2020 Mid-Year Report

HAMPTON ROADS ALLIANCE

2020 MID-YEAR REPORT MEET THE NEW ALLIANCE Over the last year, the Hampton Roads Alliance (formerly HREDA) has undergone significant changes that has positioned it as a keystone in the region’s growth and success. Under the direction of Doug Smith, the organization has a new mission, new service areas and several new staff members. With a new funding model, the Alliance generated a 300% increase in private investment from 2019 to 2020.

Additionally, a new governance structure allowed for a smaller, more focused and engaged board, comprised of six mayors and seven CEOs/top executives.

The Alliance strengthened its regional partnerships with local chambers, workforce boards, universities and more, particularly in regards to its regional business recovery and resilience efforts. The Alliance also facilitated stronger regional cooperation through the development and implementation of the Master Agreement for Regional Economic Development that was signed by all Alliance member localities.

This Master Agreement outlined an equal funding model amongst the Alliance’s public and private partners. In addition, the Alliance received a 501c3 status allowing investments to be charitable contributions. The IRS awarded this status in March 2020 with a retroactive start date of January 2019.

Building on this momentum, the Alliance launched a complete organizational rebrand in May 2020 including a new name, new logo, and new marketing materials.

This process initially began in early 2019 but was postponed due to the Regional Branding Initiative. It was then scheduled to launch in April 2020, but was delayed again due to the COVID-19 pandemic.

This all-encompassing, new and enhanced visual identity is the final piece of an evolution and will allow the Alliance to better tell its story, and the story of the Hampton Roads region. The brand launch included the unveiling of a modern, robust, and interactive new website, state and national advertising campaigns targeting c-suite executives and site location consultants, and multiple video productions. Additionally, the Alliance invested significant time and effort into increasing its social media activity in the last six months. By using best practices for social media marketing and targeting key audiences, the Alliance has successfully used its profiles to promote its new brand, provide business recovery resources, and share relevant and timely information with the community. On LinkedIn, this effort resulted in 99,000+ impressions, a 75% increase in followers, and a 329% increase in post shares in the last six months, as well as an engagement rate of 7.88% (compared to 2.1% in 2019).

On Facebook, the Alliance reached 108,000+ users and saw a 37% increase in page likes since January.

Get to know the new Alliance by visiting www.HamptonRoadsAlliance.com and by following the Hampton Roads Alliance on Facebook, LinkedIn and Twitter.

2020 ALLIANCE BOARD OF DIRECTORS » Honorable Richard W. West Mayor, City of Chesapeake » Honorable Donnie R. Tuck Mayor, City of Hampton » Honorable McKinley L. Price, DDS Mayor, City of Newport News » Honorable Kenneth C. Alexander, Ph.D. Mayor, City of Norfolk » Honorable Robert M. Dyer Mayor, City of Virginia Beach » Honorable Linda T. Johnson Mayor, City of Suffolk » J.D. Myers, II Cox Communications Virginia » Mark B. Dreyfus, Treasurer ECPI University » Keith VanderVennet Ferguson Enterprises » Bill Ermatinger Huntington Ingalls Industries » Cathie J. Vick Port of Virginia » Howard P. Kern, Vice Chair Sentara Healthcare » Brian K. Skinner, Chair TowneBank EX OFFICIO » Mary Bunting, CAO Chair City Manager, City of Hampton » Douglas L. Smith, Secretary Hampton Roads Alliance (Non Voting) » Shawn Avery Hampton Roads Workforce Council » Robert D. Moore, RED Team Chair Portsmouth Economic Development » James K. Spore Reinvent Hampton Roads » Hugh L. Patterson, General Counsel Willcox Savage (Non Voting) » C. Grigsby Scifres, Immediate Past Chair Partner, Williams Mullen

ALLIANCE AT WORK As the world continues to evolve and adapt to pandemic life, the Alliance continues to adjust its economic development efforts to address this new normal.

During the first half of the year, the Alliance opened 32 new projects, with 59% of project leads generated by the Alliance’s efforts and 41% received from the Virginia Economic Development Partnership (VEDP).

The Alliance has hosted 12 prospect visits this year, including one virtual and two in-person site visits postCOVID-19 in June and July. Staff and guests followed all CDC recommendations for the in-person visits including social distancing during meetings and wearing masks when applicable. Alliance staff, all of whom have been teleworking since March, have adapted to the current reality of a public health crisis and embraced best practices for safe business interactions by moving the majority of meetings, events and initiatives to virtual formats The Alliance has conducted a total of 27 project meetings with companies considering expansions in the region this year — 12 in-person, and an additional 15 virtual meetings since March. The team is also developing additional strategies, such as drone videos of key sites, to ensure the region’s assets can be highlighted virtually in an effective manner.

Prior to the pandemic, the Alliance held 18 meetings with key site selectors, including five at the Site Selectors Guild Conference in Atlanta and 13 during a mission to Dallas conducted in conjunction with VEDP. The Alliance is currently working with site selection firm Wadley Donovan Gutshaw (WDG) Consulting to

assess the locational resources of Hampton Roads for corporate office entities. The study came out of the need to understand why the region is frequently considered for distribution and manufacturing operations, but sees little activity from the office sector.

The project, which will conclude in late fall, will result in recommended corporate office targets as well as three technology sectors that are deemed to be a good fit for the Hampton Roads region.

Concurrent to the WDG study, students enrolled in a course in the Strome College of Business at Old Dominion University (ODU) are also exploring office-related themes for the Alliance. The students are focusing on talent trends and will make recommendations for how the region can best attract and retain talent.

Business Retention and Expansion (BRE) efforts have been critical to the COVID-19 recovery efforts, with an increasing focus on helping existing businesses survive the current economic situation and potentially grow through new opportunities. The Alliance is currently working with 8 companies on their expansion projects and has played an active role in three recent expansion announcements in the region. Staff is also leading the effort to build a BRE database tool to facilitate data collection and analysis of trends on a regional level. Alliance staff is working with a local technology company to build this tool and in doing so, is engaging local economic developers for their input to ensure it will be an efficient and effective way for each locality to participate in regional BRE efforts.

In addition to traditional BRE work, Alliance staff has also led or engaged in 15 activities to include presentations to community and regional groups, hosting regional webinars, and facilitating regional in-person events prior to COVID-19. Some highlights include: • On February 5, the Alliance, in conjunction with ODU, hosted a delegation of 17 Israeli defense-related businesses brought to Virginia by the Virginia Israeli Advisory Board for a day-long event at the Virginia Modeling, Analysis, and Simulation Center to learn about business opportunities in Hampton Roads. The event culminated with a reception attended by 110+ individuals including the delegation, Alliance investors, elected officials and local business leaders.

• In response to COVID-19, the Alliance quickly stood up a Business Recovery Taskforce for the region. The taskforce is virtual, meeting regularly to advance the business response and better disseminate information and resources in the region. The taskforce has held 17 virtual meetings since March. Additional information is shared regularly with the team members via email and on www.757Recovery.com • The Alliance worked with its partners at Williams Mullen to shift its Business Solution Series to a webinar format. The first webinar, “COVID-19 Employment and Employee Benefits Law Considerations,” took place on April 3. The second webinar, “Leasing Up Summer 2020: What We’ve Learned and How to Move Forward,” occurred on June 3.

Both webinars had approximately 60 participants.

City of Norfolk Mayor Kenneth C. A welcomes Israeli delegation to Hamp during an evening recept Half Moone Cruise & Celebratio

Alexander pton Roads tion at the on Center.

2020 ANNOUNCEMENTS The following is a job impact summary for project announcements with direct Alliance involvement from January 1 to July 30. In that time, the Alliance has contributed to six announcements from both new-tomarket and expansion projects. The accompanying Total Impact focuses on Direct Jobs announced by each project, apart from the variability of project Capital Investment.

The addition of 1,916 Direct Jobs into the region will have an overall economic impact of more than $727.3 Million and create 4,006 New Jobs across all Hampton Roads industries.

Note that Total Impacts are inclusive of direct, indirect, and induced effects which is the impact of locating the announced industry jobs in Hampton Roads, after all market forces have run their course. Value Added is a measure of project contribution to GDP, and Output is the final impact which equals the value of industry production or gross margin.

TOTAL IMPACTS DIRECT JOB

JOBS IMPACT

ACESUR, USA

LABOR INCOME

VALUE ADDED

TOTAL OUTPUTS

29 123 $2,275,481 $3,963,701 $9,016,844

40

(Olive oil production facility)

Suffolk, January 2020 Expansion

GMAX INDUSTRIES

77 $3,505,719 $6,203,571 $11,914,337

(Medical supplies manufacturer)

Franklin, January 2020 New-To-Market

AMAZON

500

832 $22,491,744 $53,849,854 $114,785,365

(Processing center)

Chesapeake, March 2020 New-To-Market

AMAZON

1,000 2,318 $127,951,529 $226,900,145 $434,797,219

(Robotics fulfillment center)

Suffolk, March 2020 New-To-Market

ASGN/APEX SYSTEMS (IT professional staffing company)

147

310 $16,310,403 $26,288,874 $89,029,333

200

346

Virginia Beach, June 2020 Expansion

ACOUSTICAL SHEETMETAL

$18,599,634 $30,730,770

$67,789,145

(Sheet metal manufacturer)

Virginia Beach, July 2020 Expansion

2O2O YTD TOTAL:

1,916 4,006

$191.1M

DIRECT JOB

JOBS IMPACT

$347.9M

LABOR INCOME

$727.3M

VALUE ADDED

TOTAL OUTPUTS

757RECOVERY.COM In March 2020, the world was hit by the COVID-19 pandemic, the worst health and financial crisis we’ve ever seen. While individuals, communities, and businesses have all struggled to adapt and realign their efforts to tackle this crisis, the Alliance and its regional partners collectively recognized an urgent and critical need to provide business recovery resources and support to the Hampton Roads community. The Alliance worked swiftly with its partners including the Hampton Roads Chamber, Virginia Peninsula Chamber of Commerce, Reinvent Hampton Roads, Hampton Roads Workforce Council, Greater Peninsula Workforce Board, ODU’s Strome College of Business and the CIVIC Leadership Institute, to create the 757 COVID-19 Business Recovery Forum, also known as 757Recovery.com.

757RECOVERY.COM CONTRIBUTORS:

This dedicated web portal, built and managed by the Alliance, was designed to give businesses and community members the opportunity to hear from and engage with industry experts on how to navigate the business impacts of the virus. Bankers, lawyers, accountants, educators, executives and more have contributed to the site by writing blogs, participating in forum discussions, and hosting webinars to share their expertise . A key feature and unique value-add of the website is the message board forum where individuals and businesses alike can “meet the experts” and ask their specific questions during weekly live Q&A sessions.

» » » » » » » » » » » » »

Jim Spore, Reinvent Hampton Roads Xavier Beale, Huntington Ingalls Industries Natasha Merz, Old Point National Bank Darius Davenport, Crenshaw Ware and Martin Shawn Avery, Hampton Roads Workforce Council Mary Miller, United Way of South Hampton Roads William Furr, Willcox Savage Jim Carroll, Hampton Roads Chamber Dustin DeVore, Kaufman & Canoles Chris Stuart, Top Guard Security Erika Marsillac & Theresa Kirchner, ODU Evan Kalfus & David Sutliff, KPMG And more...

In addition to blogs and forums, the site serves as the host for the COVID-19 Business Recovery Survey. The day after the Senate passed the CARES Act, the Alliance reached out to Senator Mark Warner to coordinate a call with local business leaders. Through participating in this call, the Alliance learned the information we had about companies impacted by the pandemic was anecdotal; we had stories, not data. The business community had specific questions and were having a hard time distilling information. Using the 757Recovery website as the hub, the Alliance launched a comprehensive, multi-wave survey series of Hampton Roads business leaders and the business community to collect meaningful data about the severity of the pandemic’s impact on businesses. The results from Wave 1 and 2 can be found at www.757Recovery.com/survey. Wave 3 of the series is expected to launch in August 2020 and will collect information surrounding reopening and what it can and should look like. The data from these surveys is being used to inform elected officials about the collective issues the community is facing and to shape the future resources offered by the Alliance and our regional partners.

Since its launch on April 2, over 8,000 unique visitors have visited 757Recovery.com nearly 20,000 times. It has quickly become the main repository for regional recovery data and expert opinions on how to navigate this unique time in a tactical and socially responsible manner.

757 RECOVERY & RESILIENCE ACTION FRAMEWORK 757 RECOVERY PLANNING VIDEO SERIES: » Doug Smith Hampton Roads Alliance » Felicia Blow Hampton University » Bob McNab, Erika Marsillac, Ph.D., & Martin Goossen Old Dominion University » Aleea Slappy Wilson City of Norfolk » Jordan Asher, MD Sentara Healthcare » Shawn Avery Hampton Roads Workforce Council » John Martin & Patrice Lewis SIR » Jeff Johnson Tech Research Center Park » Clayton Turner NASA Langley Research Center » Monique Adams 757 Angels » Jim Spore Reinvent Hampton Roads » Nancy Grden Strome Entrepreneurial Center » J.D. Myers II Cox Communications Virginia » Alex Case Cordillera Applications Group » Bob Crum Hampton Roads Planning District Commission » RADM Charles “Chip” Rock U.S. Navy

Hampton Roads’ 400-year history is a story of recovery and resilience. Together, we have successfully responded to major shocks — wars, epidemics, fires, floods, economic downturns, unemployment, and more. Our long experience in effectively dealing with adverse situations has wired us not only to survive challenging times, but to come through them stronger than ever.

To mitigate the economic impact of our latest crisis, COVID-19, the Hampton Roads business community is coming together to create the 757 Recovery & Resilience Action Framework. This initiative is designed to reactivate our economy, while protecting public health, and build our region’s future economic and community resilience. Through this framework, we will accelerate the entire Hampton Roads region’s recovery from the COVID-19 crisis in a way that makes our region stronger and even more resilient than ever. Our key to success will be joining together. We are stronger together.

More than a traditional planning process that culminates with a lengthy static document, the 757 Recovery & Resilience Action Framework is a dynamic, ongoing planning resource and implementation framework that is inspired by our region’s thought leaders, advanced by 10 active committees, and supported by a virtual platform — www.757Recovery.com — to encourage collaboration. This initiative will remain in place throughout the entire recovery period, providing an active and responsive framework to accelerate our region’s economic recovery from the COVID-19 crisis.

Hampton Roads’ leading business and academic organizations are spearheading this effort. This coalition is comprised of the Hampton Roads Alliance, Hampton Roads Chamber, Virginia Peninsula Chamber of Commerce, Reinvent Hampton Roads, Hampton Roads Workforce Council, Greater Peninsula Workforce Board, Old Dominion University’s Strome College of Business and the CIVIC Leadership Institute. This coalition has been working together since the emergence of the COVID-19 crisis to advance many COVID19-related business support initiatives.

Please visit www.757Recovery.com to learn more about this planning process.

We will also be sharing updates through the Alliance’s social media platforms, including a 18-episode 757 Recovery Planning Video Series. This video series will feature local business and community leaders sharing their perspective on how we can best leverage the trends and changes brought on by the pandemic.

To watch the full series, please visit HamptonRoadsAlliance.com/media-center.

OFFSHORE WIND In June, the Alliance received a GO Virginia grant for approximately $530,000 to stand up an offshore wind supply chain development program to support the growing $100 billion East Coast offshore wind industry. This effort will position Hampton Roads as a premier location for offshore wind supply chain companies to invest.

Organizations across the region have recognized the importance of early mover status in capitalizing on this economic opportunity. It is critical for Hampton Roads to have the necessary lead time to establish this supply chain to support the increasing number of East Coast projects. Virginia and Hampton Roads are already front of mind in the emerging US offshore wind industry, with Dominion Energy just completing installation of the first two turbines in Federal waters as part of its Coastal Virginia Offshore Wind (CVOW) project.

The offshore wind supply chain development initiative is an opportunity to create new economic prospects for existing businesses, attract new investments to the region, and spark new permanent job creation. This initiative will involve a multi-pronged approach to establish Hampton Roads as an offshore wind hub. The Alliance is adding two full-time staff members who will be focusing the entirety of their time on this effort. These staff, with support from the rest of the Alliance team and contracted service providers, will spearhead marketing, research, business recruitment, and business expansion activities related to offshore wind.

In the spirit of collaboration, a hiring committee comprised of representatives from the Hampton Roads Alliance, Virginia Department of Mines, Minerals & Energy (DMME), Port of Virginia, Virginia Maritime Association and Portsmouth Economic Development conducted the search and selection of the first of these two hires from a wide pool of candidates. In July 2020, the Alliance was please to announce that regional expert, Matt Smith, will join the Alliance as its first Director of Offshore Wind Business Development. Prior to this role, Matt served as the Senior Regional Planner at the Hampton Roads Planning District Commission (HRPDC) and worked in the areas of strategic, environmental and comprehensive planning. Matt led efforts at the HRPDC on issues ranging from offshore wind to site development readiness and was unanimously recommended by the selection committee for this role.

The Alliance will conduct outreach to supply chain companies, organize and attend prospect meetings and marketing missions, and develop marketing materials. This effort will also involve sponsoring and having a highly visible and significant presence at major industry trade shows including the Business Network for Offshore Wind’s International Partnering Forum, planned to be held in Virginia in 2021.

Many of the in-person engagements that would generally be part of this type of effort may be challenging due to COVID-19. For that reason, the Alliance is engaging overseas consultants to serve as a Hampton Roads Offshore Wind Office in Europe. These consultants will set up prospect meetings and attend in-person events and meetings, in the event that Alliance staff is unable to travel. Additionally, Alliance staff has already conducted a number of virtual prospect meetings.

Another primary focus of this effort will involve engaging local businesses in supply chain opportunities.

Many businesses have already capitalized on the chance to serve the CVOW project. The Alliance will work with its partners to provide informational seminars for existing businesses to learn about ways they can participate in the offshore wind supply chain.

To ensure this initiative is effective, the Alliance is already coordinating with key stakeholders in Virginia’s offshore wind efforts, some of which include the Virginia Division of Offshore Wind within the DMME; Port of Virginia; Virginia Maritime Association; Virginia Economic Development Partnership; Reinvent Hampton Roads; Hampton Roads Planning District Commission; and the 11 localities in the region. Stay tuned in the coming weeks for more exciting news on the offshore wind supply chain development initiative.

2020 Mid-Year Report, published July 30, 2020 www.HamptonRoadsAlliance.com