Please ensure Javascript is enabled for purposes of website accessibility
Upcoming Event

Best Places to Work in Virginia

Hamburger Menu Hamburger Menu

byline: Mason Adams

Slow and steady

Big economic development deals announced over the last two years are coming to fruition in the Roanoke and New River valleys, even as other companies are shutting down and scaling back.

Ardagh Group, a food packaging manufacturer; Korona S.A., a Polish candle maker; Red Sun Farms, a Mexican greenhouse tomato grower; and Falls Stamping & Welding Co., which provides metal stamping for the automobile industry, all have begun to hire and ramp up production.

Other employers are expanding their existing operations. Volvo Trucks North America is adding 200 jobs at its Pulaski County plant, and Altec Industries Inc., another truck-related company, is adding 203 in Botetourt County. Virginia Transformer Corp. is expanding its Roanoke facility to a new, 25-acre site in Botetourt, eventually creating 150 jobs.

Indeed, manufacturing has contributed the most to employment growth in the region during the past four years, according to Bureau of Labor Statistics figures provided by the Roanoke Regional Partnership. That employment sector is trailed by education and health, professional services and finance, in that order.

Health care remains the biggest economic driver in the Roanoke and the New River valleys. Carilion Clinic is Western Virginia’s largest employer, and another hospital chain, Hospital Corporation of America (HCA), which operates LewisGale Regional Health System, is a major employer as well.

Yet there have been setbacks. BB&T Corp. is closing its Roanoke call center, eliminating 140 jobs. Caterpillar Global Mining closed two regional facilities for a total of 285 jobs lost. Another 250 employees lost their jobs when Grede idled its foundry in Radford.

“The question is, are we still further ahead?” says Joyce Waugh, president and CEO of the Roanoke Regional Chamber of Commerce. “I believe firmly that we are, but it’s not been an easy rapid rise. It’s been slow and continuous with fits and starts.”

Recent job gains and losses have had a mixed effect on area unemployment rates. The Blacksburg area’s jobless rate was 6.2 percent in August, unchanged from July, while the rate was 6.1 percent in the Roanoke area in August, up from 5.6 percent the month before.

Seeking space
Dennis Cronk of commercial real estate group Poe & Cronk says that 2014 has been his firm’s best year for marketplace activity. He notes, however, that inventory has been shrinking. Industrial parks and prime commercial spaces have filled, leaving some companies bursting at the seams but unable to expand due to lack of capacity.

“The biggest problem is supply and demand,” Cronk says. “We have a very limited supply of industrial buildings and a limited supply of industrial land that is developable at a reasonable cost.”

One of the companies that has found space is Korona Candles. Agnieszka Fafara, the president and CEO, says the Polish company decided to build its factory in Pulaski for two reasons: It met geographical and climatic criteria for manufacturing and shipping its product, and its proximity to higher education. “Our production is pretty advanced, so we need skilled workers and engineers to be employed here,” she said.

Like Korona, Ardagh Group chose to locate a large manufacturing facility in the region because of geography. It needed a site that met a long list of criteria, including access to the ConAgra Foods plant in Newport, Tenn., one of its bigger clients. That contract also created the need for haste, which resulted in Ardagh’s decision to locate in the former Hanover Direct building in Roanoke County. Ardagh’s facility, which opens in November, will produce about 4.5 million cans per day and create 96 full-time jobs within two years.

Red Sun Farms, the first tenant of the New River Valley Commerce Park in Pulaski, began harvesting its first fruits this fall. Director of Operations Jay Abbott estimated its workers will harvest more than one million pounds of greenhouse tomatoes by January.

The NRV Commerce Park remains one of the few regional industrial parks with plenty of room to grow. The 1,000-acre property is planned for sites 75 acres or larger, with the anticipation of hosting up to five businesses of that size.
Brian Hamilton, Montgomery County economic development director, says the 175-acre Falling Branch Corporate Park has picked up a new building or two every year since 2011. Inorganic Ventures, a chemical company that moved to the park in 2008, expanded in 2012. That same year, BackCountry.com built there and now employs 180. In 2013, both Aeroprobe Corp., which makes instruments and software for cars, jets, wind turbines and other applications, and Polymer Solutions, a lab for polymer, materials and metals testing, moved in.

“We’ve got three remaining lots, the smallest being four acres and largest being 16,” Hamilton says. “There’s still some room, just not a lot.”

It’s the same story at Blacksburg Industrial Park, now in its fifth expansion to accommodate TORC Robotics, which, like Polymer Solutions, is growing out of Virginia Tech’s Corporate Research Center. That leaves three available sites before it reaches capacity. Christiansburg Industrial Park already is full.

That shrinking industrial space is driving regional cooperation and creativity. It’s why 13 localities banded together as a regional industrial facility authority to create the NRV Commerce Park. It’s also why six Roanoke Valley localities have formed the Western Virginia Industrial Regional Facility Authority to identify large potential economic development sites and allow for partnerships between local governments to split costs and share the benefits.

Reinventing the city
A steadily shrinking amount of property is also pushing governments and individual developers to think outside the box. Roanoke city worked first to reinvent its downtown and now is expanding it beyond its traditional confines.
The city partnered with Carilion Clinic and Virginia Tech to redevelop  large chunks of land near the Roanoke River. Parcels previously occupied by industrial development now house the Virginia Tech Carilion School of Medicine and Research Institute — which in May graduated its first 40 doctors — a Cambria Suites hotel and a mixed-use development known as The Bridges, which will mix parks, commercial business and apartments for an estimated build-out value of $150 million.

Aaron Ewert, project manager at The Bridges, says the first residents have already moved into the new apartment building. A Starbucks coffee shop and restaurant are moving into a historic lumber warehouse, and JDS Uniphase Corp., which develops software and instruments, is moving into a former trolley barn. Four more historic buildings are slated for commercial retail, and contractors are building a riverwalk, kayak launch and stage.

On the northern edge of downtown, private developers await the build-out of an interchange that will provide interstate access to the biggest parcel of undeveloped land in Roanoke, which sits across I-581 from Valley View — its most popular retail destination.

Closer to downtown’s heart, just a few blocks from the newly renovated Elmwood Park and its new amphitheater, developer Faisal Khan is finding ways to turn potentially difficult historic buildings into new apartments. In August he formally opened the former Crystal Tower building, renamed the Ponce de Leon, as a nod to its past as a hotel of the same name. The restored art deco building includes 90 apartments, 87 of which were leased as of mid-September.

Nearby, Khan is tackling an even bigger challenge with a former YMCA. The building has neither the ornate majesty of the Ponce de Leon nor the fashionable, exposed brick of warehouse-based projects, but instead was built with block concrete. It includes small, upper-floor dorm rooms and outdated athletic facilities that must be structurally preserved to obtain historic tax credits that make the financing work.

Khan hopes to take advantage of those potential challenges by making them a selling point. He’s turning the building into 56 apartments and 15,000 square feet of workout amenities, naming the development “the Locker Room” for its old lockers, which will be incorporated into living spaces, and marketing it all to an athletic demographic.

“Being creative in how we lay it out and being creative in keeping amenities gave the project an identity it may not have had,” Khan says.
That creativity, playing out at the individual, company and governmental levels, may well help the Roanoke and New River valleys continue to forge a regional economy that continues to reinvent itself, too.

Picking up speed

After decades of decline in manufacturing and years struggling to recover from the Great Recession, Southwest Virginia’s economic revival made big strides in 2013.

The Roanoke and New River Valley regions saw a year full of economic development announcements, and activity continued into the opening weeks of 2014.
“It was a wonderful, busy and successful year as far as economic development announcements go,” says Aric Bopp, executive director of the New River Valley

Economic Development Alliance. “We’ve laid the groundwork for a busy 2014.”

Beth Doughty, executive director for the Roanoke Regional Partnership, says that although she still hears complaints from the business community about the “tepid recovery,” the partnership’s economic development activity grew 39 percent last year. It did especially well generating investment in real estate, machinery and equipment.

The Milken Institute’s 2013 Best Performing Cities report saw Roanoke leap 47 spots to achieve its highest ranking ever, 95th out of 200 large metro areas. The same report saw the Blacksburg region advance from No. 32 to No. 21 among 179 small metro areas.

“That seems to indicate things are looking up,” Doughty says. “Job growth is improving, and this region in particular made a big leap in the past year.”

In the Roanoke area, there’s a clear driver behind that growth. “Manufacturing has led the way out of the recession,” Doughty says.

The Roanoke region’s year was highlighted by the August announcement that the Luxembourg-based food-packaging company Ardagh Group would invest $93.5 million to retrofit the former Hanover Direct distribution center in Roanoke County, creating 96 relatively high-paying jobs.

The deal generated an immediate spinoff announcement, with The Netherlands-based Canline Systems announcing it would invest $1 million and create 25 jobs in developing a facility manufacturing conveyor systems to supply Ardagh. (See related story.)

For job creation, however, the region’s biggest news was Red Sun Farms’ decision to build greenhouses and a distribution facility on 45 acres at the New River Valley Commerce Park in Dublin, creating more than 200 jobs. Red Sun Farms is a Mexican subsidiary of Canada-based JemD Farms. The announcement marks two major firsts: It’s Red Sun’s first high-technology greenhouse facility in the United States and the Commerce Park’s first tenant.

Construction on the greenhouses was delayed by heavy rain, but Red Sun Farms Director of Operations Jay Abbott says the steel structure is going up now, and the company hopes to plant its first crops in July.

Red Sun Farms will grow and distribute hydroponic tomatoes, further building its status as one of the largest organic vegetable producers in North America. It’s a potential game-changer in the regional food industry, which has seen rapid growth at the local level but nothing of this scale from a national or international company.

The Red Sun was the first of four major economic development announcements for Pulaski County.

In August, Falls Stamping & Welding Inc., a metal stamping company, announced it would invest $5.7 million and create 112 jobs in a facility that will supply assemblies to the Volvo Trucks plant in Dublin.

That was followed a month later by word that Korona S.A., a Polish company that is one of the largest candle manufacturers in the world, would build its first U.S. production facility in Pulaski County. Korona will invest $18.3 million and create 170 jobs.

The momentum carried into the new year: In early January, firearms manufacturer Alexander Industries said it would invest $2.88 million to expand its operations and relocate from the Radford Arsenal to Dublin Industrial Park in Pulaski County.  Virginia competed against South Dakota and Texas to land the project, which will create 64 jobs.

Bopp says 2013 was a “wonderfully robust” year in terms of announcements for the New River Valley.

“When I meet with people, I tell them we work with 75 to 100 projects a year,” Bopp says. “Twenty to 24 come and physically visit, and in an average year, we’re lucky to get one or two companies new to the area.”

Success hasn’t been limited to Pulaski County, either.

The New River Valley’s burgeoning tech sector was highlighted by the expansion of Rackspace Hosting, which offers cloud and IT services. It’s investing $5.4 million to expand its facility in Virginia Tech’s Corporate Research Center, creating 100 jobs.

While Rackspace drew headlines for its large-scale expansion, the New River Valley’s tech sector is bubbling over with a steady stream of small entrepreneurs and startups. “The tech sector is an incredible economic engine,” Bopp says.

In August, Blacksburg’s Harmonia and Christiansburg’s CCS Inc. were featured in Inc. magazine’s list of the top 5,000 fastest-growing companies in America.

Recent advances in broadband technology and offerings may accelerate the growth of the technology sector regionally. Last year marked the completion of two projects that began with 2009’s American Recovery and Reinvestment Act (also known as the federal stimulus) and resulted in nearly 300 miles of new fiber-optic cable in Roanoke and the New River Valley.

Additionally, Botetourt County, Roanoke, Roanoke County and Salem formed the Roanoke Valley Broadband Authority, which, along with the already established New River Valley Network Wireless Authority, seeks to bring less-expensive Internet service to Southwest Virginia’s businesses and households.

A report by Blacksburg firm Design Nine indicated the region is falling behind when it comes to broadband. Southwest Virginia, however, is taking steps to catch up. In addition to the stimulus-funded infrastructure, there is a crowd-funded Gigabit project in downtown Blacksburg and a $4.6 million investment by cable provider Cox Communications to upgrade its Roanoke-area services,

Virginia Tech’s Corporate Research Center saw two of its former tenants expand into new sites. Biotech firm TECHLAB will retain its research facilities in the center but purchased a 54,000-square-foot-building in nearby Radford for its manufacturing facilities. Another former CRC tenant, Aeroprobe Corp., which makes instruments and software used in cars, jets, wind turbines and other applications, is investing $3 million over five years into a new site in Christiansburg’s Falling Branch Corporate Park.

The New River Valley also saw expansions: Polymer Solutions Inc. is investing $2.9 million to expand its Montgomery County site, creating five jobs, and Floyd County’s Hollings-worth & Vose Co., which makes non-woven fabrics, is investing $6.1 million to expand its plant and create 17 jobs.

The Roanoke Valley and far Southwest Virginia are growing more diverse, too, but their 2013 growth came largely from its strengths in manufacturing.
Smyth County’s Liaoyang Ningfeng Woodenware Co. Ltd., which builds furniture components, announced in November it would invest $2.1 million and create 125 jobs. Scott County saw two expansions, with mattress and pillow manufacturer Tempur Sealy International and VFP Inc., which builds concrete buildings for cell towers, announcing deals last year that are expected to create 42 and 50 jobs, respectively.

Further north in Botetourt County, Capco Machinery Systems Inc. is investing $4.2 million to expand its facility manufacturing roll-grinding machines, creating 30 jobs that pay an average of $60,000 annually. Also, Altec Industries Inc. plans to invest $2.2 million in its plant and will create 96 jobs. The company manufactures truck-mounted mobile equipment.

The city of Roanoke’s Virginia Transformer Corp. anticipates the creation of 150 jobs over three years by moving a portion of its facility to a site in Botetourt. Virginia Transformer CFO Steve Nelson says the move will allow the company to ramp up production in Roanoke. It’s investing about $9 million in Roanoke and Botetourt facilities, and there’s more room to grow, which could create an additional 250 jobs during the next five years.

“It’s not a necessarily big deal in terms of numbers, but the idea that they have purchased a whole other facility in Botetourt County — their growth potential is huge,” Doughty says.

She sees even more potential to land and grow manufacturing companies. Last year Botetourt, Franklin County, Roanoke, Roanoke County, Salem and Vinton banded together to create the Western Virginia Regional Industrial Facility Authority with the idea that they can better cooperate when it comes to prospective businesses finding sites.

 

Major employers by number of jobs

Carilion Clinic
Roanoke, 11,300 jobs
 
Virginia Tech
Blacksburg, 8,000+ jobs
 
HCA Virginia Health System
1,000-2,999 jobs
 
Radford University
Radford
1,500-2,499 jobs

Kroger
Throughout region
1,000-2,999 jobs

Norfolk Southern
Throughout region
1,000-2,999 jobs

Volvo Trucks
Pulaski County
1,000-2,999 jobs
 
Wells Fargo Bank
Throughout region
1,000-2,999 jobs
 
Advance Auto Parts
Roanoke
1,000-2,999 jobs

MeadWestvaco
Clifton Forge
1,000-2,999 jobs

 
SOURCE: Roanoke Regional Partnership, New River Valley Economic Development Alliance

 

Southwest Virginia’s recent deals

Red Sun Farms
Pulaski County
205 jobs

Korona S.A.
Pulaski County
170 jobs

Virginia Transformer Corp.
Roanoke
150 jobs

Liaoyang Ningfeng Woodenware Co. Ltd. (New Ridge LLC)
Smyth County
125 jobs

Falls Stamping & Welding Inc.
Pulaski County
112 jobs

Atlas, an Americold subsidiary
Roanoke County
100 jobs

Altec Industries Inc.
Botetourt County
96 jobs

Ardagh Group
Roanoke County
96 jobs

MTM Inc.
Pulaski County
66 jobs

Alexander Industries Inc.
Pulaski County
64 jobs

Source: Virginia Economic Development Partnership

Two for one

A decision by Luxembourg-based Ardagh Group to spend $93.5 million creating a can factory in Roanoke County ranks as one of the largest new investments in Virginia last year.

In fact, Ardagh’s deal packed extra punch for the Roanoke Valley economy. In deciding to renovate the 525,000-square-foot former Hanover Direct building, Ardagh prompted one of its suppliers, Canline Systems, to invest in its own facility in Roanoke County to provide equipment to the can factory.

The two deals will create a combined 121 jobs — 96 at Ardagh and 25 at Canline — with the potential for expansion. The back-to-back announcements provided the Roanoke Valley with the opportunity to tout its appeal to global companies.

“These are pretty sexy projects,” says Jill Loope, director of Roanoke County’s economic development department.

During the official announcement, James Willich, CEO of Ardagh Metal Packaging USA Inc., said Roanoke County stood out for a variety of factors: The “proximity to our major customer, favorable business tax structure, skilled labor and reasonable cost of living for our employees, as well as logistical advantages.”

The behind-the-scenes story on the Ardagh deal, however, shows just how much location, timing and luck factor into landing new employers.

Ardagh, which makes glass and metal containers for the food and beverage industry, used real estate broker Tommy Turner of the Charlotte, N.C.-based Hart Corp. to assist in the search. He previously had worked with a smaller canning company acquired by Ardagh.

Because of a pending contract with a new customer, Ardagh sought to locate a production facility somewhere in Tennessee, western Virginia, the western Carolinas or eastern West Virginia. Turner used an internal database to find buildings in the 200,000-square-foot range.

During the search, however, Ardagh signed a new deal to provide cans for ConAgra Foods in Newport, Tenn. That meant the company now needed a building of 400,000 to 700,000 square feet, with ceiling clearances of at least 28 feet.

“When you looked at the Southeastern U.S. at the time, only four or five buildings fit that criteria,” Turner says.

Early in the process, Ardagh had zeroed in on build-to-suit sites in Berkeley County, W.Va., and Winchester.

The search changed course, however, when another Ardagh building project, on the West Coast, suddenly became more urgent.

“It delayed our time frame on this end, and they just felt a build-to-suit was cutting it too close,” Turner says. “We had to focus on an existing building.”

“All of a sudden the temperature amped up on that project,” says Beth Doughty, executive director of the Roanoke Regional Partnership. “They were in a huge hurry.”

Ardagh’s search focused on the Hanover Direct building, with its modern fixtures and high ceilings. Its first visit in early January last year was devoted to evaluating the Roanoke community — its workforce, quality of life, the cost of doing business — but over subsequent months company officials returned frequently to check logistics for freight distribution, determining whether that could be cost-effective and if it could distribute its product effectively from Roanoke County compared with other potential sites.

At the same time, another global company, Colgate Palmolive, also pursued the building. Ardagh and Colgate vigorously courted the owner of the Hanover Direct building.

Turner says Ardagh delivered its letter of intent to purchase first, but it had to move aggressively and raise its price to seal the deal. Ultimately, that approach paid off: The final sticking points were worked out, and Ardagh officials closed on the contract soon after.

Colgate Palmolive eventually announced it would invest $196 million into a similar-size building in Greenwood County, S.C.

“We could have sold that building three times,” Doughty says. “It’s too bad we didn’t have three of them.”

The incentive package ultimately included $750,000 from the state and $2.4 million from Roanoke County.

“It really emphasizes how important the real estate is,” Doughty says. “Of course you have to have a good business climate and cost structure, but if you don’t have the real estate that meets modern needs, you’re not going to be successful. Their instance of being in a hurry isn’t all that unusual either.”

Ardagh has moved quickly on the Hanover Direct building to strip out the mezzanine floors and outfit it with equipment to produce 4.5 million cans per day, or roughly 5 percent of the U.S. food can market annually.

Renovations and equipment installation should be complete by this summer, with initial startup tentatively set for this fall. The facility should be fully operational by the end of the year.

“I can tell you I fully expect future growth and expansion out of Ardagh,” Loope says. “I think this is just the beginning. They have a pad site that is pre-graded immediately adjacent to their building and can easily expand at any time.”

Regional revival

As the national economy continues to rebuild from the Great Recession, the Roanoke and New River valleys have seen a manufacturing resurgence.

Once thought a casualty of globalism, industries that make stuff have made a comeback in the region. Whether it’s the Luxembourg-based food packaging company Ardagh Group announcing it would invest in a site in Roanoke County, or Virginia Tech-grown TECHLAB expanding biotech production to the Radford Industrial Park, manufacturing is helping to drive  Virginia’s economic recovery.

Health care remains the region’s biggest employment sector, with Carilion Clinic as the Roanoke region’s largest employer. But “manufacturing led us out of the recession,” says Beth Doughty, executive director at the Roanoke Regional Partnership.

While job growth in the Roanoke and Blacksburg areas — home to a combined population of nearly half a million people — lags the national average, the region’s manufacturing sector has outpaced both the commonwealth and the nation.

There’s potential for more, too. The 4-year-old Virginia Tech Carilion School of Medicine and Research Institute reached its first full student capacity this fall.
Economic development boosters hope the research institute will do for Roanoke what Virginia Tech’s Corporate Research Center (CRC) has done for Blacksburg: Provide a supportive environment for small companies to grow and hopefully remain in the region.

An ‘exploding’ tech sector
The 230-acre CRC has 155 tenants and is at nearly 99 percent of its capacity,   according to its president, Joe Meredith. The center is adding two new buildings — one for a $5.5 million expansion by Rackspace’s IT hosting operation and the other for a $3.5 million propulsion laboratory operated by Virginia Tech’s engineering department — as well as athletic fields and amenities.

Two tenants have expanded beyond the CRC. One of them, TECHLAB, a biotech firm that started at Virginia Tech before locating in the CRC, bought a 54,000-square-foot building in nearby Radford to house its manufacturing facilities.

Also, Aeroprobe Corp., which makes instruments and software used in cars, jets, wind turbines and other applications, will invest $3 million over five years into a new site in Christiansburg’s Falling Branch Corporate Park.

Derick Maggard, executive director of the Roanoke-Blacksburg Technology Council, says  Virginia’s tech sector “is exploding right now.”

“This focus on entrepreneurship and innovation is only going to lead to greater growth,” Maggard says. “It’s not a bubble at all but the wave of the future.”

Manufacturing moves
Traditional manufacturing plants have expanded as well. Celanese Acetate, which employs more than 1,000 people at its Giles County facility, launched a $150 million capital project to convert its power plant from coal to natural gas.

BAE Systems announced it will invest $240 million to upgrade its facility at the Radford Army Ammunition Plant.

A Polish company, Korona Candles, will spend $18.3 million to establish a facility in Pulaski County, creating about 170 jobs.

James Hardie Building Products expanded its Pulaski facility to nearly 1 million square feet.

In the largest single manufacturing investment in Roanoke County history, the Ardagh Group announced it would spend $93.5 million to renovate the former Hanover Direct building into a facility that can produce nearly 4.5 million food cans per day.

Not all manufacturing news has been good, though: The Grede Holdings LLC said it would close the historic Radford Foundry, which had passed through the hands of several owners and employed 250 people when the closure was announced.

“There are always ups and downs,” says Aric Bopp, executive director of the New River Valley Economic Development Alliance. “It’s sad to see companies that do face struggles and challenges. But for the most part, the economy in the region is really firing up.”

The companies that have manufacturing facilities in the region sell to a global market, and, if the economy continues to improve, Bopp and Doughty expect to see continued investment and job growth.

No silver bullets
Manufacturing isn’t the region’s only strong point, however. Everyone wants a “silver bullet” for economic development, Doughty says. “Everyone wants the one thing that will change things and make it better. That’s an antiquated view of the economy. It’s more like spinning plates:

You have to have a lot going on to grow your economy in different ways.”

In 2012, Moody’s Analytics ranked the Roanoke region 46th out of 384 metropolitan statistical areas (MSAs) for industrial diversity. It fell slightly this year, from 73 percent as diverse as the nation to 71 percent, but it still ranks high. In Virginia it ranks just below Richmond (72 percent) but is well ahead of the two localities tied for third in Virginia (Lynchburg and Winchester, at 58 percent each).

“We’re not putting all of our jelly beans in one bucket,” says Wayne Strickland, executive director of Roanoke Valley-Alleghany Regional Commission.

The localities that comprise the Roanoke Valley worked together in 2013 to collectively raise their lodging tax rates — a move that required General Assembly approval for Roanoke County — and provide a larger marketing budget for the Roanoke Valley Convention and Visitors Bureau to attract tourists.

The Roanoke Regional Airport invested in a makeover for its terminal, and Gov. Bob McDonnell announced in August that Amtrak would extend passenger rail service to Roanoke by 2016.

Roanoke Valley governments also teamed up with the private sector to create a regional broadband authority to help encourage the expansion of affordable high-speed Internet service. In September, gigabit Internet service arrived in Blacksburg after a successful Crowdtilt crowd-sourcing campaign by TechPad, a co-working space near Virginia Tech. (See page 15.)

Breweries bubble up
Then there’s the region’s growing food economy. The biggest news in that sector was the announcement that Mexico-based Red Sun Farms would invest $30 million to build greenhouses on 45 acres in Pulaski’s NRV Commerce Park, creating 205 jobs within five years.

Beneath the banner of that high-profile economic development victory, the local food movement has grown by leaps and bounds over the past decade.

That includes the rapid expansion of the region’s craft brewing sector. While larger, traditional domestic beer companies have seen sales of products stagnate, craft beer labels have exploded in variety and revenue. Until 2013, however, Roanoke’s only brewer of note was Roanoke Railhouse, founded in 2009.

The 2012 expansion by Nelson County-based Devil’s Backbone Brewing to a new facility just north of Roanoke in Lexington, however, may have inspired more regional brewers to step up. Devil’s Backbone expanded the Lexington plant at the end of 2012 and again this year, increasing its production capacity to 40,000 barrels per year.

In the Roanoke and Blacksburg region, entrepreneurs launched Parkway Brewing Company in Salem, Sunken City Brewery in Franklin County near Smith Mountain Lake and Flying Mouse Brewery in Botetourt County.

The largest of the three, Parkway Brewing, is producing 3,600 barrels per year, with plans to expand to 6,000. Owner Mike “Keno” Snyder says the brewery saw about 15 percent growth its first year.

Sunken City invested $2.3 million at Westlake, where it produces canned product. The brewery is on track to produce about 3,000 barrels this year and has the capacity to produce up to about 20,000 barrels per year. Owner Jerome Parnell says he hopes to expand distribution eventually into five to seven states.

Local food loyalty
Besides beer, there’s been a surge of farming and food production in western Virginia, too. “Local products have really improved not just in quantity but in quality too,” says John Bryant, spokesman for the Roanoke Natural Foods Cooperative. “There’s been a real step up in the game.”

In 2003, Tenley Weaver’s Good Food – Good People, a Floyd County-based food aggregator, received local produce from five suppliers and maintained about eight accounts. Now, Good Food – Good People channels local products from 40 farmers and nearly 30 other suppliers to numerous restaurants, farmers markets, wholesalers, a retail outlet and roughly 385 people who paid at the beginning of the season for regular deliveries through a Community Supported Agriculture (CSA) program.

“The percentile growth that our company and food system here is experiencing is off the charts,” Weaver says. “Will it hold? Of course not. It has to level at some point.”

This year has been difficult for farmers, with unseasonably cool temperatures, record-breaking amounts of rain and generally unpredictable weather. The markets and demand for locally produced food, however, are better than they’ve been in decades.

Farm-to-table restaurants, such as Local Roots, River to Rail and Bent Mountain Bistro, trumpet their commitment to local foods, while others, such as Alexander’s, regularly purchase regional goods as well.

Nearly a dozen new farmers markets have cropped up. The success of one of them, the Grandin Village Community Market, founded in 2009, inspired the nearby Roanoke Natural Foods Cooperative to grow as well, expanding with not only a second, downtown location but also the establishment of an urban farm.

Downtown boom
The co-op’s new satellite location in the freshly renovated Center in the Square building wouldn’t have been possible without a residential development boom in downtown Roanoke.

Richmond developer Bill Chapman, who previously launched the Lofts at West Station in a redeveloped warehouse, this year opened Parkway 301, which includes 89 apartment units in the former Shenandoah Building. Another developer, Faisal Khan, plans 90 units for the Crystal Tower Building, which he has renamed the Ponce de Leon in honor of its former life as a hotel.

The rapid conversion of old warehouses and office buildings into apartments has resulted in new opportunities for retail stores. One retail area, 16 West Marketplace, was developed as a commercial marketplace aimed at the new downtown population: It includes a grocery, pizzeria, coffee shop and more.

The private sector investment has been boosted by the city government, too, which over the last decade has invested roughly $20 million into the Market Street corridor from the railroad to Elm Avenue. In October, the city reopened Elmwood Park after a $7 million renovation that included construction of a new amphitheater.

“We try with public dollars to leverage what’s happening downtown to get more private investment,” says Roanoke City Manager Chris Morrill.

That’s what happened with the six-  story Market Garage, which was renovated in 2009 at a cost of $6 million. That led to an announcement in 2012 by the Greenville, S.C.-based Windsor/Aughtry Co. that it would build a Hampton Inn on top of the structure. Bids came in several million dollars higher than the company expected, so it is working with city government to find ways to cut costs. The company still hopes to begin construction before year’s end.

While the region’s retail sector still struggles with online competitors, clothier Larry Davidson said the work downtown has boosted his business: “I just sense the activity level is so totally different now. For me, personally, it’s very exciting to see the quality of the things it’s instilled up and down Market Street.”

The city hopes to spin that activity into adjacent neighborhoods. Last year, the Roanoke City Council extended the downtown district south past the Roanoke River to an area that includes the Bridges, a planned $150 million development that broke ground in May. The first phase includes construction of an apartment building and the renovation of an existing structure into a coffeehouse and restaurant.

City officials also designated a district just west of downtown for targeted federal redevelopment funds. Freedom First Credit Union will open a branch in the neighborhood, and the city council voted to sell the former health department building to Ed Walker, a renowned developer who previously redeveloped the Patrick Henry, the Cotton Mill Lofts and the former Hancock Building into apartments.

One of the city’s traditional cornerstone companies, Advance Auto Parts Inc., announced in October it would acquire General Auto Parts International Inc., for $2 billion, meaning the largest automotive aftermarket parts provider in North America will be headquartered in Roanoke.
Additionally, Virginia Western Community College offers courses in mechatronics — a combination of mechanical and electronic systems — that will prepare more workers for the kind of manufacturing companies that are making a home in the region.

“Advanced manufacturing is our sweet spot,” says Doughty. “We’re just starting to see the beginning of a trend. It’s going to continue to go up.”