Developer buys land that state wants for transportation project
Editor’s note: A previous version of this story appeared on VirginiaBusiness.com on Sept. 26.
A waterfront Norfolk condominium proposal could face a roadblock from a state transportation project intended to ease congestion in Hampton Roads.
WF Willoughby Spit LLC, an affiliate of Alabama-based WeldenField Development, bought 14 acres at the end of Norfolk’s Willoughby neighborhood for $4 million on Sept. 4.
The site, which includes two parcels recently assessed at $6.3 million, was purchased from REDUS VA Housing LLC, a Wells Fargo-controlled entity.
Brian Rowe, WeldenField’s Virginia partner, says the firm plans to develop a 333-unit condominium project that will be called Admiral’s Cove at Willoughby.
WeldenField’s plans will sound familiar to people within Norfolk’s real estate scene. The proposal is roughly the same as one made about 14 years ago for a development known as the Spectrum at Willoughby Point.
Those plans were shelved when the developer was beset by financial woes during the recession, and the property went back to its lender, says Robert Thornton, a broker with the commercial real estate firm Cushman & Wakefield|Thalhimer who represented Wells Fargo in the recent sale. Thornton says WeldenField sent its first letter of intent to Wells Fargo around 2012.
State transportation planners have their own ideas for the site.
In expanding the Hampton Roads Bridge-Tunnel, the Virginia Department of Transportation plans to buy the two parcels for a construction staging area, according to Les Griggs of VDOT. Asked why VDOT couldn’t lease the property during the project, Griggs says that move isn’t an option since “the terrain of the property will likely be altered.”
Virginia law says the state can’t try to buy an entire property with an offer lower than its appraised or assessed value unless something has happened to make the property worth less than its assessment. That means if the state plans to buy the 14-acre site on Willoughby Spit, it would have to make an offer of at least $6.3 million, or $2.3 million more than what Wells Fargo sold the property for.
The city of Norfolk says it has adopted new flood maps and storm-water regulations since 2004. A city spokeswoman says the new condo plans would have to be approved for WeldenField’s proposal to move forward.
Grady Palmer, a lawyer for WeldenField, disagrees with the city’s position that the old site plan needs modification. He says WeldenField plans to apply for building permits if it receives no offer from VDOT.