Wal-Mart Stores East LP has renewed its lease of 46,530 square feet of industrial space in McK Business Park at 3010 Mine Road in Spotsylvania County. Virgil Nelson and Wilson H. Greenlaw Jr. of Cushman & Wakefield | Thalhimer handled the lease negotiations.
In other recent transactions for Thalhimer in the Fredericksburg area, Sirius XM renewed a 20,662-square-foot lease of industrial space in Fredericksburg Center C Building at 11812 Main St., in Spotsylvania County. Nelson handled the lease negotiations.
In that same development, Zenith Aviation leased 18,000 square feet of industrial space. Nelson also handled those lease negotiations.
Amtrak trains will begin running today on a new territory between Lynchburg and Roanoke, but they won’t carry any passengers.
Amtrak said Monday that these nonscheduled trains will serve as training for locomotive engineers and train conductors to learn the tracks and territory between the two cities. The trains are expected to operate two times per day, five days a week.
Amtrak is operating the trains in collaboration with the Virginia Department of Rail and Public Transportation (DRPT), and Norfolk Southern. According to Amtrak, this step is essential to completing the project to bring intercity passenger rail service to Roanoke in the fall. At that time, Amtrak Northeast Regional service will extend from Lynchburg to Roanoke and will operate one round-trip seven days a week.
It will mark the first time that passenger rail service back has been available in Roanoke in four decades. The Northeast Regional service will provide a same-seat trip to and from Roanoke and to Washington, D.C., Baltimore, Philadelphia, New York City and other cities along the Northeast Corridor.
Northeast Regional service to Roanoke represents the fourth expansion of intercity passenger rail in the commonwealth since 2009, following new or additional service to Lynchburg, Richmond and Norfolk.
The effort to expand rail options in Virginia is the result of the state’s investment of more than $100 million in Norfolk Southern’s rail infrastructure, which made the intercity passenger service extension possible.
Rocstone Warehouse 17 LLC has purchased a 45,000-square-foot office/warehouse facility in Goochland County from Lanier Lane Realty LLC for $ 3.05 million.
Porter Realty’s Kevin Cox represented the buyer in the acquisition and also will be marketing the property for lease. The facility at 2200 Lanier Lane in Rockville offers sprinkler and power systems, dock and drive-in access and a fenced storage yard.
According to Porter Realty, it was most recently occupied by Specialty Beverage VA, which relocated to a larger facility in eastern Henrico County.
Construction is underway on a new $28.6 million student center at Longwood University in Farmville.
The 84,000-square-foot, Upchurch University Center will be a modern facility that reflects the character of the nearby historic buildings on the campus, according to Skanska USA, the builder for the project.
The center will house many student organizations and activities. The façade, which will be in keeping with Greek and Roman architecture, will open to Brock Commons, the primary campus artery. It also will include a large multipurpose room and a double-story portico on the south side of the structure, which opens onto Wheeler Mall, a green space used for spring commencement.
Skanska said it has completed demolition of the Cunningham Residence Halls and finished relocating and working on below-grade utilities. All foundations and steel erection have been topped out to make way for the balance of construction.
The center is scheduled to open in fall 2018.
The Upchurch University Center project will seek LEED silver certification. Skanska is collaborating on the building with Perkins + Will, Franck & Lohsen Architects, Draper Aden & Associates, Integral Group, Stewart Engineering and HG Design Studio.
Two multifamily properties in Richmond, The Park at Forest Hill and Chateau De Ville, totaling 119 units, have sold for $6.2 million, or about $52,521 per unit.
“The Richmond multifamily market is a slow rising tide,” Altay Uzun, an associate in Marcus & Millichap’s Hampton Road’s office, said in a statement. “Apartment cap rates are steadily compressing; rents are increasing, and we are seeing new development and growth in the market.”
Uzun and Christopher Chadwick had the exclusive listing to market the property. They buyer is a local investor.
Originally built in 1983, Chateau de Ville is a garden-style apartment complex with 38 one-bedroom, two-bedroom and loft units.
The Park at Forest Hill, constructed between 1972 and 1980, has 81 units. It was named after the 104-acre park across the street from the property.
Bryn Merrey, senior vice president/division manager of Marcus & Millichap’s mid-Atlantic and Southeastern offices, served as the broker of record on the transaction.
Norfolk has taken its place among much larger markets with a West Elm Workspace.
Locally owned PC&A Business Environments has opened a showroom at 7420 Central Business Park Drive as part of a partnership with West Elm, based out of Brooklyn, N.Y. The space offers four collections of office furniture and more than 75 product lines, 140 textile options, lighting and flooring.
The collections have a residential vibe and include modern, mid-century, industrial and contemporary pieces designed to appeal to millennial workers.
Norfolk joins larger cities such as Seattle, Tampa, Los Angeles, Chicago, and Miami with West Elm Workspace in its office furniture market.
“This is a highly creative and thriving small business market, and it seeks innovative products for a new kind of workspace,” Susan Pilato, PC&A president, said in a statement.
PC&A’s client list includes TowneBank, Fahrenheit, Good Run Research, Sentara, and Commonwealth Assisted Living.
West Elm partnered with Inscape (an office solutions company) and local design firms to launch West Elm Workspace in strategic markets. Its mission is to create unique, affordable designs for the modern office.
A Richmond-area online seller of herbs is building a greenhouse in eastern Henrico County.
The Growers Exchange, which currently has operations on a 600-acre farm in Charles City County, has purchased land and soon will start construction on four acres at Tech Park Place in Varina, according to Commonwealth Commercial Real Estate, which helped broker the deal.
The Henrico-based real estate firm said access to transportation, workforce and Internet providers all played a role in the company’s decision on a location.
The Growers Exchange, started in 1985, is owned by Briscoe and Kenan White. It grows and sells more than 175 varieties of spices and herbs, which it sells online across the U.S.
Commonwealth Commercial said the new facility will modernize operations as the business adds new varieties and speeds up shipping.
The firm’s Sam Worley and Ryan Fanelli represented the seller in marketing the property. Jim McVey and Middleton Smith represented the buyer in site selection.
Virginia has been ranked No. 6 among the Top 10 States in Site Selection magazine’s 2017 Prosperity Cup, tying with Ohio. The showing represents a seven spot jump from No. 13 in 2016.
In comments on the ranking Wednesday, Virginia Secretary of Commerce and Trade Todd Haymore said, “It is gratifying to see Virginia climbing higher on the Prosperity Cup ladder for economic development competitiveness. The new Virginia economy initiatives launched in 2014 to strengthen and diversify our economy and lessen our reliance on federal funds are working …”
The No. 1 state was neighboring North Carolina. It tied with Texas for the top spot in in 2016 and placed first in 2015. While passage of a controversial “bathroom bill” in 2016 sparked a negative backlash, with canceled business relocations and expansions, factors in place that had caused North Carolina to rank well are still intact, according to Site Selection magazine.
Plus, the state’s legislature repealed HB2 in late March, the bill that required people at government-run facilities to use bathrooms and locker rooms that correspond to the gender on their birth certificate. One feature, though, was kept intact, giving the legislature control of the regulation of bathroom access, which prevents local governments from enacting their own ordinances.
Despite the furor over the bill, Site Selection said in a story about its rankings that North Carolina “still has one of the most educated workforces in the U.S.; a temperate climate; two international airports, including a major hub for American Airlines at Charlotte, which is also a top financial center; three coastal ports; a desirable mid-Atlantic location; top research universities and community colleges and a 3 percent corporate income tax rate — the lowest such rate east of the Mississippi other than Ohio, which imposes a gross receipts tax in lieu of corporate income tax.”
The Prosperity Cup determines states’ competitiveness based on several factors: new and expanded facilities, job creation, capital investment, and tax climate. In addition, it considers each state’s rank in the corporate real estate executive survey portion of the 2016 Site Selection Top U.S. Business Climates ranking, its performance in the Beacon Hill Institute’s State Competitiveness Report and the number of national career readiness certificates per 1,000 residents aged 18-64.
Site Selection debuted its Top Competitive States ranking in 2002. In 2016, the ranking became known as the Prosperity Cup.
Virginia also did well overall in the South Atlantic regional ranking, coming in No. 3 behind North Carolina and Georgia.
Loudoun County is an industry giant when it comes to data centers, and Buddy Rizer has a book to prove it. On a coffee table in his office at Loudoun’s economic development department is a book titled “Goliath” that commemorates a record in data-center construction.
It’s the story of how Loudoun worked with CyrusOne, one of the country’s largest data center operators, to complete a 220,000-square-foot data center in Sterling in 180 days.
Six months is the shortest construction time ever for a center that size. “From drawings on the desk to open-the-doors ready, it’s really a powerful story,” says Rizer, the county’s executive director of economic development whom many consider the dean of data centers in Virginia.
Getting centers online is a story that’s been playing out in Loudoun for the past decade. That’s when Rizer joined the county’s economic development staff and decided to expand upon the fiber-rich internet infrastructure already there. Put in place in the 1990s when major telecom companies such as America Online and WorldCom invested in miles of fiber, the digital infrastructure gave Loudoun an edge in moving forward with what is now the superhighway to the internet on the East Coast.
With bountiful land and affordable, reliable electricity, Rizer says Loudoun’s data-center industry took off. “We went all in,” says Rizer, who obtained industry certifications and traveled the country speaking at data-center conferences. He credits Dominion Energy for being a strong marketing partner, with utility officials sometimes co-presenting with Rizer. “Their participation, their partnership has been a critical function in the pace of the growth of Loudoun County,” he says.
Today, Loudoun is the No. 1 data center market in the country. It says that 70 percent of the world’s internet traffic passes through Ashburn daily. Some of the country’s largest operators — Digital Realty Trust, Equinix, Amazon Web Services, DuPont Fabros — have massive facilities in “Data Center Alley.” The site is broadly defined as a 6-mile radius around the intersection of Waxpool Road and Loudoun County Parkway, home to the largest concentration of data centers in the world.
Currently, Loudoun has 10 million square feet of data center space, with another 4.5 million in the pipeline. In addition, 43 new sites are available for use by data centers.
“It’s the Manhattan of the internet,” says Allen Tucker, a managing director in the Tysons Corner office for commercial real estate firm JLL who specializes in data centers. “If you’re in the financial services world, you need to be at 200 Wall St. But if you’re in data centers, the hub is at Loudoun County Parkway and Waxpool.”
Loudoun’s 75 data centers house equipment for more than 3,000 technology companies and generate about $160 million a year in local tax revenue. They have served as a major economic driver, Rizer says, in an affluent county whose largest budgetary debate this year was “do we add an 8 or 9 percent increase to the school budget?”
Nearby Prince William County also has jumped on the bandwagon. The county has more than 3 million square feet of data center space and recently approved a new zoning district designating 10,000 acres to support new development.
While Northern Virginia is undisputedly the hub, the spokes of this burgeoning industry are spreading to other areas of Virginia. Data centers have opened everywhere from Wise County in the far Southwest to Mecklenburg County in Southern Virginia, providing jobs and tax revenue in areas hard hit by the loss of traditional industries, such as coal mining and textiles.
Meanwhile, Virginia Beach soon will have the first transoceanic cable station in the mid-Atlantic. Microsoft, Facebook and Telefonica, a Spanish telecom company, have joined forces to build a 4,000-mile undersea cable that will connect Virginia to a data hub in Bilbao, Spain. With a bandwidth about 16 million times the size of a home internet connection, the cable will provide Europe with a super-fast connection. It will carve a more efficient path not only to Europe, but to Africa, the Middle East and Asia — markets internet companies look to for new customers.
“This has the potential to be a game changer for Hampton Roads,” says Rob McClintock, a vice president of research with the Virginia Economic Development Partnership. “This gives them a platform to kick-start other industries that need that big-data infrastructure.”
Not many jobs
Data centers, which house computer servers for thousands of companies, are viewed as pillars of the global digital economy. Yet critics point out that, aside from their construction, they don’t create many permanent jobs. The jobs they do provide, however, pay well: $105,942 a year on average in 2014, according to a recent study done for the Northern Virginia Technology Council (NVTC).
Since jobs aren’t the draw, why are so many communities trying to attract data centers? “They help pay the bills,” says McClintock.
Data centers are capital-intensive projects, he notes, with sophisticated computer equipment that needs updating nearly every three years. That translates into millions of dollars in local tax revenues.
To get a sense of the capital investment, consider Microsoft’s project in Mecklenburg County. With five expansions since the center’s construction in 2010, Microsoft has invested nearly $2 billion and created 250 jobs at what is its East Coast hub for online services.
In Wise County, DP Facilities Inc. recently opened a $65 million data center with top-level security. It is expected to create 40 jobs during the next three years in the areas of technology, facility management and security.
“Locally, we envision the entire Southwest Virginia region as the state’s next secure technology corridor,” says Marc Silverstein, a spokesman for New York-based DP Facilities. “Here’s what it offers: affordable power, connectivity, an ideal climate, a location away from population centers and flood zones, with room for growth.”
With the movement to cloud computing and the increased use of mobile applications and social networks, global internet traffic continues to explode. According to a Cisco report, that traffic soon will support up to 10 billion new devices and connections, increasing from 16.3 billion in 2015 to 26.3 billion by 2020.
Brian Johnston, chief technology officer for QTS, a publicly traded data-center real estate investment trust that operates 25 data centers, says, “There’s plenty of growth ahead,” and Virginia is well positioned to share in that growth. “It’s one of the best data-center markets in the world,” he says, with reasonable land and power costs, access to fiber and tax incentives.
Dominion Energy charges 5.2 cents per kilowatt hour for large data centers, with slightly higher prices for small centers, according to Stan Blackwell, a director of customer service and strategic partnerships for Dominion in Richmond. “We’re very competitive. We have some of the lowest data-center rates in the nation.”
Data centers represent Dominion’s fastest growing customer segment, he adds, with about 7 percent of the company’s retail portfolio consisting of data centers.
QTS, based in Overland Park, Kan., bought a former computer chip plant — built by Motorola and Siemens — in Henrico’s White Oak Technology Park and converted it into a data center. QTS purchased the sprawling, 210-acre complex in 2010 for $12 million after the building’s subsequent owner, Qimonda, filed for bankruptcy. Since then, Johnston says, the company has invested hundreds of millions of dollars to transform the complex into a mega data center. It currently has 500,000 square feet of data storage space in three buildings, and QTS hopes to expand to 1.5 million square feet.
Touring a center
A visit to QTS in Henrico and a Sabey data center in Ashburn offers a firsthand look into the high-security world of data centers. While these places store information designed to promote human interaction, they are designed to keep intruders out.
On the outside, the centers look formidable. They are surrounded by black crash fencing, electronic razor fences and guard stations. Inside, closed-circuit cameras guard the premises, and visitors are escorted down windowless halls to rooms accessible only by fingerprint or iris recognition.
The rooms, with high ceilings and raised floors, house hundreds of thousands of servers. They sit on racks in steel cages and emit soft colors as they blink and hum while storing the internet communications of people and businesses from around the world.
Grills in the floor at QTS allow cool air to flow in from large air conditioning units so the computer equipment, which runs 24/7, doesn’t overheat. Sabey relies on a Kyoto wheel, a thermal wheel system for distributing air, to cool its servers. In the event of a power interruption, data centers have diesel generators and battery backup to assure uninterrupted service.
“This is their business, their lifeblood operating right here,” Johnston says, pointing to cages where customers lease space. QTS’ customers include health-care, financial service and high-tech companies.
Storage isn’t cheap, because data centers are expensive to build. Robert Rockwood, president of Sabey Data Centers, based in New York, said the buildings cost $1,000 to $2,000 per square foot, compared with about $250 per square foot for an office building.
Sabey’s 140,000-square-foot center in Ashburn offers 10 megawatts of power and employs about 35 people.
Incentives
To attract data centers, some localities offer incentives. Henrico County recently dropped its business property tax rate on computers and related equipment for data centers from $3.50 to 40 cents per $100 of assessed value, an 88.6 percent rate cut.
“No one else has done what we’ve done,” says Gary McLaren, executive director of Henrico’s economic development authority. “The only folks that are even close are Prince William County, and they’re at $1.25.”
Henrico’s tax break comes on top of a state exemption from the retail sales and use tax. Passed in 2009, the exemption applies to computer equipment bought or leased for use in a data center — an incentive the General Assembly recently extended until 2035. To be eligible, a facility must be located in Virginia, generate a capital investment of at least $150 million and create 50 jobs at wages 50 percent above the prevailing local wage (a requirement reduced to 25 percent in high-unemployment areas).
hile some naysayers dismiss centers as big ugly boxes that suck up power and provide few jobs, supporters view them as stable business partners. “Our tenants are long term. There’s not a lot of turnover,” says Kevin Snead, site director at QTS’ Richmond data center.
Or as Rizer points out: “We have all become content creators. All those tweets and instagrams. That demand will continue to grow.”
The Roanoke region’s economy continues to benefit from an annual marathon that’s drawing more racers to the area.
The eighth annual race in April, known as “America’s Toughest Road Marathon,” hosted 1,859 runners who generated more than $613,000 in economic impact, according to an analysis by the Roanoke Regional Partnership and Roanoke Valley-Alleghany Regional Commission.
Over the past eight years, the event has contributed more than $3.8 million to the local economy.
A post-race survey of the Foot Levelers Blue Ridge Marathon, double marathon, half marathon, relay, and associated events including the Carilion Family 1-Miler, and Anthem Star 10K, determined that the April 16 races created $349,005 in direct new sales activity, plus an additional $264,543 in indirect and induced spending for the total of $613,548 – up 3.6 percent from 2016.
The economic impact was larger this year as a result of an increased number of participants from outside the Roanoke region. They accounted for 54 percent of race participants. The race drew runners from 43 states and the District of Columbia and eight foreign countries: Albania, Canada, Ireland, Italy, Moldova, Mongolia, South Africa and the United Kingdom.
In the survey, people were asked to report the amount spent on fuel, meals, lodging, miscellaneous retail purchases and admissions while in Roanoke. According to the Roanoke Regional Partnership and Roanoke Valley-Alleghany Regional Commission, about 48 percent of the participants took the survey.
Some of the findings:
· More than 44 percent of all respondents reported staying in town for at least one night. About 38 percent stayed one to two nights. The average length of stay among overnight visitors was 1.7 nights.
· About 46 percent of respondents reported traveling with family or friends, with an average of 1.1 additional people in the travel party among overnight visitors.
The race starts in downtown Roanoke and climbs to the top of Mill Mountain and Roanoke Mountain along sections of the Blue Ridge Parkway for a total elevation change of 7,430 feet.
Along with national interest, local participation continues to grow. The Anthem 10K race option, Carilion Family 1-Miler, post-race festival and concert in conjunction with the Down by Downtown Music Festival, brought the community to the city’s Elmwood Park.
The 2018 races are scheduled for April 21.
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