First Quarter Economic Figures Indicate Alexandria Regaining Momentum After Relatively Sluggish 2001

(Alexandria, VA) — Alexandria’s first-quarter Local Economic Indicators (LEIRS) report, a statistical measure of the economic health of the City, was recently compiled and released by the Alexandria Economic Development Partnership, Inc. (AEDP). AEDP has compiled these statistics on behalf of the City since the partnerships’ inception in 1981.

An encouraging indication of a growing vitality in the local economy was the dramatic increase in the number of new business licenses awarded (341 new business licenses were awarded in the first quarter of 2002, compared with 260 fourth quarter 2001).

Paula R.W. Riley, Executive Director of AEDP, stated “Not since the beginning of the last upswing in the economy five years ago have so many businesses applied for licenses in Alexandria, demonstrating the resilience and power of our local economy.”

Accordingly, the relative degree of improvement in several other important economic categories is encouraging:

• Unemployment seems to be stabilizing, as a first quarter unemployment rate of 3.70% improved from 3.90% in fourth quarter 2001. Fourth quarter’s unemployment numbers were as high in the City as they had been since 1996. According to the Virginia Employment Commission, the unemployment rate increased 70% in 2001 in Alexandria from the previous year. Interestingly, though the number of weekly benefit payments decreased slightly this quarter, the average weekly benefit payment increased from $323.73 to $330.76. -2-

• Hotel occupancy is still recovering, with a first quarter occupancy rate of 70.70%, down from first quarter 2001 at 79.60%. The average daily rate (ADR) in the first quarter 2002 was $101.49, up significantly from $89.51 in fourth quarter 2001.

• The assessed value of residential property in Alexandria increased from approximately $7.6 billion in 2001 to $8.9 billion in 2002, reflecting the continuing appreciation within the metropolitan region of housing proximate to core office markets and recreational amenities.

Other noteworthy indicators:

• Ronald Reagan Washington National Airport continued to experience a constricted capacity during the first quarter, with the number of airport passengers down significantly from first quarter 2001. Full capacity was reinstated during the second quarter on April 15.

• The City's economy was supported by a healthy amount of residential construction in fourth quarter 2001, with 1,546 units. However, housing construction constricted significantly in first quarter 2002 with only 294 residential units.

• Commercial office vacancies reached a high of 12.10% in the first quarter, up from 9.10% fourth quarter 2001. First quarter absorption was negative 114,415 square feet, continuing the disappointing trend – absorption has been negative for four of the last five quarters (meaning more office space was vacated than leased/occupied within a particular period of time). Industrial vacancies have stabilized back to at 3.60% after a brief spike to 4.37% in fourth quarter 2001.

• The average sale price of housing in Northern Virginia in the first quarter was $307,317, down from the fourth quarter 2001 average of $312,867.

This quarterly analysis of the economic strength of the City of Alexandria is part of the Local Economic Indicators Report, released by the Alexandria Economic Development Partnership, Inc. (AEDP). This report is prepared as a service to the business community to provide information on the health of the City’s economy for new, relocating and expanding businesses. Additional copies of the complete report may be obtained from the AEDP offices at (703) 739-3820 or at http://www.alexecon.org/leirs.html.

For Immediate Release- 6/11/02

Contact: Marc Brambrut
703-739-3820 xt. 12

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