It takes three things to develop a megasite – time, money and patience. That’s according to Beth Doughty, Roanoke-based economic development advisor.
David Manley, executive director of Wythe County’s Joint Industrial Development Authority, said he would add deliberate planning and community buy-in to that list.
It’s a huge undertaking to develop megasites, often taking over a decade and costing millions of dollars. But it’s absolutely necessary in order to land large economic development projects.
“If you build it they will come. But if you don’t build it, you’re not even in the running,” said Jordan Butler, public relations director for the Virginia Tobacco Region Revitalization Commission, which has invested millions into the state’s megasites.
Virginia has several competitive megasites – the largest and highest-profile being Berry Hill, which sits on 3,528 acres in Pittsylvania County.
This site has been considered for projects by Mazda and Toyota, Hyundai, and most recently, the Albemarle Corporation, a specialty chemicals company. These projects went to Savannah, Georgia; Huntsville, Alabama; and Chester County, South Carolina, respectively.
But the Berry Hill site wasn’t always this competitive. It took over a decade to attract attention from large companies.
And there are several smaller megasites in Virginia, which often get overshadowed by Berry Hill but are competitive in their own right.
Progress Park in Wythe County is a 1,200-acre site divided up into parcels. The park’s Lot 24, a 232-acre plot, landed medical glove manufacturer Blue Star in 2021.
Slated to bring 2,500 jobs, Blue Star was one of the largest manufacturing jobs announcements in Virginia in the last 30 years.
Another site, the Mid-Atlantic Advanced Manufacturing Center, or MAMaC, site in Greensville County, sits on 1,600 acres and has abundant access to transportation.
There are six other megasites in Virginia – all in Southwest and Southside – that the Tobacco Commission has invested in.
Let’s take a look at this lengthy and costly process.
First – what exactly is a megasite?
While there’s no national size requirements or qualifications for what constitutes a megasite, they usually include at least several hundred acres of land and proximity to utilities, roads and railways.
Megasites are developed to attract companies looking for a place to build a large facility, like a manufacturing plant. They’re highly sought after because of their potential to bring massive employers to a region, creating jobs, capital investment at the local level, and ultimately, growth for a community.
Essentially, megasites are one sign of a community’s vitality.
“If you get in the megasite game, you can really cause significant, transformative economic development,” said Matt Rowe, Pittsylvania County economic development director.
How Virginia became a player in the megasite game
This story begins several decades ago, when foreign automotive manufacturers began locating in the U.S., Rowe said.
In 1992, BMW selected Greenville, South Carolina, for its first full-production factory outside of Germany. Today, that plant employs over 11,000 people and represents a $10.6 billion investment.
In 1996, Mercedes announced a $300 million plant in Vance, Alabama, which became the first automobile manufacturing plant in Alabama and the first Mercedes facility in the U.S.
“That got everyone’s attention,” Rowe said.
In the 2000s, the Virginia Tobacco Region Revitalization Commission began conducting studies on megasite development. The commission invests in economic development projects throughout Southside and Southwest Virginia, areas that were previously reliant on tobacco farming, to help them recover from the loss of that industry.
When the commission was formed almost 25 years ago, it had a large pool of assets available for both short- and long-term projects, Butler said.
“They wanted to make sure that they were investing in things that would lead to long-term success for the Southern and Southwest Virginia region,” he said. “The megasite investments were really a long play on ensuring that they build a stable, lasting economy for the region.”
Megasite funding from the Tobacco Commission is currently only available for the nine sites that have been developed with commission support.
In addition to Berry Hill, Progress Park and MAMaC, these commission supported sites include the Sussex County Megasite, the Commonwealth Crossing Business Center in Martinsville, Oak Park Center for Business and Industry in Washington County, the Wildwood Commerce Park in Carroll County, Summit View Business Park in Franklin County, and Pathway Park in Smyth County.
The acreage of these nine sites add up to 9,351. The commission has invested about $132 million in the direct development of these sites, said Andy Sorrell, the commission’s deputy director.
But that doesn’t include indirectly related projects like extending broadband, which is necessary for a competitive site, so the actual investment amount is much higher, he said.
It’s a bit easier for the commission to invest in these projects, Butler said, because unlike other organizations, it doesn’t have to adhere to a yearly or biannual budget from the General Assembly.
But despite the support from the Tobacco Commission, Virginia has traditionally underspent on megasite prep compared to nearby states.
Annually, Georgia spends around $66 million in state funding on megasite preparation, North Carolina spends about $80 million, South Carolina spends about $50 million, and Ohio spends about $43 million.
But until recently, Virginia has only been spending about $5 million per year on site prep.
The Virginia state budget now calls for $109 million to be spent on site prep over two years, which could be increased to $159 million if revenues allow.
It’s taken time, but Virginia megasites are now solidly competitive, Rowe said.
Even in 2018, it was unclear whether Virginia could compete in this realm. But several close misses – especially at Berry Hill – has proved that it is, he said.
The process of megasite development
Despite differences in size and location, megasite development generally follows a standard process, Doughty said. Sites have to be identified, screened, purchased, and then prepared.
“Whether it’s 100 acres or 3,000 acres, it pretty much follows the same steps,” she said. “It’s not a quick project, and the steps are sequential, meaning you can’t do one part until you’ve done the previous part.”
First, a site must be identified, she said. Often, but not always, megasites start out as multiple parcels, perhaps with multiple owners.
That was the case with Berry Hill. About 13 years ago, the large tract of land was cobbled together from other properties that Danville and Pittsylvania acquired.
Progress Park, which sits on about 1,200 acres, was identified by county officials in the late 1990s and acquired in two tracts, said Manley.
The Wythe County Board of Supervisors “made a big leap of faith” in planning to turn this property into a megasite, because “site development on that scale had never been done in this part of the state,” he said.
MAMaC, a 1,600-acre site, was actually identified by an outside entity – railway company CSX.
“Around 2006, CSX did a study of the East Coast, where their main north-south line runs,” because it was losing clients to other railways with large sites along their rail lines, said Natalie Slate, Greensville County economic development director.
This study identified Greensville County as a good location for such a site, said Slate, who has been working on MAMaC’s development since it began.
“When [CSX] first came to us, we kind of laughed because we’d never thought to put anything there,” Slate said. “But the more we looked at it, the more it made sense.”
One of the reasons it made sense was the site’s access to transportation, Slate said. Interstate 58 runs right through Greensville County, and Interstate 95 actually borders the site.
The site is only 30 minutes from Virginia’s ports, within 90 miles of several major metropolitan areas, and within a day’s drive of almost two-thirds of the country’s population.
“We have a lot of logistics companies look here because they can jump on the interstate and get pretty much anywhere very quickly,” Slate said. “In a day’s time you can get all the way from Florida to Canada.”
After a site has been identified, it’s screened to make sure that developing a megasite there is prudent and feasible.
“Then you figure out what your structure would be for acquiring these properties,” Doughty said. “A lot of megasites in Virginia, but not all, are part of a Regional Industrial Facility Authority.”
That’s because megasite prep is very costly, and would be difficult for a locality to do alone.
“Back in the old days, industrial parks and large industrial properties were largely developed by one locality, and that’s decreasingly the case,” Doughty said. “As the time continuum goes on, it’s more and more expensive to do this.”
The Berry Hill site is owned by the Danville-Pittsylvania RIFA, a joint entity that includes members of both the city council and the county board of supervisors.
Progress Park and MAMaC are also publicly owned by Wythe County and the Greensville County Industrial Development Authority, respectively.
After acquisition, “you go through the process of getting a site ready,” Doughty said. “You have to do utility extension, you have to do grading, you have to do engineering. And all those things require public procurement.”
After acquiring the Berry Hill site and making sure it was zoned correctly, which Rowe called “low-hanging fruit elements” of the process, Danville and Pittyslvania began to tackle the site prep.
“We had all these studies to do on how to provide industrial-grade infrastructure,” he said. “All this costs money. All this takes time.”
About $200 million has been invested into the Berry Hill site, Rowe said, and around $35 million of that is local money.
Slate said that about $44 million has gone into MAMaC, and it’ll take another $45 million to $75 million to finish the site, depending on what the client needs.
The timing of Progress Park’s development allowed for a slightly less expensive process, though $24 million in federal, state and local funding has been spent on Lot 24 alone, Manley said.
Site development began in the early 2000s, Manley said, but was halted by the 2008 recession. The recession’s impact on the construction industry meant that site grading was cheaper than usual.
“They jumped in and took advantage of a slow time in construction and we were able to get the work done in a competitive way,” Manley said. “[Lot 24] was a significant earthmoving and site development project with lots of engineering and environmental subprojects going on.”
Workers had to move 3.5 million cubic yards of dirt during this process, on top of building roads, laying water and sewer lines, and extending a rail corridor.
Money and support from the state can be crucial in the development process, Doughty said.
“The Virginia Economic Development Partnership plays an essential function, particularly in the less urbanized parts of the state,” she said. “The less recognized or visible parts of the commonwealth really need VEDP to provide assistance.”
The VEDP also runs the Virginia Business Ready Sites Program, which ranks industrial sites in tiers, numbered one through five, to signify the level of development.
A site’s tier designation is an important factor for companies in determining where to locate, and a crucial part of the development process.
“[Companies] don’t want to be coming into a site that has to have all of its permitting still done,” Sorrell said. “It needs to be ready.”
Certifications and designations
Tiers 1, 2, 3 signify various levels of site identification and prep, Tier 4 indicates a shovel-ready site, and Tier 5 indicates a shovel-ready site with a graded pad.
“You really don’t start getting looks until you’re shovel-ready,” Rowe said. “Everyone always talks about how we’ve had this site for 13 years and we don’t have a developer yet, but we really only got into the game about 20 months ago.”
About 200 acres of graded land on the Berry Hill site has a Tier 5 designation, and the rest of the park holds a Tier 4 designation.
Progress Park and MAMaC also have Tier 4 designations.
MAMaC is not yet graded, because environmental regulations prevent speculative grading, but the land is cleared of trees and the infrastructure is installed.
“The water is in place, the sewer is at the southern border of the site, and we’ve upgraded the road that accesses the site,” Slate said. “We’re moving forward with both the engineering and the electrical design.”
In addition to financial support and designations, VEDP can also help localities with megasites and interested companies find one another. This is part of another large process of landing economic developers.
But site prep must come first. And even after prep is done – or close to done – it’s still a waiting game, Doughty said.
Perhaps the hardest part of the process comes after much of the site prep is completed.
“Then you’re just waiting, waiting for it to pay off,” Doughty said, adding that this requires a lot of “patience and political will.”
For some sites, this payoff has already begun. About 1,200 people go to work in Progress Park daily, said Manley.
But Wythe County officials continue to recruit for the other available plots in Progress Park. And the work doesn’t stop even after a developer has chosen your site, he said.
When Blue Star was announced, “there was a brief burst of excitement and glee, followed up very quickly by a lot of work,” Manley said. “There are lots of concerted efforts taking place to make sure the project gets launched properly.”
For other sites, the payoff is very close at hand. Berry Hill’s status as a finalist in many high-profile projects indicates that the site is competitive, Rowe said.
“Every single project that we’ve competed in since 2020, we’ve been in the finals,” Rowe said. “It’s going to happen before long.”
The Berry Hill team is being very selective, he added.
“The community has been all about trying to get that project that will be transformational,” Rowe said. “We could probably have thousands of really low-paying jobs in that park, but that’s not what we’re here for. … We’re trying to find that project that fits well with the community.”
And Slate said that MAMaC is hoping for a big win in the near future, too. It has mostly garnered interest from logistics and electric vehicle companies, but the county is targeting one industry, she said.
“It feels like I can finally see the finish line,” she said. “Ten years ago, I questioned whether this would be a reality or not. I’ve always been an optimist, but finally within the last couple of years, I really feel like this is going to happen.”
Landing a project that’s a good fit for the community doesn’t happen overnight, which is why it’s important to have community buy-in, said Manley.
“There can be lots of uncertainty in a community when they don’t see immediate results for millions of dollars invested,” he said.
Butler and Sorrell said the Tobacco Commission also caught some flak for investing in megasite development early on.
“Any long-term project is going to meet some resistance initially amongst folks who want results now,” Butler said. “These communities have needed jobs for a long time.”
But once a community can see the long-term vision, they’ll get on board, Manley said.
“The long-term payback pays dividends truly for generations. It’s a decade’s worth of investment and job creation,” he said. “While there’s not usually instant results from doing these types of projects, when there is success, that success is long and enduring.”