Hubs and spokes

Economic conditions bounced back across many sectors in 2021, but the COVID-19 pandemic still impacted development deals occurring in Virginia. The state saw a great deal of focus on manufacturing and supply chain growth, areas expected to stay busy despite the recent change in state political leadership.

In Hampton Roads, many of the region’s major deals centered on the Port of Virginia and Dominion Energy Inc.’s burgeoning offshore wind farm 27 miles off the Virginia Beach coast. Spanish turbine manufacturer Siemens Gamesa Renewable Energy S.A. announced in October 2021 that it was building a turbine parts production plant in Portsmouth. Set to be finished in early 2023, the $200 million project is expected to create more than 300 jobs. Even more significantly, it sets the stage for more potential development in the region’s quest to become a national wind energy supply chain hub.

The port’s Portsmouth Marine Terminalx is also being leased by Dominion Energy Inc. as a staging area to deploy equipment to build the 180 turbines for its $9.8 billion wind farm.

“We’re going to be able to service offshore wind for all of the East Coast right out of Hampton Roads,” then-Gov. Ralph Northam said in a November 2021 interview with Virginia Business. “That’s billions of dollars that we have now to pick up jobs, and so that’s a big deal.”

Another major factor in manufacturing opportunities: Transportation improvements, including railway and road projects. The expansion of Interstate 81, the $3.8 billion Hampton Roads Bridge-Tunnel project and the $1.9 billion bridge that will run parallel to the Long Bridge across the Potomac River are all expected to speed up delivery times and efficiency.

Meanwhile, the $350 million dredging projects to create the deepest and widest port on the East Coast in Norfolk Harbor are set to be completed by 2024. That will bring more traffic to the port, which already saw increased interest from shippers last year as West Coast ports experienced significant delays in processing cargo. 

In February 2021, shipping and logistics company CMA CGM Group announced it would expand its North American headquarters in Norfolk, creating 400 jobs and investing $36 million. There’s more business in Danville and Richmond, too, port officials note, because of faster turnaround times for deliveries from Hampton Roads ports.

Other areas of interest are pharmaceutical and medical supply chains — two sectors that were hit hard during the early days of the pandemic. In the Petersburg area, a group of pharma companies are growing a manufacturing hub to produce a national supply chain for essential medicines at risk for shortages. In May 2021, AMPAC Fine Chemicals, which reactivated its plant in 2019, announced it would create 125 jobs and expand its facility, and Civica Inc. has built its own plant nearby, creating 186 jobs. Phlow Corp., which won a $354 million, four-year federal contract in 2020 to produce medications, is partnering with both companies.

In Southwest Virginia, 2021’s big news was the October announcement that a glove manufacturer planned to invest $714 million in a new nitrile glove manufacturing plant in Wythe County, creating about 2,500 jobs. Similar to the pharmaceutical companies, Blue Star NBR LLC officials say that the demand for domestically produced personal protective equipment — and subsequent supply shortages — have prompted growth in the industry.

More recently, Virginia’s new governor, Glenn Youngkin, has said that he will focus more attention on building up the state’s industrial sites, making sure properties are ready for immediate development by companies seeking to locate here.

“Manufacturing has to be an industry of growth for us,” Youngkin said in a Virginia Business interview late last year. “We are not being considered for a lot of manufacturing footprint in aerospace and in automotive. We absolutely have to retool with site development to make sure that we have physical sites for these businesses to come build on and invest in.”