Posted: June 11, 2010

By Philip Newswanger

philip.newswanger@insidebiz.com

Central Radio, a government contractor on West 39th Street in Norfolk, is blocking the path of Old Dominion University's University Village expansion.

ODU's Real Estate Foundation, an arm of the university, wants Central Radio's property and that of two other owners. Central Radio has rejected the housing authority's two offers.

So Norfolk Redevelopment and Housing Authority has filed to condemn Central Radio's property.

Central Radio plans to fight the condemnation. A trial date hasn't been set yet.

Robert Wilson Jr., senior vice president of Central Radio, said he's known about the plans to develop the area for 13 years.

"I was there at the first meeting," Wilson said. "That doesn't mean I had to go out and do something."

Many property owners thought the plan to buy or condemn properties in this area east of Hampton Boulevard would die a natural death, since neither ODU nor the housing authority had initiated any action in almost 13 years.

To those who think Central Radio should have prepared for this eventuality, Wilson said that's like someone walking up to you and saying, "Hey, I like your house, so I'm going to buy your house."

Wilson said he can't sell.

"No one in their right mind would buy this property," he said.

Wilson said he developed his present location for $600,000 15 years ago, replete with reinforced floors, a second-deck loading dock with special electrical powers, and I-beams for moving equipment.

If he had to move or build another facility, he said it would cost millions. "There's no better location for what we do."

He's heard all the plans for his and the surrounding properties, from maintenance shop and park to grocery store and shopping center.

Yet he has seen nothing concrete except a map - which he called vague - 13 years ago.

Central Radio's predicament has all the trappings of a case in Connecticut that propelled eminent domain into the national headlines and engendered a debate over how public bodies use condemnation powers.

In Kelo vs. New London, Conn., a neighborhood represented by Suzette Kelo and others challenged the city of New London for condemning their property, saying the condemnation was for economic development and not for a public use.

The case went to the U.S. Supreme Court, which ruled in favor of the city in 2005, to the astonishment of many property rights advocates. The high court's ruling, though, permitted states to set their own eminent domain laws.

Since the ruling, Virginia has tightened the rules on eminent domain, making it harder for entities like Norfolk's housing authority to condemn property. Virginia's law prohibits condemnation for economic development and tightened the definition of blight.

The housing authority has quickened its pace to condemn the land, since the deadline to condemn property within its proposed redevelopment plan from 1997 ends June 30 under state law.

A grocery store and shops were proposed for the property between 38th and 41st streets, including the Central Radio site, according to a 2005 University Village master plan done by ODU.

Several years ago, Farm Fresh sent a letter of intent to the real estate foundation to build a grocery store on the redeveloped property, according to previous Inside Business interviews.

But plans have changed.

Ann Crenshaw, an attorney with the law firm Kaufman & Canoles, represents the foundation and responded to an inquiry to clarify if the shopping center is still in the plans. She said the city's Central Hampton Boulevard plan modified the way the property will be treated.

The city's plan calls for a design that is more aesthetically pleasing than a parking lot and a shopping center, Crenshaw said.

"The concept of a shopping center anchored by a grocery store may not be feasible at this point," she said. "The foundation sees more of a mixed use type, more akin to what's already in the university. Parts of this might be student housing. That's where we are now."

Central Radio's history began in 1934 in Norfolk when Houston Wilson opened his repair shop for radios. When World War II began, Houston began selling radio directional finders to convoys steaming to Europe with troops and supplies.

"He became an expert in radio directional finders," said Wilson Jr., 63, about Houston, his uncle.

But Houston was on the road all the time, traveling between Norfolk and Alabama, the location of the military office to which he sold the radio directional finders.

"He would spend 48 hours on the road without a stop," Wilson said.

After the war, the company's commercial business dried up, so it began selling its services - which ranged from repairing radios to radar - to the military exclusively.

Wilson's father, Robert Wilson Sr., joined the business and Houston retired.

The senior Wilson ran the business until the early 1970s. Then his son and Ed Dickinson, 68, took over.

As the military adopted more technology, Central Radio adapted to the challenge.

Gone are the days of radio tubes.

Now Central Radio's contracts include communications, navigations and weapon control systems.

"We are associated with a very proud industry, the shipbuilding industry," Wilson said. "The past few years have been famine. A lot of money for defense goes to the battlefield."

Central Radio employs 100 and plans to hire another 13 people within the next couple of weeks. It sits in a HUB Zone, a federal designation. In return for hiring a third of its workforce from the surrounding neighborhood, Central Radio gets preferential treatment for federal government contracts.

"We teach them a trade, a skill that pays higher than the average wage," Wilson said.

Central Radio also hires nonviolent federal parolees.

"We interview them as any other employee," Wilson said. "We train them as any other employee."

"We don't pay them substandard wages," Wilson said. "We pay them $40,000 to $50,000 a year."

Many former employees have started companies that now compete with Central Radio.

Wilson joked about his competitors, who basically learned their skills at Central Radio before starting their own business.

Central Radio is one of the last small firms in the government contracting business, Wilson said.

Many have been bought by conglomerates, such as Northrop Grumman and Lockheed Martin, he said. It's a daily fight to get business, he admitted.

Since Central Radio is a private company, he doesn't disclose sales figures.

"We bring contracts in on time," Wilson said. "We never, ever missed a contract in 75 years."