THE VIRGINIAN-PILOT
Copyright (c) 1997, Landmark Communications, Inc.
DATE: Monday, January 27, 1997 TAG: 9701270046
SECTION: FRONT PAGE: A1 EDITION: FINAL
SERIES: PORTSMOUTH: TURNING IT AROUND
Part 2 of 2
SOURCE: BY BATTINTO BATTS JR., STAFF WRITER
DATELINE: PORTSMOUTH LENGTH: 128 lines
After 14 years, Bob Judd had spent thousands of dollars renting space for his screen-printing business.
Judd wanted his own building, but he didn't want an expensive mortgage that would cripple his business.
Andrew Hamblen was tired of paying to rent an apartment in Ghent. He wanted to buy a condominium - one with character that would fit his budget and be easy to sell.
Judd and Hamblen set off on separate journeys throughout Hampton Roads in search of the perfect property.
Chesapeake and Virginia Beach? Too expensive.
Norfolk? Less costly, but a limited number of choices.
To their surprise, Judd and Hamblen found what they wanted in Portsmouth.
Judd purchased a 42,000-square-foot warehouse for his business, Rachel's Screen Printing, in Portsmouth's west end. Judd estimates that he paid at least $500,000 less for the property than he would have in other cities.
Hamblen, who is in the Navy, recently moved into a two-bedroom, two-bathroom condo in Portsmouth's Olde Towne section. He says his new place looks more original than the ones he considered buying in Chesapeake and Virginia Beach.
Dozens of other people like Judd and Hamblen recently have chosen Portsmouth as their place to live or do business. They've come to Portsmouth in search of neighborhoods, small-town flavor, reasonable property values and refuge from suburban sprawl.
It's part of what some call the rediscovery of a port city perceived as a lesser player in Hampton Roads for years, to the point of being nearly presumed dead.
``Portsmouth is the best-kept secret in Hampton Roads,'' said Jeannette Rainey, a real estate agent with Long and Foster who recently moved to the city. ``It has had such a bad rap. It has been known as the armpit of Hampton Roads. But the reason you are seeing growth trends now is that people are taking off the horse blinders they had on to Portsmouth.''
City officials are reluctant to declare Portsmouth rid of its problems, but they are cautiously optimistic that the rise will continue.
The growth has brought additional tax revenues that resulted in a $6 million budget surplus for 1996. City officials say that will enable them to complete long-overdue capital improvement projects like street and sidewalk resurfacing. Such face lifts undoubtedly will make Portsmouth more attractive, city officials say.
Portsmouth may be on the road toward shedding its crime-plagued image. For the first time in 13 years, the city reported a drop in the violent crime rate in 1996. And crime is at the top of the list of concerns prospective home-buyers or businessmen have about a city.
Hamblen said Portsmouth's reputation of being unsafe kept him away from the city before.
``Back in 1989, when my ship was in the dry docks, we were advised not to do anything in Portsmouth, not to walk the streets and not to stop in the stores,'' he said. ``People were having run-ins and being victims of robbery. I feel pretty safe in my neighborhood, the Olde Towne area. But . . . I still have some concerns.''
Hamblen's lingering fear shows Portsmouth still has a way to go. But if this city is making a comeback, why now?
Timing, preparation and determination are the answers, say residents, real estate agents and city officials.
Just three years ago, Portsmouth was a city struggling to pay its bills. A sour economy forced numerous businesses to leave town, causing the city's unemployment rate to soar and, along with it, crime. And when people aren't working, they don't have money to spend, so a number of Portsmouth's retail outlets, such as Tower Mall and the MidCity Shopping Center, foundered.
The outlets' demise took a huge bite out of the city's retail tax revenue. Cities such as Chesapeake, Virginia Beach and Suffolk saw their property tax coffers fatten as families left Portsmouth in search of a better life.
Portsmouth hit a low point in 1994 when its general fund balance hovered near zero, and the school district had to borrow money from the cafeteria fund.
But Judd said something else was happening in other cities while Portsmouth was in a rut. Property values in Chesapeake and Virginia Beach soared because of the growth, making it tough for small businessmen like Judd to survive, he said.
``My rent had gotten substantially higher,'' Judd said. ``I felt (with) the money I paid to lease, I could buy a building.''
Also, according to Shannon Meagher, a longtime Portsmouth resident who is rehabilitating several houses in the city, people began to crave older neighborhoods instead of new subdivisions.
``You have sidewalks in Portsmouth, and you can walk downtown and see people you know,'' Meagher said. ``You're lucky if you see someone you know at an intersection in Virginia Beach.''
Although some parts of Norfolk, such as Ghent, provide that neighborhood flavor, the availability is limited. That pushes up the cost of property - it's a case of supply and demand. Rainey, the real estate agent, estimated that a buyer would pay $40,000 more for a three-bedroom house in Norfolk than in Portsmouth.
``There are neighborhoods in Portsmouth like Olde Towne, Waterview, Glensheallah and Sterling Point that have everything the suburbs are trying to create,'' Rainey said. ``Everybody is crying out for communities, but it is all over Portsmouth.''
The city's crime problem is at least partially responsible for its lower property values, Rainey said.
But if this is truly a reversal of fortune for Portsmouth, it's occurring because the city has prepared itself for it, said Matthew James, the city's director of economic development.
The city staff and community groups have developed initiatives to combat crime, toughen zoning and code enforcement, redevelop blighted neighborhoods and aggressively recruit businesses, he said.
``I think a lot of the new activity that is being generated in Portsmouth is the result of the hard work of a lot of people and positioning Portsmouth as a unique business and residential opportunity within the region,'' James said. ``Within the past few years we have worked very hard to create a pro-business atmosphere and a positioning that will allow us to utilize our unique attributes.''
Judd said the city's commitment to improving Portsmouth was evident when he was looking for a warehouse. The city's economic development staff showed him numerous available properties throughout the city, he said. The help Judd received from the city led him to relocate his company, which employs 50 people, to Portsmouth from Norfolk 10 months ago.
``They seemed like they were genuinely interested in having a business over here,'' Judd said. ``They really tried to help me out. They were willing to see me through it.''
Meagher, who moved to Portsmouth 11 years ago and considers herself a booster for the city, says she will continue to encourage her friends in Virginia Beach and Norfolk to visit Portsmouth. Once they come, she's certain they will like it as much as she does.
``I think the city has definitely turned the corner, and it has a lot to do with the decision of the merchants and the neighborhood groups not to die and to be reborn,'' she said. ``I feel Portsmouth has been underrated. I would not choose to live anywhere else.''