When Virginia took over the former U.S. Army base at Fort Monroe in 2011, the original plan was to carve most of it up and get it into the hands of private developers.

But more than a decade later, the early visions of expansive private development haven’t materialized.

The latest effort to build a new hotel and revamp the fort’s marina just fell through nearly three years after a deal was inked.

Fort officials say the focus has shifted over time. For now, it’s emphasizing the site’s historical importance and retrofitting historic buildings for commercial use. But changes on the horizon — and the potential for a big cash infusion — may pave the way to finally get private development going around the national monument.

“A massive real estate project”

When the Army closed Fort Monroe in 2011, the 565-acre property was handed over to a state authority. Then-Delegate Glenn Oder was tapped to lead the Fort Monroe Authority and is still overseeing the fort today.

Oder said the original charge from the state, as he describes it, was to essentially create a subdivision in the city of Hampton. He was told to divvy up the old base and parcel it out to let developers do their business, in part to make up for the economic shock for Hampton, which took a big hit when thousands of soldiers packed up and left.

Early planning documents envisioned the land north of the original fort as a nexus of new development, with plans for hotels, restaurants and whole neighborhoods full of new residences. The Authority’s 2013 master plan cites the beachside Sanderling Resort in the Outer Banks as a model for what it envisioned.

“What we realized about Fort Monroe is that it is a massive real estate project,” Oder said. “What we did not realize, and what has been our growing responsibility, has been the history of the property.” 

Two months after Oder started, President Barack Obama declared Fort Monroe a national monument, and the history of the fort took precedence over just about everything else, he said.

Old Point Comfort, where the fort leans out into the Chesapeake Bay, was the site of the first landing of Africans in America in 1619.

And two and a half centuries later, a Union commander at Fort Monroe declared three escaped enslaved men “contraband” after Confederates tried to reclaim them from the fort. The decision paved the way for freed slaves to flee the Confederacy - thousands of whom sought refuge at what became known as“Freedom’s Fortress.”

The original fort and plenty of the surrounding area are now National Park Service property. Besides that, the state’s Fort Monroe Authority owns dozens of historic buildings, a visitor’s center and a museum.

And then there’s the long-awaited memorial to the first Africans who landed in the United States. That sculpture is still being planned and the installation is expected to take several years once the design is finalized.

Jim Moran, a former Congressman and now chair of the Fort Monroe Authority’s board, said the public would lose something if all the land was handed over to private developers, but obviously people want to see dirt moving out there. 

“A principal purpose, at least when Governor (Terry) McAuliffe appointed me, was to find a way for Fort Monroe to largely pay for itself and to bring back the economy the U.S. military generated for Hampton,” he said.

The Authority remains reliant on the state for funding.

For the one-time House Appropriations Committee member, it all comes down to money — money to manage the existing resources, money to hire staff and money to help entice private development.

“We have to sell the vision that we have and we're just going to have to keep begging the legislature ‘please, share this vision and provide the resources necessary to fulfill that vision,’” Moran said.

One major barrier to new development has been the fort’s utilities. Built by the Army without consulting local utility companies, the old electrical and water systems don’t match up to what existing utility providers use.

“They don't know how it was built and so they're not willing to take it on,” Oder said.

That left the Authority holding the bag. To get the utility companies to assume control, it’ll have to retrofit the water and electrical systems to bring them up to the companies’ specifications. It’s a pricey and time-consuming proposition that’s been under discussion at the fort for more than a decade.

Gov. Glenn Youngkin, who stopped by the Authority’s board meeting in Richmond Thursday, said the state needs to fix the utility issue to capitalize on the promise of Fort Monroe.

“We need to press forward with this in order to give developers the confidence that, in fact, the fort will be the kind of place that they're willing to invest. But sometimes we have to invest in front of that,” Youngkin said.

Youngkin’s proposed budget includes $50 million to start the utilities overhaul in earnest.

Fort Monroe officials say that’s a great start, but to revamp all of the fort’s utilities will take something like $200 million.

“Spiraled out of control”

It looked like new construction was finally coming to Fort Monroe in 2021, when the Authority signed a redevelopment deal with Smithfield-based Pack Brothers Hospitality.

The plan called for a boutique hotel with event space and two new restaurants to go with a renovated marina.

But economic conditions changed a lot over the last couple of years.

“The project spiraled out of control,” said Randy Pack, one half of the Pack Brothers. 

What was originally pitched as a $50 million project in 2021 was looking more like a $75 million project in 2024.

“Over four years of working through the project, the cost just got absurd,” Pack said.

“As much as I love the project and everything else over there, it has to be profitable for us to be able to do."

Pack Brothers pulled the plug on the project earlier this year, though Randy Pack said they’re still hoping to go back to the drawing board to find a way to make the project work.

One obstacle Pack Brothers ran into was the requirements for building on such a history-filled property.

“Every time we would excavate six inches into the ground, you have to have an archeologist on site. Well, guess what? Archeologists don't come and screen all your material for free,” Pack said.

He said Fort Monroe’s history should be treasured and respected, but there was no getting around the added expense.

The limited availability of parking on the fort, which is surrounded by water, was also a problem when the Packs were looking for investors.

Despite the end of the project, neither side holds any ill will. The Authority said it understands the financial realities that weighed on the project, and the Pack Brothers are going to stay on to manage the marina for the Authority.

Making use of what remains

After the collapse of that project, Oder said the immediate mission is to handle the existing buildings, which are costing state taxpayers to heat, cool and take care of. The quicker the Authority can get them into private hands, the less it’ll cost the state.

“When and if new development ever occurs is down the road. It's not on the table right now. What is the focus right now is the adaptive reuse of historic buildings,” Oder said.

On that front, he said things are going well.

About half of the commercial properties controlled by the Authority are currently usable. Oder said those are almost fully leased. 

Many of the buildings that aren’t occupied are in need of significant investments and repair. 

The ongoing maintenance projects at the Fort have been slowed by staffing woes. Only one of the three project manager jobs at the Authority are currently filled, and staff told the Authority’s board they’re having a difficult time hiring for those and several other jobs.

The fort also hosts 179 residential units, which are virtually all spoken for.

A developer is currently in the early stages of repurposing two of the fort’s buildings into a total of 81 apartments.

And the skyline at the fort will change soon, Oder said. 

The old water tower that still bears the U.S. Army star logo will be coming down in the next few weeks — a visual metaphor for the fort slowly conquering its looming utilities problems.

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