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byline: Robyn Sidersky

Danville considers new rules for short-term rentals

Amid a boom in local short-term residential rentals like Airbnbs, Danville officials are examining ways to regulate the practice.

Caesars Entertainment opened its temporary Danville Casino in May, drawing some area visitors. Additional factors driving short-term rentals, speculates Danville City Manager Ken Larking, may include construction on local projects such as the $100 million White Mill redevelopment and the $650 million permanent Caesars Virginia resort casino, along with a new Navy training program for defense industry manufacturing workers at the Institute for Advanced Learning and Research.

Short-term rentals are adding to an affordable housing shortage for the region’s growing workforce. A study last year commissioned by the city found that Danville has a housing shortfall of about 600 units based on current housing supply and projected job and population growth, as well as residents’ ages and income levels. 

At least 100 short-term rentals are listed in the Danville area and not all have been vetted, says Renee Burton, Danville’s director of planning and zoning. About 30 comply with city law, but others are operating under the radar.

Danville allows for short-term rentals of bedrooms or basements as an accessory use, but special-use permits and a business license are required to rent out a house — a fact of which many residents offering their properties for short-term rentals aren’t aware, Larking says. “As soon as we know about them,” he says, “we let them know what the rules are.”

To address the issue, city staff are proposing several ordinance changes, including: requiring special-use permits for all rentals, whether a room or a house; charging a $500 fee for hosts; conducting annual inspections; collecting back taxes from hosts; limiting concurrent short-term rentals to 150, or about 1% of the parcels in the city; limiting stays to between 18 hours and 30 days; and requiring property owners to live within 30 miles or designate a local agent.

Additionally, standards are needed to address safety and ensure short-term rentals are compatible with neighborhoods, Larking says, adding that other questions should be considered, including, “Is there room to park? Will this become a nuisance to the neighbors?”

Danville’s planning commission has signed off on some changes, which are under review by Danville City Council, but a vote had not been set as of mid-November.  

Va. Tech hires CIO from Brown

Virginia Tech has named Sharon P. Pitt its vice president for information technology and chief information officer, the university announced Tuesday.

Pitt will start her new role on Feb. 1, 2024. She returns to her alma mater from Brown University, where she is currently vice president for information technologies and chief information officer. She has previously served in information technology leadership roles at the University of Delaware, Binghamton University in New York and George Mason University.

In her new role, Pitt will oversee the Division of Information Technology, which has more than 300 employees in nine departments. She will focus on balancing the university’s priorities, building consensus and supporting the innovation and collaboration needs of the university.

“As we look to the work ahead, Virginia Tech should aspire to be best in class in our use of technology in learning, research and workspaces,” Amy Sebring, Virginia Tech executive vice president and chief operating officer, said in a statement. “I am thrilled that Sharon will be stepping into this role at a time when the demand for technology has never been higher. I am confident in Sharon’s ability to develop a technology road map for Virginia Tech aligned with our shared strategic priorities.”

Pitt earned her master’s in architecture and bachelor’s in economics from Virginia Tech and a graduate certificate in higher education administration from George Mason University.

Norfolk makes economic development head permanent

The City of Norfolk will keep Sean Washington as its director of economic development permanently after serving as interim director since August 2022, the city announced Tuesday.

His appointment was effective Nov. 6. Before serving as interim director, Washington was assistant director from November 2020 through August 2022, but he’d worked in the department since June 2017 as a business development manager and became secretary-treasurer of the Norfolk Economic Development Authority in October 2017. Washington became the interim head of the department when Jared Chalk left to take a job with the Hampton Roads Alliance.

As secretary-treasurer for the EDA, Washington managed the financial position of the EDA to include overall assets of about $29 million and $4.4 million in cash and equivalents. When he was business development manager for the city, he administered five small business programs, resulting in $4.5 million in grants being awarded to Norfolk businesses.

“Norfolk is a thriving community today thanks in large part to economic development efforts that have already occurred. We’ve worked hard to secure new businesses, additional jobs and the benefits such investment bring to our residents and visitors,” Norfolk City Manager Pat Roberts said in a statement. “Looking forward, Sean’s business acumen, expertise and familiarity with all of the advantages Norfolk offers to both incumbent and prospective business partners uniquely position him to help us author the next chapters in Norfolk’s economic success story. I can’t wait to see what comes next from Sean and his team.”

Before he worked for the city, Washington was an assistant vice president for BB&T for seven years, where he managed a $34.5 million deposit portfolio and $15 million lending portfolio.

Washington attended Hampton University, where he earned a business degree, according to his LinkedIn page.

Bonaventure acquires Norfolk apartments for $42M

Alexandria-based real estate company Bonaventure has acquired Monticello Station, a Class A apartment building in downtown Norfolk, for $42 million, the company announced last week. 

The 121-unit building at 328 Freemason St. has one-, two- and three-bedroom apartments. S.L. Nusbaum previously owned the property, according to Bonaventure. 

Bonaventure will rename the building Attain Downtown East. In addition to the apartments, it has 33,000 square feet of ground-floor retail space, including Buffalo Wild Wings, 7-Eleven and Sushi King as tenants. 

“With its prime location, numerous amenities and long-term financing, Monticello Station directly aligns with the type of assets we seek to acquire and manage in our perpetual life multifamily fund,” Bonaventure CEO and founder Dwight Dunton said in a statement. “As part of our investment management platform, this vehicle provides investors access to strategic diversification across our target markets as well as predictable income. We are pleased [to] expand our footprint in Norfolk and the greater Hampton Roads area, and look forward to capitalizing on the opportunities in our investment pipeline to grow our carefully constructed portfolio.”

Bonaventure also owns Attain Downtown, another apartment building at 450 Boush St. in downtown Norfolk. 

Bonaventure has $2.3 billion of assets under management and manages more than 6,500 apartment units across 35 communities in the mid-Atlantic and Southeastern regions.

Amazon HQ2 impact on housing market short-lived, report says

The June opening of Amazon.com’s $2.5 billion East Coast headquarters in Arlington County only had a short-lived impact on home prices, and it’s hard to pinpoint HQ2’s direct impact due to other factors affecting residential costs, according to a report released this month by Bright MLS Research.

When Amazon announced it would bring 25,000 highly-paid workers to its second headquarters in Arlington County in November 2018, there were fears that the development would displace low-wage residents in the area, and only high-income earners could live there.

“It has been difficult to identify the true impact Amazon has had on housing costs — specifically on — home prices in Arlington and the surrounding area,” according to the Nov. 13 report. “Home prices tend to be high in places close to jobs and amenities. Arlington has an unparalleled location across the river from the District of Columbia. Furthermore, over the past two decades, the county has also pursued land use policies and economic development strategies to make Arlington attractive to young professionals and families.”

The pandemic was a complicating factor, upending where people work while the government’s response fueled housing demand, the report adds.

“While the announcement prompted both elation and anxiety, the effect on the housing market was short-lived as the COVID-19 pandemic and the resulting government and business responses to the pandemic have had a much bigger impact on the housing market,” Bright MLS Chief Economist Lisa Sturtevant said in a news release about the report.

Ryan McLaughlin, CEO of the Northern Virginia Association of Realtors, agreed that it’s hard to pinpoint the impact of HQ2’s announcement and its first phase of construction on the housing market. The pandemic started about two months after the start of HQ2’s construction.

“I think the full impacts of HQ2 are yet to be seen,” he said, pointing out the shift in how people work and other economic factors, such as mortgage rates, low inventory and high interest rates.

Amazon opened Merlin, its first tower, and one of the twin 22-story buildings that make up Metropolitan Park, HQ2’s first phase, in June. About 8,000 employees currently work there. Amazon delayed construction of HQ2’s second phase, known as PenPlace, in March, as the Fortune Global 500 tech company laid off 18,000 workers.

A George Mason University report in 2018 estimated only about 10% of Amazon’s workers would live in Arlington County, while 60% would live in other parts of Northern Virginia, Washington, D.C., Maryland and elsewhere, according to the new report.

“I think the long-term impacts, certainly for Arlington, Northern Virginia and the Greater D.C. metro region will be very strong,” McLaughlin said. “There’s a reason why HQ2 selected Northern Virginia as the place where they wanted to invest.”

Trader Interactive CEO Lori Stacy to retire

Trader Interactive CEO Lori Stacy will retire Dec. 14 and Chief Operating Officer David McMinn will succeed her in leading the Virginia Beach-based online marketplace for boats, recreational vehicles, motorcycles and other niche vehicles.

Stacy, who has served as CEO since 2017, will take on the new position of chair of Trader Interactive’s board after her retirement, the company announced Monday. She joined the company as a sales manager in Florida in 1997, when its predecessor company, Auto Trader magazine, was owned by Norfolk-based Landmark Media Enterprises. The company evolved into Trader Interactive, an umbrella for several online-only marketplaces, in 2010.

“Now is the right time for me to step back and embark on a new chapter in my life so I can focus on my passions and spend more time with my family,” Stacy said in a statement. “I have never been more confident in the team and the work we are doing than right now. Our leadership team is the strongest it has ever been, we have an amazing partnership with our owners, and I see nothing but positive momentum ahead. TI is a part of me, and I am dedicated to seeing it thrive in the years to come.”

David McMinn
Photo courtesy Trader Interactive

Australian auto retailer carsales.com acquired 49% of Trader Interactive in August 2021 for $624 million and then announced plans in June 2022 to buy the remaining 51% of the company for $809 million. Trader Interactive’s valuation was estimated to be $1.87 billion at the time, making it a unicorn in venture capital parlance, or a privately held startup with a total market value of $1 billion or more.

McMinn has served as chief operating officer and chief financial officer at Trader Interactive. Before joining the company in October 2022, he was COO of Trader Corp., a Canadian classified advertising company. He has also served in senior leadership roles in sales and operations with the Trader Media Group in the United Kingdom. He also served as CFO of Sensis Classifieds in Australia. He was named COO of Trader Interactive in April, and a new COO has not yet been named.

“Trader Interactive is unique with a thriving culture and so many opportunities to continue to build value for our customers,” McMinn said in a statement. “Lori and the team have built a great business and I am honored to lead the world-class team here at TI. We have an exciting future ahead of us.”

Trader Interactive runs marketplaces for buyers, sellers and renters of powersports and recreational vehicles, aircraft, marine and commercial vehicles, and heavy equipment. It reaches more than 9 million unique monthly users through brands such as Cycle Trader, RV Trader, Commercial Truck Trader and Equipment Trader.

International logistics company to expand in Norfolk

Katoen Natie Norfolk, a subsidiary of Belgian international logistics service provider and port operator Katoen Natie, will invest $59.9 million to expand its Norfolk facility and create an estimated 76 jobs.

Katoen Natie Norfolk will add a 450,000-square-foot warehouse and rail yard, and expand its existing rail spur, which will allow more room to load and unload train cars, Gov. Glenn Youngkin announced Monday. Katoen Natie Norfolk established its Norfolk operation at the former Ford Motor assembly plant and refurbished body shop at 810 Ford Drive in 2011. The Norfolk company is a plastics and polymers warehousing and distribution company. The addition will help the company meet increased demand.

This is the second expansion for the Norfolk company. In April 2021, Katoen Natie Norfolk announced it would invest $61 million in a 243,000-square-foot warehouse and rail facility, and create 35 jobs.

“Katoen Natie Norfolk’s increased demand matches the surge Virginia is experiencing as a premier supply chain destination, and this expansion will foster the synergy of the industry ecosystem,” Youngkin said in a statement. “Katoen Natie Norfolk has thrived in Hampton Roads for more than a decade thanks to the region’s outstanding logistics advantages, access to the Port of Virginia and robust workforce, and I look forward to its continued growth.”

Katoen Natie, founded in 1854, focuses on 10 main industries: supply chain engineering, process engineering, petrochemicals, specialty chemicals, consumer goods and industry, port operations, general cargo and commodities, food and feed, silo cleaning and art. At its Norfolk facility, the company allows producers of plastic resin pellets to ship bulk railcars to the warehouse, where the product is packaged and loaded into intermodal containers for shipment through the Port of Virginia.

“Due to its central location on the East Coast, great workforce including former military, dual rail service via Norfolk Southern and CSX, and natural deep-water, great-functioning port, we chose Norfolk for our expansion,” Katoen Natie President Frank Vingerhoets said in a statement.

The Hampton Roads Alliance, Virginia Economic Development Partnership and the City of Norfolk recruited Katoen Natie to Hampton Roads in 2011. Virginia competed with Georgia and South Carolina for the expansion project.

Katoen Natie Norfolk is eligible to receive state benefits from the Virginia Enterprise Zone program, administered by the Virginia Department of Housing and Community Development. Funding and services to support the company’s employee training activities will be provided through the Virginia Jobs Investment Program, and the company is also eligible to receive benefits from the Rail Industrial Access program through the Virginia Department of Rail and Public Transportation, which is subject to approval by the Commonwealth Transportation Board.

Katoen Natie Norfolk’s parent company is present in 35 countries on five continents and has more than 15,000 employees around the world.

Communities must rally to solve housing issues, Barkin says

Homeownership is becoming increasingly unattainable for too many workers, and communities are going to need to make innovative decisions to create more affordable housing if they want to attract talent, Federal Reserve Bank of Richmond President and CEO Tom Barkin said Wednesday during the Virginia Governor’s Housing Conference in Hampton.

Barkin said the nation’s housing crunch is affecting the largest cities to the most remote of towns, impacting availability of talent, and encouraged communities to rally together “to see housing as integral to economic growth. Regional leaders need to speak with one voice.”

Though some areas saw increased housing demand and higher home prices before the pandemic, demand increased and supply dwindled across many more communities over the past three years, he noted. Low interest rates and spending more time at home in 2020, as well as remote work allowing some people to move to less expensive places, caused people to reevaluate their living situations. With buying becoming harder, it became cheaper to rent, but the rental market is taking a hit on the supply side too, Barkin said. 

In a question-and-answer session with Virginia Commerce and Trade Secretary Caren Merrick, Barkin discussed the Fed’s role in addressing inflation and interest rates — the goal is to use interest rates to bring down inflation.

“The objective isn’t interest rates,” Barkin said. “The objective is to control inflation … everybody hates inflation, we do something about inflation. We’re the only agency asked to do something about it. We have one tool: interest rates.”

Virginia numbers

In Hampton Roads, the number of monthly active listings increased for the seventh straight month in October, according to the Real Estate Information Network. But the number of settled and pending sales are down month-over-month and year-over-year. The median sales price is down slightly from September, decreasing from $333,000 to $330,140.

In Northern Virginia, home sales declined 5.6% in October as compared to October 2022, and prices increased 3.1%, according to data from Northern Virginia Association of Realtors. The month’s supply of inventory was up but still down from the five-year average. Median sales prices increased but at a slower clip.

“The combination of mortgage rates and selling prices continues to challenge some would-be buyers,” Jon McAchran of Virginia Beach-based AtCoastal Realty and president of REIN’s board of directors, said in a news release. “However, homes are still selling, as shown by the median days on market, which is the same as it was last year at this time.”

Virginia isn’t faring as well as its neighbors, however, when it comes to building single-family homes.

“Everyone is struggling with this issue, but we can learn from each other,” Barkin said. “For those of you with a competitive spirit, both South and North Carolina have issued more permits for private, single-family homes than Virginia in each month since 2016.”

While encouraging communities to work together to solve housing availability, communities must also recognize they are competing for developers, Barkin said, suggesting they explore ideas including developing financial incentives and streamlining municipal processes like permitting and timelines. He added that communities also need to “work” the biggest barrier and incentive for developers: land availability.

In 2022, Barkin noted, finished lot costs made up nearly 20% of the average sales price of a new single-family home, and minimizing that cost can go a long way. Communities can rezone under-leveraged land to spark higher-density development and invest in buildable homesites. Another idea: transforming older, unused structures into apartments. Barkin referred to the Dan River Falls project in Danville, where developers are turning an old textile mill into retail space and 150 apartments. 

“Once you start thinking of the possibilities, it is impossible to stop, and I know Virginia has efforts underway to look at all state-owned land that could be used for housing,” he said.

Barkin cited another alarming stat: In 2022, construction costs were 60.8% of the average sales price for a new single-family home in the U.S., up from 55.6% in 2017, according to a February report for the National Association of Home Builders. Those costs may stay high, and communities should consider efforts to bring down housing costs, whether it’s building smaller or different types of homes, for example, he said.

Finally, Barkin said Virginia localities need to look to unconventional partners to lower homebuilding costs, working with foundations and employers such as Amazon.com, as well as colleges and universities, which can build more dorms to free up other housing. 

“We all know housing availability is limiting communities,” Barkin said. “The key is more supply. To create that supply, communities need to own the problem, compete for developers, innovate in offering affordable land and lowering costs and engage with nontraditional partners … this is a math problem — but one where potential solutions are beginning to multiply.”

 

Mars to acquire British chocolatier for $662M

A subsidiary of McLean-based international candy and pet food manufacturer Mars, the largest privately held company in Virginia, has agreed to acquire Britain’s Hotel Chocolat for $662 million, Mars announced Thursday.

Bidco, a wholly-owned subsidiary of Mars, will acquire Britain’s largest chocolate maker in a cash offer at 375 pence per share, or about $662 million, in a deal that will help the brand continue expansion.

Reuters reported Thursday that Hotel Chocolat CEO and co-founder Angus Thrilwell will continue to lead the company for the next five years. Thirlwell founded the company with Peter Harris in 2003, though they started selling chocolates online in 1993, according to Hotel Chocolat’s website. Mars said it intends to maintain Hotel Chcolat’s brand.

“We have long admired the fantastic business that Angus, Peter and the Hotel Chocolat team have created,” Andrew Clarke, global president of Mars Snacking, said in a statement. “Hotel Chocolat is a differentiated and much-loved brand, with an impressive product offering and a deep commitment to its values of originality, authenticity and ethical trading. The Mars and Hotel Chocolat businesses are highly complementary, and during the course of our discussions with Hotel Chocolat’s leadership it has also become clear that there is a very strong cultural fit — with purpose at the heart of both organizations and a shared passion for quality and sustainability.”

In a news release, Mars said the company believes the acquisition will strengthen its presence in the United Kingdom. It has operated there since 1932 and has about 10,000 employees. Hotel Chocolat opened in North London in 2004 and now has 131 stores in the U.K., as well as cafes, restaurants, outlets and factory stores, and a luxury hotel on the company’s cocoa farm in the Caribbean overlooking a UNESCO world heritage site. It also has 21 stores in Japan through a brand licensing and supply agreement with a local partner, according to a news release.

As of July, Hotel Chocolat had 2,339 employees, according to the company’s annual report.

Known for its M&Ms and Snickers candy brands, Mars is the fourth largest privately held company in the nation. With $45 billion in sales in 2022, it has approximately 140,000 employees in 80 countries. Its divisions include Mars Petcare, which runs an international network of 2,000 pet hospitals, roughly half of which are operated by U.S. subsidiary Banfield Pet Hospital.   

 

Richmond-area mainstay Saxon Shoes moves onto its next step

When Gary Weiner’s parents, Jack and Gloria, opened Saxon Shoes in Richmond in 1953, they mostly carried shoes for children with orthopedic needs. Now, 70 years later, the store has something for everyone and is about 10 times the size of the average shoe store and operates in Henrico County’s Short Pump area. It’s become a greater Richmond mainstay.

But the local retailer is taking another new step. After running the family business since 1979, Gary Weiner announced this week he is retiring and has sold Saxon Shoes for an undisclosed amount to Alexandria-based Comfort One Shoes. Established in 1993, Comfort One has several stores in Virginia, Maryland and Washington, D.C. The sale was finalized Wednesday and the new owners do not plan to change Saxon’s name. 

Weiner, his wife, Beth, and other family members, including two of his three adult children, Amanda and Evan, have been running the store, with about 25 to 30 employees.

Talking about how he got into the family shoe business, Weiner recalls that his parents “kept me in the stockroom because they couldn’t afford a babysitter and here we are today.” He’s seen the shoe industry evolve, with the boom of online shopping, vendors selling directly to consumers and other changes. Now he’s ready to hand over the keys. 

Saxon, in Henrico County’s Short Pump, has new owners.
Photo courtesy Gary Weiner

“I feel like it’s been very good to us and the timing was just right,” he said. “Our business was on a pretty nice uptick,” he notes. “The trend was positive.” 

He said he’s been approached multiple times over the years by many companies, but the timing wasn’t right then, and now it makes a lot of sense to sell. One of his children, Amanda Weiner, will stay on to work for the new owners, but the rest of the family will depart. The other employees, who are not family members, will also stay on. 

The original Saxon opened at 410 E. Grace St. in downtown Richmond. Then, the Weiners had a “big shoe concept store” in 1989 in an old grocery store that was about 18,000 square feet. Saxon moved to Short Pump in 2004. The store is currently about 22,000 square feet, while most shoe stores are 2,000 to 3,000 square feet.

“We do it all under one roof. You don’t need to go to multiple places to get everything you need, whether it’s Ugg boots or Birkenstocks,” Gary Weiner said. 

He feels good about his decision to sell and said the new owners will keep the focus on good shoes, good quality, good service and attention to detail — “all the things we stood for.” He said he thinks Comfort One will “create the new and improved Saxon Shoes.”

Gary Weiner said his mother, Gloria, a native of Casablanca, Morocco, came up with “Saxon” after visiting London and seeing a small department store called “Saxone.” When her husband said he wanted to open a shoe store, that’s the name she suggested. 

What he’ll miss about running a shoe store — aside from being able to work with so much family and learning from them — is the people and seeing customers happy in the store. 

“They [the Richmond community] were good to us for a long time,” he said. “We tried to be a good patron of Richmond and Henrico and give back.”