area.”

She adds that TCC has expanded its global and technological reach during the past three decades, establishing an exchange program with a Danish business college and increasing the use of smartphones, iPads and other technologies in instruction. “It’s fundamentally changed how we deliver education, specifically with our online degree programs.” 

TCC also offers dual enrollment programs that give local high school students a jump on college courses. The school also a mechatronics program preparing workers for jobs in advanced manufacturing and other industries, a groundbreaking maritime technologies degree and a textbook-free degree program.  Along with technical skills, the college develops communication and problem-solving abilities, giving students a leg up in the crowded job market. “These are employable graduates,” Baehre-Kolovani says. “Employers know our students are skilled and have the related competences to make them employable.” 

One-third of TCC’s students are military, National Guard and reserves personnel, veterans and their families. Earlier this year, Military Advanced Education named TCC the nation’s top school for military.

TCC also serves about 14,000 veterans and active-duty personnel through its Center for Military and Veterans Education, which helps vets transition into private-sector jobs. The college regularly sponsors training programs on military bases, including a recent four-month program that prepared students to become solar energy repair technicians or installers. “We try to anticipate the labor market needs and how to meet those needs,” Baehre-Kolovani says.

That includes designing a maritime technologies degree to augment the number of skilled technicians for Hampton Roads’ shipbuilding and port-related industries. TCC also hosts the Southeast Maritime and Transportation Center, one of more than 40 National Science Foundation Advanced Technological Education centers across the country.
“We’re preparing people for exactly what the maritime industry needs,” says Barbara Murray, the center’s executive director. “The region’s shipbuilding industry needs tugboat workers, truck drivers, welders, pipefitters, ship fitters. By the end of the decade, 18,000 of these jobs will need to be filled. When you save those jobs, it helps our economy.” 

TCC trains more than 1,300 maritime apprentices annually, giving students real-world experience at shipyards and the Port of Virginia in areas ranging from maritime welding to marine logistics and truck driving.  That attentiveness to industry needs sets TCC apart from other colleges, says Brad Mason. He’s the director of maintenance, modernization and technical services for AMSEC and chairs the SMART Center’s Maritime Technologies Consortium, a group of industry and education representatives. “TCC is very responsive. If we go to them and say we have this need, they’ll develop the academic curriculum.”

About 450 representatives from local businesses serve on advisory committees for each of TCC’s technical programs, helping the college develop curricula and respond to industry changes. “They tell us what they need, and we respond,” says Thomas Stout, dean of science, technology, engineering and math at TCC’s Chesapeake campus.
Demand for advanced manufacturing workers led TCC to develop its highly successful mechatronics program. “There’s a career at the end of it,” Stout notes. “Employers need mechatronic technicians and don’t want to just hire an electrician and a mechanic. They need someone who understands the processes.” 

TCC mechatronic students finish the program as technologists ready to work on electrical and mechanical systems. Many transfer to Old Dominion University and other schools to complete their bachelor’s degrees. “Our graduates are coming out as more than a technician but not quite an engineer,” Stout explains. “With a four-year degree, you’re more qualified to be the person in charge of a maintenance team. That can be a pretty lucrative job.”

Last fall, TCC and Chesapeake Public Schools launched a dual enrollment program in mechatronics, a first for the college’s career and technical programs. Students will attain their high school diploma along with a career studies certificate in mechatronics and then earn an associate degree in mechatronics from TCC in one year.  Almost 30 Chesapeake high school students have enrolled and are being mentored by representatives from local technical firms. “It’s industry buy-in,” Stout adds. “They’re excited about what we’re doing and are actual participants in keeping students engaged.”  TCC also plans to offer mechatronics as a dual enrollment program in Virginia Beach Public Schools. 

About 350 to 400 students are enrolled in the mechatronics program. (Mechatronics is a multidisciplinary field of engineering.) Representing traditional and nontraditional students, they include a group of Stihl Inc. employees hired for the company’s four-year apprentice program.  Virginia Beach-based Stihl is a major power-tools manufacturer.

Through a partnership with TCC and the Virginia Department of Labor, the apprentices work at Stihl while earning associate degrees in mechatronics. “Manufacturing is highly automated,” says William “Skip” Johnson, Stihl’s apprenticeship coordinator. “Between on-the-job training and the education they get at TCC, our apprentices are prepared to work in these automated systems.”   

Students can earn continuing education credits and industry certifications through TCC’s Center for Workforce Solutions, which partners with local industries to design customized employee training programs. “Our goal is to serve the community and be responsive to businesses’ needs,” says Corey McCray, the center’s vice president.  “We can’t guarantee jobs for people going through our programs, but we do provide quality potential employees.”

Students learning sonography, the use of ultrasound technology, hone their skills while helping first-year Eastern Virginia Medical School students learn to perform ultrasounds through a unique mentorship program between TCC and EVMS. “EVMS is among the few U.S. medical schools that integrate ultrasound into its curriculum,” says Indu Sharma, TCC’s head of diagnostic medical sonography. “Our sonography students take part in labs at EVMS where they give individualized attention to medical students who perform ultrasounds on model patients. They sit in on a lecture before the lab and then help the medical students produce the ultrasound images.”

While lectures are integral to most TCC classes, textbooks are rapidly vanishing in favor of freely accessible Open Educational Resources. Chalk that up to the growing popularity of TCC’s innovative “Z Degree,” a textbook-free degree program developed to offset the escalating costs of textbooks. With textbooks accounting for one-third of college costs, students can spend up to $1,500 a semester for books, with some forced to either go without them or place their education on hold. “A student told me that she needed my class to graduate, but couldn’t afford the $275 for a textbook,” recalls Linda Williams, a TCC business administration professor who helped design the Z Degree.  “As long as she’s got that one course out there, she doesn’t graduate. I can’t let that happen if I have the ability to do something about it.” 

TCC became the first U.S. community college to offer a textbook-free degree in 2013. The pilot program gave students the opportunity to earn an associate degree in business administration — completely textbook free. Along with the slate of business courses, students also took general education and electives without using textbooks. More than 90 percent of students in Z courses give the program high marks. Last fall, more than 1,000 students enrolled in Z courses.

For her business statistics course, Williams created a six-minute video on her laptop to explain theory and demonstrate problem-solving techniques. “We strip courses down to the learning objectives,” she notes. “What we end up with is a course that is much leaner and allows us to spend more time focusing on the things that matter and get more critical thinking from students.”

Textbooks are still available for those who prefer traditional learning methods, but Williams notes that millennials tend to prefer video and audio materials. “They grew up with their face in a phone. They’re much more accustomed to instant information received in a digital or video format.”

TCC plans to add an associate degree in applied science in criminal justice to the Z degree roster this fall.  Z degrees for general studies and social sciences are also on tap in the next year, and Williams believes all courses could be offered textbook free. “It’s more of a challenge to create some of those courses than others such as technical trades where the content is proprietary,” she says, “but I don’t believe it’s impossible.”

Also on tap, the college is looking to renovate its Virginia Beach campus and is building a parking garage on the Chesapeake campus, a first for the city. Construction is expected to begin early next year on a STEM academic building on the Chesapeake campus, which Baehre-Kolovani says is the top community college capital program in the state’s budget.

Proof, she adds, of the college’s value. “Our overriding vision is to be the most affordable, innovative and convenient provider of high-quality career training. We’re vital to the region’s economy.”

Related: Tidewater Community College offers a textbook-free degree program

Ready for a fresh start

Armed with cameras, creativity and a love for Portsmouth, Betty Sanborn and Niki Park are on a mission to promote pride in the historic Hampton Roads city they call home.

Professional photographers, Sanborn and Park travel throughout Portsmouth taking portraits of residents and placing them on The People of Portsmouth Facebook page along with why they love living in the city and their vision for its future.

They’ve photographed more than 200 Portsmouth residents since launching the project last June.  “The only thing to disqualify someone from being on the page is you can’t say something negative,” says Sanborn, owner of EMS Photography. “We want everyone to feel welcome and be willing to work with other people regardless of who they are because we’re all citizens of Portsmouth, and until we all work together, we’re not going to get anywhere.”

Sanborn and Park’s attitude is indicative of a fresh start many in Portsmouth are trying to make this year after recent turmoil in city government and the damaging financial effects of new transportation tolls.

New City Manager Lydia Pettis Patton is working to shape what she calls The New Portsmouth. “Right off the ground, there are a lot of great things to be done to continue the excitement in the city, improve quality of life and improve education.” she says. “It’s very important that we engage the community and listen to the community.”

City officials point to positive signs, including new investment in multifamily real estate projects, potential development of the city’s waterfront and an influx of new downtown residents.

Last year was tumultuous. City Council struggled to plug an $11.7 million budget gap and fired City Manager John Rowe and City Attorney George Willson. Another 13 city officials either resigned or were forced out. In May, a citizens group began an effort to recall Mayor Kenny Wright. (In a bizarre incident early this year, Portsmouth Sheriff Bill Watson charged Wright with a felony after he failed to stop his car during a low-speed chase over an expired inspection sticker.)

Portsmouth also has taken a major financial hit in the two years since tolls were levied on the Downtown and Midtown tunnels to help pay for the $2.1 billion Elizabeth River Tunnels project, Virginia’s largest road-building project in 20 years.  The deal, approved by the administration of then-Gov. Bob McDonnell has been harshly criticized by the current governor, Terry McAuliffe.

The tolls, along with regular nightly and weekend closures of the downtown tunnels, have riled motorists and business owners. Norfolk and Virginia Beach residents have shunned the tunnels, curtailing travel to Portsmouth and dampening sales for local businesses. Some closed their doors, including Crockin’s Furniture which is shuttering its downtown store after 126 years.  

“We’ve got some very, very serious issues with our city — the highest taxes in the region, incomes stymied by tolls,” says Fred Schoenfeld, the owner of the Commodore Theatre in Olde Towne, who supports efforts  to recall the mayor. “The city has a lot of charm, but we’re considered the ugly stepsister of Tidewater. Until something changes in city government, it’s going to be hard to reverse that.”  

Working with civic groups
These are some of challenges that Pettis Patton has faced since starting work as Portsmouth’s first female city manager Sept. 1. Council’s unanimous choice for the job, Pettis Patton previously spent 22 years in city hall, overseeing an array of departments before retiring as deputy city manager in 2008. She then spent seven years as associate director for student access, success and diversity initiatives at the Illinois Institute of Technology in Chicago.

In creating a New Portsmouth, Pettis Patton expects city employees to remember that they are public servants. “That’s the only reason we’re here,” she notes. “Citizens need to know what the work of government is, what these departments are for and how we are here to help them.”

It’s a philosophy she imparts not only to rank and file employees but also to department heads, including those appointed late last year to fill seven vacant positions. To enhance city government’s connection with residents, she is requiring department heads to meet with every civic association during 2016.

In an effort to hold down taxes, she also encourages city employees to find ways to cut costs without hurting essential services.  “There are some things government can do, and some we cannot do,” she notes, adding that she wants staffers to handle the city’s finances like they would their own. “The same way you feel about your money is the same way I want us to feel about reallocations spending.”

Elie Bracy III also has faced challenges since becoming superintendent of Portsmouth Public Schools a year ago. The former superintendent of rural Weldon, N.C., schools took the helm of an urban division in which enrollment has declined during the past 20 years to about 14,000 students. Six of the system’s 19 elementary, middle and high schools currently have partial accreditation. The rest are fully accredited.

Bracy has pledged to have all city schools fully accredited. He is optimistic that the division can become an “exemplary school system” where parents want their children to attend.  “When you start looking at schools and talking to people, you find that it’s a good school system,” he says. “You have to really get inside to see what’s going on, but students have pride in their schools.”

Surveyed by explorer
That optimism dovetails with Sanborn and Park’s efforts.  They know all about the problems facing Portsmouth, but they want residents to focus on the positive. “There’s been a lot of discontent in the city, which really upsets me,” says Sanborn, a Portsmouth native. “But Portsmouth is a great place with so much history and so many families that have such a long lineage here.” 

The city’s storied past dates from 1608 when Capt. John Smith surveyed land along a body of water, which he named the Elizabeth River. Today, Portsmouth’s economic development department touts the city’s 90 miles of shoreline, which played a vital role in the nation’s maritime and military history. The Norfolk Naval Shipyard was established in Portsmouth in 1767, while the U.S. Fifth District Coast Guard Command provides maritime protection for the mid-Atlantic U.S. Portsmouth is also home to the U.S. Naval Medical Center, the Navy’s oldest, continuously operating hospital, in use since the 1830s.  

Many of the workers at those facilities commute from other cities. Housing in the city has largely consisted of small, single-family homes and low-end apartment complexes, with 60 percent of residences built before 1970.

Eight new developments
That’s one reason city leaders are enthused about the addition of eight developments totaling 770 multifamily units in the downtown corridor, representing $100 million in private investment. The Quarters at Park View, a 140-unit luxury apartment community that opened last summer, is fully occupied. Its developer, The Whitmore Co., also is constructing two other apartment complexes in Olde Towne. Meanwhile, the Monument Cos., a Richmond firm specializing in rehabbing historic properties, is converting the former Seaboard Building and the Governor Dinwiddie Hotel into high-end apartments, with commercial space on the first floors. Work should be completed by the end of 2016.

The Breeden Co., based in Virginia Beach, is making its first foray into Olde Towne with the construction of two downtown apartment projects. The 134-unit Harbor Vista will be ready this summer, while the 187-unit North Pier, next to the city’s Harbor Center Pavilion,  is scheduled for completion in 2017. The company has also purchased Montgomery Square, a 69-unit property with 40,000 square feet of commercial space.

“Not many cities right on the water have opportunities like this,” says, Ramon W. Breeden Jr.,  president, CEO and founder of The Breeden Co.  “There is untold amount of opportunity there for not only housing but also commercial. There may be some risk, but we believe in the land and the leadership and the future of the city as well as the potential of the waterfront.”

Promoted as a tourist destination, Olde Towne boasts one of the largest collections of historically important homes between Alexandria and Charleston, S.C., as well as historic places of worship, including Monumental United Methodist Church, one of the oldest continuing Methodist congregations in the South, and Emanuel African Methodist Episcopal Church, the second oldest building in Portsmouth and the oldest black church.  

Targeting port-related businesses
Now millennials, as well as retirees, are flocking to downtown Portsmouth, says Mallory Butler, the city’s director of economic development. “Millennials want to be part of a vibrant community, and empty nesters want to be away from the responsibility of a yard.”

Butler officially took over the city’s top economic development job in December after working in the department for two decades. She’s seen the city evolve and is bullish about its future. “We’ve come a long way, and there is nothing but opportunities ahead of us,” she says.

For starters, the city is working to attract more maritime and port-related industries and retail and restaurants and even craft breweries. Two of Virginia’s three container terminals are in Portsmouth, and the state’s long-term plans call for developing the city’s Craney Island as a container terminal.

“Clearly the port business is part of Portsmouth,” Butler notes. “Businesses want to be in or near port terminals or on the waterfront.”   Interchange, a logistics company based in Harrisonburg, is building two 100,000-square-foot warehouses on 13 acres in Portsmouth, while PER Properties of Virginia Beach is developing about 15 acres along the Elizabeth River for storage and shipment of agricultural products.

Retail is once again flourishing in Portsmouth, reversing a trend that saw many stores leave the city for suburban shopping centers. Developers have poured $37 million into Midtown’s resurgence, where a Kroger Marketplace, a Wal-Mart store and national eateries are drawing shoppers. “Over the last five to 10 years, we’ve made a concerted effort to bring retail back,” Butler says.

Now, the city is looking to get in on the burgeoning craft brewery market. “That’s blooming across the commonwealth,” she notes. “Certainly there’s opportunity for us to get a sip of that keg.”

Create Portsmouth Now
Yet, Portsmouth is regularly perceived as Hampton Roads’ underdog, says Park, the photographer, a city native who moved back 14 years ago. “I happen to be a fan of underdogs,” she adds.

Discovering that others were also rooting for Portsmouth, Park brought together a group of friends and acquaintances to brainstorm ways to improve the city. The conversation led to the formation of Create Portsmouth Now to highlight residents’ creativity, talent and entrepreneurship and instill pride in the community.  The group sponsored a fall festival featuring bands and artists and is planning a spring event as well as an initiative to display local artists’ work in storefront windows and on a public art wall in Olde Towne.

“This started out as an effort to connect people who care about Portsmouth,” Park adds. “We just ask that people be willing to work to make the city a better place.”

 “If people can come together and tap into that spirit of community and unity, we can reflect that back to the city leadership,” she says.  “It really is the people that make Portsmouth special. They’re genuine and lack pretense. They want to stick with Portsmouth, invest in the community and make improvements over the long haul.”

‘Stay tenacious’

Vivian Turok hadn’t been on her public relations job long at Divaris Real Estate Inc. when Chairman Gerald Divaris asked for a favor. He had a conflict and couldn’t show a property. Could Turok do it? To sweeten the deal, he mentioned that she could receive 25 percent of the commission if the prospective tenant leased the space.

From that moment on, Turok was sold. “When the opportunity to show the space for Gerald and earn six times my monthly salary from one commission came along, I knew that was my kind of career,” she recalls of her foray into brokering deals. More than 38 years later, Turok is Divaris’ longest-standing employee and was its top producer last year,  leasing approximately 500,000 square feet of space.

She also is one of Hampton Roads’ leading commercial real estate brokers. The Commercial Alliance, a council within the Hampton Roads Realtors Association, gave her the Platinum Commercial Sales and Leasing Achievement Award as one of southeastern Virginia’s top five grossing agents for 2014.

She also received the honor in 2009, becoming the first Hampton Roads woman to attain the Platinum Award level.

A senior vice president and member of Divaris’ Virginia Beach/Southside office team, Turok represents landlords and tenants in office leases. “The key is bringing the needs of both the tenant and the landlord into alignment,” she says. “What I try to do in all my transactions is to analyze the tenants’ long-term goals and objectives so as to enhance their business plan.”

That process played out last year when Turok and her team represented Armada Hoffler Properties in negotiations with USI Insurance for more than 19,000 square feet of office space in Town Center. The deal included a complete modification of the building’s electrical system and plumbing, additional lighting and signage and an extension of the entire front façade. USI kept its corporate office in Norfolk but brought 150 employees to Town Center.  “Our team worked so long to find a tenant,” Turok notes. “Town Center is ideal for their needs. Both Norfolk and Virginia Beach scored on this deal.”

A native of South Africa, Turok graduated from the University of Cape Town. Faced with limited job prospects due to the nation’s poor economy, she readily agreed to a three-month trial doing public relations for Divaris Real Estate in Cape Town, a company co-founded by Zimbabwe natives Michael and

Gerald Divaris in 1974. Turok followed her husband, an architect, to Virginia Beach in 1986, where she began work in Divaris’ first U.S. office.  “I’ve had the good fortune to work with two great mentors in Gerald and Michael Divaris,” she says. “They saw potential in me in South Africa.”

These days, Turok offers similar encouragement to colleagues entering the business.  “When I mentor young people, I always tell them my principles,” she notes. “Life is a journey with its ups and downs, its challenges, its successes, and one should stay tenacious and focus on one’s goals. To try to be perfect is unrealistic, but what is important is to be true to oneself.”

As she closes in on 40 years with Divaris, Turok has no plans to slow down. “I really enjoy what I do,” she says. “I have a passion for this business and love helping companies continue to be successful.”

On a fast track

Editor’s note: This is a part of an ongoing series looking at Virginia’s colleges and universities as economic engines.

When Paul Trible became president of Christopher Newport University in 1996, the university was viewed as a commuter school, with most students driving to and from class each day without lingering on the Newport News campus.

Trible immediately set out to change the school’s direction in a bid to make Christopher Newport one of the nation’s pre-eminent, public, liberal-arts universities. Upgrades were made in academic programs and facilities. Dorm space was increased to encourage a larger residential student population, with the school requiring all freshmen, sophomores and juniors to live on campus. Civic involvement also was encouraged as CNU expanded its reach beyond its 260-acre campus.

The university has undergone $1 billion in capital construction since 1996, increased full-time faculty from 166 to nearly 300 and expanded enrollment from 3,500 to 5,200 students, with nearly 4,000 living on campus. CNU’s budget also has grown significantly, from $33 million in 1996 to almost $145 million for the 2015 fiscal year, a 339 percent increase.

“No school has come so far so quickly,” Trible says. “We rejected the notion of incremental progress.” Indeed, 55 years after Christopher Newport College’s beginnings as a two-year branch of the College of William and Mary, the school is making a mark not only on the Peninsula but throughout

Hampton Roads and the commonwealth. In May, the university graduated the largest class — more than 1,200 students — in its history. CNU, as Trible states emphatically, has undergone a “dramatic transformation.”

U.S. News and World Report ranks CNU 17th among regional universities in the South and seventh among public regional universities in the South. In addition, Forbes magazine placed CNU among the top 20 colleges for minorities in STEM fields (science, technology, engineering and mathematics), while the Princeton Review named it one of the country’s best institutions for undergraduate education. CNU is also the nation’s only public institution to receive a perfect “A” from the American Council of Trustees and Alumni based on the strength of the school’s curriculum.

Undergraduate focus
With more than 80 areas of study, CNU focuses on undergraduate education. “We see our role as positioning and preparing students to go off to great graduate programs,” Trible says, adding that the school does offer three, five-year master’s degree programs — in education, environmental sciences, and applied physics and computer sciences. He notes that the overwhelming number of newly minted teachers — who receive bachelor’s and master’s degrees or teaching certification through the program — opt to remain in Hampton Roads.

While remaining dedicated to its liberal-arts emphasis, the university has strengthened its programs in the sciences, with nearly 30 percent of graduates receiving degrees in STEM disciplines. Student demand led CNU to launch a bachelor’s degree in electrical engineering last fall. “Virginia has a shortfall in the number of electrical engineers,” Trible says. “To that end, we saw this as an opportunity to help Virginia meet an important requirement.”

 

Also last year, CNU began the most ambitious fundraising campaign in its history, seeking to raise $50 million by June 2017. The Defining Significance comprehensive campaign focuses on support for scholarships, faculty and an alumni house. The time is right to undertake such a monumental campaign, Trible says. “We have the students, faculty and a campus that marries Georgian architecture with 21st-century technology,” he adds. “The one thing we need to add is a strong financial foundation.”

The campaign comes on the heels of expansive gifts from plumbing supplier Ferguson Enterprises, which in 2013 pledged $12 million to CNU over the next three decades. The largest gift in the school’s history, the funds will be used to support operation at the Ferguson Center for the Arts, as well as to create scholarships for students in music, theater and dance and to support the university’s Center for Community Engagement. In addition, Smithfield Foods has contributed $10 million during the past decade. The university’s endowment currently stands at about $24.3 million.

Centers for the arts
The Ferguson Center is perhaps the most public sign of the university’s transformation. Designed by renowned architect I.M. Pei, the $70 million facility features a 1,700-seat concert hall and a 500-seat theater. Since opening in 2005, the center has hosted more than 2 million patrons, with more than 70 performances each season, including Broadway plays, symphonies and ballets. “It’s world-class in every respect,” Trible says. “There is nothing like it in Virginia.”

He adds that until the Ferguson Center opened, the Peninsula was the only community of its size in the country without a regional performing arts center. By all accounts the facility has paid off, with patrons spending more than $97 million during the past decade and 3,100 jobs being created. In addition, more than 23,500 performers and support crew have spent $3.8 million for more than 32,000 hotel nights on the Peninsula and $1.2 million on meals.

CNU also plans to build a new visual arts center, following its recent merger with the Peninsula Fine Arts Center, as well as an addition to the university library. The General Assembly has approved the design phase for both capital projects.

Community service
Beyond campus facilities, the university is focusing on producing leaders and citizens who can impact Hampton Roads and beyond. Students are encouraged and expected to perform community service. “Service is important,” Trible says. “We are all about leadership, honor and civic engagement.” 

Students often parlay their coursework into avenues for assisting local businesses and other agencies. For example, students enrolled in the university’s four-year Bonner Service Scholars program serve 1,200 hours on local site-based teams working on a range of issues, including poverty, homelessness, immigration and projects to reduce high-school dropout rates. “We are not turning a blind eye to the challenges people face,” says Brad Brewer, who directs the Bonner Service Scholars. “We’re training our students to become lifelong active citizens and engage people very different from themselves and listen to different perspectives. While they’re doing that, they are having an enormous impact on the people they serve.”

Brewer also heads CNU’s Center for Community Engagement, which annually funds up to 30 Ferguson Fellowships for Social Entrepreneurs. Working with faculty members, students receive a $1,000 stipend to research a community need, design a plan to address the problem in a new way and implement the plan. Brewer estimates that 148,000 hours of CNU volunteer work has a value of about $3.4 million in the community. “In the long run, it’s a question of whether our community will be known as a healthy, vibrant community with youth and energy and a long-term economic impact,” he says.

Assisting small companies
Strengthening the region’s economy is the focus of CNU’s Small Business Institute, which has provided free assistance to small companies in Hampton Roads for more than two decades. Senior business students spend a semester developing business and marketing plans, conducting market research studies, performing accounting, operational and business systems analysis, and guiding firms through the social-media maze. “The traditional business school curriculum tends to focus on large public corporations, but 84 percent of the world’s businesses are small or entrepreneurial,” says William Donaldson, the institute’s director. “This program gives our students exposure to the real world for life after academia, and is our way of giving back to the community.”

Forty-five to 60 students enrolled in a class on small and family business and entrepreneurship work with five or six companies each semester. Recent projects have included conducting a food optimization and plate cost study for a local restaurant and completing an inventory analysis for a NASA researcher who developed a test to detect cancer. A faculty member oversees each team, but the students are essentially in charge. “It’s really their show,” Donaldson says. “They’re the professional consultants who decide what hours they work.” Donaldson doesn’t attach a dollar value to the students’ efforts, but he believes firms have benefitted. “We have good anecdotal evidence. Clients rave about the experience they’ve had.”

Such praise reinforces the mission of CNU’s Luter School of Business, which has purposefully remained an undergraduate program, accepting about 130 students annually. Earlier this year, the school was reaccredited by the Association to Advance Collegiate Schools of Business International in an especially strenuous process for schools offering only undergraduate business degrees. “Only four percent of business schools are strictly for undergraduates,” says Pamela Pringle, the school’s assistant director. “We are very student-focused, with small classes and lots of hand-on team projects.”

Accounting students gain hands-on experience through a voluntary income tax assistance program in which they help more than 200 low- and moderate-income taxpayers prepare their returns. This year, 20 students volunteered more than 600 hours under the supervision of an accounting faculty member to prepare and file returns.

While Christopher Newport strives to be among the top American universities, its mission remains centered in Virginia. “We believe our job is to educate the sons and daughters of Virginia first and foremost,” Trible says, noting that 90 percent of the university’s students are from the Old Dominion.
But no matter where they go upon leaving CNU, Trible says, students will spread the university’s name and reputation. “The key to our success is students come here and fall in love with this place and share that passion with their friends, neighbors and parents,” he says.

 

Plugged in

In a region brimming with military installations, federal laboratories, a major East Coast port and shipyards, Old Dominion University does not have to look far for opportunities to impact Hampton Roads’ economy.

With nearly 25,000 students and $96.2 million in research and development expenditures, the university contributes more than $2.1 billion annually to Hampton Roads’ economy. Not bad for an institution launched during the Great Depression.

Opened in 1930 as the two-year Norfolk Division of the College of William & Mary, the school became independent and took on the moniker Old Dominion College in 1962, attaining university status seven years later. “This region gives us significant niches that very few colleges or universities have,” says ODU President John R. Broderick. “There’s a good mix of opportunities to teach, study and find avenues where economic development is a natural spinoff.”

The university’s role in the region’s economy has surged in recent years with the development of programs that assist not only students preparing for careers in the marketplace but also local businesses and industries. ODU’s Business Gateway is the university’s front door to local companies seeking research assistance, technological assistance and research partnerships.

“If you’re a startup, we’ll help you think about your ideas and put together a plan to execute your business,” says its executive director, Martin Kaszubowski. “We try to add value to a client wherever we think we can.”

The Business Gateway includes Launch Hampton Roads for aspiring entrepreneurs, the Veterans Business Outreach Center (funded with a grant from the Small Business Administration), the Women’s Business Center for women-owned companies, the Technology Applications Center offering engineering support to businesses and the Hampton Roads Procurement Assistance Center, which helps companies compete for government contracts.

“Whoever walks in the door, we try to serve with a variety of services for whatever they need,” Kaszubowski says. “We’ve got a bunch of happy clients.”

One of them is Arizone Hollins Brown, co-founder of ASJ IT Services, an information technology management firm that set up shop in Chesapeake last year. Seminars and mentoring sessions with Launch Hampton Roads, the veterans’ and women’s business centers and the Procurement Assistance Center helped Brown get up to speed on her venture.  “As a new business owner, you’ve got lots and lots of questions, and having those resources in one location really helps,” she says. “These centers have given us credibility and helped us build relationships.”

The Business Gateway is housed in ODU’s Innovation Research Park, one of the few research parks in the U.S. based on the campus of its institution. Located in the 75-acre University Village, the 5-year-old park is a business-friendly entry to university resources. “Sometimes navigating colleges and universities for particular resources is difficult,” Broderick says. “We want to take all that difficulty out of that and help people identify those they need to work with.” Businesses outside ODU also have located in the park because of relationships with ongoing university research or teaching.

Entrepreneurial center
Those relationships are strengthened by Old Dominion’s emphasis on entrepreneurialism. Last year, ODU alumnus Mark Strome and his wife, Tammy, gave the university $11 million to create a student-focused entrepreneurial center. Strome is the founder, chairman and chief investment officer of Santa Monica, Calif.-based Strome Investment Management LP. 

“Entrepreneurs create jobs,” Strome said at the dedication of the Strome Entrepreneurial Center last September.  “And when a person has a job, he’s empowered.” 

While a previous entrepreneurial center based at the university primarily assisted outside startups, the Strome Center focuses on student entrepreneurs.  “It gives the students a significant edge, a place to share ideas and work together and take those ideas to business and industry leaders in Hampton Roads,” Broderick says.

That, adds Nancy Grden, the center’s executive director, galvanizes students in all academic disciplines to develop ideas that will create economic and social value in Hampton Roads and beyond. The center’s staff offers free consultations on business ideas to students and faculty and puts would-be entrepreneurs in touch with potential investors. “When you look at the demographics of people in their 20s and 30s, there’s a strong desire to be independent and create their own destiny,” Grden says. “It’s easier than it has ever been to create a business.”

The center is also the nucleus of the Entsminger Fellows Program, a clearinghouse for handpicked faculty members to infuse entrepreneurism in academic departments and courses throughout the university.  A $100,000 gift from alumnus Lee Entsminger funds the annual program. “Innovation is everywhere,” Grden says. “An engineer might have a great idea for a problem-solving product. Someone in biotechnology has a scientific discovery. An educator has an idea for a new school.” 

Meanwhile, ODU opened a new school last year at its Virginia Beach Higher Education Center for nontraditional learners. Working with Old Dominion’s business and military partners, the College of Continuing Education and Professional Development offers classes in areas such as public procurement, engineering and education. “It makes us more flexible to serve the needs of business and industry,” Broderick says. “A lot of companies we work with are looking for very specific skill sets.”

ODU recently crossed the $40 million threshold in annual federal research expenditures for the first time in the school’s history. That’s especially significant, says Morris Foster, the university’s vice president of research, in the face of flat or declining federal research disbursements. The uptick reflects the volume of Department of Defense research performed at ODU as well as faculty doggedness in submitting research proposals. “We’re a relatively young institution and haven’t had time to establish a unique identity as a research institution, but we’re clearly moving there,” Foster adds.

Sea-level research
ODU research teams generate about  $67 million annually through more than 400 ongoing projects. That includes the university’s research in climate change and sea-level rise, a focus Broderick began with the Climate Change and Sea Level Rise Initiative five years ago. A byproduct is the Mitigation and Adaptation Research Institute which conducts research to help coastal communities cope with the impacts of sea level rise and climate change.

“This issue directly involves the military and major employers,” Broderick says. “Everyone is in agreement that we have to work together because it impacts all of us.” He hopes this endeavor will lead to the university’s designation as a federal center for the study of sea level. “The great upside for us is it’s created an entrepreneurial culture where people will look for ways to mitigate and adapt to sea level rise.”

ODU is taking advantage of its coastal location to perform innovative research in sea-level rise, Foster notes. “We can do something that’s regionally relevant and benefits the economy but in a way that enhances ODU’s national and international reputation.” University research includes infrastructure vulnerability, technology that could lead to more resilient construction in coastal regions, and the public health implications of sea level rise. “We are just beginning sea level research, but we can develop and produce things in Hampton Roads and take them elsewhere as our intellectual property that can be licensed.” 

And ultimately bring new businesses and jobs to Hampton Roads, he adds.  “Economic development is not based on this region going to California and taking 500 jobs and bringing them here,” Broderick says. “We have the place to make inroads and trigger new and different jobs.”

Old Dominion University at a glance

Source: Old Dominion University

Location Norfolk
History

1930: Norfolk Division of The College of William and Mary

1962: Independent institution

1969: University status

Enrollment

24,670 total

19,612 undergraduate; 5,058 graduate

International: 1,092 from 105 countries

Alumni More than 124,000 in all 50 states and 67 countries
President John R. Broderick
Faculty Full-time: 722      Part-time: 502
Accolades U.S. News & World Report listed online graduate programs in ODU's Darden College of Education as eighth among the nation's graduate education programs for student services and technology and 10th for admissions selectivity.

 

A rising tide of concern

The tide is rising in Hampton Roads, and the commercial real estate industry is getting a wakeup call. Accelerating sea levels combined with sinking terrain potentially threaten property, infrastructure and ultimately, the region’s economic vitality.

The National Oceanic and Atmospheric Administration says Hampton Roads is second only to New Orleans as the U.S. area most affected by sea-level rise. Sea levels in the region have risen more than 14 inches in the past 85 years, compared with the global average of 5 to 8 inches. Recent studies by the Virginia Institute of Marine Science and the Sierra Club also paint a sobering picture. By 2100, Norfolk’s sea level is projected to be between 3.6 and 5 feet above the level it was in 1992, averaging an increase of more than half a foot a decade. Meanwhile, land across the region is sinking about one foot per century.

Then there’s the increased necessity for and increasing costs of flood insurance and structural changes to buttress buildings against rising waters. Municipal bond ratings also could be downgraded.  Moody’s Investors Service, a credit-rating group, recently surveyed city halls in Norfolk, Portsmouth, Hampton and Virginia Beach about the effects of sea rise, flooding and storms on infrastructure, budgets and tax bases. Standard & Poor’s has followed the economic impact of sea-level rise for nearly a decade.

Still, sea-level rise has yet to become a priority for the commercial real estate industry. “It’s not on anybody’s radar on the property management side,” says Kathy Grubbs, senior vice president for property management at Harvey Lindsay Commercial Real Estate in Norfolk. “They’re not seeing the effects of it. What you can’t see, you don’t worry about.” 

Grubbs, however, does not think the industry should bury its head in the region’s proverbial sinking sand. A member of the Hampton Roads Green Building Council, she has attended conferences focusing on coastal flooding and is seeing a slow uptick in concern. “I think it will be, in the future, a very hot topic,” she says. “It’s starting to be more prevalent because we’re seeing more seminars about it. The more people start to talk about it, the more our industry starts to realize it.”

The Center for Sea Level Rise at Old Dominion University is trying to jumpstart the conversation. One of four regional pilot projects in the U.S. charged with addressing sea-level rise, the center wants government, business and community stakeholders to help craft plans for dealing with land use and municipal and economic impacts. “We need to start making better planning and investment decisions, and we need the commercial real estate community to be participants in this project,” says Ray Toll, director of coastal resilience research at ODU and a member of the Governor’s Climate Change and Resiliency Update Commission. “We don’t have to immediately jump, but we need to start thinking how all this can work together.” 

State and local governments already have picked up the mantle, developing strategies to mitigate the effects of sea-level rise and increased coastal flooding. During the 2015 legislative session, the General Assembly approved a bill requiring localities in the Hampton Roads Planning District Commission to come up with comprehensive plans addressing sea-level rise and recurrent flooding. The assembly also passed measures directing the Department of Conservation and Recreation to update the state’s flood protection plan every five years and authorizing a study on groundwater and surface water consumption and sustainability.

Localities also are enacting new regulations. In Norfolk, where heavy rains regularly foreshadow flooding, city leaders are considering expanding the sea wall from downtown toward Old Dominion University. “If localities implement things like that, it could create value in a lot of real estate,” says David France. He’s a vice president with Kimley Horn and Associates in Virginia Beach, a design consulting firm that has worked with Hampton Roads cities, including Norfolk, Portsmouth and Hampton. The commercial real estate industry, he adds, is slowly realizing the effect sea-level rise could have on property throughout the region. “We’re still on the cusp of this. It’s not been tremendously impactful to commercial real estate as of yet, but it’s headed in that direction.”

Industry leaders for the most part are paying attention, with the Hampton Roads Association for Commercial Real Estate leading the clarion call as it lobbies the General Assembly and local governments to address recurrent flooding. “We’re becoming more aware that we’ve got problems,” says Ann Crenshaw, an attorney with Kaufman & Canoles and president of HRACRE. “The more we find out, the question is how bad is it going to get and how fast?” The urgency grows when the prospect of companies bypassing Hampton Roads for areas less impacted by rising waters is factored into the equation. “There’s an awareness that we need to tackle this issue to have successful economic competitiveness with other areas.”

For now, though, concerns about potential flooding have not prevented businesses from venturing into Hampton Roads. “I’ve not heard about outside companies changing their plans,” Crenshaw says. “I like to think that because the federal government, the state and localities are addressing the issues head on, there will not be reluctance to move here.”

Robert Kerr, president of Kerr Environmental Services Corp., adds that state and municipal pre-emptive moves help allay companies’ fears.  “Businesses feel comfortable locating here because they know that localities are reacting proactively rather than reactively, and can accommodate new development,” he says. “Localities in Hampton Roads get very positive feedback from businesses looking to expand in the area because they’ve been proactive.”

The hitch comes when the costs to mitigate flooding are tabulated. “You can do the planning, but implementing it requires much more money,” Kerr says. “That’s where the urgency is — trying to figure out how to finance infrastructure improvements.”

Michael Divaris, president of Divaris Real Estate Inc. in Virginia Beach, says his clients have not avoided the region because of flood concerns. “I don’t think it has risen to the forefront of the selection process.” He adds that developers do pay close attention to the proximity of potential sites to flood zones. “It’s starting to play an important part in the decision making. More and more due diligence will be done on properties that are impacted.”

William King, president and CEO of Harvey Lindsay’s industrial sales and leasing division, adds that flood concerns have hampered deals with firms seeking to locate data centers in the region. “Some of the data center companies have written off Hampton Roads because we’re in a hurricane-prone area,” he notes. Overall, most of Harvey Lindsay’s commercial projects are not in flood-prone areas. “I don’t see it as one of the top two or three challenges we face,” King adds. “It’s really not been that big of a factor of the average type of development.”

But that could change as more people in the industry understand the potential long-term threats of rising sea levels. “It’s a matter of trying to educate people and let them know what the projections are for Hampton Roads,” Grubbs says. “We have to learn how to live with sea-level rise.”

Regional reboot

After decades of relying on the military, the Port of Virginia and tourism to drive its economy, Hampton Roads is taking steps to add to its financial arsenal, with business and civic leaders seeking a bit of divine inspiration — from angel investors.

Chalk up this new momentum to Reinvent Hampton Roads, a leadership initiative of the Hampton Roads Community Foundation formed to find strategies for expanding the economic base of a region with 1.7 million people dispersed throughout 15 cities and counties. Reinvent Hampton

Roads believes that building a diversified economy is the best way to increase the region’s competitiveness on the national and international stage. That push includes adding new businesses and industries to the economic mix, especially startup companies. “We need to create a culture that supports people who have an idea and want to translate that into a business and into jobs,” says Donna Morris, the foundation’s vice president for strategic initiatives, who staffs Reinvent Hampton Roads. 

757 Angels Inc.
That’s where 757 Angels Inc. comes in. Launched in February, the angel investment group matches venture capitalists with local entrepreneurs seeking $100,000 to $1 million for their fledgling businesses. The investment organization grew out of recommendations from Reinvent Hampton Roads’ entrepreneurship study group, which determined that the region’s newest businesses need additional support to get off the ground. “There is a lack of ready capital in the area,” says Monique Adams, executive director of 757 Angels. “We’re excited that we’re providing a platform to match and connect entrepreneurs to capital.”

Two business owners, chosen from five semi-finalists, presented their companies to about 70 investors during the group’s meeting in March.

The angels concept is positioned to be a win for not only entrepreneurs and investors but for the entire region, says John M. Paris Jr., a member of 757 Angels’ board of directors and chairman of the Private Equity Group at Williams Mullen. “We’ll be able to fund companies in the area and keep our talent here in the area.”

As a bonus, 757 Angels could influence greater cooperation among Hampton Roads’ communities. “Regionalism is hard in Virginia because cities all have their own mission,” Paris adds. “The best way to help cities and the region is to have businesses lead in ways that are not city centered, and 757 is not city centered. It benefits the whole region.”

To be eligible for angel funding, entrepreneurs must be located in Hampton Roads but should derive a large portion of their revenue from outside the region. After undergoing a screening process, a select number of entrepreneurs pitch their businesses to more than 40 investors at one of the group’s three yearly meetings. “We embrace the entrepreneurial community and provide a forum in which they introduce themselves to investors who evaluate the pitch and decide as individuals if they want to invest,” Adams explains. “The investors still do their own due diligence, but we start the process for them. We make sure we’re pushing forth companies that are the most promising.” Along with providing capital, angel investors mentor entrepreneurs, introducing them to potential customers and other investors while helping their businesses gain credibility in the marketplace.

Comparisons to the TV reality show “Shark Tank” are inevitable, but Adams stresses that this is a collaborative effort that will ultimately benefit Hampton Roads. “We’re not interested in good TV,” she says. “We’re interested in what’s good for our neighbors. We want to make sure we’re creating jobs in Hampton Roads.”

These new jobs would not rely on the military, the ports or tourism. According to Reinvent Hampton Roads, those three components generated about 60 percent of the region’s $87.7 billion economy in 2013, with 46 percent directly related in the defense industry.  Those figures, combined with the region being ranked 302nd out of 382 metropolitan areas in employment growth since the recession, propelled Reinvent Hampton Roads to action. Companies seeking venture capital support in 757 Angels’ inaugural phase included medical, education and instrumentation firms.

“It’s been a phenomenal response,” Adams says. “All of the companies show great promise for growth and creating jobs in our area.”

Morris of the community foundation, who previously served as executive vice president and interim president of the now disbanded Hampton Roads Partnership, believes Reinvent Hampton Roads will succeed where other initiatives have fallen short. “This is something that has not been done before in the region, and we hope it leads to identifying implantable projects,” she says, noting that prior proposals involved many different entities with different and even conflicting objectives. “Everybody’s got to be committed to reaching a common goal. The implementation piece is very difficult when you’ve got a lot of players.”

Creating a mega-region
While 757 Angels is taking flight, recommendations from Reinvent Hampton Roads’ workforce development, industry clusters and civic leadership study groups still are being evaluated.  “Whenever you put people together in a setting where they discuss opportunities, it’s an exciting level that rises, and you come up with good ideas and want to move ahead,” Morris says. “We’re going to see what can be implemented in the short and long term.”

That includes cultivating burgeoning industries like advanced manufacturing, coastal energy and cybersecurity. “A lot of the things we’re looking at right now are based on the assets we’ve got in place,” she notes. And, despite the U.S. Navy’s recent announcement that the USS Gerald R. Ford will be homeported in Norfolk, Morris warns that Hampton Roads must be prepared for defense cuts. “We’re so comfortable. We’ve been very risk averse in the region,” she says. “We have to realize that it’s important to look at how we’re going to grow the region and grow jobs.”

Thomas Frantz believes expanding  the region geographically is the ticket.  The chairman of Williams Mullen law firm is a leading proponent of merging the Hampton Roads Metropolitan Statistical Area, the nation’s 37th largest MSA, with Richmond, the 44th largest, to create a mega-region. Combined, the two would jump to 16th, which Frantz says would pique the interest of corporations looking to place plants or regional headquarters in one of the country’s largest metro areas. “The top 25 regions tend to get more advances and looks from companies,” he says. “We would be holding ourselves out to the world as one diverse, strong economic region.”

The mega-region would encompass 8,000 square miles and 3 million people, but all municipal jurisdictions and services would remain localized. “We would still consider ourselves citizens of where we live,” Frantz says. “From a day-to-day standpoint, there would not be much difference, but from a business and marketing standpoint, we would grow in importance.” 

Mega-regions are emerging across the country, built around multiple adjacent metropolitan areas connected by overlapping commuting patterns, environmental landscapes and watersheds and linked economies and social networks. The Hampton Roads Business Roundtable and the Richmond Management Roundtable have discussed forming a mega-region for more than a year, encouraging collaboration between the two regions on issues like ports and transportation. “Clearly there are things that could help both regions,” Frantz says. “It’s almost like football. We’re each sort of a middle-size college team. Together, we could be like an Ohio State.”

Though still in the early stages, the idea has been well received, particularly among millennials, who focus on connectivity. “Every time we have spoken on [creating a mega-region], it’s been very enthusiastically accepted,” Frantz adds. “More and more people are talking about it. People are seeing what we can accomplish and that it’s more important to work together to bring new businesses and high-paying jobs.”

The Office of Management and Budget would ultimately decide whether the two regions unite.  It will take political will, Frantz notes, but he believes the result will be worth it. “You always come across obstacles along the path, but we feel good about this, that we’re going to do something this time, that it’s going to be important for this region,” he adds. “By adopting a bolder vision for our future, I think we can change some people out of being so parochial.”

Marketing group in transition
Change and perhaps reinvention is also on the agenda at the Hampton Roads Economic Development Alliance, which markets the region to companies throughout the world. Kevin Sweeney came on board as interim president and CEO in March after the resignation of Darryl Gosnell and is leading the HREDA through a transition period as it reviews its mission. “The bottom line goal is to be relevant in the community,” says Sweeney, who retired from the U.S. Navy as a rear admiral last year after leading Carrier Strike Group Ten. “We want to look at how else we can participate in the region’s drive to diversify and broaden its economic base.”

He adds that the HREDA will continue to leverage Hampton Roads’ strengths, including the port, a highly skilled workforce, its location along the mid-Atlantic coast, the climate, educational systems and quality of life, as it tries to attract advanced manufacturing, regional manufacturing, biohealth and other diverse industries. To do so requires regional collaboration. “We can only be competitive when we work together. It’s a team effort. A company may locate in one municipality, but the economy advances across the board to all cities here.”

As Hampton Roads strives for diversification, a growing number of its residents say life is getting better. That’s according to the 2014 Old Dominion University Quality of Life Survey. Seventy-one percent of the 853 respondents rated the region’s overall quality of life, including economic and recreational opportunities, schools and health care, as excellent or good. Chesapeake and Virginia Beach residents gave their cities the highest marks, followed by Suffolk, Hampton, Newport News, Norfolk and Portsmouth.

Those are the highest ratings since 2010, says Jesse T. Richman, director of ODU’s Social Science Research Center. “The last couple of years we’ve seen a bit of an uptick,” he adds. “Recreation — museums and beaches — were the largest positive that people mentioned. They also like the climate, economic opportunities and the quality of health care.”

Several Hampton Roads hospitals posted high scores in other surveys. Sentara Princess Anne Hospital, the region’s newest, was the only Virginia hospital included among the U.S.’s leading hospitals in the 2014 Leapfrog Top Hospitals report. In addition, the Sentara Heart Hospital, Hampton Roads’ only dedicated heart hospital, ranked 44th among the country’s top heart programs in the 2014-15 U.S. News & World Report rankings. Sentara Norfolk General last year was named Virginia’s best hospital by U.S. News for the second consecutive year.

Library opens; arena planned
For recreation, Hampton Roads boasts a variety of options, from oceanfront beaches to expansive parks throughout the region. Construction is scheduled to start this fall on a major recreation venue, an 18,000-seat arena across from the Virginia Beach Convention Center. United States Management will own the $200 million arena, which city officials call a regional game changer.

Another game changer is Norfolk’s Slover Memorial Library, which opened in January, eschewing the traditional library approach. The $65 million, high-tech facility covers three downtown buildings, including two renovated historic structures and a new six-story addition. One of the nation’s most innovative libraries, Slover combines a collection of more than 160,000 books with a digital media lab and a multitouch interactive experience covering thousands of local historical photos and artifacts.  “History really comes to life with the kind of technology that comes in this place,” says Sonal Rastogi, the city’s director of libraries. “It sets the standards for all libraries.”

That’s a success for a region trying to combine the old with the new. It is one that Hampton Roads’ economic development players believe they can emulate. “You always come across obstacles along the path, says Reinvent Hampton Roads’ Morris, “but we feel good about this, that we’re going to do something this time, that it’s going to be important for this region.”

Hampton Roads at a glance

Unemployment 5.6 % (February)
Population 1.67 million (2013)
Increase since 2010 2%
Average weekly wage $809
Median family income $70,943
% of adults (25+) with bachelor’s degree 29%
Virginia Employment Commission, Virginia Economic Development Partnership

The new Midtown Tunnel

Precision is key when it comes to towing  16,000-ton concrete elements down the Chesapeake Bay be­­fore submerging them below the bottom of the Elizabeth River to create the new U.S. 58 Midtown Tunnel. 

It will take 11 of these elements — each the size of a football field — to construct the centerpiece of the state’s most complex public-private transportation project to date. Still more than a year from completion, the long-awaited expansion of the tunnel — which links the cities of Portsmouth and Norfolk — already has won national acclaim because of the scope of its engineering challenges. Yet its biggest beneficiaries will probably be Hampton Roads’ motorists who have endured decades of hair-raising congestion on what is the most heavily traveled, two-lane road east of the Mississippi. During the work week, nearly 40,000 vehicles a day travel through the narrow, 23-foot tunnel.

A dry dock at Sparrow’s Point, Md., near Baltimore is the construction site for the reinforced concrete elements. The work is being done in Maryland, because no dry dock in Hampton Roads large enough to meet the construction schedule was available. That means each element, which measures 29-feet-tall by 54-feet-wide and 342-feet-long, must be individually floated 220 miles to its new underwater home. Then a special barge submerges each piece into a trench as deep as 95 feet below the river bottom — a delicate process that takes 12 hours. A hydraulic arm connects the element to an adjacent tube, forming a watertight seal. So far, six of the elements have been put in place. The final five are expected to be immersed by September. By October, construction workers should be able to walk from one end of the nearly mile-long tunnel to the other.

Scheduled to open in December 2016, the new Midtown Tunnel is the  largest component of the $2.1 billion Elizabeth River Tunnels project. The state formed a public-private partnership with Elizabeth River Crossings (ERC) to build the tunnel, as well as rehab the existing Midtown Tunnel and the two tubes of the Downtown Tunnel. The overall project will improve and form an efficient network between the two tunnels.

The Virginia Department of Transportation owns and oversees the project, while ERC operates and maintains the infrastructure until 2070. A joint venture between Skanska Infrastructure Development, a global construction firm with offices in Virginia, and the New York-based firm of  Macquarie Group and Real Assets, ERC was formed to design, build, maintain and operate the 51 highway miles of infrastructure.

The new Midtown Tunnel is Virginia’s largest road building project in 20 years and represents one of the most extensive public-private partnerships in the nation. The new tunnel and connecting highway extension are expected to cost $1.47 billion, with operations and maintenance totaling $2.2 billion over the life of the project. Funding sources include $675 million in private activity bonds, a $463 million Federal Highway Administration loan, $272 million in private equity, and $169 million in project revenue during construction. The state also kicked in $391 million initially to reduce the cost of the tolls and later made another contribution of $113 million to defer the commencement of tolls, which began on Feb. 1, 2014. In January of that year, Virginia’s Commonwealth Transportation Board approved another $82.5 million over three years to further reduce the tolls amid much controversy about making motorists pay while the project was still under construction.   

Some public officials expect the im­­proved transportation network to unleash an economic bonanza in a region frequently passed over for corporate headquarters in part because of highway congestion. According to figures from ERC, the project is expected to generate a $170 million to $254 million annual increase in Hampton Roads’ gross regional product. The thinking goes that improved connectivity between cities would lead to greater military readiness and additional access for trucks traveling to and from the Port of Hampton Roads. Plus, officials expect a reduction by 30 minutes in daily commute times for motorists who can expect to save $66.3 million in annual fuel costs since the tunnel will be less congested.

So far, work on the tunnel is ahead of schedule. That’s good news for Greg Woodsmall, ERC’s chief executive officer, and Dallas Marlow, the project’s construction director. These men have labored over the details of construction, especially when it comes to submerging the new tunnel. “It’s a tremendous amount of engineering technology that requires tremendous job planning,” Marlow says. “You only have a one-inch tolerance between each element to get them in place. We can’t risk being wrong.”

Designed to withstand the weight of a Nimitz-class aircraft carrier, the new tunnel is only the second in the nation composed entirely of concrete, instead of a traditional steel-shell. The concrete makes the structure easier to seal and less likely to develop leaks. “We ran over 100 test batches of concrete for the tunnel tubes to ensure that they would meet the specifications and workability requirements,” Marlow says.

Built to last 120 years, the tunnel includes jet fans, a deluge system, fire sensors, motorist aid phones, video monitoring and a separate escape corridor.

At mid river, the bottom of the element reaches 95 feet below the surface of the river’s bottom, while the road deck is 90 feet below, and the top of the tube sits at 65 feet below the river’s bottom. This positioning protects the tunnel and prevents it from interfering with ship traffic.

In addition, the tunnel boasts a 10-foot-high drainage system. It’s designed to prevent flooding and protect one of the region’s major routes for hurricane evacuation. “We almost lost the Midtown Tunnel during Hurricane Sandy,” Marlow says.  “The drainage system backs up at an elevation of 6½ feet. The water got up to seven feet. Water was rushing in, and we were frantically pumping it out. Luckily the river backed off at the last minute.”

Such enhancements are one reason Roads & Bridges magazine recently named the project the No. 1 Road Project in North America for 2014. The trade publication, which honors the top 10 projects for successful navigation of challenges, the scope of the work and regional impact, cited ERC not only for constructing a new tunnel, but also taking on the rehabilitation of the existing tunnels and extending the Martin Luther King Freeway Extension with minimal disruption to traffic.

Boosting safety in the tunnels was a major impetus for the long-delayed project, ranked by the Hampton Roads Transportation Planning Organization as the region’s top priority. The overhaul gives the Downtown Tunnel a repaved road bed and new lights, ventilation and traffic control systems. “The new lights are 10 times brighter,” Woodsmall notes, adding that incidences in the westbound tube have dropped dramatically with the improved lighting. ERC will begin rehabbing the existing Midtown Tunnel once the new tunnel is opened. That work will repair leaks and tiles and bring the installation of a new ventilation system. Rehabbing all three tunnels carries a price tag of nearly $120 million.   

“When that’s done, it will look very much like the westbound Downtown Tunnel,” Woodsmall says, referring to the soon-to-be rehabilitated tunnel. The project will eliminate the harrowing bi-directional traffic that motorists have put up with for years, since the new tunnel will carry westbound traffic from Norfolk to Portsmouth while eastbound traffic will use the old tunnel.

Along with improving transportation, the expansion has added to the region’s employment rolls. About 1,700 jobs have been created. Currently, between 700 and 725 people work locally on the tunnels project. They include more than 500 employed by SKW, the joint venture of Skanska, Kiewit and Weeks Marine that’s serving as the project’s design-build contractor.  Also onboard are 120 ERC employees, 20 to 35 subcontractors and 75 ERC Customer Service Center employees. The remaining 1,000 jobs are positions within the community, industry and suppliers. SKW has subcontracted more than $311 million locally, while ERC has spent nearly $15 million locally to operate and maintain the infrastructures.

Then there’s the intrinsic value of the project’s on-the-job training program for about 70 carpenters, laborers, electricians, ironworkers and other craft workers. “When this project is over, the region will have a huge trained workforce for any future projects,” Marlow says.

Despite the good news, the project has not been without controversy. ERC officials hope motorists will focus on new jobs and shorter, safer commutes instead of tolls and tunnel closures. While there’s no dispute that an overhaul of the 52-year-old tunnel is long overdue, many motorists decried the tolls placed on the Midtown and Downtown tunnels in February 2014 before the project’s completion.

At that time, motorists with an E-ZPass paid $1 to drive through the tunnels during peak travel periods and seventy-five cents during off-peak times. Tolls went up 25 cents this January — to $1 and $1.25 — and will go up another 25 cents in 2016.  Yet, it could have been worse. Until the state stepped in, the tolls were supposed to be $1.59 per trip for cars during off peak hours and $1.84 for peak drive-time hours (from 5:30 to 9 a.m. and from 2:30 to 7 p.m). These were the rates with an E-ZPass. They were higher if drivers opted for another payment method.  

Compounding motorists’ frustration has been the regular nightly and weekend closures of the downtown tubes. Portsmouth business and political leaders have been especially incensed, fearing that the tolls could cause drivers from Norfolk and beyond to avoid the city. 

“None of us, if we had our druthers, wants tolls anywhere,” says Portsmouth Economic Development Director Charles Rigney. “But we need to make transportation enhancements in the region to do a better job of linking communities together, and they do cost money.” Rigney adds that while some drivers may have shied away from using the tunnels when the tolls were first imposed, many have determined that taking alternative routes is just as costly in fuel or additional travel time.

Instead, Rigney says businesses have been more affected by weekend closures of the Downtown Tunnel’s eastbound tube. “It needs to be clearly understood when the tunnels are open and closed. If you miss that message and come to Portsmouth, you need to understand how to get to a secondary route.”

Olde Towne Business Association members in Portsmouth had tried to persuade ERC and VDOT to make one tube bi-directional during the weekend closures. “They said it couldn’t be done, that it was unsafe,” says Tony Goodwin, the association’s president. “But the things were designed to travel two-way traffic per tunnel.”

Combine periodic closures with the tolls, and frustration ensues for businesses and motorists. “Tolls only grease the skids to toll more facilities in the region,” Goodwin adds. “Eventually, people’s personal budgets won’t be able to justify paying tolls.”

On the flip side, Goodwin believes that as tolls increase, people living on the Norfolk side of the tunnels but working in Portsmouth will reconsider housing arrangements. “I can guarantee it will make people think twice about living in Virginia Beach and driving to and from work on the Portsmouth side. They’ll say why spend an extra $600 a year just to get to work.”

Goodwin says that situation will benefit new apartment complexes springing up in Portsmouth and northern Suffolk. “We’ve needed market-rate apartments for decades,” he adds. “We can obviously use this as a way to bank those apartments.”

Motorists hoped they had seen the last of the tolls on the Elizabeth River Tunnels when 25-cent fees were removed in 1986, 34 years after the Downtown Tunnel opened. Goodwin thinks it was a mistake to jettison tolls. “What the quarter toll could have done from 1986 to this point — we probably could have had another tunnel around 2000,” he says. “Now we’re playing catch up.”

Calling VDOT’s contract with ERC, which sanctioned tolls, the “worst deal I’ve ever seen,” Gov. Terry McAuliffe stepped into the fray shortly after taking office last year. He authorized the state to pay ERC $82.5 million to lower the tolls. Still, the tolls, along with annual increases, are destined to remain in effect until ERC hands operations over to VDOT in 2070. ERC’s contract with VDOT allows for annual toll hikes of 3.5 percent after year 2017 or the rate of the Consumer Price Index, whichever is higher, meaning that motorists could pay $21 to cross the Elizabeth River by 2070.

ERC has shouldered much of the criticism for the tolls, both for the amount and collection methods. Woodsmall, however, disputes the notion that ERC is lining its pockets with toll revenues. “Tolling is the funding source,” he says. “Without tolling, this project would not have been built. If we waited until the end of construction to put tolls on it, the toll would have been over $2.”

Depending on traffic, expenses and toll collection, ERC stands to accrue a 13 percent return on its $272 million equity contribution to the project.  “That doesn’t occur until 2021 at the earliest,” Woodsmall notes. Meanwhile, the company must fund its operations, including maintaining the tunnel infrastructures. “The public doesn’t understand why we have to raise tolls, but going forward, it’s tolling that pays the debt and the operation and maintenance costs.”

Hampton Roads motorists likely will find it hard to escape tolls as the state tackles substantial highway projects throughout the region. They include the construction of a new eight-lane, high rise bridge in Chesapeake. “Those are very expensive projects,” says Virginia Transportation Secretary Aubrey Layne. “All are in the billions of dollars, and it will be a long time unless additional revenue sources are considered. That’s something we have to come to grips with.”

Nonetheless, Layne believes that pre-tolls should be taken off the table. “That’s a bad policy,” he says. “Motorists in Hampton Roads are paying for a facility that’s not expanded. Never again should we see pre-tolling of facilities.” Layne adds that motorists should always have the option to use either the tolled lane or a “free” lane, similar to those found in Northern Virginia. “If you want to pay, you join the HOT (high occupancy toll)  lanes. If you don’t want to pay, you stay in the free lanes.”

Aside from tolls, the public-private partnership added another wrinkle to the public’s perception of the funding process, Woodsmall says. “It’s a new mechanism to this region, and there have been a number of challenges with all the entities to understand their role and responsibilities. But, I think we’ve finally overcome those challenges.”

Layne believes public-private partnerships are a viable procurement method, although he adds that the state should have initially invested more money in the tunnels project. “We’ve already done that in buying tolls down. It would have been much better to put the money in upfront and kept the tolls lower.”

Del. Chris Jones (R-Suffolk) agrees that tolls would have been much lower if the state had invested additional funding before the project got underway. Addressing the unpopular toll structure and the derailed project to build a new, tolled 55-mile leg of U.S.  Route 460, Jones sponsored a bill during the recent legislative session that establishes new oversight and accountability for public-private partnerships in transportation projects. An advisory committee would review highway deals and determine if they serve the public interest, while VDOT would be required to identify high-risk projects and mitigate risks before significant funds are dispersed. “If this law had been in effect, the general terms of the tunnel toll agreement would have been released to the public before it was signed and certified to be in the public’s best interest,” Jones says. “Those terms of agreement should never have been signed. At the end of the day, they did a disservice to the region with those terms and conditions.”

Still, Jones believes the project will be a plus for the region. “The new tunnel will double capacity at the Midtown Tunnel,” he notes. “This is certainly going to be significant at peak traffic hours.”

In the end, ERC hopes that will be enough to dissolve any lingering animosity motorists have toward tolls and closures. “Our message is Elizabeth River Crossings is here to deliver,” Woodsmall says. “We’re doing our best to deliver and live up to the expectations of the project.”