VIR’s economic impact tops $77 million

Not only does Virginia International Raceway give visitors a chance to relax and enjoy motorsports in rural surroundings, but it also contributes millions of dollars to the region’s economy each year.

VIR Operations, the businesses it attracts and visitor spending generate an economic impact of $77.5 million annually and support 1,542 jobs in the city of Danville and Pittsylvania and Halifax counties, according to a financial impact study by Chmura Economics & Analytics that was commissioned by the city of Danville, the counties of Halifax and Pittsylvania and VIR. The report was released Thursday.

The governments of those entities also receive $1 million in annual tax revenue because of VIR.

The annual financial impact on the commonwealth of Virginia was estimated at $92.5 million.

VIR Operations handles the racetrack operations, while VIR is the umbrella organization covering other related businesses, including dining, lodging and real estate development.

VIR, located in Halifax County between Danville and South Boston, is an international motorsports resort, featuring a 3.27-mile race circuit. It operates 350 days a year with an average 480 events a year, including club car, pro and motorcycle races.

VIR also maintains other businesses in the area, including dining, lodging and real estate development.

“We’re so glad to have quantifiable measurements of the regional impact of the track,” Connie Nyholm, a managing partner of VIR, said in a news release. “We’ve used realistic, conservative assumptions and still calculated significant impact to each community in our region. VIR’s plans for continued growth will benefit greatly from a cooperative and regional approach.”

Watching VIR’s transformation during the past 10 years has been “exciting,” Danville City Manager Lyle Lacy said.

“This world-class motorsport resort is one of the premiere destinations in our region and has quickly become a tourist attraction for race enthusiasts from all over the world,” he said in the release. “I am encouraged by the results of the impact study, and I look forward to working with VIR as they continue to grow.”

Coy Harville, chairman of the Pittsylvania County Board of Supervisors, said that the county views VIR as a “dynamic component of the regional economy and a primary drawing card” for outside money coming into the community.

“Pittsylvania County supports VIR efforts to grow and strengthen the economy of Southside Virginia and Pittsylvania County,” he said in the release. “We hope the Chmura report will open the eyes of local citizens, bringing about more support of VIR.”

Multiple effects

The study reports that from 1998 to 2008, VIR also invested $30.8 million in the region, one-time spending which, with ripple impact spending, generated “a total economic impact of $44.8 million” and “sustained 574 jobs.”

The economic impact of VIR comes primarily from four sources: one-time capital expenditures, such as the construction of the race tracks, hotels and restaurants; the ongoing operations, including hosting the track events and operating the resorts and facilities; the presence of VIR that attracts other businesses to the area; and the money spent by visitors to the VIR region.

Investments include redeveloping the racetracks that had not been used since 1974; building the Villas at South Bend, The Lodge at VIR and Paddock Suites; developing an industrial and technology park; and creating 389 jobs.

More than 50 percent of the construction vendors were located within the region.

The indirect impact generated from the capital projects were estimated by Chmura to be $6.1 million with 81 jobs created in industries that supported the construction projects.

The induced impact was estimated to be $8 million, adding 104 jobs. Induced impacts are “the economic activity generated by household income as the result of the direct and indirect impacts,” for example, an employee of VIR spending his money in the local economy.

Adding together the indirect and induced impacts, Chmura determined the total economic benefits to Danville and Halifax and Pittsylvania counties due to construction spending: Danville gained $6.4 million in spending and 85 jobs; Pittsylvania County gained $3.3 million in sales and 43 jobs; and Halifax County gained $35 million in spending and 446 jobs.

Since all the construction occurred in Halifax County, it received all the direct impact, or economic activity generated by the construction project, for a total of $30.7 million.

Tourism benefits

The average number of visitors yearly to VIR is estimated at 350,000, according to the study. Based on the Virginia Tourism Corporation’s figures, the average visitor spends $51 per day and stays two-and-a-half days in the region.

The annual direct visitor spending in the region linked to VIR is estimated to be $44.9 million.

Since Danville has the largest tourism infrastructure (hotels, restaurants, etc.), Chmura determined that 51 percent of the total economic impact of visitor spending occurs in Danville, 27 percent in Pittsylvania County and 22 percent in Halifax.

The study concludes that VIR is “a great asset to the economy of the VIR Region.”

Contact Elzey at or (434) 791-7991.