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

Best Places to Work in Virginia

Hamburger Menu Hamburger Menu

byline: Robyn Sidersky

CarLotz to merge with San Francisco’s Shift

Richmond-based CarLotz Inc., the nation’s largest consignment-to-retail used vehicle business, will merge with San Francisco-based Shift Technologies Inc., a similar platform on the West Coast, the companies announced Tuesday.

The companies will combine in a stock-for-stock merger, according to a news release and will trade on Nasdaq under SFT. At the close, the new company will have a cash position of about $125 million, according to a news release. CarLotz’s stock was trading at 57 cents per share on Tuesday; the stock has gradually fallen from its January 2021 height of $11.92 per share, hitting a low of 40 cents per share last month.

CarLotz and Shift have complementary geographies, with CarLotz’s strong presence in the mid-Atlantic and Shift’s West Coast footprint.

“While this is an exciting day for both companies, the merging of Shift and CarLotz will be most beneficial to consumers looking to buy or sell a used car,” CarLotz CEO Lev Peker said in a statement. “Shift’s technology and consumer sourcing abilities combined with our consignment and retail remarketing expertise will provide one extraordinary, omnichannel experience.”

Shift’s CEO also released a statement.

“The Shift and CarLotz teams have admired each other and our respective businesses for quite some time. We’ve always seen a considerable amount of strategic and cost synergies with a combined entity,” Shift co-founder, CEO and Chairman George Arison said in a statement. “We are strongly convinced that the merger will put us in a position to pursue a profitable future. As such, this is a transformative moment in Shift’s history by enabling us to advance our vision to be the end-to-end destination for car ownership that controls its own destiny.”

Under the terms of the merger agreement, CarLotz shareholders are expected to receive approximately 0.692158 shares of Shift common stock for each share of CarLotz common stock, according to the release.

The deal is expected to close in the fourth quarter, subject to CarLotz’s and Shift’s shareholders approvals and other regulatory approvals. Arison will step down as CEO of Sept. 1, but will remain in his position as board chairman; Shift President Jeff Clementz will succeed him as CEO.

CarLotz was founded in 2011 in Chesterfield County before expanding nationwide. It went public in January 2021 after partnering with Acamar Partners Acquisition Corp., a SPAC. Last year, CarLotz announced an expansion of its headquarters in Richmond that would create 192 jobs. Peker, who is based in Los Angeles, took over as CEO of CarLotz in April; he had previously served as CEO of CarParts.com, an online retailer of automotive parts and accessories. He replaced CarLotz co-founder Michael Bor, who left the company in March.

CarLotz’s net revenue in 2021 increased 118% to $258.5 million, from $118.6 million in 2020. Tuesday, the retailer reported its second quarter 2022 earnings, which rose 51% to $76.5 million, up from $50.8 million during the same period in 2021. Retail sales increased 21% from the same period last year.

Downtown Norfolk Council adds 2 execs

The Downtown Norfolk Council announced two leadership changes Monday.

Rachel McCall has been promoted to vice president, from director of strategic initiatives. She has been with DNC since 2014 in a variety of roles, advancing the NEON District — Norfolk’s arts district — and other initiatives. In her new role, she will manage placemaking, oversee DNC operations and spearhead NEON District efforts, among other duties.

A not-for-profit organization that includes businesses and individuals “working toward a dynamic, attractive and prosperous downtown,” DNC manages the 50-block Downtown Norfolk Improvement District.

“As a native and a resident of Norfolk, I’m grateful to spend every day working toward a more vibrant, inclusive, walkable and beautiful downtown,” McCall said in a statement. “I’m thrilled to take on a larger role with DNC and share the incredible impact this organization has on our city.”

She’s also a founding board member of the Elizabeth Trail Foundation, chair of the foundation’s events committee and a graduate of the International Downtown Association’s Emerging Leader Fellowship. She earned her bachelor’s degree from William & Mary.

Laura Wood is DNC’s new director of business engagement. She will support programs, services and initiatives that sustain and grow DNC’s economic development. She has worked in the restaurant, tourism and hospitality industry for 25 years as co-owner of Croc’s 19th Street Bistro in Virginia Beach, and as a co-founder of the ViBe Creative  District, Old Beach Farmers Market and the Business Alliance for Protecting the Atlantic Coast.

In her new role, she will support the implementation and tracking of economic development strategies for DNC and develop partnerships to support business retention and recruiting, among other duties.

“I see my role at DNC as a bridge builder, and I am excited to be an advocate for the little guys, the small biz and creative communities,” Wood said in a statement. “I have lived and breathed community building and placemaking for several decades and am humbled to play a part in my new role to meet existing business owners in Downtown Norfolk and recruit new ones. Additionally, my experience with law enforcement and all levels of government makes me well suited to support a safe and vibrant downtown.”

She has served on several regional boards, including  the Virginia Museum of Contemporary Art and the FBI Norfolk Citizens Academy Alumni Association, as well as the Virginia ABC Enforcement Expert Review Panel. Wood studied at the Art Institute of Fort Lauderdale and earned an associate degree in interior design from Tidewater Community College.

Restoration Bioproducts to build $5.8M biochar plant

Lynchburg-based Restoration Bioproducts LLC will invest $5.8 million and build Virginia’s first biochar production facility in Sussex County, creating five jobs and purchasing 34,560 tons of Virginia-grown wood products, Gov. Glenn Youngkin announced Monday.

Wood pellet manufacturer Wood Fuel Developers is already in Waverly. Restoration Bioproducts will use pyrolysis technology to turn wood waste from Wood Fuel Developers’ mill into biochar and syngas, a form of natural gas. Black carbon produced from biomass sources, Biochar is organic matter, highly porous, stable, carbon-rich, charcoal-like and used commonly as an agricultural soil amendment, odor absorber or animal feed additive. The syngas produced by Restoration Bioproducts will be used to power the pyrolysis reaction chamber and a 500kw electric generator to provide electricity to Wood Fuel Developers.

Wood Fuel Developers produces the EasyPellet brand of wood pellets for home heating and animal bedding. Restoration Bioproducts will process 11,000 tons per year of waste wood fibers produced by Wood Fuel Developers into biochar, wood, benegar, biooil and power, according to its website.

The $5.8 million investment over three years will be used for a new facility in Waverly. Forestry is Virginia’s third-largest private sector industry.

“Technology and entrepreneurship are powerful forces driving the commonwealth’s economy forward. Today’s announcement is further evidence that Virginia is the location of choice for companies looking to transform their industries through innovation,” Youngkin said in a statement. “I congratulate Sussex County on bringing a first-of-its-kind green energy project to Virginia and commend Restoration Bioproducts for demonstrating the power of private-sector led, sustainable waste solutions.”

Wood pellets are big business right now. Because of the war in Europe, the supply of compressed wood pellets from Russia, Belarus and Ukraine has been cut off to power plans in Western Europe that burn the pellets instead of coal, The Wall Street Journal reported. That puts a premium on U.S. wood pellets, primarily produced in the South.

The Virginia Department of Agriculture and Consumer Services worked with Suffolk County and Restoration Bioproducts LLC to secure the project for the commonwealth. Youngkin approved a $50,000 grant from the Governor’s Agriculture and Forestry Industries Development Fund, which Sussex County and Waverly will match with local funds.

Chesapeake industrial building sells for $10.2M

A 152,180-square-foot industrial property in Chesapeake has sold for $10.275 million, S.L. Nusbaum Realty Co. announced in July.

Chesapeake Dexter St West LLC purchased the property, located at 101 Dexter St. West in Chesapeake, from On Trading Corp. The building is on 13.89 acres and was fully leased at the time of the sale. It was purchased as an investment and no immediate changes are planned.

Sam Rapoport of S.L. Nusbaum Realty represented the seller in the transaction.

Newport News apartments sell for $9.75M

A Newport News apartment complex has sold for $9.75 million, S.L. Nusbaum Realty announced Aug. 2.

53 Colony Square Court LLC has purchased Colony Square Apartments, which has 92 units, from Lyn Van Turette Trust LLC.

The buyer is planning extensive renovations to the property, which is on 4.82 acres.

Bill Overman and John Wessling of S.L. Nusbaum Realty represented the seller.

Norfolk high rise sells for $27.5 million

The Lafayette, an apartment tower in Norfolk, has sold for $27.5 million, according to Norfolk public records.

Philadelphia-based PRG Real Estate Management Inc. purchased the property from Graycliff Capital Partners and Buligo Capital Partners; it is the company’s seventh apartment investment in Hampton Roads, according to Colliers, which brokered the sale. The Lafayette is in Norfolk’s Colonial Place neighborhood, at 4601 Mayflower Road.

The high rise has 168 units (studios, one -, two- and three-bedroom apartments) with recently upgraded amenities and common areas. It has views of the Lafayette River and the Norfolk skyline and was built in 1964.

PRG also owns properties in Richmond.

SCC approves Dominion’s $9.8B offshore wind farm

The State Corporation Commission has approved Dominion Energy Inc.’s application for the proposed $9.8 billion Coastal Virginia Offshore Wind Project (CVOW), which calls for the construction of 176 wind turbines 27 miles off the coast of Virginia Beach.

The Richmond-based Fortune 500 utility has already erected two pilot turbines for its 2.6-gigawatt Coastal Virginia Offshore Wind (CVOW) project. Installation of the wind turbines is expected to begin in 2024. When completed in 2026, the CVOW project will be the nation’s largest offshore wind farm, powering up to 660,000 homes with renewable energy.

The SCC also approved the electric interconnection and transmission facilities to connect CVOW with the existing transmission system.

“Following a full proceeding, the commission found, as directed by the General Assembly, that construction of CVOW is in the public interest,” the SCC wrote in a news release announcing the approval.

It will likely be the largest capital investment and single largest project in the history of Dominion Energy Virginia, according to the SCC. 

“Our customers expect reliable, affordable energy, and offshore wind is key for delivering on that mission. We are very pleased that the commission has approved this important project that will benefit our customers,” Dominion Energy Chairman, President and CEO Robert M. Blue, said in a statement.  “We are reviewing the specifics of the order, particularly the performance requirement.” 

$14 monthly electric bill hikes

With the approval of the wind farm, the SCC also approved a revenue requirement of $78.702 million for the rate year from Sept. 1, 2022, through Aug. 31, 2023, to be recovered through rate increases to Dominion’s customers. 

“Over the projected 35-year lifetime of the project, for a residential customer using 1,000 kilowatt-hours of electricity per month … [it] is projected to result in an average monthly bill increase of $4.72 and a peak monthly bill increase of $14.22 in 2027. The rate adjustment clause is effective for usage on and after Sept. 1.”

However, the SCC wrote in its ruling: “In so finding that these costs must be recovered from customers, the commission is also keenly aware of the ongoing rise in gas prices, inflation and other economic pressures that are impacting all utility customers. This is a prescriptive statute, and we applied it based on the record in this case.”

The SCC ordered consumer protections, including that Dominion must file a notice within 30 days if the offshore wind farm’s cost is expected to exceed the current estimate or if the final turbine installation is delayed beyond Feb. 4, 2027. Dominion must also inform the SCC about any material changes to the project and says “customers shall be held harmless for any shortfall in energy production below an annual net capacity factor of 42% as measured on a three-year rolling average.” 

“The final order from the SCC affirms that CVOW meets all Virginia statutory requirements for rider cost recovery and the issuance of a Certificate of Public Convenience and Necessity for the onshore infrastructure. The order also includes a performance requirement, but does not outline the details surrounding that requirement,” Dominion noted in a news release. 

Harrison Godfrey, managing director of Virginia Advanced Energy Economy, an industry association that has supported Dominion’s proposal, applauded what it called the SCC’s attempts to protect ratepayers by requiring Dominion to provide notices if the wind farm’s total costs exceed estimates as well as requiring the utility to deliver project updates to the commission on any material changes or cost overruns. 

Dominion submitted its application to the SCC in November 2021. The offshore wind farm had been previously estimated to cost $7.8 billion but that cost was increased by $2 billion late last year. Bob Blue, the Richmond-based Fortune 500 utility’s chair, president and CEO attributed the increase to rising commodities expenses and general cost pressures across a number of industries due to inflation. He also cited the need to build about 17 miles of new transmission lines and other associated infrastructure for the project.

East Coast supply chain hub

The project is expected to attract significant investments to Hampton Roads while spurring as many as 900 construction jobs and 1,100 jobs in operations and maintenance, Hampton Roads Alliance President and CEO Doug Smith told Virginia Business. 

“This country is building an industry from scratch, that is the offshore wind industry,” Smith said. “Dominion’s project represents an opportunity for Virginia, and candidly, Hampton Roads, in particular, to be on the forefront of that new industry. What that will allow us to do is to begin to build the supply chain hub for the East Coast and build upon the strengths of a very skilled workforce and maritime industrial base that very few other regions have.”

Virginia Advanced Energy Economy has estimated that the offshore wind industry will add 5,000 jobs to the commonwealth over time.  

Hampton Roads, already home to skilled shipbuilders who build and maintain naval ships across its various shipyards, including Huntington Ingalls Industries’ Newport News Shipbuilding division, has been preparing for the needs of an offshore wind workforce. Earlier this year, the Hampton Roads Workforce Council launched its Hampton Roads Strong campaign in partnership with local community colleges and the Virginia Ship Repair Association to recruit workers to the maritime trade, skills that are transferable to the needs of offshore wind, said the workforce council’s president and CEO, Shawn Avery. 

News of the SCC’s approval also comes a day after the U.S. Department of Commerce announced it was granting $11 million to the workforce council to invest in workforce development. 

“This grant couldn’t come at a better time to help develop the workforce,” Avery told Virginia Business Friday. “What it’s really going to do is increase the capacity to put training in place. It’s got a lot of funding in it for recruitment of individuals. … It’s really developing a system that’s going to meet the needs of the offshore wind industry and the shipbuilding/ship repair industry and anything else we need to happen.”

Though construction of the wind farm isn’t expected to begin until 2024,  Siemens Gamesa Renewable Energy S.A., a Spanish wind turbine company, is already investing $200 million to build the first U.S. offshore wind turbine blade manufacturing facility at the Port of Virginia’s Portsmouth Marine Terminal. Siemens Gamesa will make 176 14.7-megawatt turbines to be installed in the Dominion wind farm’s 112,800-acre commercial lease area. Construction of the factory is expected to be complete in early 2023, bringing with it 310 jobs. 

Reaching net-zero

The CVOW will help Virginia reach its target, codified in the Virginia Clean Economy Act (VCEA), of having 100% carbon-free energy production by 2045, and Dominion Energy’s goal of reaching net-zero carbon and methane emissions by 2050. President Joe Biden’s administration has set a 2030 target to establish 30,000 megawatts of offshore wind power capacity.

The VCEA mandates that all electricity consumed in the commonwealth must have zero carbon emissions and be generated from renewable energy sources by 2050. It also requires stringent energy-efficiency standards that are projected to generate as much as $3,500 in savings for the average Virginia household over the next 30 years, according to a study by Advanced Energy Economy, an industry trade association. 

Although Republicans wield more power in Richmond this year and have expressed dissatisfaction with the VCEA, utilities do not expect significant changes to the law.

 

Amazon opens new Chesapeake facility

Last week Amazon.com Inc. opened its new, 640,000-square-foot processing facility in Chesapeake, the global e-tailer’s first cross-dock fulfillment center in Virginia.

About 900 of the 1,000 workers that Amazon announced it would be hiring for the facility are already on the job, an Amazon spokeswoman told Virginia Business.

Located at 5045 Portsmouth Blvd., the Chesapeake center receives and consolidates products from vendors and ships them to surrounding fulfillment centers within Amazon’s network. A similar facility planned for Stafford County will create 500 jobs and is expected to be operational by the second half of the year.

“Amazon has quickly become one of Hampton Roads’ largest and most engaged employers,” Hampton Roads Alliance President and CEO Douglas L. Smith said in a statement. “The opening of this facility in Chesapeake represents yet another milestone in their tremendous growth in the region, aided by the impressive collaboration between our partners in the city of Chesapeake, [the] Virginia Economic Development Partnership and the Port of Virginia. We are confident that this is only the beginning of Amazon’s relationship with the Hampton Roads community.”

Full-time employees at the Amazon facility make $18 an hour, and earn benefits such as a 401(k) with 50% company match and up to 20 weeks of parental leave, the company says.

Amazon has opened facilities all over the commonwealth, first launching its Virginia operations in Sterling in 2006. Since 2010, Amazon has invested more than $34 billion in Virginia through fulfillment centers, cloud infrastructure and research facilities. The e-commerce giant has made 30,000 direct hires and created 96,000 indirect jobs, according to a news release. Amazon is also building out its multibillion-dollar HQ2 East Coast headquarters in Arlington County.

Six Va. companies land spots on Fortune Global 500

Six Virginia-based companies have landed spots on Fortune Magazine’s Global 500 list, which was released Thursday and ranks the world’s 500 largest corporations by total revenue.

Walmart Inc. took the top spot on the list, reporting $572 billion in revenue, retaining its top spot from last year. Amazon.com Inc. followed behind, rising a spot to No. 2, posting $469 billion in revenue.

The highest-ranked Virginia company on this year’s Fortune Global 500 list is McLean-based Federal Home Loan Mortgage Co. (“Freddie Mac”). On the Fortune 500 list, which only includes American companies, Freddie Mac ranked No. 56 this year. Freddie Mac’s total revenue was around $65 billion, a drop from last year and 50 spots lower than last year. It’s made the Fortune Global 500 list for 26 years.

Goochland County-based CarMax Inc. made the Global 500 for the first time this year. Its revenues were about $33 billion, up 65%. CarMax also ranked 174th on the Fortune 500 list this year.

The other Virginia-based companies that made the list are:

361) General Dynamics Corp., Reston (dropped 45 spots, 22 years on the list)

399) Northrop Grumman Corp., Falls Church (dropped 73 spots, 23 years on the list)

432) CarMax, Goochland County (was not on the list last year)

443) Capital One Financial Corp., McLean (dropped 54 spots, 12 years on the list)

468) Performance Food Group Co., Goochland County (jumped 15 spots, two years on the list)

At least two other companies — Raytheon Technologies Corp. and The Boeing Co. — that made this year’s Fortune Global 500 list are in the midst of moving their global headquarters to Virginia, or will soon.

Boeing ranked No. 204 on Fortune’s Global 500 list for 2022, falling from its previous rank at No. 173. The company, which had $62.2 billion in revenue in fiscal 2021, announced the move of its global headquarters from Chicago to Arlington’s Crystal City, where it already has about 400 employees, in May.

Raytheon followed Boeing’s announcement in early June, announcing it would also move its headquarters from Waltham, Massachusetts to Arlington’s Rosslyn neighborhood in the third quarter of this year. Raytheon ranked No. 197 on the Fortune Global 500 this year, falling from No. 183 last year. The company reported $64.4 billion in fiscal 2021 revenue. Its new location won’t be far from its existing Raytheon Intelligence & Space business, where about 130 corporate staffers already work.

Neither of the company’s moves are expected to involve major staff boosts.

And while Amazon.com Inc.’s headquarters are in Seattle, the e-tailer is building its $2.5 billion HQ2 East Coast headquarters in Arlington County. The company recently closed on its $198M PenPlace development, which is slated to include the distinctive Helix tower.

 

Hilton will expand global HQ in Fairfax

Hilton Worldwide Holdings Inc. will expand its Fairfax County corporate headquarters, creating 350 jobs over the next five years, Gov. Glenn Youngkin announced Thursday.

Over the next five years, the Fortune 1000 global hospitality company will add a variety of roles in areas created to support growth in the coming years, according to a Hilton spokesperson. Hilton currently has about 800 employees at its headquarters, located at 7930 Jones Branch Drive in McLean.  Renovation plans will “create spaces for meaningful connection and collaboration,” as well as enhance common areas and office space. Hilton’s headquarters has been in Virginia since 2009.

“Virginia is America’s hometown for corporate headquarters, and we are proud that Hilton will continue to call Fairfax County home,” Youngkin said in a statement. “For more than a decade, this global company has benefited from the commonwealth’s combination of strategic location, diverse, world-class talent and stable business climate, and we look forward to a continued partnership as Hilton recommits to Virginia and reinvents its headquarters for the future.”

Hilton’s current HQ in McLean will undergo renovations. Photo courtesy Hilton

The space in McLean, at Park Place II, is about 220,000 square feet. It has grown its footprint from occupying about a third of the building to 70% today, according to a Hilton spokesperson. Hilton’s renewed lease is for 15 years. Bethesda, Maryland-based B.F. Saul Co. owns the property.

Hilton’s portfolio includes 18 brands with 7,000 hotels and resorts and 1.1 million rooms in 122 countries and territories. In the second quarter, Hilton added 91 new hotels and 14,400 rooms to its network, according to its July 27 earnings release. The hotelier also approved another 23,400 rooms for development, bringing the total number of rooms in the pipeline to 413,000 across 2,780 new hotels. Hilton’s net income for the second quarter was $367 million. This year Hilton ranked No. 538 on Fortune magazine’s Fortune 1000 list, ranking the largest United States corporations by total revenue.

“Northern Virginia has been Hilton’s home for more than a decade, and the region has played an instrumental role in helping us create the best, most inclusive home for our team members while also managing the demands of a global business,” Hilton President and CEO Chris Nassetta said in a statement. “We appreciate the continued support of the commonwealth of Virginia, Fairfax County, and the Tysons Partnership in ensuring we continue to attract strong, diverse talent to our vibrant, growing region.”

The Virginia Economic Development Partnership worked with the Fairfax County Economic Development Authority to secure the project for Virginia. Youngkin approved $5 million in funds from the Virginia Economic Development Incentive grant. Youngkin also approved a $1 million grant from the Commonwealth’s Opportunity Fund to assist Fairfax County with the project. Hilton is eligible to receive benefits from the Major Business Facility Job Credit for full-time jobs created.

Hilton did not release the amount of investment in the project.

“Hilton’s continued investment in Fairfax County will result in extraordinary benefits for our community,” Fairfax County Economic Development Authority President and CEO Victor Hoskins said. “The diversity of our business base continues to be one of our greatest strengths, and we are honored that Hilton has chosen to continue to play a key role in our corporate ecosystem.”