
DATE: Wednesday, May 7, 1997                TAG: 9705060232

SECTION: LOCAL                   PAGE: B3   EDITION: FINAL 

TYPE: PUBLIC LIFE 

SOURCE: BY BATTINTO BATTS JR., STAFF WRITER 

DATELINE: PORTSMOUTH                        LENGTH:  105 lines

PORTCENTRE: HALF EMPTY OR HALF FULL?

Portsmouth set out to save the run-down neighborhood around the Norfolk Naval Shipyard by demolishing most of the homes and converting the site into a tax-producing business hub. Two decades later, PortCentre Commerce Park remains half empty. City officials, however, look at it as half full, and - with an aggressive marketing campaign and a new city-financed office building - say it is finally on its way to helping Portsmouth's finances.

At the turn of the century it was an affluent neighborhood called Newtown, where prominent military and city officials lived. But the community hit a decline after World War II, and many of the original families moved away. Property values plummeted and crime soared.

In the mid-1970s, fearing that the neighborhood's crime posed a threat to the workers at the nearby shipyard, the city's housing authority purchased most of the properties. By the mid-1980s, it had razed nearly all of the houses.

The area was designated an enterprise zone in 1984, meaning businesses are offered incentives such as tax credits, to locate there.

In 1987 city officials named the area PortCentre Commerce Park. The plan was to fill it with a variety of manufacturing businesses that would diversify Portsmouth's economy.

But those plans have been slow to materialize, city officials acknowledge. Nearly 20 years after bulldozers began clearing the land, roughly half of the 63-acre park remains vacant.

Filling the park, which is next to downtown, is considered a high priority in the plan to restore Portsmouth's economic health. The city's construction of a 100,000-square-foot shell office building, designed to attract businesses looking to open shop within a matter of months, is the centerpiece of an aggressive marketing strategy.

``The development of PortCentre is a high priority for two reasons. It offers the ability to expand our capacity for growth as well as increase product in terms of new buildings which companies can expand into,'' said Matthew James, the city's director of economic development. ``The primary objective is to create new employment as well as tax revenue for the city of Portsmouth.''

Although no business has signed a lease to enter the office building, city officials say they are encouraged by the number of firms that have expressed interest.

City officials are also encouraged by other developments in the park. In January, B&B Manufacturing, a producer of tents and funeral supplies, opened an 18,000-square-foot plant there. And in February, Fast Food Merchandisers International began construction on a 24,000-square-foot plant to be completed this summer.

Those developments could show the park's potential and could help attract other tenants, said Gordon Wheatley, the housing authority's director of development.

``I cannot explain why there was a lull,'' Wheatley said. ``But the last year has been a real turnaround. That in itself is going to spur a lot of additional interest in that area.''

The city's struggle to develop PortCentre has created some skepticism about whether a commerce park was the best way to revitalize the neighborhood.

``It could have been rebuilt,'' Billy Baker, a local historian, said of Newtown. ``It had some beautiful homes, some dating back to the early 1800s. It is a shame that they didn't save it.''

But Wheatley said refurbishing the homes wasn't feasible when the housing authority took over the neighborhood.

``It was some of the worst housing that we ever acquired,'' he said. ``It was some of the most blighted land in Tidewater. It was seriously deteriorated.''

Wheatley said roughly a third of the properties the housing authority acquired in Newtown had delinquent taxes - meaning the neighborhood was a liability. ``It was a tremendous drain on the city in the sense of police, fire and social services,'' he said.

It's not like city officials weren't trying before to develop PortCentre.

Direct Marketing Enterprises, one of the nation's largest mail-order firms, planned to build a 230,000-square-foot warehouse on 20 acres in the park. But the project, which would have added 300 jobs to Portsmouth's economy, fell through last summer when Direct Marketing failed to secure a $10 million loan needed to finance it. Negotiations on the project took two years, and that meant the 20 acres Direct Marketing was to occupy was effectively off the market during that time.

In hindsight, Portsmouth might be better off without Direct Marketing, City Manager Ronald W. Massie said.

The failed deal has allowed the city to break the large parcel into several smaller ones and market them to numerous companies, Massie said. That will help diversify the kinds of businesses in the park. ILLUSTRATION: AN AERIAL VIEW OF PORTCENTRE

The Virginian-Pilot

The 60-acre PortCentre Commerce Park was originally an affluent

neighborhood at the turn of the century called Newton. After World

War II, the community began to decline until most of it was finally

razed in the mid-1980s.

PORTCENTRE TENANTS AND NEIGHBORS

The area was designated as enterprise zone in 1984. meaning

businesses are offered incentives, such as tax credits, to locate

there.

GRAPHIC

[For a copy of the graphic, see microfilm for this date.]

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