Allianz Partners will be the naming sponsor for Richmond’s forthcoming 7,500-capacity, $30 million outdoor amphitheater, the global insurer announced Tuesday.
The Allianz Amphitheater at Riverfront, a project led by Charlottesville’s Red Light Ventures and Live Nation, is expected to open next year in time for the summer concert season, according to the announcement. The amphitheater is the first new major concert venue in Richmond in decades, and is set on four acres near the banks of the James River, near CoStar’s Richmond campus and Tredegar.
“We are thrilled to be a part of bringing this exciting new entertainment venue to the Richmond community,” Jeff Wright, CEO of Richmond-based Allianz Partners USA, said in a statement. “Our leadership team, along with the hundreds of our associates who live and work in Central Virginia, eagerly anticipate opening night and many future summers filled with incredible music against the backdrop of our beautiful city.” Financial terms of the deal were not disclosed.
The amphitheater’s expected to host 30 shows a season and generate $30.6 million in economic impact annually, as well as creating 300 jobs, according to the announcement. Red Light Management, founded by Coran Capshaw, represents dozens of major music artists, including Dave Matthews Band, Chris Stapleton, Sabrina Carpenter and others.
Capshaw also developed the Ting Pavilion on Charlottesville’s Downtown Mall and owns the Jefferson Theater, also in Charlottesville. He founded Starr Hill Presents and Musictoday, which concert promoter Live Nation purchased in 2006, but Capshaw reacquired the entertainment marketing company in 2017 after a later purchaser went bankrupt.
“We’re excited to have Allianz Partners join us as we bring a new destination for live music to downtown Richmond,” Capshaw said in a statement.
A Fairfax County-based stone products manufacturer and distributor, Marble Systems, will invest $9.7 million on a warehouse and distribution center in Caroline County, creating an estimated 59 jobs, Gov. Glenn Youngkin announced Friday.
Virginia competed with South Carolina, New Jersey and Georgia for the project, which will also include cut stone and stone product manufacturing facilities, according to the governor’s office.
In a statement, Marble Systems CEO Munir Turunc said, “By investing in our home state of Virginia, we have achieved an outstanding geographic position that bolsters our ability to serve our distribution and dealer networks and gives us ready access to the Virginia ports and the I-95 corridor. And importantly, we will have access to great employee talent for both immediate and future hiring needs.”
Headquartered in Fairfax, Marble Systems was founded in 1982 and has presences across the country, from Florida to California, as well as a tile outlet in Chantilly. It also has offices in Turkey and Germany, and three factories in western Turkey.
“Marble Systems’ decision to expand in Caroline County underscores Virginia’s commitment to fostering homegrown businesses,” Youngkin said in a statement. “This $9.7 million investment is a win for Virginia’s construction and design industries, and cements the commonwealth’s unparalleled reputation as a hub for high-quality stone product manufacturing.”
Marble Systems will receive consultation and funding for employee recruitment and training through the Virginia Jobs Investment Program, a state-funded initiative. The Virginia Economic Development Partnership worked with Caroline County and the Fredericksburg Regional Alliance to secure the project for Virginia, and the company is also eligible for benefits from the Port of Virginia Economic and Infrastructure Development Zone Grant Program.
Currie Medical, a medical device manufacturer, plans to invest $1.22 million to expand its operations in Norfolk, creating an estimated 60 jobs, the governor’s office announced Friday.
Based in Franklin, Tennessee, Currie Medical will lease a 30,000-square-foot building at 3701 E. Virginia Beach Blvd. in Norfolk, where it will house its medical device reprocessing operation and distribution center. Currie has 15 employees in Norfolk and employs about 45 people total between Virginia and Tennessee, according to co-owner Carter Smith. The new facility is expected to be in full operation and fully staffed in the first quarter of 2025, he added.
“Currie Medical is excited to expand our operations into the vibrant business community of Norfolk,” Smith and co-owner Owen Griffin said in a statement. “This region offers us a skilled workforce, strong infrastructure and a supportive environment that fosters growth and innovation in the medical technology sector. With this investment, we are committed to bringing new job opportunities to the area and continuing to develop new solutions in medical device reprocessing. We look forward to contributing to the advancement of health care with our growing Norfolk-based team.”
The Virginia Economic Development Partnership worked with the City of Norfolk and the Hampton Roads Economic Development Alliance to secure the project, and the Virginia Jobs Investment Program will assist Currie Medical with consultation and funding for recruitment and training activities. The company is also eligible for state benefits through the Port of Virginia Economic and Infrastructure Development Zone Grant Program.
“Currie Medical’s expansion in Norfolk highlights Virginia’s growing prowess in specialized manufacturing,” Gov. Glenn Youngkin said in a statement. “This project not only adds to our skilled workforce but also strengthens our reputation as a hub for innovative medical technology solutions. We are proud to have them in the commonwealth for years to come.”
Gerald “Jerry” Yagen, founder of the Aviation Institute of Maintenance and Centura College, has made a $100 million gift to Virginia Beach’s Military Aviation Museum, including his private collection of 70 vintage military aircraft, the museum announced last week.
In the 1990s, Yagen began collecting aircraft from the first 50 years of aviation history, from the Wright Brothers’ flight in 1903 to the Korean War in the early 1950s, planes that were originally stored in hangars in Suffolk. In 2008, he opened the Military Aviation Museum in Virginia Beach, allowing the public to see the collection. Yagen’s gift includes the 130 acres where the museum sits, an airfield at 1341 Princess Anne Road, and $30 million to start an endowment for the museum. The gift was announced Oct. 5 at the museum’s annual Warbirds Over the Beach air show.
Gov. Glenn Youngkin thanked Yagen, his wife, Elaine, and their family for the gift in a statement. “It’s due to great Virginians like the Yagens that our commonwealth is the best place to live, work and raise your family.”
The museum, which now has about 250 volunteers, is run by Keegan Chetwynd, the museum’s director and CEO, who has shepherded it from a private collection to an independent nonprofit. About 85,000 visitors come to the museum annually, according to the announcement. Many of the aircraft are still flyable, and on Thursday, a World War II-era plane from the collection carried a load of baby formula, diapers and other necessities to western North Carolina to assist victims of Hurricane Helene, in partnership with the Virginia Beach Fire Department.
“In the beginning, I saw this as my personal challenge to preserve history and these beautiful warbirds,” Yagen said in a statement. “I just didn’t want to see them disappear to time. I never believed so many would volunteer so much to help Elaine and I do this. I realize it is no longer an individual challenge.”
Siemens Energy pleaded guilty and agreed to pay $104 million this week to settle a federal criminal investigation into stealing trade secrets in order to undercut competitors’ bids in 2019 to build a Dominion Energy gas turbine “peaker” power plant in the Richmond metropolitan area.
The settlement comes after three former Siemens employees and a former Dominion employee pleaded guilty to various charges, including conspiracy to convert trade secrets and conspiracy to commit wire fraud, as part of a scheme to help Siemens prevail over two competitors — General Electric and Mitsubishi Heavy Industries Ltd. — in winning the contract to build the plant, a deal valued upwards of $500 million. Peaker plants are backup facilities that provide extra electricity when there is a high grid load.
Siemens Energy is scheduled to be sentenced on Dec. 5. Along with the financial penalty, the U.S.-based subsidiary of German global manufacturing conglomerate Siemens Energy AG has agreed to a three-year term of organizational probation, according to a U.S. Department of Justice announcement released Monday.
“Corporate accountability remains a top priority for the Department of Justice,” Jessica D. Aber, U.S. attorney for the Eastern District of Virginia, said in a statement. “The actions of these defendants undermined the integrity of the competitive marketplace, harming both competitors and consumers. The department has established whistleblower programs to encourage corporations and individuals to come forward with timely information regarding misconduct and criminal behavior. Failing to do so invites prosecution and serious consequences.”
Siemens Energy issued the following statement: “The agreement between Siemens Energy Inc. (SEI) and the U.S. Department of Justice (DOJ) conclusively resolves a matter related to the misconduct of former employees which took place more than five years ago. The company proactively discovered the conduct in 2020 and voluntarily disclosed it to its customer and two affected competitors whose claims it subsequently settled.
“SEI also investigated the matter extensively with the assistance of a prominent law firm and has cooperated fully with the U.S. government investigation. It took disciplinary action against several individuals, including separation, and has further enhanced the company’s already-strong compliance program.
“SEI is committed to the highest standards of integrity and compliance and the aberrant conduct that occurred in this case does not reflect who we are as a company.”
According to the DOJ, GE and Mitsubishi submitted closed bids for the project to Dominion in May 2019, and a Siemens account manager, Michael P. Hillen, “coordinated with a Dominion insider,” Theodore S. “Ted” Fasca, then director of generation system planning, “who used his sensitive position to improperly obtain GE and MHI confidential information.”
Using private and work email accounts, Hillen “then disseminated the confidential information to Siemens Account Manager Mehran Sharifi, who analyzed the confidential bid information with other employees. Realizing that Siemens had a less competitive bid than GE by some metrics, Sharifi recommended to Siemens Executive Vice President and Head of Sales for North America John Gibson that Siemens resubmit a lowered bid to undercut GE’s bid price.”
Gibson passed along the other companies’ bid details to other Siemens senior executives, the DOJ said, and submitted a lower bid for the Dominion project, “undercutting GE’s bid” and winning the Dominion project. “Even after submitting the lowered bid, Siemens continued misappropriating GE and MHI confidential information on numerous occasions throughout June 2019,” according to the DOJ. Dominion was not accused of wrongdoing.
Gibson and Sharifi both pleaded guilty to conspiracy to convert trade secrets, with Gibson receiving a sentence of three years and seven months in prison. Sharifi faces a maximum sentence of 10 years in prison when he is sentenced Oct. 11. Hillen and Fasca both pleaded guilty to conspiracy to commit wire fraud and were sentenced to three years and one month in prison.
“The FBI will work to hold those accountable who steal confidential information to obtain a competitive advantage, whether they be agents, employees, executives, or corporations themselves,” said Stanley M. Meador, special agent in charge of the FBI’s Richmond Field Office. “We will rigorously investigate those who criminally conspire to defraud companies for their personal gain.”
The natural gas plant was canceled in 2020, but Dominion has plans to build a similar combustion turbine plant in Chesterfield County. Known as the Chesterfield Energy Reliability Center, the gas plant would be on the retired Chesterfield Power Station site northwest of Dutch Gap Conservation Center, Dominion announced in September, with General Electric having won the bid to manufacture its turbines.
The plant was intended to be built elsewhere in Chesterfield, but some residents opposed the project and fought county rezoning to allow the new plant to be built at the James River Industrial Park. In the new location, the plant is allowed at the former power station site under a 2010 conditional use permit, Chesterfield officials have said.
About 45,000 International Longshoremen’s Association (ILA) workers walked off the job midnight Tuesday at the Port of Virginia and every other major port along the East and Gulf coasts, launching the ILA’s first U.S. port strike in 47 years. Dockworkers hit the picket lines after the union reached an impasse in contract negotiations with the United States Maritime Alliance (USMX), which represents shipping employers such as Maersk’s APM Terminals.
The port strike is the largest such action since 1977 and, depending on its length, it could cause massive disruptions to the nation’s supply chain and negatively affect the U.S. economy. Outside of Virginia, other affected ports include: Baltimore; Boston; Brunswick, Georgia; Charleston, South Carolina; Houston; Mobile, Alabama; New Orleans; New York/New Jersey; Philadelphia, Savannah, Georgia; Tampa, Florida; and Wilmington, North Carolina.
Here in Virginia, the immediate impact was felt at the Port of Virginia’s marine terminals in Hampton Roads, where no cargo is moving in or out of the port during the walkout.
According to the port, there are no cargo operations taking place at Norfolk International Terminals, Virginia International Gateway or Newport News Marine Terminal, which are currently closed. However, employees of the Virginia Port Authority and at its operating company, Virginia International Terminals, are still at work.
“Richmond Marine Terminal (RMT) and Virginia Inland Port (VIP) are operating per normal, but cargo operations there will be affected by what is happening locally. Portsmouth Marine Terminal (PMT) is operating per normal,” the port said on its website Tuesday.
“The International Longshoremen’s Union and United States Maritime Alliance must reach a fair and equitable deal as soon as possible to ensure operations can continue at the Port of Virginia and other port facilities along the East and Gulf Coasts,” U.S. Sens. Mark Warner and Tim Kaine and U.S. Rep. Bobby Scott said in a statement Tuesday. “We urge both sides to work in good faith towards a new contract, and we’ll continue to monitor this situation as it develops.”
In a letter obtained by Virginia Business that was sent last week to President Joe Biden and Vice President Kamala Harris, Virginia Gov. Glenn Youngkin had urged the Biden administration to “take all actions under your authority to bring the U.S. Maritime Alliance and the International Longshoremen’s Association to the table to reach an agreement and avert a coastwide strike.”
Youngkin issued a statement Tuesday: “Every day this strike of port workers along the East and Gulf coasts continues, the economic impacts intensify, affecting livelihoods, supply chains and prices. The economic fallout from the work stoppage at the Port of Virginia extends well beyond the commonwealth, as the port manages approximately $66 billion in essential imports, with nearly 60% destined for locations outside of Virginia. As a cornerstone of Virginia’s economy, the port supports 10% of the gross state product and supports employment for over half a million jobs in Virginia.”
The ILA and the USMX have been negotiating a new master contract to cover East Coast and Gulf Coast union workers. In Virginia, the Hampton Roads Shipping Association represents employers, while ILA Locals 970, 1248, 1624 and 1970 represent unionized workers at the Port of Virginia.
At Virginia International Gateway, Norfolk International Terminals and the Newport News Marine Terminal, picketers carried strike signs Tuesday morning and said they plan to be present 24 hours a day until the strike comes to an end.
“People say we make a lot of money, but the work we do is very dangerous,” said picketer Derrick Perry, a 19-year Port of Virginia worker and a union spokesman for ILA Local 1970, which provides maintenance and repairs at the port. “We worked during COVID to keep the country running, and a lot of our fellow workers got COVID and died. At this point, we just want to be compensated. We are out here in solidarity. This is not something we want to do, but we have to because it affects so many people.”
Virginia impact
“The Port of Virginia is one of the three pillars of the Hampton Roads economy,” Old Dominion University economics professor Vinod Agarwal said Tuesday. “If something adverse happens to the port, Hampton Roads and the commonwealth will be affected.”
The strike’s impact will increase the longer it lasts, added Agarwal, who is also deputy director of ODU’s Dragas Center for Economic Analysis and Policy. “About two-thirds of [all] cargo through Port of Virginia goes by train. Rail lines will also be impacted within a month or two. That’s when things get to be interesting, and you’ll see much more widespread impacts.”
Many businesses and workers will be affected if the strike lasts more than a week or two, and consumers will start to see empty shelves after about three months, Agarwal noted. And while many retailers purchased additional supplies in anticipation of the strike, especially with the holiday shopping season on the horizon, shortages could still occur depending on the length of the strike, he added.
Virginia exporters — including agricultural producers — also will be affected. Overseas shippers are likely to reroute shipments to West Coast ports, which are not impacted by the strike, and from there, shipments will come to the East Coast by train. “Obviously, that causes an increase in time and adds to the cost of shipments,” Agarwal said, and that could have long-term implications if shippers get used to sending their products to the West Coast and continue to do so after the strike ends.
Also impacted will be Virginia companies that import components from abroad that are assembled stateside; an example, Agarwal said, is power tools manufacturer Stihl, a German company with its U.S. headquarters and a major assembly plant in Virginia Beach. “If those companies don’t have enough supplies on hand to use in the production process, they will have to start laying off people.”
“Truckers will also be losers if the strike continues,” he added. “Their services will no longer be needed, and it will take some time to catch up with lost earnings.”
“I think everybody has anticipated it,” Virginia Trucking Association President and CEO P. Dale Bennett said Tuesday. “For the past two weeks, the prospects of getting it resolved have looked dimmer and dimmer as time went on. Truckers, their primary businesses serving the Port of Virginia, are definitely going to be impacted. They’re looking to try to do other things, haul other kinds of freight that isn’t impacted by the [strike]. That equipment sitting idle isn’t making the revenue they need to make truck payments and pay employees and take care of other expenses that don’t go away because the freight’s not there.”
For the general public, “there’s a significant amount of goods that we use that come through the ports up down the East Coast and from the Gulf Coast, and that’s all come to a standstill,” Bennett added. “It’s estimated for every day there’s a work stoppage at these ports, it will take five to seven days to recover, so do the math.”
The Port of Virginia was busy last weekend, staying open extra hours to accommodate trucks seeking to pick up containers before the strike started, according to officials with Mount Crawford’s Interchange Group, a third-party logistics company with more than 3 million square feet of warehouse space and a fleet of 90 trucks. David Bosserman, Interchange’s transportation general manager, said his company was able to get about 45 containers out of the port last weekend. Customers started calling last week, expressing concerns about getting products from the Port of Virginia’s Hampton Roads terminals, he said Tuesday.
Chris Thompson, Interchange’s vice president of business development, said that if the strike lasts a while, Interchange may pivot to other domestic trucking work not tied to the ports, including domestic shipping work on the spot market. A spot rate or spot quote is a one-time fee that a shipper pays to move a load or shipment at current freight market pricing.
“Short term, we can probably overcome a little bit of the … stoppage, but the longer this goes, the more of an impact this is going to have,” Bosserman said. “After that, we’re going to have to find alternative work.” Thompson says Interchange hopes to avoid layoffs, though.
Stihl Inc. President and CEO Chris Keffer called the Port of Virginia “crucial” to its success, “enabling us to export chainsaws and power tools from our Virginia-based manufacturing facility to over 80 countries. While we hope for a swift and mutually beneficial resolution, it’s important to note that Stihl has diversified its supplier base in recent years to mitigate the effects of short-term supply chain disruptions. We remain well-positioned with strong inventory levels both domestically and internationally to support our customers.”
Keffer said Tuesday that Stihl is making “minor adjustments to our import/export plans and closely monitoring the situation,” and that “there is no immediate impact to workers because of the strike.”
Ricardo Ungo, an assistant professor in ODU’s Department of Information Technology and Decision Sciences who specializes in supply chain research, said that consumers may start purchasing more supplies like toilet paper and paper towels than usual because of the strike — which in turn will lead to a faster decline in inventory. But so far, most Americans haven’t seen any direct impacts from the strike.
“When we talk about imports into the U.S., about 60% come by water to seaports on East and Gulf coasts,” Ungo said. “Out of that, about 75% to 80% are containers. Imports will simply get delayed. There will be costs associated with the original cost of storing items in a different part of the supply chain. It’s not that imports will disappear, but there will be delays and additional costs.”
International Longshoremen’s Association workers picket at the Port of Virginia’s terminals on Oct. 1, 2024. Photo by Mark Rhodes
A more immediate impact, Bennett noted, is due to damage from Hurricane Helene across Southwest Virginia, western North Carolina, eastern Tennessee and nearby regions. Road closures have impacted truckers, creating “a big unknown — trying to deal with the impacts of the hurricane. [The strike is] certainly going to have a detrimental impact on getting what those folks need to have. Hopefully it won’t delay their path to recovery.”
If the strike goes on very long, he added, “This is going to have a significant impact and certainly disrupt the supply chain, and that’s going to hurt. It’s going to hurt folks. We have signed onto a letter calling on the White House to do everything they can to bring the parties together and get this worked out. … There’s not a lot Congress can do about it. It’s strictly in the hands of the two parties involved under negotiations and the White House under the Taft-Hartley Act.”
Also known as the Labor Management Relations Act, the 1947 law limits unions from conducting certain kinds of actions, prohibiting jurisdictional and wildcat strikes, solidarity strikes and secondary boycotts, as well as letting the president intervene in labor disputes by calling an 80-day cooling-off period. However, Biden said Sunday that he doesn’t intend to intervene in the port strike.
Youngkin’s statement Tuesday called for Biden to take action. “The time for leadership is now, President Biden has the tools to remedy this situation for the Commonwealth of Virginia and the nation, including utilizing provisions of the Taft-Hartley Act. The well-being of Virginia and American workers, as well as the health of our economy, depends on a swift resolution to this strike. A failure to lead will only drive up prices, disrupt trade and exacerbate the challenges already faced by Virginians and Americans.”
In his letter last week to Biden and Harris, Youngkin faulted the White House for reports that “no substantive meetings have happened ” between U.S. officials, USMX and the union since June, adding that “such inaction has jeopardized the economic security and well-being of America.”
In addition to the national impact on supply chains for consumer goods, pharmaceuticals, manufacturing and agriculture, “Virginia’s largest industries, agriculture and forestry, would be severely impacted” by the port strike, Youngkin wrote. “The Port of Virginia supports 10% of gross state product [and] 11% of total employment, including 2,600 longshoremen employed at the Port and approximately an equal number of truck operators.
“In Virginia, employers and local ILA management have a productive relationship,” the governor added. “The Hampton Roads Shipping Association and the local ILA finished their negotiation in June. However, as you know, the national ‘master contract’ must be agreed and ratified before the ILA local members in the commonwealth can act.”
Rachel Shames, vice president of pricing and procurement for Norfolk-based logistics and trade compliance company CV International, said Tuesday she’s also watching to see how long the strike will last. “There are some that firmly believe that this will be two to three days, and they’ll come to an agreement and things will start moving again. There will be certainly a backlog … but if that were to happen … we’ll avoid the worst of potential disruption.”
However, if the strike extends into several weeks, “it will be much, much, much more disruptive,” Shames said, with costs increasing and being passed on to shippers and possibly consumers. “I think the question now is just … is this going to be over in a few days, and we can start digging out and moving forward, or is this going to last into the weeks, and impacts will be broader?”
French shipping giant CMA CGM’s America operation, based in Norfolk, wrote to customers Tuesday that it implemented contingency plans ahead of the strike, noting: “For all cargo received on or after Oct. 11, a Local Port Charge (LPC) will apply as per the governing tariff(s). Cargo received on or after Oct. 11 will not be subject to additional operational costs.”
National impasse
“Even though the ILA’s members worked tirelessly during the pandemic to ensure that the nation’s commerce flowed and continue to sacrifice time with their own families so that goods can arrive in the homes of other families throughout the world, still, due to corporate greed, employers refuse to compensate the ILA’s members fairly,” the union said in a statement released last week.
“Over the last several years, the net revenues of these companies have grown astronomically from hundreds of millions to billions of dollars while ILA members’ wage increases do not even cover the cost of inflation. The ILA is fighting for respect, appreciation and fairness in a world in which corporations are dead set on replacing hardworking people with automation. Employers push automation under the guise of safety, but it is really about cutting labor costs to increase their already exceptionally high profits. As the last six years have demonstrated, automation cannot outperform the skilled men and women of the ILA. Automation of our nations’ ports should be a concern for everyone; the truth is, robots do not pay taxes, and they do not spend money in their communities. The ILA will continue to fight until its members receive the fair contract they deserve.”
In an update Monday night, the USMX wrote: “In the last 24 hours, the USMX and ILA have traded counter offers related to wages. The USMX increased our offer and has also requested an extension of the current master contract, now that both sides have moved off their previous positions. We are hopeful that this could allow us to fully resume collective bargaining around the other outstanding issues – in an effort to reach an agreement. Our offer would increase wages by nearly 50%, triple employer contributions to employee retirement plans, strengthen our health care options, and retain the current language around automation and semi-automation.”
However, the last-minute offers failed to prevent the strike.
“USMX brought on this strike when they decided to hold firm to foreign-owned ocean carriers earning billion-dollar profits at United States ports but not compensate the American ILA longshore workers who perform the labor that brings them their wealth,” said ILA President Harold Daggett, who leads the 85,000-member union.
“We are prepared to fight as long as necessary, to stay out on strike for whatever period of time it takes, to get the wages and protections against automation our ILA members deserve,” said Daggett.
Contributors to this story included Virginia Business Editor Richard Foster; freelance writer Beth Cooper; and NJBIZ, a BridgeTower Media publication.
Hampton Roads always has plenty going on, and in this issue of Hampton Roads Business, we’ll take you on a tour around the region to check in on some of the largest and most consequential projects that are under development.
In our main feature, “Latest and greatest,” freelance writer Jim Morrison will bring you up to date on major construction projects like Atlantic Park in Virginia Beach and upgrades to Norfolk’s Half Moone Cruise Terminal, as well as ambitious improvement plans for Norfolk International Airport, and the latest on redevelopment efforts around Military Circle and MacArthur Center malls in Norfolk and Fort Monroe in Hampton. We also are keeping up with several current infrastructure projects, led by the expansion of the Hampton Roads Bridge-Tunnel, where Mary the boring machine is in action. At the Chesapeake Bay Bridge-Tunnel, a second boring machine is back at work after hitting an old anchor last fall, requiring the removal of the anchor and repair of parts on the machine.
This year’s issue also reports the latest on offshore wind, from progress on the Coastal Virginia Offshore Wind project to LS GreenLink’s plan to build a $681 million subsea cable factory in Chesapeake, the first such U.S. plant to produce cables used for offshore wind farms. Plus, we have an update on Rivers Casino Portsmouth, which will celebrate two years in business in January 2025.
As usual, Hampton Roads Business devotes ample attention to residential and commercial real estate, higher education, workforce training and local Inc. 5000 businesses, as well as providing numerous charts and lists that can help newcomers and longtime residents.
We hope you’ll enjoy reading the 2024 Hampton Roads Business guide and will find something in here that may spark an idea or introduce you to a person who can help your business.
Sentara Health is cutting approximately 200 positions across its workforce, officials told employees this week. Most of the affected employees work for Sentara Health Plans and are based in Virginia, according to a statement issued Friday by the Hampton Roads-based health system.
The cuts are related to the Medicaid redetermination process and associated decline in membership, according to Sentara’s statement. “There has been a significant decline in Medicaid membership across the U.S. and Virginia,” the health system said. “For Sentara Health Plans, this has resulted in a loss of over 115,000 members, which is approximately 16% of our Medicaid membership, in the past year. These workforce adjustments align our staffing levels with our health plan membership.”
The other affected jobs are in the corporate shared services department that support Sentara’s health insurance operations. The final number of impacted positions has not yet been determined, and Sentara officials are working to find other posts within the 34,000-member workforce for affected employees. About 40% of all positions are leadership posts, and impacted employees are across 10 states, although the majority live in Virginia, according to Sentara.
“These individuals have been dedicated and mission-driven team members, and we are grateful for their passion and contributions to the organization and to the community,” Sentara Health President and CEO Dennis Matheis said in a communication to Sentara employees this week. Matheis became Sentara’s CEO in 2022, and he previously led Sentara’s health insurance plans business. In 2023, Sentara’s Optima Health and Virginia Premier insurance brands combined to create Sentara Health Plans, which provides health insurance coverage to more than 1 million customers in Virginia and Florida.
Affected Sentara employees received 60 days’ notification, in which time some may move to other roles in the health system. “Sentara is making every attempt to find them another role within Sentara, upskill for other in-house positions, or offer severance and resources for those who are unable to find a new position within the Sentara family or who choose to transition elsewhere,” the statement says.
Sentara has 12 hospitals in Virginia and North Carolina. Over the past three years, the health system has been embroiled in an ongoing federal civil investigation over accusations that Sentara inflated insurance rates to maximize profits. Sentara, however, counters that it was unfairly targeted and was trying to keep vulnerable Virginians from losing health care coverage by offering Affordable Care Act plans while other insurers dropped them.
Theodore “Ted” Colbert III is no longer president and CEO of Boeing Defense, Space & Security, the Arlington County aircraft and aerospace manufacturer reported in a Securities and Exchange Commission filing Friday evening, Sept. 20.
The announcement comes weeks after NASA decided it was unsafe to send two U.S. astronauts back from the International Space Station on the Boeing Starliner spacecraft, instead opting to send them to Earth in SpaceX’s craft in February 2025, eight months behind schedule.
Colbert, named head of Boeing’s space sector in 2022, “will be leaving Boeing, and … I’ve asked Steve Parker to temporarily oversee BDS, effective immediately, until a replacement for Ted is named at a later date,” according to Sept. 20 email from Boeing President and CEO Robert K. “Kelly” Ortberg to employees. Parker is chief operating officer of Boeing Defense, Space & Security.
“I want to thank Ted for his 15 years of service at The Boeing Company, supporting our customers, our people and our communities,” Ortberg wrote. “At this critical juncture, our priority is to restore the trust of our customers and meet the high standards they expect of us to enable their critical missions around the world. Working together we can and will improve our performance and ensure we deliver on our commitments.”
Colbert restructured the defense program, but Boeing is still years behind schedule on aircraft and tanker deliveries; his unit logged nearly $1 billion in losses in 2023 alone. In January, a Boeing official said that they plan to get the unit back to high single-digit margins by the 2025-26 timeframe.
Colbert’s departure is just the latest shakeup at the Fortune Global 500 company, which has been plagued by problems with its 737 Max planes, such as fatal crashes in 2018 and 2019 and a midair wall-panel blowout on a January commercial flight. A strike by 33,000 Boeing union machinists is entering its second week, as Boeing announced it would be furloughing thousands of employees across the nation and would be cutting pay for senior executives amid the strike.
In a Sept. 18 letter to Boeing employees, Ortberg emphasized that “all activities critical to our safety, quality, customer support and key certification programs will be prioritized and continue, including 787 production,” but announced temporary furloughs that would impact tens of thousands of Boeing workers nationwide. “We are planning for selected employees to take one week of furlough every four weeks on a rolling basis for the duration of the strike,” wrote Ortberg, who added, “Along with these steps, my leadership team and I will take a commensurate pay reduction for the duration of the strike.”
Ortberg’s predecessor, Dave Calhoun, stepped down in July after previously announcing his intention to leave following the blowout. Ortberg was previously president and CEO of Rockwell Collins.
A Delaware Bankruptcy Court judge on Monday approved the sale of 219 LL Flooring stores to an entity connected to F9 Group, which is owned by Lumber Liquidators founder and former CEO Thomas Sullivan. The court also OK’d the $104.75 million sale of the bankrupt flooring company’s eastern Henrico County distribution center to an entity connected to data center giant QTS Data Centers.
The transaction between Henrico-based LL Flooring, which filed for Chapter 11 bankruptcy in August, and purchaser LumLiQ2 and guarantor F9 Investments is expected to close by Sept. 30, according to court documents. The two parties reached a last-minute deal earlier in the month after LL Flooring — formerly known as Lumber Liquidators — announced it would be closing all of its 400-plus stores nationwide. Instead, 211 stores will close over the next few months, according to the company. In a court document filed Sept. 3, F9 offered LL Flooring $44.5 million in cash at closing and at least $22 million in assumed liabilities in a $66.5 million bid this summer, and the company also said it had paid a deposit of $4.1 million toward the total purchase.
SNA NE LLC, a limited liability corporation connected with QTS Data Centers, reached an agreement in September to purchase LL Flooring’s 995,792-square-foot distribution center on 97.55 acres in the White Oak Technology Park for $104.75 million. QTS owns much of the technology park property, as well as all 622 acres of White Oak Technology Park II. In a separate ruling, U.S. Bankruptcy Judge Brendan Shannon approved that deal too.
According to the Associated Press, Sullivan said that the stores purchased by F9 will be renamed Lumber Liquidators, and that the stores will align with Cabinets to Go, one of F9’s brands.
Sullivan founded Lumber Liquidators in 1994, and he departed in 2016, after a 2015 “60 Minutes” investigation into allegations that laminate flooring produced in China and sold by Lumber Liquidators in the United States had violated California Air Resources Board regulations and failed tests for maximum formaldehyde emissions, even after California authorities notified the company of the issue in 2013 and 2014. In 2019, the U.S. Department of Justice fined the company $33 million to settle allegations of securities fraud, which also included a $6 million payment to the U.S. Securities and Exchange Commission.
In 2020, Charles E. Tyson became the company’s president and CEO, and renamed the company LL Flooring in 2021. In 2022, the business opened 17 stores, but sales dropped the following year. Net sales in 2023 were down 18.5% from 2022, from $1.11 billion to $904.7 million. LL Flooring closed eight locations and opened three in 2023, and net losses last year amounted to $103.5 million, a large increase from a net loss of $12.1 million in 2022.
Last year, Sullivan purchased 9.4% of LL Flooring stock, and F9 attempted to purchase LL Flooring to merge with Cabinets to Go, but LL’s board rejected the deal. However, in July, Sullivan, F9 Brands President and CEO Jason Delves and Jill Witter, a Texas-based legal consultant for F9 Investments, were elected to LL Flooring’s board in a proxy war. The three resigned from the board as F9 and LL Flooring neared a deal on September’s acquisition agreement.
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