The Pinnacle is Doubling in Size

BRISTOL, Tenn. – The Pinnacle commercial development is effectively doubling in size, after developer Steve Johnson completed the purchase of adjoining land in Washington County, Va.

Johnson and Pinnacle Partners LLC paid $3.14 million to Henard Enterprises Inc. for the remainder of the former Bristol West property, which will join about 200 acres he has been developing near Interstate 81’s Exit 74 in Bristol, Tenn.

“Occupying two states and covering 500 acres, this has evolved into the super regional development that had always been envisioned. It will serve Southwest Virginia, Northeast Tennessee, western North Carolina and eastern Kentucky. It is the largest development of its kind currently in the country,” Johnson told the Bristol Herald Courier Thursday.

The Virginia portion extends from the Tennessee line and Bristol West Boulevard — just behind the Tennessee welcome center — eastward to Miller Hill Road near Gate City Highway and Interstate 81’s Exit 1, according to records on file with the Washington County, Va., Circuit Court Clerk’s Office.

“As planned from this project’s inception, I have purchased or have agreements to purchase all of the land necessary for phase two of The Pinnacle project,” Johnson said. “This allows The Pinnacle to be accessed from both Highway 11 in Tennessee and the Gate City Highway by way of Miller Hill Road in Virginia.”

The Virginia portion is expected to include additional retail, a state-of-the-art 7,000-seat amphitheater, recreation areas, professional, medical and multi-family residential development, Johnson said.

Contractors are currently moving about 2 million cubic yards of dirt and rock to prepare the Tennessee portion of the site for new shopping, dining and entertainment businesses.

“Bass Pro is on track to open in the early spring of 2014 and the Belk-anchored complex will open in early spring of 2015,” he said. “The Tennessee property is mostly committed. We were committed to fulfilling the project in Tennessee first. There are some retailers who want to be part of The Pinnacle that we don’t have room for and some retailers who want to be in Virginia.”

Besides Bass Pro Shops and Belk — the only named tenants — Johnson said he has commitments for an additional 500,000 square feet of tenant space in Tennessee. The Virginia segment has more land that can be easily developed, he added.

“I know the public is anxious to know who is coming and we will make those announcements in the very near future,” Johnson said.

The Tennessee portion of The Pinnacle will be partially funded by recouping sales tax revenues through Tennessee legislation for large developments in border communities. That doesn’t apply to Washington County, Va., which has been at odds with Bristol, Va., because the city is using similar legislation to develop The Falls near Interstate 81’s Exit 5.

County leaders have unsuccessfully attempted to be included in that legislation.

“We haven’t had much encouragement from our legislators that we could be added to the bill,” Washington County, Va., Administrator Nadine Culbertson said. “Not having the tools that Bristol has for The Falls really shuts Washington County down for the term of that bill.”

The county “welcomes the opportunity” to become part of The Pinnacle development, Culbertson said.

The Pinnacle is one of three major commercial developments announced for the region. Site work is also under way at The Falls and Heritage Point Town Center at the junction of Interstate 81 and Interstate 26 between Kingsport and Johnson City.

Pinnacle Site Preparation to Begin This Week

BRISTOL, Tenn.—The first signs of construction will soon become quite prominent at The Pinnacle, located at Exit 74 off Interstate 81. Bass Pro Shops®, America’s most popular outdoor store, has signed a lease to become the anchor store in The Pinnacle, the planned mixed-use retail outlet developed by Johnson Commercial Development.

The new, more-than-100,000-square-foot Bass Pro Shops® at The Pinnacle – the only Bass Pro Shops® store in the Tri-Cities – is tentatively scheduled to open in late 2013 or early 2014.

“This is the next exciting step in the progress of The Pinnacle,” says Johnson Commercial Development President Steve Johnson. “We will begin site work immediately, which will pave the way for the vertical construction phase of this project in early spring 2013 with the hope of a Christmas 2013 opening.

“It has been a privilege and a pleasure to work with the Bass Pro team since we first began our discussions, and I will take tremendous personal pride in seeing this store constructed and then visited each year by millions of outdoor enthusiasts.”

Bass Pro Shops® locations in the U.S. each average 2 million visitors per year.

Bass Pro Shops® Founder Johnny Morris is equally excited about the new store location and its significant traffic potential.

“We are thrilled to be the first of many committed tenants who will also bring the upscale shopping experience Johnson Commercial Development looks to create,” Morris says. The Tri-Cities region has a long history of great fishing and hunting, and combining those traditions with this highly visible and easily accessible location makes this the perfect place to allow us to better serve all our customers and outdoor enthusiasts who visit and live in this beautiful part of the country. We look forward to serving the Tri-Cities region and the many travelers who will pass our store on Interstate 81.”

Johnson continues to express his appreciation for the state and local government support and cooperation that have allowed The Pinnacle project to succeed.

“We express our many thanks to Tennessee Lt. Gov. Ron Ramsey and Bristol Tennessee City Manager Jeff Broughton for their hard work and full support of this project,” Johnson says. “This is an extraordinary project for the Tri-Cities region that will have significant impact on our local economy for decades to come.”

Bristol, Tenn.-based Baker Construction Services will prepare the Bass Pro Shops® site. The expansive wood-and-stone structure will be built by Bass Pro Shops®. Bass Pro Shops®’ unique, award-winning, mega-sized outdoor stores are known for combining retail with entertainment, conservation and outdoor education.

Digging Begins at The Pinnacle

BRISTOL, TN – Legendary outdoorsman Bill Dance, NASCAR team owner Richard Childress and Sprint Cup driver Jamie McMurray were among the dignitaries when Bass Pro Shops founder Johnny Morris and Bristol businessman Steve Johnson celebrated the start of the construction of the retailer’s newest store – at Exit 74 off Interstate 81.

The fanfare at the Friday ceremony capped a hectic period that saw Johnson and Bass Pro Sports reach agreement on the deal a mere two weeks before the digging began in the planned retail development that will be called The Pinnacle.

“I can’t think of a better place I’d want to be than Bristol, Tenn.,” said Morris, who currently operates 58 Bass Pro Shops across the U.S. and Canada – making the Missouri-based chain the nation’s largest outdoors retailer.

Added Morris: “It’s so exciting for us to have a store in Thunder Valley.”

Johnson, who landed Bass Pro Sports as an anchor tenant for The Pinnacle, called the groundbreaking “a great day” for the city.

“We’re not only the home of the world’s fastest half-mile [race] track,” Johnson said, “we’re also now the home of the world’s fastest Bass Pro Shops deal in history.”

Upon opening, sometime in late 2013 or early 2014, the 100,000-square-foot store is expected to employ 250 to 300 people, according to Bass Pro Shop officials. Developers expect it to be a key draw for the 400-acre retail development project Johnson is developing at that exit.

Also among the estimated 200 people gathered for the event were a slew of local, state and regional elected, community and business figures.

Tennessee Lt. Gov. Ron Ramsey, a state senator from Blountville who attended the event, said The Pinnacle offers good prospects for the area.

“This is [going to be] the first of many groundbreakings,” he said.

The event included the delivery of ceremonial shovels by a race car and a lavish post-ceremony fish fry.

It also occurred just days after neighboring Bristol, Va., announced that the city had reached agreement with national outdoors retailer Cabela’s to build an 80,000-square-foot store in The Falls – an estimated $200 million, three-phrase, retail-development project off Interstate 81’s Exit 5 – just five miles down the road from The Pinnacle.

Cabela’s, which has 38 stores across the United States and Canada, is expected to break ground on its Bristol site during the summer of 2013 and open by October 2014. The Exit 5 store is expected to employ some 170 people, according to Bristol, Va., city estimates.

East Tennessee State University economics professor Steb Hipple, who has won national acclaim for his work analyzing the Tri-Cities economy, said Friday that while Bass Pro Shops should enjoy an advantage by opening its Bristol, Tenn., store sooner than Cabela’s Bristol, Va., site – and by already having a larger share of the national outdoors market – there are real questions about how either could truly thrive with a competitor so close.

“It’s very unusual to have two major [outdoors] stores in such close proximity,” Hipple said. “It will be interesting to see if there’s actually enough new business to sustain both stores – or both property developments [The Pinnacle and The Falls], for that matter. I’m skeptical, frankly.”

But during Friday’s ceremony, Johnson – who briefly fought back tears while recalling how he intensely lobbied Morris to locate a Bass Pro Shops store in Bristol – said that Bass is a perfect first tenant for The Pinnacle because of the retailer’s proven ability to consistently draw massive numbers of shoppers.

Noting that a Bass Pro Shops store averages 2 million visitors a year, Johnson likened the store’s potential local economic impact to that provided by Bristol Motor Speedway, which seats 160,000 spectators.

“It would be like having a packed Bristol Motor Speedway [in Bristol] once a month each year,” year after year, Johnson said of Bass’ traditional store traffic.

Morris was equally upbeat about his company’s potential to draw huge numbers of future customers to the Exit 74 location. Pointing to figures that rank the Tri-Cities region as the 70th largest retail market in America, Morris said, “When you look at the concentration of people [in the Tri-Cities market] who like to hunt and fish, it’s a very significant amount. So everyone in our company is grateful to be here.”

Alpha Breaks Ground

BRISTOL, Va. – From drawing board to Tuesday’s groundbreaking, Alpha Natural Resources’ new $21 million corporate headquarters already has grown by more than 20 percent.

It has been that kind of meteoric rise for the nation’s third-largest coal company, which formed just eight years ago.

On a bluff overlooking Sugar Hollow Park on Tuesday, state and local officials joined about 200 company employees to celebrate the start of site work for the 130,000-square-foot, five-story building. Alpha CEO Kevin Crutchfield recounted some of that growth during the ceremony.

“When [Alpha Chairman] Mike Quillen got a gleam in his eye back in 2002 about something called Alpha, it was in a little office on Main Street in Gate City, Va.,” Crutchfield said. “When it became apparent this [Alpha] was going to go forward, he really upgraded and got a small office on Main Street in Abingdon – 4,500 square feet.

“We really thought at the time that office was all we were going to need. … But after a few more acquisitions, we were spread all over town and it was clear that wasn’t going to be enough. When we moved into our current 46,000-square-foot building, we really thought that would hold us for a good, long while.”

The company, which now employs about 6,400, outgrew its present Abingdon headquarters after a 2009 merger with Foundation Coal of Baltimore, Md. Employees are again working at five different locations around town.

The merger touched off an intense recruiting battle eventually won by the city, which beat out Washington County, Va., and prospective suitors from Maryland and Tennessee.

Originally conceived as 80,000 square feet, the building plans quickly expanded to 100,000 and then the current level – something not all company officials knew about Tuesday.

The facility is expected to be completed in about 18 months and employ more than 200.

“Part of the reason it grew a little bit was many of the Baltimore people began making the transition much earlier than we thought they might, so we’ve had an influx, which necessitated more space. Rather than add onto the building in three or four years, we decided to bite the bullet now and create a building we can grow into over time. I hope it will be sufficient for the foreseeable future,” Crutchfield said later.

About 40 former employees of the Maryland company have already moved to the region, he said.

Lt. Gov. Bill Bolling, who attended the ceremony, said he was initially concerned the merger might mean another state could lure Alpha away.

“We think you made the right decision – not just to remain in Virginia – but to remain in Southwest Virginia. This is your home,” Bolling said.

Crutchfield said the company weighed a number of potential incentives and tax breaks before accepting the city’s offer – free land and a $7.4 million package of financial incentives from the Governor’s Opportunity Fund, the Virginia Tobacco Indemnification and Community Revitalization Commission, the city and Bristol Virginia Utilities.

“We mulled our way through that [offers] from a financial perspective. But in the end, I think we tested our hearts on where we thought it made sense to be,” Crutchfield said. “I guess somebody could have thrown a deal at you, where you had no choice. But the city made it easy to stay in the area with the financial incentives package. And it felt like the right thing to do, for us. We love this area and we like to be able to contribute to our communities.”

While Washington County will experience diminished revenues once the move is complete, Board of Supervisors Chairwoman Dulcie Mumpower said they’re not upset.

“It’s a good day for the region,” Mumpower said. “I’m happy Southwest Virginia beat out Maryland and those other places and those jobs are remaining here.”

Commercial developer Steve Johnson, who built the company’s current headquarters and is handling the new one, also praised the project.

“This will give them the flexibility they need and room for growth,” Johnson said. “They’ve only been in their present space for about five years, but getting this land from the city gives them room – if they need to expand later.”

Johnson’s company will develop the project and sell it to Alpha on a long-term lease. BurWil Construction, of Bristol, Tenn., will be the building contractor.

Long-term growth and economic vitality – in the face of mounting pressure on the coal industry – were also on the minds Tuesday of state lawmakers.

“Alpha is leading the way to make Virginia the East Coast energy leader,” Bolling said. “We believe there is a great place for energy in the future for Virginia. We want to do more to develop the coal industry, more to develop nuclear power and to safely and responsibly develop our offshore energy resources.”

Legislators are concerned whether coal can remain a viable energy source well into the future, state Sen. William Wampler, R-Bristol, said.

“The Southwest delegation remains committed to people whose livelihood is dependent upon coal and we will work vigorously to beat back all efforts to effectively shut down this industry through direct or indirect extreme regulatory policies or laws. The Southwest delegation will never waiver,” Wampler said.

Crutchfield acknowledged that the industry faces a mounting number of challenges.

“But the fact remains 50 percent of [U.S.] electricity comes from coal and nothing can be done overnight to change that,” he said. “Now long term, that may be a different story.”