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byline: Paula C. Squires

No Walmart store for Caroline County

Caroline officials said Wednesday that Walmart would not be coming to a development in Ladysmith.

“Walmart Inc., in its effort to compete with other online retailers, has decided to contract the number of stores it will build annually from hundreds to 25 a year. The decision to step away from physical stores also includes Caroline County’s Ladysmith store. No Walmart store is anticipated to be built at the Blackwood retail development on Rt. 639 known as Ladysmith Crossing,” the county said in a press release.

Walmart announced plans in September 2015 to build a 158,000-square-foot supercenter store that was expected to create 300 jobs.  The company expected to make a $25 million investment in a 36-acre retail project by Richmond-based Blackwood Development.

While news of Walmart’s decision was disappointing, the county noted that in 2016 Walmart closed 269 existing stores and announced more cuts in its building plans last year.

The county staff is consulting with Blackwood Development to arrive at a new plan for the retail site located on the southwest corner of Ladysmith Road and Route 712 (Green Road), near the Ladysmith exit off I-95.

According to Gary R. Wilson, director of economic development for Caroline County, Blackwood has indicated that it intends to move forward with the project with modifications.

There also is no change in the county’s plans to upgrade Rt. 639.

Dominion Energy to buy SCANA in $7.9 billion all-stock deal following failed nuclear project

Dominion Energy Inc. and SCANA Corp. announced an agreement Wednesday for the companies to combine in a $7.9 billion all stock deal.  Including the assumption of debt, the value of the transaction is about $14.6 billion. The deal comes as SCANA, a South Carolina-based utility holding company, struggles to cope with the aftermath of huge cost overruns stemming from its role as majority partner in a failed nuclear reactor construction project.

Richmond-based Dominion says the transaction would benefit customers of SCANA’s South Carolina Electric & Gas subsidiary (SCE&G), which have been on the hook for much of the costs of the partially completed reactors.  Dominion is proposing partial refunds and rate cuts to offset previous and future costs related to the halting of construction in July of two nuclear units at the V. C. Summer Generating Station near Jenkinsville, S.C.

The project got underway in 2008 with high hopes of jumpstarting a renaissance in clean nuclear power.  However, SCANA abandoned it last summer due to rising costs, work delays and the bankruptcy of its main contractor, Westinghouse Electric Co.

The merger also would broaden Dominion Energy’s reach in the Southeast. SCANA's operations include service to about 1.6 million electric and natural gas residential and business accounts in South Carolina and North Carolina and 5,800 megawatts of electric generation capacity.

“SCANA is a natural fit for Dominion Energy,” Thomas F. Farrell, II, chairman, president and CEO of Dominion Energy, said in a statement. “Our current operations in the Carolinas — the Dominion Energy Carolina Gas Transmission, Dominion Energy North Carolina and the Atlantic Coast Pipeline —complement SCANA's, SCE&G's and PSNC Energy's [another SCANA subsidiary] operations. This combination can open new expansion opportunities as we seek to meet the energy needs of people and industry in the Southeast.”

Under the terms of the transaction — which is subject to shareholder, federal and state regulatory approvals, — SCANA shareholders would receive 0.67 shares of Dominion Energy common stock for each share of SCANA common stock, the equivalent of $55.35 per share, or about $7.9 billion.

SCANA would operate as a wholly owned subsidiary of Dominion Energy and would maintain its local management structure and the headquarters of its SCE&G utility in Cayce, S.C.

SCE&G residential electric customers would get an average of $1,000 refunded on their bills, with Dominion agreeing to fund $1.3 billion of cash payments within 90 days upon completion of the merger. Customers could also expect what Dominion says would be a 5 percent rate reduction, equal to about a $7 a month savings for a typical residential customer.

The deal also calls for a more than $1.7 billion write-off of existing V.C. Summer 2 and 3 capital and regulatory assets, which would never be collected from customers. This would allow for the elimination of all related customer costs from the failed nuclear reactor project over 20 years instead of a previously proposed 50-60 years.

Dominion also agreed to the completion of the $180 million purchase of a natural gas fired power station (Columbia Energy Center) at no cost to customers to fulfill generation needs.

In addition, Dominion Energy would provide funding for $1 million a year in increased charitable contributions in SCANA's communities for at least five years, and SCANA employees would have employment protections until 2020.

“We believe this merger will provide significant benefits to SCE&G's customers, SCANA's shareholders and the communities SCANA serves,” Farrell said in a statement “It would lock in significant and immediate savings for SCE&G customers — including what we believe is the largest utility customer cash refund in history — and guarantee a rapidly declining impact from the V.C. Summer project.”

Farrell also noted what he described as “potential benefits to natural-gas customers in South Carolina, North Carolina and Georgia and to their communities. And, this agreement protects employees and treats fairly SCANA shareholders, many of whom are working families and retirees in SCANA's communities. The combined resources of our two companies make all this possible.”

Jimmy Addison, SCANA’s CEO, said in a statement that “Dominion Energy is a strong, well-regarded company in the utility industry and its commitment to customers and communities aligns well with our values. Joining with Dominion Energy strengthens our company and provides resources that will enable us to once again focus on our core operations and best serve our customers.”

Dominion said in a news release that the transaction is “contingent upon South Carolina approval of a proposed nuclear solution.” The company said it will seek approval from the Public Service Commission of South Carolina for the immediate customer payments, rate refunds and other conditions related to the resolution of the failed nuclear units.

“We believe it is in the best interests of all parties to reach an agreement on this critical issue,” Farrell said.  “Having certainty on this issue can act as a catalyst for economic development and it is essential for the Dominion Energy-SCANA merger to move forward. The availability, reliability and cost of energy are often the deciding factors when businesses consider investing — and we want businesses to have every reason to continue investing in SCANA's communities.”

The  Post and Courier in Columbia, S.C., reported Wednesday that the sale depends on keeping a South Carolina law that allows SCANA to collect customer payments for the two unfinished reactors, which cost $9 billion.

The newspaper said state regulators are considering whether SCE&G customers should continue paying $37 million a month for the canceled project. The utility already has asked federal regulators to withdraw licenses for the unfinished reactors. According to the newspaper, South Carolina legislators are expected to consider legislation next week that would eliminate payments for the project, which account for 18 percent of customers’ electric bills.

If the merger is completed, the combined company would deliver energy to about 6.5 million electric and natural gas distribution customers in eight states with an electric generating portfolio of 31,400 megawatts and 93,600 miles of electric transmission and distribution lines.

At its website SCANA says it has a workforce of about 6,000, serving more than 500,000 electric customers in 25 South Carolina counties and more than 1.3 million gas customers in South Carolina, North Carolina and Georgia.

Dominion Energy Inc. is one of the largest energy utility companies in the U.S. with 16,200 employees and operations in 18 states. It delivers electricity and natural gas to nearly 5 million homes and businesses.

The company has a market cap of about $50 billion, and a 22.50  price-to-earnings ratio.
By early afternoon Wednesday, SCANA’s shares had risen more than 22 percent, to $47.40 per share, while Dominion’s shares fell nearly 5 percent to $76.39.

McGuireWoods LLP served as legal counsel and Morgan, Lewis & Bockius LLP as tax counsel to Dominion Energy. Credit Suisse Securities (USA) LLC acted as the company's financial adviser for the transaction.

Ready, set, learn

In 2014, when new owners took over the sprawling 65-acre National Conference Center in Leesburg, the occupancy rate was down to about 18 percent. By 2016, that figure had jumped to 50 percent.
Occupancy remained at that rate during 2017, and things are looking up for 2018, too. So far, officials say the center has booked four times as many events compared to the same time the year before.

In October, the property also took home two top awards from the Virginia Restaurant, Lodging and Travel Association: Hotel of the Year and Hotelier of the Year (for Geoff Lawson, the conference center’s general manager).

What behind’s the dramatic turnaround? “We had to reset the building to what we believe it should be, a facility for adult learning and education,” says Lawson.

The National got its start in 1974 as the Xerox International Center for Training and Management Development. For 26 years, Xerox trained employees at the 1 million-square-foot plus campus. In 1994, Xerox opened the facility to other corporations for training meetings, before selling the property in 2000 to Chicago-based Oxford Capital. 

Coming full circle
After the sale,  the National largely catered to government agencies and federal contractors because of its location within 35 miles of Washington, D.C. That market, however, soon tanked from the combined effects of the 2007-09 recession, federal budget cuts and a government shutdown in 2013.

Then the property — with 917 guest rooms, more than 265,000 square feet of meeting space and the largest ballroom in Northern Virginia — tried to be a hotel in the narrow sense of the word, with people coming for overnight accommodations.

“The property was getting beat up on Trip Advisor,” and other online travel sites, recalls Chuck Ocheltree, the National’s chief marketing office.  With aging amenities and a campus-like design, it couldn’t compete with the sleek modern hotels of metropolitan Washington, D.C. 

After the property’s sale in 2014, new owner NCC PS Enterprises, in a joint venture with PCCP LLC and Stoneleigh Capital, invested $12 million in renovations, which positioned the National to come full circle with a return to its conference/training mission. 

Today, 90 percent of the property’s business comes from meetings, conferences and training events, with the other 10 percent from social occasions such as weddings and proms, says Lawson. 

With an updated Black Olive Bar and Grill, a spruced-up lobby with a living room feel and an outdoor area with fire pits and furniture, there are plenty of places for people to hang out after a long day of training.

Customers include corporations such as BAE, the World Bank, IBM, accounting firms like KPMG, and telecommunications and insurance companies. “We are perfect for that environment, because they have annual new employee training and many of them are industries that require some type of accreditation,” Lawson explains.
Military groups and government agencies also continue to be customers, with some training groups staying for as long as 90 days. 

New emphasis on food
With such lengthy stays, the food has to be good, says Lawson. The National has put a new emphasis on food, with menus that offer local wines and farm-to-table dishes.

“They’re eating our meals three times a day, so you have to have quality and variety. You can’t have them come in and say, ‘It’s Monday, so it has be pasta,’” says Lawson.  The National’s spruced-up dining areas and food cases with choices of entrees and fresh fruit and vegetables are a far cry from the cafeteria-style fare of the past. 

The rate for a complete meeting package, including lodging, food, coffee breaks and meeting space, is about $260 per person per day — “less than a hotel night in D.C.,”  notes Lawson.

Another key focus is creating local partnerships in Loudoun County. One example is a partnership with the adjacent Riverside High School. The National works with students interested in culinary careers, by hiring them for internships, summer jobs and post-graduation jobs.

Lawson adds that the property’s senior management team is active in the community and wants to build relationships. When Riverside opened in 2015, the school planned to serve peanut butter-and-jelly sandwiches at its opening reception. “We sent over high-end canapés and hors d’oeuvres,” he says.

Demand is outstripping supply

The outlook for lodging remains favorable in Virginia with many new hotels in the pipeline. In fact, demand for hotels is outpacing supply throughout most of the commonwealth, according to recent reports from STR and CBRE, two companies that track hotel industry data.

Two of Virginia’s hotel markets — Norfolk/Virginia Beach and the Washington, D.C., metro area — were among North America’s top markets in 2017 in terms of revenue per available room (RevPar).

According to STR, Norfolk/Virginia Beach saw a 6.9 percent increase while the Washington metro area got a 5.2 percent boost. 

Virginia’s overall hotel occupancy rate was 64 percent at the end of the third quarter of 2017, and the average daily rate per room was $109.  Both figures are slightly below national averages of 65.9 percent and $129.94, respectively.

Currently, Virginia has about 24 projects under construction, which would add 2,723 rooms. In the final planning stages are another 73 projects that, if built, would bump the total of new rooms coming online in the near future to 10,556, according to STR. Charlottesville, Richmond and Lynchburg are the cities with the most hotel rooms in the pipeline.

Here’s a list of some of the new projects expected to open this year:

  • Hotel Madison, Harrisonburg, 230 rooms
  • Holiday Inn Newport News, 182 rooms
  • Homewood Suites Arlington, Rosslyn Key Bridge, 168 rooms
  • Autograph Collection The Draftsman, Charlottesville, 150 rooms.   

Career fairs continue as Cavalier Hotel gears up to reopen in March

Editor's note: This story has been updated to reflect a later official opening date.

Gold Key | PHR is looking to hire more people for the March 7, reopening of the The Cavalier Hotel in Virginia Beach. Two career fairs will be held on Jan. 5 and Jan. 6 at Gold Key’s Career Center at 313 Laskin Rd., Suite 103, in Virginia Beach.

Gold Key said it already has hired 125 people and still has nearly 100 associate positions available. The Virginia-Beach based hospitality management company said The Cavalier Hotel is looking to hire experienced hospitality workers from managerial full-time employees to bar and wait staff, culinary professionals, banquet servers and housekeeping staff.

While some employees have started work, all 225 associates will begin employment at the hotel by Feb. 5, in time for its reopening the next month.


“We had a fantastic turn out for our first career fair where we hired over 25 hospitality professionals, many of which were local hires with several applicants applying for careers from outside of Hampton Roads,” Gold Key | PHR’s Elizabeth Weller said in a statement. “While we currently have successfully hired 125 applicants to date, we are dedicated to finding the remaining 100 hospitality professionals that will reflect The Cavalier’s rich history of stellar service.”

As a member of Marriott’s Autograph Collection, The Cavalier Hotel, which originally opened in 1927, will reopen following a $75 million-plus renovation.

The updated hotel will offer standard rooms and suites, an onsite distillery and tasting room, meeting spaces and multiple dining and beverage experiences, along with a full-service spa.

Gentry Locke lawyers in Roanoke are promoted

The law firm of Gentry Locke in Roanoke announced Tuesday that Roanoke lawyers Jonathan D. Puvak and Daniel R. Sullivan have been promoted to partner.

Puvak practices on the firm’s Business & Corporate team, assisting businesses, business owners and governmental entities with corporate governance, commercial transactions, employee benefits, and tax and real estate matters.

Before attending law school, Puvak worked for NVR Inc., one of the nation’s largest homebuilders. He holds leadership positions with the Virginia State Bar’s Young Lawyers Conference and The Virginia Bar Association’s Young Lawyers Division. In the firm, he coordinates Gentry Locke’s annual fundraising campaign for the United Way of Roanoke Valley. He earned a bachelor’s degree from Bridgewater College and a law degree from the College of William and Mary.

Sullivan practices on the firm’s Business Litigation team. His experience includes business, insurance, product liability, and professional liability lawsuits. Sullivan represents public and closely-held businesses in state and federal courts. Sullivan is a member of the West Virginia State Bar, the Federal Bar Association, The Virginia Bar Association, Virginia State Bar and Roanoke Bar Association. He also serves on The Virginia Bar Association Young Lawyers Division’s Executive Committee and is active in St. Andrew’s Catholic Church’s adult ministry. He earned a bachelor’s degree from the University of South Dakota and a law degree from the University of Virginia.

Gentry Locke has more than 55 lawyers operating from offices in Roanoke and Lynchburg.

Tax credits helps Henry County move forward on advanced manufacturing training facility

 

 

Henry County, in partnership with the Martinsville-Henry County Economic Development Corporation (EDC), recently closed $13 million in funding to break ground on a new advanced manufacturing training facility.

 

Construction will begin in January on a 25,889-square-foot project that will include 10,553-square feet of office space and a 15,336-square-foot high bay. Construction is expected to take 18 months.

 

 The county credited a New Markets Tax Credit (NMTC) transaction, completed on Dec.  8, for moving the project along. The transaction included a $5 million grant from the Harvest Foundation, as well as funding from the Tobacco Commission and the Virginia Economic Development Partnership. The groups said they leveraged these funds to generate an additional $2.7 million to help construct the Commonwealth Centre for Advanced Training (CCAT) in the county’s Commonwealth Crossing Business Centre. The money incudes funds for a water tank and sewer lift station.

 

“Without both the Harvest Foundation Grant and the ability to leverage available funds through the use of the NMTC program, CCBC would have remained only a business center promising to support new companies once they complete site selection,” EDC Director Mark Heath, said in a statement. “CCAT demonstrates our commitment to those companies and to developing our workforce to meet their specific needs.” 

 

People Incorporated Financial Services, a community development financial institution in Abingdon, provided $10 million of NMTC allocation to the project.  SunTrust Community Capital LLC provided an additional $3 million of allocation and served as the tax credit investor on the transaction.  Tax Advantage Group of Greenville, S.C., and the law firm of Gentry Locke based in Roanoke provided advisory services.

 

The CCAT center is designed to provide modern, high-tech training and office space for companies locating in the Commonwealth Crossing Business Centre during the company’s construction phase. Through curriculum established by Patrick Henry Community College, the companies will have a path from training to employment without leaving the center.

 

“We think the CCAT project is a game-changer for the Martinsville-Henry County area,” Tim Hall, Henry County’s administrator, said in a statement.

 

 

Virginia’s residential sales volume up nearly 9 percent year-over-year

The residential real estate market hasn’t lost strength as the year draws to a close. According to the November 2017 Home Sales Report released Thursday by the Virginia Realtors, year-to-date volume (the sum of all sales) for January through November rose 8.8 percent compared to the first eleven months of 2016, rising from $35.24 billion to $38.34 billion.

Year-over-year transactions for the November rose by 3.9 percent, from 8,648 in 2016 to 8,982 in 2017.

Jay Mitchell, 2018 president of Virginia Realtors, is confident that the strong market will continue in 2018. “November sales show there are still buyers in the market who are ready to make the deal if they can find the house they want,” Mitchell said in a statement. “While the fourth quarter can typically slow, we are still seeing tight inventory and high demand from buyers for homes that present well and are priced right.“

The possibility of interest rate increases and the effects of federal tax reform also are combining to persuade buyers to purchase now “to make sure they can close ahead of an upward curve,” added Mitchell.

Sales volume for November was $3 billion, rising 8.7 percent from November 2016’s volume of $2.7 billion. The increase reflects boosts in median price and the number of transactions.
The number of transactions in November fell 8.3 percent from October (from 9,797 to 8,982), a drop characteristic for that time of year.

Statewide, the median sales price for November was $270,000, an increase of 2 percent from the median price last November ($264,700). Since November 2014, the median price has risen 8 percent (from $250,000).

The average number of days on the market in November declined markedly year-over-year by 12.7 percent (62 days from 71 in November 2016).  According to the report, the decline is an indicator of buyer eagerness.

Month-to-month, though, the average length of time on the market increased by 3.3 percent (from 60 days in October).

The average 30-year, fixed-rate mortgage interest rate rose in November to 3.92 percent.

I-564 Intermodal Connector opens in Norfolk

 

Motor carriers got an early Christmas gift on Thursday.  With the opening of the $169 million, four-lane I-564 Intermodal Connector, it will be easier for carriers to move cargo to and from Norfolk International Terminals (NIT). 

 

The connector is a dedicated ramp that provides an unimpeded link between the NIT’s North Gate and Interstate 564. The roadway was designed to speed the flow of truck-borne exports and imports while reducing the volume of vehicles on Hampton Boulevard, one of Norfolk’s busiest thoroughfares.

 

“The Port of Virginia is growing and projects like this are helping us keep pace and provide the necessary access to deliver the goods coming through this port – exports and imports — to manufacturers and consumers throughout our market and build our status as the mid-Atlantic’s global gateway,” John F. Reinhart, CEO and executive director of the Virginia Port Authority, said in a statement.

 

The North Gate and I-564 connector projects are expected to alleviate pressure on Hampton Boulevard. “We estimate that over time, as many as 700 trucks a day will forego Hampton Boulevard and head straight to the interstate,” Reinhart said.

 

In June, the port opened the new 26-lane, $42 million North Gate. The increased gate capacity at NIT – to 42 total lanes for motor carriers — is critical to the larger expansion taking place at the terminal. 

 

“We are investing $375 million at NIT to expand our container handling capacity by 400,000 containers,” Reinhart said. “In order to handle more cargo at the berth and stack yard, our means of moving cargo to and from our terminals – rail, barge and truck – must expand and modernize in parallel.”

 

The expansion of NIT’s southern container stack yard is underway, with the pace of work expected to pick-up in January. The construction is scheduled to be complete by late 2020.

 

The Virginia Department of Transportation managed the I-564 Intermodal Connector project, and the phase connecting to the North Gate was opened as scheduled.

Downtown Staunton will get a new boutique hotel in spring 2018

 

 

A new boutique hotel plans to open in downtown Staunton this spring. The 49-room Blackburn Inn is scheduled to open on the grounds of the Villages of Staunton at 301 Greenville Ave.  

Robin Miller, a principal of Richmond-based Miller & Associates, is the developer behind the project. He and a partner, Dan Gecker, also developed the 80-acre Villages of Staunton, the original site of Western State Hospital.

Miller is known for the adaptive re-use of architecturally significant buildings in Richmond, Petersburg and Staunton. He said in a statement that state and federal historic tax credits made the Blackburn project financially feasible. He did not disclose the investment cost. 

 

Designed by Thomas Jefferson protégé and master builder Thomas Blackburn, The Blackburn Inn was originally constructed in 1828. In bringing the building back to life, A Concept 2 Design was commissioned to develop a design that retains the building’s historic components. 

 

Wide corridors, hallway arches, vaulted ceilings and original heart pine floors have been left intact. An original wood staircase will allow guests to access a rooftop atrium that offers 360-degree views of downtown Staunton. 

 

Richmond-based Retro Hospitality will manage the property. “We foresee hosting many community events, which will directly benefit Staunton and all of Augusta County,” Paul Cooper, president of Retro Hospitality, said in a statement. 

 

The Blackburn Inn also will be home to a 16-seat indoor bistro and bar with seating options on the outdoor terrace and columned front porch. Other food and beverage offerings will include a front lobby tea parlor offering coffee, tea and breakfast pastries from a local bakery.