Major Projects in The Oceanfront Resort Area

As early as 1993, the Virginia Beach City Council identified an area of the oceanfront from Rudee Loop to The Cavalier Hotel at 42nd St. and from Laskin Road to Birdneck Road, down to 17^th St. and then back to the oceanfront and called it the Oceanfront Resort Area. The intent was, and remains, to extend the tourist area from "The Oceanfront Strip" to the "Oceanfront" Resort Area. The long term plans were specified in the document called "Oceanfront Resort Area Concept Plan" that was published in 1994.

The table, "Major Projects in the Oceanfront Area," lists major projects described in the Concept Plan. The first part of the table shows projects that have been completed or are currently being developed. The second part of the table lists projects that are in the planning stage.

The table lists the projects in column one, and in columns two through seven show the "original" cost estimate of each project, the actual construction cost, the interest cost for the borrowed money (all projects are funded with borrowed money), the total cost of the project, the dollar amount that the total exceeds the original cost estimate, and finally the percentage the total exceeds the "original".

The first project listed is the Atlantic Avenue beautification that was estimated to cost $28.5 million. The table shows the actual construction cost was $37 million with an interest cost of $13.3 million for a total cost of $50.3 million. The total exceeds the original estimate by $21.8 million which means that the final cost was 76% over estimate. The data for the seawall (The hurricane Protection Plan project) does not show an interest cost because 2/3 of the $145 million was paid by the federal taxpayers. The 31^st St. garage was estimated to cost $12.5 million and then was expanded to accommodate the larger hotel. Note that the final construction cost is not yet available so the total of $54.4 million is an estimate. Also note the absurd percentage overrun.

The second group, projects in the planning stage, are all estimates based on projects completed or city staff estimates. The interest cost is computed assuming 5% over 20 years. As a rule of thumb, the interest was computed using 60% of the construction cost.

For example, the 19^th St. corridor cost is an estimated $100 million; 60% is $60 million in interest that must be added to calculate the estimated total cost. Council plans to redevelop 19^th Street as a corridor to service the new convention center, and redevelop 17^th , 21^st, and 22^nd streets, Laskin Road, and Pacific Avenue as gateways to enhance the experience for tourists. As for Rudee Loop, who knows?

The total cost for these major projects will be at least $1.2 billion. This list of major projects does NOT include the proposed Bus Rapid Transit (BRT), an entertainment venue at the oceanfront, or a new headquarters hotel for the convention center.

Keep in mind that this $1.2 billion spent on the Oceanfront Resort Area major projects is money that is NOT available for roads, police officers, firefighters, or teachers.