Forbes.com rates Virginia the best state for business for the 2nd year in a row.region ranked

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1 Forbes.com rates Virginia the best state for business for the 2nd year in a row.region ranked # 14 out of 200 large metro areas in Forbes annual Best Places for Business and Careers survey. Dow Jones MarketWatch rates the Richmond area 3rd in the U.S.; 1st in the East for business. Greater Richmond is a proven and successful location for banking, specialty finance, and insurance businesses. Already a nationally recognized corporate headquarters location, the region is home to a vibrant cluster of commercial banking, brokerage firms, investment banking, insurance, risk management, credit cards, mortgage lending, money managers and a host of financial specialties. This publication will document how your business can capitalize on a unique series of factors and opportunities that have resulted from national business trends and cycles. For example, we will describe how the upcoming merger of Wachovia Securities and A.G. Edwards will create a pool of highly qualified workers and a range of office real estate opportunities that expanding businesses can leverage. A brief overview of the existing business base shows the solid foundation already in place: Banking. Richmond is notable for the presence of the Federal Reserve Bank of Richmond, which oversees banking activity in the fifth Federal Reserve district. The city serves as the banking center for most of Virginia south of metro Washington, with Wachovia, SunTrust, Bank of America and BB&T each maintaining important regional banking operations here. Brokerage/Investment Banking. Another key player is Wachovia Securities, the third-largest brokerage firm in the United States. Wachovia Securities has recruited world-class financial talent into the region, and its alumni have created numerous start-ups, contributing to the CONTINUED ON NEXT PAGE Why Richmond?...2 Tax Rate Comparison...3 An Increasing Wealth of Talent...3 Cost Comparison...4 Real Estate Options...6 Possible Incentives...8

2 CONTINUED FROM FRONT PAGE wealth of specialty firms in the region. Besides Wachovia, a number of investment banking firms Scott & Stringfellow, Harris Williams, Ewing Bemiss, Matrix Capital Management serve the middle market. Specialty Finance. Greater Richmond also is home to a wide range of specialty finance firms. The largest and best known is Capital One, a provider of credit cards and other consumer financial services. Capital One was founded in Greater Richmond in the early 1990s and still maintains its operational center and core of the company here. Insurance. Genworth Financial, a Fortune 500 company, leads the list of major insurance companies in the region, but it s hardly alone in the insurance field. Markel Corporation, a provider of specialty insurance products, and Land- America Financial, a provider of title insurance, rank in the Fortune 1000, while Hilb Rogal and Hobbs is the eighth-largest insurance broker in the United States. Why Richmond? Why is Greater Richmond attractive to so many finance, securities, and insurance companies? Greater Richmond has a long history of attracting finance, securities, and insurance companies. When Richmond was chosen in 1914 over 36 other cities to be the location of a Federal Reserve Bank, one of the reasons given was its importance as a commercial and financial center. This observation is still true today. Greater Richmond has the infrastructure businesses require plus the quality of life and low cost of living that attract and retain a skilled workforce. The financial sector has prospered in the Greater Richmond region because companies have access to a wealth of talent at both the undergraduate and graduate level. Virginia Commonwealth University, the University of Richmond, Virginia State Rendering Source: VCU School of Business University, and Randolph- Macon College all offer undergraduate degrees in business. In fact, Business- Week magazine recently ranked the University of Richmond s Robins School of Business undergraduate program 23rd in the nation. Richmond is also home to two respected MBA programs at the University of Richmond and Virginia Commonwealth University. Business- Week ranks the University of Richmond s Robins School of Business graduate program 14th in the nation. In addition, Richmond-area companies recruit heavily from top-ranked business programs at the University of Virginia, College of William and Mary and Virginia Tech. Greater Richmond s Finance, Securities and Insurance Companies A sampling of successful existing companies includes: BROKERAGE FIRMS AND FINANCIAL ADVISORS Anderson & Strudwick Barrett Capital Management Davenport & Co. LLC JoycePayne Partners Pinnacle Group RBC Dain Rauscher Richmond Capital Management Scott & Stringfellow INVESTMENT BANKING Alpha Omega Capital Partners Baxter Fentriss and Company Cary Street Partners Ewing Bemiss & Co. Harbert Venture Partners John B. Levy & Company Matrix Capital Markets Group Seare Marriott & Co. Transact Capital Partners, Inc. Windward Advisors LLC INSURANCE Anthem Bankers Insurance Berkley Mid-Atlantic Group Creative Insurance Concepts Inc. Genworth Financial (Fortune 500 headquarters) Gilbert-Krupin Hilb Rogal & Hobbs LandAmerica Financial Group (Fortune 1000 headquarters) Markel Corporation (Fortune 1000 headquarters) FUNDS AND MONEY MANAGERS Caprin Asset Management Closed-End Fund Advisors, Inc. Private Advisors LLC Tattersall Advisory Group Thompson Siegel Walmsley BANKING Federal Reserve Bank of Richmond Bank of America BB&T SunTrust Bank Mid-Atlantic Wachovia SPECIALTY FINANCE Capital One Financial Corp. Capital Source Charter One Mortgage Corp. Circuit City (Fortune 500 headquarters) Dynex Capital James River Mortgage LLC Saxon Capital Inc. Stone and Youngberg Virginia Credit Union SUPPLIERS AND VENDORS Fulfillment Services, Inc. Precision IR Group 2

3 An Increasing Wealth of Talent Aproductive and affordable workforce continues to be the core factor in the viability and financial success of businesses. In these current turbulent economic times, one company s misfortune can be an opportunity for its competitor. A number of prominent firms in the Greater Richmond market are undergoing layoffs and retrenchments. These actions create a pool of highly qualified employees who are available for new companies entering the market. For example: Wachovia Securities Wachovia Securities, a division of Charlotte, N.C.-based Wachovia, expanded its presence in Greater Richmond after merging with Prudential Securities in That merger brought 1,500 jobs to the area from New York. Wachovia Securities latest merger will have the opposite effect. In 2007 the company announced that its corporate headquarters would move from Richmond to St. Louis as a result of the merger of Wachovia Securities and A.G. Edwards Inc. About 2,000 highly skilled people in the Richmond area are expected to re-enter the labor market. SunTrust Bank Mid-Atlantic Atlanta-based SunTrust, one of the largest Tax Rate Comparison commercial banking organizations in the country, maintains its Mid-Atlantic Group in Richmond. In 2007, 300 jobs were cut companywide as well as 100 jobs in Richmond area. Saxon Capital Inc. Saxon Capital Inc., based in Greater Richmond, is a residential mortgage lender and servicer that manages a portfolio of mortgage assets. The company will lay off a total of 193 people between October 2007 and February Capital One Financial Corp. Capital One Financial Corp., a Fortune 500 company headquartered in McLean, maintains major operations in Richmond. The company, one of the largest marketers of MasterCard and Visa credit cards in the world, also provides auto loans, mortgage loans and other categories of consumer finance. In 2007, the company announced that it will exit the mortgage business altogether, which leads to layoffs of 1,900 jobs companywide associated with its mortgage operations. In June 2007 Capital One laid off 130 people in Richmond. Companies in Greater Richmond benefit from Virginia s business-friendly climate, characterized by stable and competitive taxes. Corporate Personal Income Tax Sales Tax Income Tax Richmond, VA 6% 5% 2% to 5.75% Atlanta, GA 6% 7% or 8% 1% to 6% Boston, MA 9.5% 5% 5.3% or 12% Chicago, IL 7.3% 7.75% or 9% 3% Columbus, OH 5.1% and 8.5% 6.75% 0.681% to 6.87% +2% local tax Jacksonville, FL 5.5% 7% 0% New York, NY 7.5% state 8.375% 4% to 6.85% % NYC 2.907% to 3.648% NYC Newark, NJ 9% 7% 1.4% to 8.97% San Francisco, CA 8.84% 8.5% 1% to 9.3% Stamford, CT 7.5% 6% 3% to 5% RIA, All States Tax Guide, 2007 and local and state websites. Atlanta sales tax is SOURCES & NOTES 7% in Fulton County and 8% in the city of Atlanta. Boston personal income tax is 12% on short term capital gains and 5.3% on other forms of income. Chicago sales tax is 7.75% in DuPage County and 9% in Cook County. Columbus corporate income tax is 5.1% on the 1st $50,000, and 8.5% over $50,000; sales tax includes 1% Franklin County tax and 0.25% transit tax. In addition to the taxes shown, business real estate and personal property are subject to tax. Other state and local taxes may also apply. Greater Richmond s Business Advantages Greater Richmond s growing population exceeds 1.2 million. The area is a magnet for labor, drawing workers from more than 40 localities statewide. A labor force of more than 600,000 includes almost 48,000 employed in the finance, securities, and insurance industries. More than 11,300 high school students graduate and more than 9,000 post-secondary degrees are conferred each year. The diverse economy includes 13 Fortune 1000 headquarters; financial and information technology services; pharmaceutical, chemical, biotech, semiconductor, and other 21st century manufacturers; the Fifth District Federal Reserve, Fourth Circuit U.S. Court of Appeals, and state capital; and higher education. Greater Richmond is strategically located at the mid-point of the East Coast. More than 3.3 million passengers and about 115 million pounds of cargo are handled at Richmond International Airport (RIC) each year. RIC is served by nine passenger airlines and five dedicated air cargo airlines. The area s telecommunications infrastructure is state-of-the-art with an extensive fiber optic network and digital switching capability. All business support services are available, including legal, accounting, and advertising services. Sites and buildings are available with ready-to-move-in spaces. Greater Richmond offers the cultural and recreational opportunities of a large city with minimal traffic congestion and an average 24-minute commute. The area s excellent quality of life makes it easy to relocate, attract and retain top quality professional and technical employees. Relocation services are provided by the Greater Richmond Partnership, Inc. in cooperation with local businesses. 3

4 Cost Comparison 100-PERSON SCENARIO Richmond, VA Atlanta, GA Boston, MA Chicago, IL Annual Costs Rent Class A - 25,000 SF $519,500 $587,500 $953,250 $785,500 Electric $57,974 $72,706 $170,122 $81,924 Salaries Accountants and Auditors $63,128 $61,693 $63,003 $66,768 Brokerage Clerks $36,462 $34,840 $38,958 $41,579 Computer Systems Analysts $74,069 $75,587 $79,685 $78,374 Customer Service Representatives $30,701 $32,302 $38,334 $34,154 Executive Secretaries $39,478 $39,894 $45,344 $40,706 and Administrative Assistants Financial Analysts $73,216 $74,818 $84,365 $81,682 Personal Financial Advisors $99,986 $76,731 $98,987 $92,040 Securities, Commodities, and Financial Services Sales Agents $90,210 $70,283 $105,123 $82,410 Average Salary for Occupations Shown $63,406 $58,269 $69,225 $64, PERSON SCENARIO The Greater Richmond region compares favorably to a number of cities with an abundance of finance, securities, and insurance companies. The following model compares major operating costs rent, electricity, and salaries in Richmond, Va., and nine other metro areas. Two scenarios are shown. The first case provides Richmond, VA Atlanta, GA Boston, MA Chicago, IL Annual Costs Rent Class A - 100,000 SF $2,078,000 $2,350,000 $3,813,000 $3,142,000 Electric $231,898 $290,822 $680,486 $327,698 Salaries Bill and Account Collectors $32,302 $29,931 $36,275 $32,573 Bookkeeping, Accounting, and Auditing Clerks $34,029 $32,219 $37,232 $33,966 Computer Systems Analysts $74,069 $75,587 $79,685 $78,374 Customer Service Representatives $30,701 $32,302 $38,334 $34,154 Executive Secretaries and Admin Assistants $39,478 $39,894 $45,344 $40,706 First-Line Supervisors/Managers of Office and Admin Support Workers $51,147 $46,530 $53,539 $51,501 Loan Interviewers and Clerks $32,115 $27,227 $36,379 $36,296 Loan Officers $57,158 $63,024 $82,888 $66,685 Telemarketers $25,688 $24,211 $33,925 $26,062 Claims Adjusters, Examiners, and Investigators $56,555 $50,898 $56,555 $56,784 Insurance Underwriters $55,203 $60,154 $70,034 $61,485 Insurance Sales Agents $54,413 $65,374 $81,328 $64,730 Insurance Claims and Policy Processing Clerks $33,717 $32,552 $36,421 $34,528 Average Salary for Occupations Shown $44,352 $44,608 $52,918 $47,526 Rent: Grubb and Ellis, Office Market Trends Q2 2007, and Cushman and Wakefield, SOURCES & NOTES Typical square footage of space required for 100-person and 500-person office scenarios estimated by HKS, Inc. Data for Stamford based on Fairfield County. Data for Newark based on Northern and Central New Jersey. Electric: Edison Electric Institute, Typical Bills and Average Rates Report, Summer Electricity kwh usage estimated as 8 kw per worker multiplied by 55% load factor for one shift by 720 hours per month. Annual cost shown is monthly Richmond, VA Atlanta, GA Boston, MA Chicago, IL Cost of Living Construction Cost Cost of Living: C2ER Cost of Living Index, Second Quarter 2007 (Council for Community and Economic Research, formerly ACCRA). SOURCES & NOTES U.S. Average = 100. Construction Cost: RS Means Building Construction Cost Data 2007, City Cost Indexes. 30 major cities =

5 estimates for a 100-person brokerage firm. The second case provides estimates for a company that employs 500 workers and is representative of a back-office operation for finance or insurance. Salaries for representative occupations are shown. Occupations were chosen to represent the most prevalent industry-specific functions (financial advisors) and generic functions (computer occupations), based on national staffing patterns in the finance and insurance industries. Columbus, OH Jacksonville, FL New York, NY Newark, NJ San Francisco, CA Stamford, CT $489,000 $521,250 $2,045,500 $741,750 $1,156,500 $890,250 $66,243 $94,755 $180,006 $113,383 $123,362 $152,444 $58,198 $55,494 $75,296 $72,259 $67,642 $76,627 $40,726 $35,859 $44,782 $37,419 $50,544 $45,822 $71,261 $65,874 $84,594 $88,213 $84,157 $82,742 $29,786 $28,912 $37,190 $33,550 $38,272 $37,419 $39,229 $35,090 $48,235 $49,150 $46,738 $46,176 $64,376 $69,472 $96,949 $80,891 $102,419 $112,382 $82,638 $88,899 $114,670 $101,941 $105,893 $97,718 $65,915 $85,051 $111,488 $98,550 $122,595 $147,971 $56,516 $58,081 $76,651 $70,247 $77,282 $80,857 Columbus, OH Jacksonville, FL New York, NY Newark, NJ San Francisco, CA Stamford, CT $1,956,000 $2,085,000 $8,182,000 $2,967,000 $4,626,000 $3,561,000 $264,972 $379,020 $720,023 $453,531 $493,448 $609,777 $28,142 $28,746 $37,274 $36,421 $40,664 $38,085 $34,008 $30,701 $37,523 $37,398 $39,894 $39,458 $71,261 $65,874 $84,594 $88,213 $84,157 $82,742 $29,786 $28,912 $37,190 $33,550 $38,272 $37,419 $39,229 $35,090 $48,235 $49,150 $46,738 $46,176 $46,030 $44,366 $56,014 $53,394 $54,829 $55,203 $30,722 $33,634 $36,566 $36,088 $41,642 $34,237 $53,768 $52,146 $78,229 $55,702 $80,912 $86,923 $18,720 $26,125 $31,845 $34,507 $29,182 $28,184 $54,101 $44,658 $62,546 $58,802 $60,486 $57,013 $55,307 $50,086 $75,982 $71,157 $65,520 $69,056 $61,422 $55,578 $78,104 $79,747 $78,790 $80,454 $33,467 $31,075 $35,235 $35,422 $42,765 $38,667 $42,766 $40,538 $53,795 $51,504 $54,142 $53,355 kwh multiplied by average commercial rate for utility serving the area and by 12 months. For Jacksonville the average rate for Florida was used since Jacksonville Electric Authority was not included in the source. Salaries: U.S. Bureau of Labor Statistics, May 2006 Metropolitan and Nonmetropolitan Area Occupational Employment and Wage Estimates, Data are average (mean) salaries. Columbus, OH Jacksonville, FL New York, NY Newark, NJ San Francisco, CA Stamford, CT

6 Real Estate Options Central Business District Class A and B office space is readily available in both the central business district and the surrounding suburbs. It is anticipated that a large portion of Wachovia Securities space in the Riverfront Plaza downtown will become available in the next 18 months. JAMES CENTER 901 East Cary Street Space Available: 35,900 square feet 17th Floor: 16,131 square feet move-in ready, 20th Floor: 16,131 square feet RIVERFRONT PLAZA - WEST TOWER 901 East Byrd Street Total Space Available: To be determined Wachovia Securities currently occupies approximately 350,000 square feet. BANK OF AMERICA CENTER 1111 East Main Street Space Available: 130,340 square feet Typical Floor: 22,721 square feet EDGEWORTH BUILDING AT TOBACCO ROW 2100 East Cary Street Space Available: 68,655 square feet Typical Floor: 28,400 square feet 6

7 Surrounding Suburbs 4840 Cox Road - HENRICO COUNTY Space Available: 86,247 square feet Typical Floor: 28,759 square feet Sublease opportunity LIBERTY PLAZA II INNSBROOK CORPORATE CENTER Nuckols Road - HENRICO COUNTY Space Available: 135,375 square feet Typical Floor: 33,800 square feet Sublease opportunity BOULDERS CENTER 1011 Boulder Springs Drive - CHESTERFIELD COUNTY Space Available: 90,409 square feet Options from 19,791 to 33,771 square feet Atlee Station Business Park - HANOVER COUNTY 236 acres, located at I-295 and U.S. Route 301 Ideal for corporate headquarters, business operations centers and professional offices ARBORETUM III 300 Arboretum Place - CHESTERFIELD COUNTY Space Available: 50,587 square feet Options from 10,000 to 40,731 square feet Sublease opportunity 4991 Lake Brook Drive - HENRICO COUNTY Space Available: 56,680 square feet Typical Floor: 23,750 square feet 7

8 Greater Richmond, Virginia Incentives There are additional advantages to locating in the Greater Richmond area. Your company may be eligible for a variety of incentives at the state and/or local level. Statelevel incentive programs for financial services companies include: Governor s Opportunity Fund Discretionary cash grant to companies locating or expanding in Virginia. Must entail a competitive multi-state selection process. Requires 100% match from the Virginia locality. Requires company to meet threshold levels of investment, job creation and salaries. Virginia Economic Development Incentive Grant Discretionary performance grant for significant headquarters, administrative or service sector operations creating significant new job opportunities. Requires company to meet threshold levels of investment, job creation and salaries. Virginia Jobs Investment Program Assistance Designed to reduce the human resource development costs of new and expanding companies. Provides customized recruiting and training services and cash reimbursements. Major Business Facility Job Tax Credit $1,000 income tax credit for each new job created in Virginia over a 50 or 100 job threshold. Credits available in installments over a three year period (i.e. $333 per job per year). Enterprise Zones in Chesterfield, Henrico, and the City offer local tax and financing incentives in addition to the state s cash grants for new job creation and real property investment. Contact The Greater Richmond Partnership, Inc. provides site location assistance and other services to new and expanding companies in the counties of Chesterfield, Hanover, and Henrico and the City of Richmond. The Partnership is a single point of contact to the network of private sector and local government professionals that supports a company s successful operation. Contact Rowena Fratarcangelo at the Greater Richmond Partnership, Inc. for more details. Visit our dedicated website for Greater Richmond s finance and insurance industries: Greater Richmond Working Capital at East Byrd Street, Suite 801 Richmond, VA Phone Toll-free Fax 8