The former American Bank & Trust Co. building at 201 W. Brookland Park Blvd. (Photo by Tina Eshleman)
Amid persistent questions from North Side residents and commercial property owners about the long-delayed rehabilitation of the former American Bank & Trust Co. building on Brookland Park Boulevard, the project faces new setbacks.
Virginia Union University, which LaMar Dixon of Dixon/Lee Development Group had identified as a tenant and partner in a business development center planned for the site, said this week that it has decided to terminate a memorandum of understanding signed Nov. 1, 2017, “as the school assesses its relationship with Mr. Dixon and Dixon/Lee Development Group,” according to an emailed statement Tuesday from university spokeswoman Pamela H. Cox.
The university declined to comment on what led to the decision to end the agreement. “We stand by the statement we sent you,” Cox said via email.
Dixon said Wednesday that his attorney has requested a meeting with VUU officials. He said he and his partners have spent a significant amount of time during the past year building a relationship with the university.
"From August to December, I was on campus just about every day," he said. "We were creating the entity so we could receive outside support to make sure it was sustainable."
The university did express support for the concept, saying, “We are excited about the possibility of the American National Bank Building on Brookland Park Boulevard becoming a small business development center.” The statement clarified that the university is not involved in construction “or financial aspects of the project.”
In January, Virginia Union published and distributed a booklet titled “The Promise of One Richmond,” which highlighted partnerships with local government, schools, corporations and community organizations. It included a section titled “VUU partners with business incubator,” describing a community partnership with Dixon/Lee Development Group in the former North Side bank building, noting “the mixed-use, co-working innovation space will serve as a business accelerator connecting entrepreneurs and business owners to mentors, tools and technology.” The booklet states that the partnership, called the Virginia Union University Small Business Development Center, would lead to 30 or more jobs and student internships. The center’s goal “is to create a sustainable model of access to enterprise and opportunity for Brookland Park’s corridor residents.”
Another complication is the city's involvement in the project, which received an economic development grant of $200,000. Dixon met Feb. 20 with staff members of Richmond’s Department of Economic and Community Development “and discussed failure to meet the terms of the agreement,” Interim Director Douglas C. Dunlap wrote in a Feb. 22 email.
In a follow-up message Wednesday, Dunlap added, "Upon assessment of the terms of the performance agreement, the city has determined that the project is in default. Key milestones for construction and job creation have not been met. We made the developer aware of the default status and are in discussions about a repayment or remedy."
Dixon said Wednesday that he believes the project can still happen without Virginia Union, adding, "All the programmatic work has been done."
Regarding the city's involvement, he said, "We’re agreeing that if we can get the city made whole financially, then it takes away people’s concern about the city [funds] being involved."
Dixon says that the project would be moving forward with construction if Virginia Union had not withdrawn. He and his partners say they are in talks with prospective financial partners and tenants.
Art Burton, a community activist working with Dixon on program development, says an incubator is necessary to support economic development and job creation in the African-American community.
"The issue was that Brookland Park Boulevard as a historic black business district was in a state of decline," Burton says. "How do we stop the decline and support black businesses?"
Burton says he hopes the partnership with Virginia Union can be salvaged, adding, "The university's involvement does make it a better project."
Constructed in 1927, the 2,200-square-foot building at 201 W. Brookland Park Blvd. housed the American Bank & Trust Co. and later the Virginia Auto Mutual Insurance Co. and Still’s Specialty Shop.
Dixon, a native of Bridgeport, Connecticut, who attended Virginia Union, says he bought the building in May 2015 from the Richmond Redevelopment and Housing Authority for $33,000. (RRHA acquired several properties along Brookland Park Boulevard as part of the city's efforts to revitalize the corridor.) He received a $200,000 grant from Richmond’s Economic Development Authority — $75,000 for acquisition and development and $125,000 for construction and business development.
Dixon received the $75,000 payment during the fiscal year ending June 2015, according to a letter sent to him by the Richmond Economic Development Authority. In an Oct. 30, 2015, memo sent to the EDA, Dixon requested the remaining $125,000, asserting that he had met the requirement to secure financing sources. Dixon/Lee Development received the funds during fiscal year 2016, Dunlap said.
During an interview in April 2017, Dixon said he envisioned a co-working/business accelerator center similar to Gather or 804RVA, offering administrative and technical support to business startups. He also mentioned the possibility of a commercial kitchen that would offer space to food-truck entrepreneurs and the creation of upstairs apartments during a second phase of the project.
At the time, he said he was conferring with Virginia Union University’s Center for Small Business Development on an agreement that could involve administrative support and student internships, and offer graduates incentives to work in the community. VUU President Hakim Lucas, who arrived Sept. 1, 2017, became involved in the talks later, Dixon says.
The inside of the bank building, as seen in the summer of 2017 (Photo by Stephen Clatterbuck)
When our first article about it was published in June 2017, the project was behind on the grant’s timelines, which had been extended on Feb. 22, 2016. Construction was to be completed and a certificate of occupancy received by March 1, and the grant required the creation of 30 new jobs — 15 “permanent” and 15 part-time — for a period of five years, Dixon says. The “permanent,” or full-time, jobs were to be created by April 1, 2017, the rest by Nov. 1 of that year.
On June 14, 2018, Dixon appeared at a Brookland Park Area Association meeting and said he had an agreement with VUU to collaborate on a business accelerator that would open in 2019, with construction starting in the fall of 2018. Dixon's team also presented a video rendering of the new space.
Chris Hilbert, who represents the North Side 3rd District on Richmond City Council, said in the summer of 2017 that he planned to request another extension of the dates for construction and job creation, but acknowledged recently that it had not been done.
“I want to make sure of realistic time frames involving VUU before moving forward with another ordinance,” Hilbert said in a Jan. 26 message responding to questions about the project.
Meanwhile, residents and property owners have continued to press for answers about the project status and use of the $200,000 grant. During a packed 3rd District public meeting at Ginter Park library branch on Jan. 24, Hilbert faced a flurry of questions: If the developer hasn’t met the contractual obligations, why isn’t the city reclaiming the money and the building? Is there a signed contract with Virginia Union? At what point is it enough? Where does the buck stop and with whom?
“I would say it’s with me and the developer,” Hilbert responded. Afterward, he said he was not ready to pull the plug on what he called “a transformational project.”
Outside the library, North Side resident Matt Dunlap expressed frustration about what he’d heard.
“I’ve been asking about this for a year — a year and a half,” he said. “But nothing ever happens. … There needs to be accountability.”
The councilman said he would be meeting the next day with Dixon and VUU President Lucas. Asked about that meeting afterward, he wrote on Jan. 26, “Per my meeting … the MOU will be moving to a new level and the time frames will become clear. I expect VUU to have a press release next week laying out their intentions moving forward.”
Despite several requests for information about Virginia Union’s involvement, the university did not respond until this week. “Due to ongoing talks, this is the first opportunity that the university is able to offer a comment regarding the American National Bank Building,” spokeswoman Cox wrote on Feb. 26.
During an interview after the VUU meeting, Dixon told Richmond magazine he had spent a total of $360,000 on the project so far, including business development, architectural renderings, site upkeep, taxes and insurance.
“We have money left to build out the property,” he said, estimating $929,000 in construction costs. “This is not just about construction of a building,” he added, noting that projects created for social impact often take five years or longer to complete.
"A lot of what we’re doing, we're doing because there’s a need," Burton says. "A lot of this work has been trial-and-error, and trying to figure out how we align these resources together."
Residents who are concerned about the lack of progress at the former bank site have circulated phone and email templates asking city administrators, Mayor Levar Stoney and City Council President Cynthia Newbille for a detailed accounting of $200,000 Dixon/Lee Development received for the project and requesting no further extension of deadlines.
Responding to one such letter, Hilbert wrote that the proposed business accelerator and co-working space “would be the first such business that would be focused on African-American business owners in the region.” He added, “This project at 201 W. Brookland Park Blvd. is but one instance of Council assisting a small minority-owned business that faces the challenges of institutional racism and in particular finding financing for their projects. The delays that have occurred are due to the lack of business partners to be obtained to make the vision a reality.”
Acknowledging that “the developer is currently in default,” Hilbert said a thorough examination of the status was warranted.
“If [the city] administration recommends that we move forward with an extension, then I would definitely require strict adherence to tight deadlines in the extended performance agreement,” he wrote. “If the administration believes that we need to exercise our rights by taking the property back and demanding that the city be repaid, then I will fully support that decision.”
Many in the neighborhood see the empty bank building as hindering efforts to revive the commercial strip.
“It’s a prominent building in the neighborhood, and rehabbing it would be a catalyst for the neighborhood," says Cory Weiner, an investor and developer who owns 10 properties along Brookland Park Boulevard. Businesses that recently opened in his renovated buildings include Boho Fit Studio, Hand/Thrown ceramics studio, Diamonds and Dutch Pet Bath & Spa, and Scrap RVA.
Meanwhile, it appears that the city’s Office of the Inspector General is investigating a complaint about the project made via the office’s “Fraud, Waste and Abuse Hotline.” A city resident who filed a complaint alerted Richmond magazine.
An investigator confirmed that the office had received a complaint, but declined to elaborate. Louis Lassiter, the city auditor/inspector general, answered “no comment” to questions about an investigation. However, information posted on the city website says that according to state law, “the inspector general is required to investigate all allegations of fraud, waste and abuse.”
Lassiter did say that “all final reports issued are sent to the chief administrative officer and [City] Council and publicly presented at the Audit Committee and posted on the city's website.”
Asked whether he was aware of a complaint investigation, Dixon responded, “We were aware for several weeks that complaints might have been lodged against the project. We are still moving forward, though, toward completion and we are excited about what this will mean to the [North Side].”
Reached by phone Wednesday evening, Hilbert said he supports the city administration's finding of default, adding, "I'd like to see the city be repaid."
Whether Dixon is able to continue with the project depends on his ability to reach an agreement with the administration and the RRHA, which sold him the property four years ago, the councilman said.
"Should the housing authority want to take [the building] back, I think a lot of people would be interested in it," Hilbert said. "I wish Mr. Dixon the best. I’ve supported him throughout this process." He added, "I’m very supportive of this corridor and I want it to do well."
