2018 Annual Report
Cover Photo and Page 2 and 3 Photo by Joe Rice
Director’s Message Dear Stakeholders, Greetings and welcome to the annual update from the City of Charlottesville Office of Economic Development. As J.P. Morgan once said, “The first step towards getting somewhere is to decide you’re not going to stay where you are.” It seems like the Charlottesville community took a series of first steps in 2018 to move forward and heal from the events of the previous year. We are fortunate to report that revenue receipts and investment levels remained strong in the City. Since August 2017, the three primary tax revenues that reflect economic activity have all been positive. Specifically, sales tax has been up +0.9%, meals +0.3%, and lodging up +6.29% over the same period a year prior. Coupled with continued job, wage, and population growth, it is fair to say that the City remains fundamentally solid from an economic perspective. Speaking of numbers, with over 200 restaurants and the many breweries and wineries in the area, the City has become a food destination. This trend, along with an unemployment rate below 3% drove us to launch GO Cook, an entry-level culinary arts training program, in 2018. A profile of one of our participants and her experience with the program can be found on page 11. Another figure of note is 1.7% - this is the vacancy rate for commercial office space in the City as of the issuance of a comprehensive study conducted by HR&A Advisors in August. In the downtown area, the rate is even lower at .9%. This constraint on space presents an obvious challenge to growing companies. You can read more about the report and projects already underway that will alleviate this challenge in the following pages. Please read further for a better understanding of all our activities and their impacts throughout the past year. Thank you for your continued support. Sincerely,
Chris Engel Chris Engel Director, Office of Economic Development
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Capital Investment Building partnerships with private sector groups in order to maximize capital investment in the City
Groundbreaking(s) Four major developments broke ground in 2018 that will add significant additions to the market in the next 18 months. On West Main Street, the Quirk, a 75-room art-inspired boutique hotel began construction in early spring and is expected to be completed in late 2019. The structure integrates two historic buildings fronting the street with new construction and marks the fifth hotel to call West Main home. Across the street, the Six Hundred West Main project broke ground on a cold and rainy spring day. This project also restores two historic street front structures and connects them to a new 57 unit residential tower with underground parking. Over on the Preston Avenue corridor, the historic Monticello dairy building began a major transformation in the heat of late summer. This five-acre site is slated to be become a major mixed-use anchor on the western end of this active boulevard. Phase 1 will bring 50,000 square feet of class A office space as well as retail and restaurant space to include Virginia’s first modern food hall and a brewery. Future phases will add over 200 residential apartments. Closer to the Mall, a nine story, 120,000 square foot class A office building known as 3Twenty3 broke ground in November. This modern building will have large floorplates, internal parking and a rooftop event space just a block south of the downtown mall. “3TWENTY3 C’Ville is answering the void of available large floor plate office buildings in Downtown. We assessed the market 3 years ago and recognized the opportunity to develop a new large office building to meet the demand and we are confident that we made the right decision to move forward with the building. Charlottesville offers such a rich and vibrant urban environment centered on the Downtown Mall and there just isn’t enough office space to allow companies to be downtown.” - Jay Blanton, Managing Principal Insite Properties, LLC
Hotel Haven Hospitality options continued to grow as three new hotels opened their doors for business in the city over the course of 2018. The Draftsman, the Fairfield Inn and Home2 Suites collectively added 380 new rooms to the overall inventory. The Charlottesville-Albemarle area now has a supply of 4,100 rooms available on any given day to accommodate visitors for business, leisure or meetings. This activity produces over $630 million in annual visitor spending and supports over 5,000 jobs in area. In addition, through the collection of the transient occupancy tax from overnight guests the industry helps fund local government services and the destination marketing efforts of the Charlottesville Albemarle Convention and Visitors Bureau. In pursuing its mission, the Bureau commissioned a consultant to assess the feasibility of a central conference facility to host larger meetings. The recently released study suggested that sufficient demand does exist for such a facility to capture the desire to hold larger meetings and events in the area. A larger challenge will be to identify the capital needed to create such a facility and develop a sustainable financial model for its ongoing operations.
Capital Investment Commercial
Residential
475
$58M
1,608
$116M
# of commercial permits issued
$ value of investment
# of residential permits issued
$ value of investment
*Calendar Year 2018
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Business Development Creating an entrepreneurial environment where start-ups thrive & existing businesses have opportunity
Business Visitation Program The OED’s business outreach program continues to be a vital and important conduit that links local government with the business community, new opportunities, and community resources. Additionally, the business visitation program aims to connect businesses to several OED programs targeted to strengthen City businesses.
GO Hire The City has targeted assisting City businesses with their workforce needs. The GO Hire program helps businesses looking to hire new staff with wage subsidies for City residents and also helps create and support training programs for incumbent employees. These training programs are industry specific and often identified by each business to help the company become more efficient.
"Without GO Hire, our company would not be where it is today. In 2018, we wanted to expand our business from merely serving coffee to actually roasting and selling our own coffee. The GO Hire program provided us with the resources to send a key member of our team to coffee roasting training, which gave him the skills and knowledge to stand up our roasting operation within weeks, not months. The added business allowed us to make the investment in our employee's wages and grow our roastery organically and sustainably. Our business has been completely transformed, and we wouldn't have been able to do that without the support of GO Hire." -Dan FitzHenry, Director of Operations at Grit
ACE Program
GO Hire
VJIP Match
95 Businesses Awarded $194K
35 Businesses Enrolled 71 Employees Served
218 Jobs Created
Served
Average wage $32/hr
ACE Program The OED’s unique business assistance program, the Advancing Charlottesville Entrepreneurs (ACE) Program, has assisted more than 90 businesses over the course of the last six years. This competitive grant program was fully funded by the Charlottesville Economic Development Authority in 2018 and continued to award micro grants to eligible businesses. These grants are used for advertising, equipment, and supplies; and the goal of the ACE program remains the same – helping City businesses increase revenue and capacity.
"It can be difficult for a small business when the only limitation to increasing your sales is your existing equipment. The ACE grant allowed us to purchase a larger mixer that literally enabled us to double our production capacity. This had the effect of proportionately increasing sales and also allowed us to hire a third team member. I am grateful to the City of Charlottesville for supporting its local makers!" -Earl Vallery, Owner, Bowerbird Bakeshop
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Workforce Development Fostering an environment that provides career ladder employment opportunities for Charlottesville citizens
Downtown Job Center The year 2018 was a year of transition for the Downtown Job Center (DJC). Two full -time staff moved on to pursue other goals Roy Fitch Darrell Simpson Zoie Smith and three new team members were brought on to continue to offer high-level services to job seekers and employers in the Charlottesville community. The DJC provides assistance in resume writing and review, job search, referrals, and mock interviewing for both entry-level and skilled job seekers, while also working with local employers to help recruit qualified candidates for open positions. The DJC also assists those in the midst of their job search as well as incentivizes those recently employed but facing transportation barriers by administering the GO Ride program. This initiative offers 7-day bus passes for City residents with verified job interviews or opportunities to submit applications and 30-day passes for those offered and accepting employment who need help getting to and from work. The DJC remains the recruitment and facilitation hub for the City’s Growing Opportunities (GO) training programs, helping to identify and enroll candidates and providing oversight and support during active programs. The Downtown Job Center continued to invest in the training of local citizens for placement in stable, full-time employment opportunities that offer the ability to achieve self-
sufficiency through GO programming. In 2018, the DJC facilitated five total GO training programs: A Skilled Trades Academy concluding in March, two GO Driver cohorts placed with Charlottesville Area Transit graduating in March and November, and two GO Cook classes helping prepare individuals for careers in the culinary arts, finishing in June and December, respectively. While Charlottesville is experiencing a historically low unemployment rate, the DJC has diversified its practices to assist job seekers and employers alike. These steps include working with those who are underemployed to locate more fruitful prospects for better pay, benefits, or hours. The DJC has worked with community partners to develop a rapid response to closing businesses such as National Optronics and Brown’s Cleaners to help employees resettle into new jobs with as little disruption to their lives as possible. The DJC has also maintained a steady presence in community job fairs and events, focusing on demographics like citizens returning from incarceration and women and minority business owners, as well as hosting its annual spring job fair at the John Paul Jones Arena. The Downtown Job Center subscribes to a mission of diverse and flexible means by which to serve the people and business communities of Charlottesville and the surrounding area.
2018 Downtown Job Center Stats 415 # of Intake Forms Completed*
134 # of Cville Visitors
178 # Receiving Job Search Help
112 # Receiving Resume Help
*This number does not include general inquiries not requiring the completion of an intake form.
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GO Connect GO Connect is an innovative initiative that was created by the Office of Economic Development in partnership with private sector partners, Seedplanters Coaching and The Spill Teem. Networking can often feel like a robotic task that has no real benefits to either party. You soon find that you have a drawer full of business cards and no meaningful connections. It is this scenario that inspired GO Connect. This is no ordinary networking event; it is Networking REImagined. To REImagine Networking is to see the chance to connect based on passion and purpose rather than on self-serving reasons. GO Connect concentrates on taking a different approach to networking in today’s world and is filled with activities that inspire creative talks in an innovative environment with tons of aha moments. This resource is a great opportunity for job seekers, businesses, and community partners to meet new people who are not met through typical modes of networking. The connections made at GO Connect are meant to bring a lasting impact on the individuals living and working in Charlottesville. For more information about upcoming events, visit www.goconnectcville.org.
Photo by Eze Amos
GO Cook Based on the success of the GO program model, GO Cook was launched in 2018 with two separate training cohorts occurring. GO Cook is a five-week training program that prepares individuals for entry-level culinary careers within the restaurant industry (e.g. food prep, pantry cook, line cook, etc.). The program is a partnership between the City’s OED and Chef Antwon Brinson of Culinary Concepts AB LLC. The program offers training that will equip residents with basic cooking skills, ServSafe certification, a Certified Cook certification, and workplace essential skills. Recent graduate, Shamia Hopkins shared her perspective of the program below: Where do you currently work and how long have you been there? UVA Dining Services with Aramark. I have been employed with them for approximately 6 months. Why did you decide to participate in the GO Cook program? I had been out of work, had just had my son, and I was pretty much spending my days at home thinking about what I could do next. My sister had taken a program called GO CNA and it peaked my interest. She shared info with me about another program called GO Cook. I saw a flyer about it and read that you could become ServSafe certified. I thought to myself, why not get a free ServSafe certification? I thought that while I’m unemployed, I may as well take the class to keep myself busy. I also encouraged my dad to enroll in the course with me. We completed the course together. We also work at Aramark together. What lasting memories do you have of GO Cook? I loved the program. No words can sum up my experience. The class as a whole helped me step out and believe in myself and the skills I possess. It has also encouraged me to become an entrepreneur. Thank you said one million times wouldn’t be enough for what I learned and the experiences I had.
How did GO Cook lead directly to you being successful with your career goals? Visibility. GO Cook allowed me to open up more personally so that I would push myself to try new things. I have participated in events such as the Women and Minority Business Expo and the Tom Tom Festival. These are events I never knew I could be a part of. My confidence in my abilities has definitely increased. Would you recommend any of your peers to try GO Programs? I pitch this program to anyone I can, both friends and family. I actually have two friends that are currently participating in GO Cook now. I share the support I received by supporting others that are interested in becoming cooks. The teaching I received reminded me that cooking can be a passion of mine and not just a job.
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Special Projects Working with internal and external partners on special projects that further the City’s economic goals
Office and Retail Market Study In 2018, the Charlottesville Economic Development Authority (CEDA) commissioned HR&A Advisors, Inc. to conduct a market study of the office and retail space in the City. The report was intended to serve as a source of foundational data and information to guide future actions. While some high-level market data is occasionally published on the Charlottesville office and retail markets, it is not geared towards the specific interests of the City and is not available on a regular basis. HR&A, a respected real estate and economic development consultancy, provided for the first time a comprehensive review of these important sectors that are integral to the overall economic health of the City and broader community. The full report is available on our website.
Urban Ale Trail Forms This past year, the OED also helped create a collaborative initiative to support the City’s breweries. The Charlottesville Ale trail was formed to promote the vibrant and growing brewing industry within the City of Charlottesville. The trail is a 2.3 mile self-guided, urban walking tour featuring the City’s six breweries. The Charlottesville Ale Trail is uniquely positioned to be the premier urban and pedestrian beer trail in Virginia. To our knowledge, it is the only trail in the state to be promoted as a walking trail with the aim for people to not only enjoy the walk between our breweries, but also to visit other shops and restaurants along the way.
e-scooters Emerge There is a national growing trend for dockless electric scooter and bike rentals as a form of transportation. In the past, these businesses have located in large urban cities, but these scooters are now being deployed in medium sized cities, especially those with colleges and universities. However, as many communities have learned, this new technology has become a burdensome problem for cities unprepared to analyze how scooters fit into the city’s current transportation network.
The Office of Economic Development played a large role in help developing a proactive policy to evaluate dockless mobility devices including both pedal and electric pedal-assist bicycles and electric foot scooters during a temporary pilot program. This was an opportunity to be proactive in welcoming new models of transportation within the marketplace, while creating policies to limit their potentially negative impacts. In order to continue Charlottesville’s responsible stewardship of the public right-of-way and business friendly practices, as well as provide thoughtful response and adaptation to the transportation needs of community, staff is currently conducting a pilot program to learn if and how the technologies and services help to advance the City’s transportation goals, making the community better, safer, and more sustainable.
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Parking Management Throughout 2018, the City continued work on the Parking Action Plan. Significant progress was made in several areas. While the Water Street Parking Garage appears to be a wholly public facility, its ownership is actually structured as a condominium association with multiple owners. The agreement dates back to the original construction of the garage over 30 years ago. By 2016, the ownership of the public parking spaces in the garage had been consolidated down to only two owners, the City of Charlottesville and Charlottesville Parking Center (CPC). Over the past few years however, the owners had developed significant differences over how the garage should be operated, ultimately resulting in civil litigation. This year, the two parties were able to resolve their differences through negotiation. The resolution resulted in the City leasing CPC’s interests in the public parking spaces and assuming full control over the operation of the Garage. This arrangement commenced on August 1, 2018, with the City operating the Garage in the same manner as it had been operating the Market Street Garage. The first hour of parking is now free to the public in both garages, and rates and hours of operation for both facilities are the same. The resolution of this dispute makes parking easier to understand and access for everyone who visits or works in the area of the Downtown Mall. Also in 2018, the City and County concluded negotiations over the location of the County courthouse and agreed to jointly construct a new courts facility downtown. The joint agreement between the City and the County clears the way for the City to construct additional parking on the 7 th Street parking lot, jointly owned by the City and the County, and the adjacent private parcel that currently contains the retail uses. This parcel was purchased by the City in 2016 with the express purpose of building additional public parking. Over the next few months, the City will explore options and begin the design process for a new facility at this location.
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OED Staff Chris Engel, CEcD Director
Hollie Lee Chief of Workforce Development Strategies
Jason Ness Business Development Manager
Darrell Simpson Job Center Coordinator— Administration
Roy Fitch Job Center Coordinator— Community Engagement
Rick Siebert Parking Manager
Zoie Smith Job Center Customer Service Representative
Trish Carpenter Administrative Assistant
610 East Market Street 2nd Floor, Room B226 Charlottesville, VA 22902
www.charlottesville.org/econdev 434.970.3110