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Posted February 22, 2014 | Leave a comment
PROGRESS 2014: Businesses view 2014 with optimism
By Ryan Cornell
Businesses in the Northern Shenandoah Valley reflected the steady rates of growth experienced in the rest of the country over the past year, and in some cases, did better.
People are starting to spend more money in our economy again, according to Clay Arthur, president of the Shenandoah County Chamber of Commerce.
He said consumer confidence is returning and people seem to be more willing to talk about investments.
"They aren't saying that I need to guard all my dollars and cents under my mattress because doomsday is coming," he said.
Business owners in Front Royal were worried that the completion of the Dominion Virginia power plant in Warren County would halt the dollars flowing into the local economy and send hundreds of construction workers packing. Their fears were somewhat relieved with the announcement of a new construction project north of Front Royal: a Marriott hotel being built off of Country Club Road.
Steve Parrish, senior vice president of the Winchester-based development firm Aikens Corporation, said the project is still in its early stages but construction might not be too far off.
He said the company is planning to break ground on the property within the next 12 months and hopes to open the hotel between spring and summer of 2016.
The hotel will be geared mostly toward long-term guests -- those staying for at least four days -- and will be the first Marriott property in Warren County. Parrish said the Aikens Corporation owns the Hampton Inn in Front Royal and knows the demand for another hotel in the area.
"There will be full kitchens in every room and we will have studio suites and there will even be two-bedroom suites," he said. "There will definitely be a swimming pool, fitness center, and of course a free breakfast every morning."
He said he hopes to secure planning approval of the project from Warren County by July. The contractor for the project will be Winchester-based H & W Construction. He added that there will be about 23 employees at the hotel once it's completed.
"We have been very impressed with the leadership of Warren County trying to bring in new development into the county," he said. "Their officials are trying to bring jobs into the community and I think they've done a pretty good job trying to facilitate this into the community."
While Front Royal is thriving, Middletown encountered some turbulence this year with the closing of the Wayside Inn.
George and Rebecca Reeves, the new owners of the Wayside Inn, said the past few months have shown them that the idea of being an innkeeper is harder than it seems, but business seems to be picking up.
"Basically, we have been given a great deal of community support and people have been booking special events and patronizing our tavern," Rebecca Reeves said.
The couple hosted an open house on Dec. 15, not long after purchasing the "longest continuously running inn in America" on Nov. 22, and were shocked at the turnout they received.
"We expected 100, 200 people, and there were probably about 1,000 people," Rebecca Reeves said.
"It was stuffed," she said. "People were just parked up and down the street. It was really a very surprising response that people cared so much about this inn and how much it means for them to have it open."
The owners are expecting a busy 2014 coinciding with the sesquicentennial of many local Civil War battles, such as the Battle of Cedar Creek.
It seems like more and more things are happening in the valley and more and more people are coming out here, Rebecca Reeves said.
George Reeves, who wants the Wayside Inn to become the "nucleus of the revival of the community," said he plans to paint the exterior of the inn and work on its landscaping this spring.
"When you think that this place was shut down for a year and the condition of the kitchen and other things that had to be brought up to specs, it's remarkable what we've done in two months," he said.
Another town landmark that's seen its fair share of history is the Walton & Smoot Pharmacy in downtown Woodstock. Part-owner Charles French said the pharmacy has been in business on Main Street since 1906.
Back in those days, the pharmacy had one competitor, a local drugstore known as Schmitt's. Today, the pharmacy is competing with big box retailers such as CVS, Rite Aid and Walmart as well as the Internet, which can be used to purchase all types of medicine.
He said he doesn't have a problem competing with the box stores on level ground; it's the pharmacy benefit managers that skews business against his favor.
"What we're finding right now is that there are certain plans locking us out," he said. "In other words, they wont let us on certain plans. We're not what's called a preferred pharmacy when we were before."
He said this has increased the co-pay at their pharmacy, though their loyal customers who have been coming to Walton & Smoot for decades are willing to pay more for the customer service.
"Every once in a while, we'll go to their house and straighten their medicines because they're all mixed up," French said. "Walmart isn't going to do that for you."
According to French and co-owner Nancy Miller, the future is filled with lots of paperwork.
"That's why I'm getting out soon and she's taking over," he said. "It's just that's all we do. You used to go in and fill a prescription and now it seems like every prescription has a problem."
Those problems could either be exacerbated or lessened by the passage of the Affordable Care Act. The two pharmacists said not enough people have signed up for universal healthcare, so it's a little too early to tell.
He said if the new act works as it's described, it could prove to be a benefit to pharmacies by increasing their prescription volumes.
According to local real estate agents, last year was a great time to buy a house and 2014 is expected to be even better.
Front Royal real estate agent Ken Evans said home sales increased by about 12 percent from 2012 to 2013 and predicts the trend to continue.
"I think we're expecting a 6 percent increase nationwide [in 2014], so it will probably be in that ballpark," he said.
While the northern part of Shenandoah County has "improved dramatically," he said the southern part hasn't made the same gains.
"New Market, Mount Jackson, it's not as strong in different places," he said.
Robin Gochenour, owner of Skyline Team Real Estate in Woodstock, said total dollar volume sold in December 2013 measured $746,243, an 11.33-percent increase since December 2012.
Although that means more money was spent on real estate last month than the previous year, she said those houses tend to be on the affordable side, ranging from $100,000 to $200,000.
She said the average sold price last month was $176,050, a 1.21-percent increase since December 2012.
Evans said many of the houses were purchased by second-time homebuyers getting back on their feet and reentering the market.
"You got people not looking for real large homes like during the boom," he said. "The trend is more affordable homes, living within their means."
He credited increasing interest rates and more construction projects with helping fuel the recovery.
Gochenour said fewer foreclosures than in previous years and more homes being sold by their owners also have contributed to prices steadily rising.
"2014 is going to be a marvelous year," she said. "We're seeing activity. Things are happening."
Beth Waller, a real estate agent with Weichert Realtors in Front Royal, agreed.
"I'm really anticipating a fantastic housing market," she said. "It's been amazing what 2013 has yielded."
She said the market typically tends to slow around July 4, but noticed no such lag in 2013.
"I don't think the increases in property values for property owners is going to be dramatic," she said. "I think it's going to be a slow and steady increase. I don't think people are going to wake up and find their homes are worth anything like during the boom."
She said she believes the incline will be more steady, and admitted that her confidence is so strong she has added four new people to her sales team.
As owner of Frets N' Friends, a guitar shop down the street from his Strasburg financial planning office, Arthur has developed a natural barometer for the local economy.
"People aren't coming in and buying $3,000 collectible guitars every day, but a lot of people are coming in and buying $50 to $100 of products," he said. "We didn't see that a couple years ago."
Although people might be dropping more cash in the local and global economies, job proliferation has continued to plateau at low numbers. Instead of using its extra revenue to create jobs, large companies are holding onto their money and increasing in profitability.
"In years past, company profitability has translated into jobs," he said. "We're not seeing that.
"But when companies start to spend their money in those economies, then I think people's confidence will really soar."
Contact staff writer Ryan Cornell at 540-465-5137 ext. 164, or firstname.lastname@example.org
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