Finding a Balance

Loudoun encouraging business development, while protecting rural landscapeLoudoun encourages development in the east, preservation in the west

Originally Published on

June 01, 2011 6:00 AM

by M.J. McAteer

Things are looking good in Loudoun.

In April, Forbes Magazine once again rated the Northern Virginia county as among the richest localities in the country, with its latest stats showing a median household income of $112,021. (Only Falls Church residents were richer, and just barely, with a median income of $113,313.)

Loudoun posted an equally enviable unemployment rate, 4.3 percent in March compared with a national average of 8.8 percent and a Virginia rate of 6.1 percent during that month.

The county benefits from its position in Northern Virginia near the nation’s capital. People don’t seem to realize it, says Stephen S. Fuller, with a touch of frustration in his voice, but the recession is over in Northern Virginia. The “patient still thinks he is sick,” says the director of the Center for Regional Analysis at George Mason University’s School of Public Policy, “but the regional economy is not just in recovery, but expanding. Good times are here.”

Northern Virginia is on track to add a whopping 22,000 jobs this year, the largest employment surge since 2002, and Fuller says that Loudoun will be in “the catbird’s seat” to reap more than its share of the benefits.

The question is: What is the wisest way for the county to grow, because growth is not without costs?

Loudoun County has undergone a jaw-dropping expansion in the past 20 years. According to the latest Census Bureau statistics, its population surged by 84 percent from 2000 to 2010, from 169,599 to 312,311. That growth was on top of a flood of new residents who had arrived during the previous decade. The county’s landscape and economy have been transformed by this surge of people.

East of the north-to-south-running U.S. 15, whole new towns, such as Brambleton and Broadlands, materialized atop former cow pastures. High-tech and high-profile companies, such as AOL and Orbital Sciences, attracted by the county’s proximity to Washington Dulles International Airport and Washington, D.C. — as well as its state-of-the-art networks, relatively cheap power and available land — came in droves. These high-profile businesses built or leased so many shiny office buildings along Route 28 that it came to resemble corporate trophy cases.

Development also came to the scenic half of the county west of 15. This swatch of horse country, with its working farms, palatial estates, historic villages and soothing views of the Blue Ridge, has seen about 60,000 of its approximately 200,000 acres gobbled up since the 1990s, primarily by new housing.

Such spectacular growth would seem to be synonymous with prosperity, but it has had a down side for Loudoun.

Although commercial enterprises generally more than pay their own way through taxes, residential development seldom does because it requires so much infrastructure, especially schools. Since 1993, Loudoun has built 47 schools, says Loudoun County Supervisor Jim Burton, and it probably will need 49 more by 2026.

School Board Chairman John Stevens says the system is looking at cost-savers such as online learning, clustered building projects, larger class sizes and charter schools, but the addition of 3,000 new students a year has been a driving factor in the county accumulating a $1.322 billion debt, the second highest of any Virginia city or county. (Fairfax topped the list at $3.262 billion.)

That is why, as the economy ramps up, Loudoun is taking what amounts to a two-pronged approach to its future. It has decided that having a county with a split personality is a good thing.

East of Route 15, the focus will be on business development. “All the candidates for office are singing from the same song sheet: the need to create jobs,” says Tony Howard, president and CEO of the Loudoun Chamber of Commerce.

West of 15, the consensus is that Loudoun has something special that deserves to be husbanded. “It’s not this or that,” says Doug Fabbioli, a winemaker and chairman of the county’s Rural Economic Development Council. “It’s how the pieces can work together.”

Chris Miller, president of the Piedmont Environmental Council, perhaps best sums up the county’s unusual position as it heads toward 2012. “Loudoun has one of the most innovative economies in the world,” he says, but it has also “one of the most historic landscapes.” The challenge will be “focusing on the balancing point that makes both possible.”

In the following pages, Virginia Business takes a close look at plans for both areas of the county.

East of Route15: Clusters of high-tech and engineering businesses envisioned for corridor

The Route 28/Dulles Corridor, which runs like a belt across the county’s midsection between state Route 7 in the north and U.S. 50 in the south, will be the go-go area for development, with a new comprehensive plan recently adopted to steer its growth.

Thomas M. Flynn, director of the Loudoun Department of Economic Development, says the area will be “very marketable to corporations,” and he envisions more clusters of tech and engineering businesses, such as the data centers that now occupy about 2 million square feet in the county.

Stephen Fuller concurs. “Growth goes where it can find good space,” says the George Mason professor, and the middle of the county is not yet built out like the eastern sector around Sterling.

Although it falls in the category of a cloud with a silver lining, the economic downturn of the past several years left Loudoun with “some nice vacant buildings” along Route 28, Fuller says. This is Class A space that is larger and more affordable than what’s available in Washington or most of the surrounding suburbs. Once this space is absorbed, several multiuse projects should be coming on line to accommodate anticipated demand from federal contractors and tech companies.

Kincora and One Loudoun, both near Route 7, encompass close to 800 total acres. When they were green-lighted by county supervisors back in 2007, their developers outlined plans for millions of square feet of commercial space, thousands of units of housing, Reston-like town centers, a minor-league baseball stadium and even an airport. At the other end of the corridor near Route 50 and the Dulles area, the similarly ambitious 361-acre Arcola Center also got the pre-recession go-ahead.

Not surprisingly, all three projects became dormant shortly after their approval as commercial space vacancy rates in the county climbed over 25 percent by 2009. One Loudoun even went into foreclosure before being sold back to its original developer at a 2010 auction on the county courthouse steps.

Now, these projects are back in business.

One Loudoun recently announced that it was going forward this fall with the construction of 168 single-family homes, 146 town houses and almost 170,000 square feet of retail and commercial space.

This spring, Kincora broke ground for phased development, and county supervisors recently approved alterations to the Arcola Center plan that its developer says will allow that project to proceed, too.

In addition, by a 7-2 vote in March, supervisors gave the nod to a new project, the 82-acre Dulles World Center near the airport, which will include 4.1 million square feet of commercial space and more than 1,200 apartments targeted at young, white-collar workers.

Loudoun Supervisor Lori Waters, who voted for the project, calls it “smart growth” and “tax-positive development,” but fellow Supervisor Jim Burton, who opposed it, says he doubts that “we’ll ever see the commercial build out promised.” Even without the Dulles World Center, he says, the county has approved 40,000 residential units that have yet to be built.

Loudoun’s housing market has not tracked job growth, either. Sales in February, although up 21 percent from a year earlier, were still sluggish, according to the Dulles Area Association of Realtors, and prices have yet to approach prerecession levels.

Fuller, however, is confident that in the next 10 to 15 years the county, especially its Dulles area, will develop dense “urban pockets,” which will allow young professionals to work and play where they live instead of commuting to jobs and entertainment venues elsewhere. Metrorail, slated to come to both Dulles in the south and Ashburn in the north in 2016 or 2017, should facilitate this development.

Universities and hospitals also are integral to a more self-contained economy, and these institutions are prepared to expand their presence in Loudoun as needed.

Back in 1991, The George Washington University established its beachhead campus in the county, the Virginia Science and Technology Campus in Ashburn. It started with one building and 50 acres and now has four buildings and more than 100 acres. It serves 650 students and offers 20 degree programs, including the country’s first undergraduate degree in pharmacogenomics, which combines the study of pharmacology and genetics.

Craig Linebaugh, associate vice president for academic planning and chief academic operating officer at the Loudoun campus, is proud of GW’s symbiotic relationship with the high-tech community and with the county’s well-regarded public schools. In April, the university’s annual Science, Technology and Industry Day attracted 150 Loudoun high school students who participated in workshops in the university’s earthquake simulation labs and crash analysis center. The keynote speaker for the day was Titanic discoverer Robert Ballard, who urged his young listeners to follow their passion.

George Mason University also has a presence in Loudoun, opening its Broadlands campus about six years ago. Kathleen Johnson, GMU’s assistant vice president for regional campuses, says the university recently was given a 37-acre site for future expansion and has the zoning to add 1 million square feet of classroom and offices. Northern Virginia Community College, Strayer University, DeVry University and Patrick Henry College all have opened Loudoun locations.

Loudoun residents will see an expansion of medical services in the next few years. For several years, health-care company HCA encountered stiff resistance from Inova Health System (which owns a hospital near Leesburg) and the county supervisors in proposing a hospital in the Broadlands area. HCA eventually won approval for a four-story hospital, StoneSpring Medical Center, in another area.

The hospital, scheduled for completion in late 2015, will occupy a 50-acre site at the south end of the county off Route 50. Tracy White, vice president of community and government relations for HCA’s Capital Division, expects the 164-bed facility to create 500 jobs. It will become part of a new medical hub, which includes a recently opened HealthSouth rehabilitation facility that employs 140 and Capital Hospice, a 21-bed facility that is scheduled to open in 2013.

West of Route 15: Tourism and agriculture remain the twin pillars of rural area

In the 1990s and first years of this century, Loudoun leaders were often at loggerheads over how much development to allow west of U.S. 15. Back then, preservation groups such as the Piedmont Environmental Council and pro-business organizations such as the Chamber of Commerce weren’t usually found on the same side of growth issues. That’s not true anymore — at least not as often.

“There’s a pretty broad consensus now that Loudoun has something special,” says Tony Howard, the Chamber’s president and CEO. “We want to retain what differentiates us from surrounding communities.” Denizens of both ends of the political spectrum, for example, are standing together in opposition to a state initiative for a Western Bypass or outer Beltway that would take a yet-to-be determined route through Loudoun.

Despite many pockets of new housing, western Loudoun has hung on to its rural character, and tourism and agriculture remain the twin pillars of its economy.

In 2009, some 21 million tourists generated about $59 million in tax revenue and $1.3 billion in spending, according to the organization Visit Loudoun and Virginia Tourism Corp. These visitors come primarily for the scenery, the history, and the wine. They attend equine events such as polo matches and the recent steeplechase races at historic Oatlands Plantation, and they flock to festivals such as the popular Waterford Fair. They shop and dine in historic Middleburg and Leesburg, and check out Civil War sites, such as the Goose Creek Bridge.

While few historic sites are left east of 15, villages west of 15, such as Unison and Taylorstown, still feel like a step back in time.

The tasting rooms and decks of the county’s 28 wineries, the most of any county in the commonwealth, are also a big draw. According to the Loudoun Wine Growers Association, a vineyard can generate an annual net income of $5,000 an acre.

More traditional agricultural pursuits are the other mainstay of the western economy. Loudoun ranks 20th among Virginia’s 95 counties in agricultural sales, according to the National Capital Farms organization. It has more horses than any other Virginia county — about 15,000 of them valued at more than $200 million.

Loudoun also has more than 24,000 head of cattle, and its 1,400 farms produce everything from hay, soybeans, and corn to the organic meats and produce that appeal to “locovores” on both sides of 15. In addition, the west is looking for products for the 21st century, such as switchgrass, a biomass crop that is a source of ethanol.

Such innovative uses of the land will help the west earn its keep while keeping its character, says Fabbioli, the winemaker who chairs the county’s Rural Economic Development Council. That’s important to Loudoun County, he says, “and lots of citizens get that.”

Loudoun County at a glance

Unemployment rate (1)……………………………4.30%

2010 population (2) ………………………….312,311

Increase from 2000…………………………….. …..84%

Adults (25-plus) with college degrees (3)…….47.20%

Median household income (4)……………….$112,021

(1) March 2011 (2) Census Bureau (3) Virginia Economic Development Partnership (4) Forbes magazine

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