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Strengths, headwinds seen in region's economic future

Vienna forum looks at situation from national down to local levels
Keith Waters, assistant director of the Stephen S. Fuller Institute at George Mason University, gives a rundown of the local region's economy Jan. 18, 2024, at the Vienna Department of Economic Development's inaugural State of the Economy event, held at the Vienna Community Center.

The Vienna Department of Economic Development’s first-ever “State of the Economy” event provided information, spectacle, tasty food and town-promoting swag to about 70 people who filled the Vienna Community Center’s auditorium Jan. 18.

Keynote speaker Keith Waters, assistant director of George Mason University’s Stephen J. Fuller Institute, gave a rundown on the economy, from the national level all the way down to Vienna.

Echoing retired Mason economist Stephen Fuller’s recent remarks, Waters said the Washington region’s economic output has been lagging the nation’s for about 13 years. While the region’s job numbers are about the same now as at the pandemic’s start, the Dallas area has gained about 500,000 jobs, he said.

“We’re not as good as we think we are,” Waters said.

Most worrisome, he said, was the decline in high-paying professional-and-business-services jobs, which are the Washington area’s bread and butter. While employees in that sector weathered the pandemic fairly well because they could work remotely, employer hiring of such workers “came to a screeching halt at the end of 2022,” Waters said.

Federal-government employment, which also is a regional staple, is increasing nationally, but not in the Washington area, he said.

Waters also expressed concern about the low inventory of existing homes, saying only about 11,000 units are up for sale in the Washington area.

“The housing market is really tight,” he said. “People are not leaving when they have sub-3-percent mortgages.”

Vienna’s residential-housing market is strong, with median sales prices of $1.2 million versus about $660,000 for Fairfax County, said Natalie Guilmeus (formerly Monkou), the town’s economic-development director. Vienna’s 6.2-percent office-vacancy rate is far lower than the county’s, she added.

The town gained 72 new businesses last year, including 18 that are home-based, Guilmeus said. She urged attendees to visit for further information.

Vienna Planning and Zoning Director David Levy and his deputy, Kelly O’Brien, gave a rundown of the new Code Create Vienna zoning rewrite, which took effect Jan. 1 after being approved last October by the Town Council.

Code Create simplified and modernized the town’s zoning code, which hadn’t received a major update in more than 50 years, and created several uniform commercial areas that supplanted the former hodgepodge of zoning parcels in the Maple Avenue commercial area.

Levy also brought the audience up to speed on a pair of redevelopment projects approved under the since-rescinded Maple Avenue Commercial (MAC) ordinance. Developers of a massive mixed-use project at 440 Maple Ave., W., where the Vienna Wolf Trap Hotel and Tequila Grande restaurant used to be, have obtained full approvals to begin construction on the cleared site, but “the cost factors have kept them from moving forward, although they would very much like to do so,” Levy said.

Developers of the Vienna Market mixed-use MAC redevelopment two blocks to the east along Maple Avenue, W., still have not met all requirements to open the site’s ground-floor-retail spaces, he said.

“They have to finish their work,” Levy said.

Vienna resident Cathy Hardman said she came to the event to learn about the region’s and town’s future economic outlooks.

The town’s new zoning code is much clearer than its predecessor and “should help with a lot of interesting new developments in Vienna,” Hardman said. “You don’t actually have to have an economics degree to understand what’s going on in the town.”

Mayor Linda Colbert described the event as “fantastic” and especially was fond of the Code Create presentation.

“I thought they did a great job of showing what was the same and what had changed,” Colbert said, adding that she hoped the new zoning code would help draw new businesses to the town. “We’ll wait a few years and see what happens. We always need to be thinking, are there adjustments that need to be made?”

Doug Francis, a residential-real-estate agent and vice president of the North East Vienna Citizens Association, agreed.

“I think there’s a real clear vision and blueprint now that people can follow if they want to come and develop property in the town of Vienna,” he said.

Guilmeus said she hopes to hold “State of the Economy” programs in future years, as well as other signature events throughout the year.

“I think it’s good to start the year off with where we ended the previous year [economically] and how our strategy may change, depending on the data,” she said.