This article first appeared in the Journal of Business on January 14, 2021. By Patrick Jones, executive director of the Institute for Public Policy & Economic Analysis at Eastern Washington University.
Supply side said to have greater effect as listings fall short of local demand
Ever thought it’s those out-of-towners who have driven up housing prices here recently? You probably aren’t alone.
After all, the median house price for resale has climbed from approximately $284,000 to $330,000 over the past four quarters.
That $46,000 represents a 16% bump, a steep one for buyers. Spokane’s median price, while still considerably lower than the state value, cruised upward at a slightly higher pace than Washington’s median, which rose 14% over the past 12 months. (Supporting data is available on Eastern Washington University’s Spokane Trends website.)
Prices reflect many forces, both demand and supply. The key drivers of housing demand are income, financing, and population. Incomes here have moved upward in the past few years, but at a rate not too far from historical rates. For sure, mortgage rates have plummeted, leading some homeowners to consider trading up and some renters to consider buying.
Population growth, too, has surged over the past four years, relative to the past two decades. And like most western U.S. cities, Spokane’s population has expanded largely due to migration.
Local families continue to keep OB-GYNs busy, but in the larger scheme of things, it is migration that moves the population needle. For example, from April 1, 2019, to April 1, 2020, the number of heads in Spokane County rose by 7,350. Of those, 85% can be attributable to net migration.
Net migration accounts for the difference between those who move in and those who move out. Over the past five years, the number of county residents here due to net migration has been slightly more than 25,000. That’s a large jump from the prior five years.
Has it been just me who has seen more out-of-state license plates on Division Street or Interstate 90 since the pandemic struck? Observations from behind the wheel are not optimal research techniques. Thankfully, we can look at a public data series: driver’s license surrenders tracked by the Washington state Department of Licensing.
The surprise result for the first 11 months of the year: out-of-state license surrenders have dropped. From January through November the Department of Licensing reports about 7,700 new residents from outside of our state exchanging driver’s licenses. That total is down from 9,160 and 10,830 for the first eleven months of 2019 and 2018, respectively. So much for casual empiricism.
In retrospect, that shouldn’t be too surprising. The early months of the pandemic’s outbreak put a hard stop to mobility in this country.
A comparison of license surrenders in the second quarter of this year with the second quarter of 2019 is startling: 104 this year versus 2,360 last year.
Undoubtedly, the low numbers from this year are due to the closure of state offices for a good part of the quarter. Yet the third quarter, when obstacles to reregistering ostensibly were removed, didn’t compensate for the prior quarter. Licensing data show a gain of little more than 200.
In sum, the continued discovery by those from out-of-state, so strong in the recent years, shifted gears in 2020.
Yet, inflows might still be strong from movers within the state. The U.S. Census tracks annual flows from county to county in the U.S, compiled over five-year intervals. The most recent period is 2014-2018. It clearly shows the flow of Washingtonians to our county to be considerable.
Over that interval, the ratio of new residents to Spokane from Washingtonians to those outside of the state was just slightly below even. That is, a few more new residents have recently come from outside the state than from the other 38 counties in Washington.
It might be the case that the pandemic has changed that relationship, making it relatively easier for residents of Evergreen State counties to move here than those from hundreds of miles away.
In fact, among the top 10 U.S. counties contributing to in-migration here over the 2014-2018, period, seven were in Washington. Ranked by size of their flows, these were: Snohomish, King, Benton, Grant, Pierce, Stevens, and Lincoln counties.
Of the two out-of-state counties, one, not surprisingly, is neighboring Kootenai County, and the other, perhaps surprisingly, is Maricopa, Arizona. Though not a county, Asia as a whole rounded out the top 10.
Most of us have heard anecdotes about neighbors or friends of friends who have moved here from the central Puget Sound area. Many of the accounts describe the new residents as remote workers. That arrangement may well be part of the new normal for our economy and in particular for tech workers.
If so, these new neighbors symbolize a hope held by many in the economic development community: Someday Spokane will benefit from an arbitrage of labor from high-cost to lower-cost urban centers.
It is this observer’s hunch that current movement from other Washington counties has mirrored the decline of out-of-state new residents in 2020.
As a consequence, fingers can’t be pointed at Seattleites for the dramatic run-up in housing costs. Until we have data for 2020, we simply won’t know.
Attempts to explain housing prices solely to increased demand, however, miss half of the equation, perhaps the greater half. The supply side must be considered. Here, as has been widely noted, the offering of Spokane homes has been lowest on recent record.
The Washington State Real Estate Research Center, source for some of the housing data on Spokane Trends, tracks the number of listings by quarter in the county. For Q3 2020, the most recent quarter for which data are available, the count stood at 558. Compare that with 1,158 listings in Q3 2019, or 2,562 listings in Q3 2015.
Population has grown, incomes have grown, financing has gotten much more favorable, yet supply has diminished. Clearly this is a textbook case for rising prices.
The supply of homes (listings) rests on two sources: the number of local households selling their homes and the number of new homes coming onto the market. Spokane Trends doesn’t track the latter, but does follow residential building permits, typically viewed as a leading indicator. (See indicator 2.3.3.) The graph clearly shows a peak in 2016, followed by a decline of 500 permits into 2019.
The reasons behind the decline are numerous.
They include: difficulty in securing land, the cost of developing lots, a tight labor pool in the building trades, and the rising costs of construction, especially lumber. Some of these forces might see some relief relatively soon, but others will take longer to resolve.
That is, unless hundreds of current Spokanites decided to sell and move to a different place. That doesn’t seem to be in the offing now. The pandemic has kept local residents place-bound, too. Once our community reaches a safe threshold of vaccinations, I don’t expect a big outflow. Continued low supply, growing popularity from outside the region, continued low financing costs, and no significant rise in departures imply rising home prices for the foreseeable future.
For the last few months, the Port of Lewiston has become an important transportation center for wind turbine components being barged up the Columbia and Snake rivers. After being barged from Port of Longview, in Washington, to the Port of Lewiston, the components will be trucked to Alberta, Canada.
Because the Port of Lewiston is at the end of the navigable Columbia Snake River System, it serves as a transportation corridor for commodities exported from Idaho or cargo imported to the interior of the U.S. and Canada.
The wind turbines are shipped in pieces to the Port’s dock, which was expanded as part of a 2013 capital investment project made possible by federal and state grants, and then trucked north using U.S. Highway 95 to the Canadian border. The wind turbine components will be assembled to make 42 new wind turbines.
The Port of Lewiston is an advocate for renewable energy sources such as hydroelectric power as well as wind power. Wind turbines work to harness the power of the wind and turn it into energy. When the wind blows, the turbine’s blades spin clockwise, capturing energy. This triggers the main shaft of the wind turbine, connected to a gearbox to spin. The gearbox sends that wind energy to a generator, converting it to electricity. Wind power generation helps to create a clean, renewable way to power our world.
Both blades and tower components have been barged and stored on Port property before being trucked to Canada.
126 turbine blades and 168 tower components have been shipped on 21 barges of this project.
This project is important to so many, especially during this COVID-19 time. The crew that is shipping these turbine components was mobilized to our area and is helping to fuel the local economy. The Port of Lewiston is a public organization serving the citizens of Nez Perce County as an economic development district, intermodal transportation center and facilitator of international trade.
“The success of this inland shipping route will foster future opportunities for the Port of Lewiston and the Valley as a whole,” General Manager, David Doeringsfeld, commented.
This article first appeared in the Journal of Business on October 22nd, 2020. . Written by Natasha Nellis
Spokane-based wholesale cooperative URM Stores Inc. has purchased the former Northwest Bedding complex on the West Plains to accommodate ongoing growth, as the organization expands west of the Cascade Mountains.
Located at 6102 S. Hayford Road, just west of the Amazon Fulfillment Center and north of West Plains Building Supply, the newly acquired property includes two warehouses with nearly 140,000 square feet of floor space—one with 117,900 square feet of space and the other with 16,000 square feet.
The structures will be used as additional staging and storage space, says Mike Winger, vice president of store development.
“It gives us some flexibility to better utilize the main URM facility,” he says.
A commercial change-of-use application on file with Spokane County shows tenant improvements in both structures are valued at about $12.4 million. URM purchased the 13.8-acre property for $3.7 million in September, according to Spokane County Assessor’s Office records.
The recently acquired Hayford Road structures previously operated as a boat manufacturer, Sun Runner, from 1977 to 1991 before transitioning into a Northwest Bedding manufacturing facility, says James Black III, Realtor with NAI Black who handled the transaction. The property has been vacant for roughly two years.
The expansion comes on the heels of a double-digit growth in revenues during the most recent fiscal year.
In its 2020 fiscal year ended July 31, the company experienced double-digit sales growth and closed out the year at a consolidated annual revenue of $1.3 billion, up 13% compared with 2019 revenue, Winger says.
Much of that growth is attributable to the COVID-19 pandemic, as more people cook at home and drive up sales at grocery stores, which in turn drives up sales at the wholesale cooperative, he says.
“The way the virus has impacted the restaurant trade has really changed people’s eating habits, and a lot of our retailers have experienced significant sales growth because people are now going to the grocery store and buying a lot of that center-store grocery product,” he contends.
Winger says it’s likely the new facilities will operate with a limited staff, as the facility is intended to be used as a temporary dry food storage facility. However, he adds, the significant growth and demand the company has seen this year has led to over 80 new hires at the URM headquarters, and the company is looking to add 30 to 35 additional employees before year’s end.
URM currently has over 670 employees.
In addition to eliminating periodic expenses related to off-site storage during the holiday seasons, the new facilities give URM expanded storage capabilities that Winger says will allow the company to better serve its growing client base in the large Pacific Northwest metropolitan areas.
“With the growth of our company, we’ve been pushing our trade area farther west,” says Winger. “Now, we service grocers over in the Seattle and Portland area.”
He adds that as more retailers are added to the company’s roster, the demand for specialty products could increase. The new facility will help to accommodate those products that the company headquarters, at 7511 N. Freya, currently doesn’t now.
Further, he says the grocery industry is continuously evolving, with new products being added every day, organic products growing in popularity and diversity, and ethnic foods growing in demand.
The new space will give the company the flexibility to accommodate those needs in the future as the company’s retailer base diversifies, he contends.
During the holiday season, the distributor often rents additional space to store the candy and other holiday treats the member companies only stock seasonally, Winger explains, so having the additional space will cut that expense.
The West Plains facilities currently are undergoing tenant improvements to ensure that the buildings are up to date with code requirements, he says. The buildings also aren’t connected to city water or sewer systems, and instead operate on a private well, so the company is inspecting them to ensure the life safety systems are operational, he adds.
Winger says improvements are slated to be completed by spring 2021.
“We have, for some time, been looking to see how we could expand our existing warehouse facility. We’re somewhat limited because we have the railroad property to the west of us and we have streets on either side,” he says of the company’s headquarters on Freya Avenue.
Much of the planned work is cosmetic, adds Winger. Additionally, the structure’s roof will be replaced, portions of the steel panel wall will be repaired, and the loading docks will need to be repaired or replaced to be properly sized for the company’s trucks, he says.
URM’s flagship distribution center on Freya Street is 680,000 square feet. According to the company’s website, its distribution center receives over 400 inbound truckloads weekly and ships over 450 outbound truckloads a week.
Its headquarters were established in Spokane in 1926. Since, the company has steadily expanded its space, with its last addition occurring in 2014 when the company added 77,000 square feet to its perishable groceries space.
URM services members in Washington, Idaho, Montana, and Oregon. Its offerings include dry groceries, frozen food, ice cream, deli foods, dairy products, fresh meat, general merchandise, and health and beauty aids.
The 99-year-old cooperative is a member-owned food distributor to grocers that include Center Place Market, Family Foods, Harvest Foods, Huckleberry’s Natural Market, Rosauers Supermarkets, Super 1 Foods, The Markets LLC, Town & Country Markets Inc., Yoke’s Fresh Market, and Northwest Grocers.
The company also provides supplies to two URM Cash & Carry stores.
Next year URM Stores will celebrate its 100th year, says Winger.
this article first appeared November 5 in the Spokane Journal of Business. Written by Kevin Blocker.
Extended holiday shopping season benefits some here
Despite the fact thousands of retail storefronts across the U.S. have struggled or gone away in recent years, some Spokane-based retailers say they could be on the verge of all-time holiday sales records in 2020.
As the pandemic’s surge continues to strengthen heading into late fall, so too does consumer demand for some products as the holidays near.
At the General Store, general manager Mark McKee says he’s fully prepared for both store locations to set holiday records this season. The General Store, located at 2424 N. Division, and The General Store Outpost, at 1330 N. Argonne in Spokane Valley, last year partnered with ACE Hardware to carry its brand of tools and hardware.
The day after the region’s Oct. 23 snowstorm, the Division store set a single-day sales record, McKee says. Though he declines to disclose an actual dollar amount, he says Oct. 24’s single-store revenues were 150% above the same date in 2019.
“This year, both stores are up 45% year to date,” says McKee.
Online sales in 2020 have driven a substantial part of growth at both locations. Meanwhile, the North Division flagship store has gotten a steady facelift throughout the year.
“We’ve made the store more shoppable,” McKee says. “And something new here for us is that we’re launching a toy department on Nov. 14.”
As for in-store shopping, McKee says checkout stands will be reconfigured in an effort to create an even more socially distanced experience.
The store recently began offering curbside delivery, and for those customers with medical mask exemptions, The General Store offers full face shields for customers to use, he says.
“We want to be able to maintain full safety for customers and employees,” he says.
Chris White, the store manager at Wheel Sport cycle shop at 9501 N. Newport Highway, in North Spokane, says the company’s four stores have seen a 35.7% increase in revenue this year over 2019.
Chris White, store manager at Wheel Sports’ North Side shop, says sales are up a whopping 340% this year, and some products are difficult to get in stock.
And despite the fact this time of the year is considered off-season for riding bicycles, White says bikes have been a strong holiday gift traditionally.
Wheel Sport operates four stores across the region, and all share each other’s inventory. When asked if he was concerned about the company’s ability to fulfill holiday orders, White says, “Unfortunately, yes. Very few people anticipated this.”
He advises people to shop early for Christmas gifts; the store only recently received a pair of bikes he had ordered in April.
“If you’re going to wait to start shopping after Thanksgiving, then it’s going to be too late,” he asserts.
Mark Schneider, who owns and operates Rambleraven Gear Trader, an outdoor gear and clothing store at 3220 N. Division, says he’s feeling optimistic about a strong consumer holiday shopping season.
Schneider says Rambleraven is currently “fully stocked” with outdoor gear.
Schneider says Rambleraven has picked off traffic from the closing of Mountain Gear, which occurred at the beginning of the year.
“It’s hard to predict tomorrow, but one of the shining stars through the pandemic is the outdoor economic sector,” Schneider says. “There’s been a year-long, pent-up need for people to maintain their sanity.”
The Washington, D.C.-based National Retail Federation launched its nationwide consumer education campaign encouraging people to shop earlier and safer due to the pandemic.
“We know this has been a year unlike any other,” NRF President and CEO Matthew McShay told the Associated Press in a late October interview. “And we ought to expect that the holiday season will be just as different from normal holiday seasons as the rest of this year has been from normal years.”
Despite the pandemic, the federation projects consumer spending on gifts will be on par with 2019, decreasing by only about $9 per person, while spending on other holiday items, such as decorations, will be up slightly.
“Expected spending remains significantly higher than the five-year average for both those categories. The holiday season is top of mind, with 42% of people saying they plan to start their holiday shopping by the end of October and another 41% in November,” the retail federation says.
NRF estimates the average adult consumer will spend $650 on gifts this year, up from the four-year annual average of $624 from 2016 to 2019. Consumers are expected to spend $230 on nongift holiday items, such as decorations, compared with the $217 annual average from 2016 to 2019.
The only category the retail federation anticipates seeing a decrease in consumer spending is on “other nongift purchases,” down to $117 per consumer compared with the 2016 to 2019 average of $145.
“One in five holiday shoppers say that they typically travel for the holidays but will stay home instead this year,” according to the retail federation. “Over half of those who changed their holiday travel plans said they are likely to spend more on holiday items this year, specifically because they will not be traveling.”
The retail federation says online sales have skyrocketed in 2020, and 60% of its survey respondents say they plan to purchase holiday items online.
Other top holiday shopping destinations for consumers include department stores, mentioned by 45% of respondent, discount stores (43%), and grocery stores or supermarkets (42%), NRF says.
The survey was conducted Oct. 1-Oct. 9 and sampled 7,660 total consumers, according to the retail federation.
Consumer zest for spending is still strong even though as of mid-August, a Business Insider report said retailers were expected to close more than 7,500 stores in 2020 following a record-high closing of more than 9,300 store closings in 2019.
Spokane-based Spiceology has secured a $4.7 million round of Series A funding, led by grocery and retail executive Ty Bennett with participation by Kickstart Funds III and IV, a group of angel investors and the Cowles Co., which publishes The Spokesman-Review.
“I have been an investor in Spiceology since the early days and had the privilege of watching the company elevate above the thousands of small spice purveyors in the market,” Ty Bennett, founder and former CEO of Jacent, said in a statement. “I look forward to bringing my retail and grocery experience to the table to help Spiceology continue to delight customers and find new ways of meeting customers where they shop.”
The privately held spice company will use the funding to bring process automation to its SpiceLab operations, and advance its sales and marketing efforts. The SpiceLab is where spice blends are formulated and packaged with the company’s trademarked “periodic table of flavor” labels, according to a company release.
Series A funding is the first round of investment funding after seed funding. It typically involves venture capital firms and is for startups that have established growth.
Spiceology, founded in 2013, was recently named to Inc. Magazine’s list of the 5,000 fastest-growing companies in the nation. It ranked 1,081 on the list with a three-year revenue growth of 423%.
The company has steadily grown its operations by creating recipes and how-to videos for customers as well as collaborating with chefs and food influencers on new product lines.
At the onset of the coronavirus pandemic, Spiceology experienced an uptick in spice sales as more people began preparing meals at home.
Bennett has joined Spiceology’s board of directors. The company also hired Roger Landrum as senior vice president of global supply chain and operations, the release said.
Landrum was formerly the senior director of supply chain, risk management and procurement at Litehouse Foods, a Sandpoint-based $300 million salad dressing and herb manufacturer.
“Spiceology’s formula is focusing on quality and innovation at scale. By doing so, we’re bringing life into a very tired category that’s sorely in need of a fresh alternative,” Chip Overstreet, president and CEO of Spiceology, said in a statement.
“There’s nothing more core to our lives than eating, and we bring smiles to people’s faces when they realize how much better every meal can be with a simple sprinkle of Spiceology goodness.”
This article originally appeared on KXLY.com by Derek Deis
COLVILLE, Wash. — Buildings made with cross laminated timber are already commonplace in Europe, but it’s a relatively new concept here. So to say Russ Vaagen, whose family has owned Vaagen Brothers Lumber for more than 70 years, is excited about his new venture would be an understatement.
“We could put this as the mass timber capital of North America eventually,” said Vaagen, the CEO and founder of Vaagen Timbers.
Cross laminated timber is an eco-friendly, wood panel product made from gluing layers of lumber together. Vaagen says it’s kind of like a Lego set.
“We’re actually putting together a kit that a builder can do very rapidly, high quality and goes together the same way every time,” explained Vaagen. “And so, it’s going to speed construction time up, it’s going to provide a much higher quality build, we’re going to be much more energy efficient.”
Vaagen Timbers can build its CLT panels up to 60 feet wide with varying depths. And Vaagen says it’s one-fifth the weight of steel and concrete with the same structural strength.
“So we’ll have a lighter, more nimble building. It’ll also be much better equipped to handle seismic shifts.”
And Vaagen says it can be used for all sorts of applications, including, “Mid-rise structures for commercial buildings, apartments and even homes.”
CLT panels start with pieces of lumber on the finger jointer machine.
“We take knives and we make a set of fingers. And they do just as it says, they joint together. And then we use pressure and an adhesive to tie those together,” said Vaagen.
After the wood is planed, it goes to the layup line, where Vaagen says those pieces of lumber get turned into panels.
“So we take four feet of wood, we lift it up all together, put it on the conveyor, goes and gets a layer of glue.”
A set of vacuums then lifts and places each additional layer.
“Sets it on top of that glued layer 90 degrees to the other layer, comes back through the glue, gets another long layer set back on it.”
The now heat cured panels then get cut by giant saws on the CNC line.
“We’re cleaning the cuts, we’re making the connections to go panel to panel if we’re doing a wall or a floor system,” said Vaagen.
After sanding, they’re ready to be shipped to customers.
One of the first places you’ll be able to see Vaagen Timbers’ CLT put to use is in Spokane’s Perry District, where Blockhouse – Life is building a 14 unit modular structure using CLT.”
“So we’ll make boxes basically that can be repeatable, but they can be customized,” said Vaagen. “And it’s modular. So ultimately, you could pick it up and move it and put it someplace else.”
Vaagen says Spokane, and Washington as a whole, are poised to be leaders in CLT and mass timber products. And that has him excited about Vaagen Timbers’ potential for growth.
“There’s just no losers. Everybody wins. And we’re going to be offering incredible structures for people to build with for years to come.”
The following are projects, initiatives and economic developments are making news in eastern Washington and northern Idaho.
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SPOKANE, Wash. — Washington Department of Commerce has provided a $100,000 grant to support expansion and workforce training needs of SkyOne Aerospace. Founded in the Spokane Valley in 2015 with three employees, SkyOne Aerospace, specializes in customer-oriented repair and overhaul of instruments, avionics, electronics, mechanical units and hydraulic units of military aerospace aftermarket. SkyOne will purchase new equipment to meet expansion needs and hire additional skilled technicians with military aerospace experience. The company will retain 18 jobs and create 45 new jobs over the course of the next three years. Presently, 40 percent of SkyOne’s workforce are veterans, and the company is committed to hiring more, mostly from Fairchild Airforce Base. Read more on the SkyOne website.
COEUR d’ALENE, Idaho — Idaho Central Credit Union, ranked 2nd by Forbes’ 2020 Customer Satisfaction Survey, opened a branch in Coeur d’Alene at 1327 W. Appleway Avenue. This is Idaho Central’s 38th location in Idaho. The 8,600-square-foot branch has a drive-through with three lanes, an ATM and a video booth in the corner for members to access our VideoChat services. See more about ICCU’s Appleway Branch here.
PULLMAN, Wash. — With the recent successful completion of the $155M runway realignment project at the Pullman-Moscow Regional Airport (PUW), work recently began on the design and construction of a new terminal. In early August, the PUW Airport Board created a Terminal Advisory Committee to help gather community feedback and help shape the design of the $35 – 50M project. Committee members include community and university officials, key business leaders and other interest. Contact the PUW for more information.
MOSCOW, Idaho — Work continues on identifying and developing additional water supplies for the Palouse Region. Under the direction of the Palouse Basin Aquifer Committee (PBAC), an organization which includes the cities of Pullman, WA, and Moscow, ID, Latah and Whitman counties, University of Idaho, and Washington State University, a $150,000 contract was recently awarded to Alta Science and Engineering, Inc., of Moscow, ID. The study will focus on refinement of potential water supply alternatives as well as interim measure to help identify and develop additional water supplies within the Palouse Basin. Contact PBAC for more information.
SPOKANE VALLEY, Wash. — The Spokesman-Review has moved its printing operation to a new facility in Spokane Valley. It is now being printed on a press that was built in the early 2000s, and used to print the New York Times in Ann Arbor, Michigan. A second press, expected to come online this summer, will give the new company, Northwest Offset Printing, a way to print magazine-quality products. Read more in this Spokesman-Review article.
KELLOGG, Idaho —The Silver Valley Community WIFI CO-OP has recently launched to provide community Wi-Fi and free internet connections to Kellogg, Wallace, Pinehurst and Cataldo for residents to do remote learning, apply for essential services, pay bills, and perform other essential tasks. See more at https://www.svwifi.org/home.
SPOKANE VALLEY, Wash. — Spokane-based GL8 Hospitality LLC is breaking ground this week on a Tru by Hilton property in Spokane Valley, marking the brand’s first in the state. The 43,000-square-foot, four-story building will be at 13509 E. Mansfield Ave., east of CenterPlace Regional Event Center. The hotel, which will have 92 guest rooms, is expected to open in November 2020. See the full story here.
LEWISTON, Idaho – The Port of Lewiston welcomes Tsceminicum Bottling Company as its newest tenant. The full-service beverage and bottling factory produces Artesian Fusion Brand products in Aluminum, 500ml PET and PHA fully biodegradable plastic bottles, using water directly from their own Artesian well located at their factory, providing nutrient rich minerals from a deep and ancient aquifer. The bottling factory located on Colonel Wright Way will create eight full time and two part time jobs. Artesian Fusion brand products will be available in regional grocery stores and distributed through Idaho. More on Artesian Fusion here.
SPOKANE, Wash. — Palo Alto, California-based electric car manufacturer Tesla Inc. has established a service center in East Spokane. The company is planning to install 10 more superchargers in Washington, according to its website. Electric vehicles have grown in popularity in Washington in recent years, with over 42,500 plug-in electric vehicles registered in the state as of December 2018, according to the Washington state Department of Licensing. Over 810 of those were registered in Spokane County. Read more here.
MULLAN, Idaho — Lucky Friday mine, located near Mullan, produced 568,537 ounces of silver in the second quarter of 2020 and expects to reach full production by year-end. Lucky Friday is owned and operate by Coeur d’Alene-based Hecla Mining Co, and is the closest mine to Spokane. A Canadian company is a new investor in Hecla. Hecla Mining Co. has silver mines in Idaho, Alaska, and Mexico, as well as gold mines in Nevada and Quebec. Read the full article in the Journal of Business.
SPOKANE VALLEY, Wash. — Etailz has secured $25 million in debt financing to develop new products, expand inventory and grow retail partnerships. The new round of financing will specifically allow the Spokane Valley-based company – which partners with third-party sellers to grow their brands on Amazon, eBay and Walmart – to improve its proprietary software that discovers product trends, identifies new distributors and optimizes price positioning decisions. Etailz was founded in 2008 by Gonzaga University graduate Josh Neblett, his wife, Sarah, and angel investor Tom Simpson. Trans World Entertainment, a publicly traded company, acquired etailz in 2016 for $75 million. Etailz relocated to its 40,000-square-foot Spokane Valley headquarters in 2018. Read more here.
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Inland Northwest Economic Alliance (INEA) is a consortium of fourteen economic development agencies representing fifteen counties in the North Idaho/Eastern Washington region. The collaborative effort is aimed at building economic growth through enhancing the brand recognition of the Inland Northwest and its communities and showcasing its business value. To learn more, visit www.inlandnorthwestregion.com.
Article first appeared in Spokane Business Journal, July 30 2020. Written by Virginia Thomas
Socially distanced, socially conscious
Some nonprofits switch to longer fundraising cycles, spend less on overhead
Instead of canceling fundraising events, many Inland Northwest nonprofits have moved them into the digital realm.
Donor participation in charity events is lower, but some nonprofits say they’re receiving nearly as many donations as in prior years from a smaller pool of donors, and nonprofits are saving money by forgoing costly in-person events in favor of low-cost online affairs.
Heather Hamlin, executive director of Women Helping Women Fund, says her staff saw the writing on the wall by mid-March. The organization had planned its 28th annual luncheon for May, but Hamlin and her staff knew well before then that in-person events wouldn’t be possible for several months, at least.
“But the need in the community was bigger than ever,” Hamlin says. “We saw that was going to continue to grow, so we decided to move to a virtual event.”
Women Helping Women Fund decided to change to a longer, eight-week fundraising campaign in which table captains set goals for their groups, who raised money through networking. Keynote speaker Stephanie Land spoke to the organization through a Facebook Live event, which Hamlin says has garnered more than 13,000 views.
Hamlin says Women Helping Women Fund received about $170,000 in private donations in its eight-week campaign, as opposed to the $300,000 the annual luncheon typically generates. Hamlin says corporate donations go to underwriting the event, so Women Helping Women Fund receives every dollar donated by individual donors.
Lutheran Community Services Northwest’s fundraiser was a different story. The annual 8 Lakes Leg Aches bike ride fundraiser, which typically results in about $75,000 in donations, raised about $80,000 in this year’s “virtual ride.”
Clockwise from top left, Stephanie Land, Heather Hamlin, Kris Crocker, and Kristi Gravelle participate in Women Helping Women Fund’s virtual event.
The 22nd annual biking event had been scheduled for June 22 but was rescheduled for July 18. Development manager Christie McKee says the organization had thought an in-person event might be possible. By July, it was clear that wouldn’t happen, and the organization decided to make 8 Lakes Leg Aches a virtual event.
Attendees were invited to complete one of three rides, with routes that were 30, 45, and 70 miles long, on the course of their choice, or even on a stationary bike, between July 11 and July 18. A finish-line event was held via Facebook Live on July 18.
McKee says ridership was down this year, to about 200 participants from nearly 600 riders in past years, but she says she was impressed by the support those 200 riders provided to the organization.
“We had one pledge rider who raised $9,900 who is 90 years old and rode 17 miles to celebrate his 90th birthday,” McKee says. “We had a few others who were able to raise $10,000 each, and several that did $3,000 or more.”
McKee says most riders are from outside of the Spokane area, which was part of the reason for encouraging participants to bike any course. But it also meant that overhead for the fundraiser was much lower.
“Usually, if we have David’s Pizza at the event and we have 600 riders, our bill’s going to be for 600 riders,” McKee says. “We have roughly 160 riders who are here in this area. The others are all out of town, so they’re not even going to go to David’s Pizza.”
McKee also ordered about half as many T-shirts as usual for the event, expecting that participation would be lower.
“We’ll actually net more this year, because our expenses are going to be lower,” McKee says.
Amy Knapton Vega, executive director at Vanessa Behan Crisis Nursery, said that when she was trying to decide how to pivot the organization’s annual June benefit luncheon, she was told by some that the organization shouldn’t expect to raise any money from events.
But Vega watched as other organizations held successful fundraising events, and she decided to forge ahead. She asked for help from longtime partner Hamilton Studios, which helped the organization put together a virtual benefit luncheon.
“They helped us navigate through what would work, how to tailor it, and they did a great job of doing their own set up, as far as social distancing,” Vega says.
The online event drew 300 viewers, in comparison to the roughly 1,000 people who usually attend the luncheon. But Vega says the exceeded its goal of $170,000, bringing in a total of $172,000.
Going virtual saved Vanessa Behan Crisis Nursery thousands of dollars. Vega says the luncheon usually costs the organization about $40,000. This year, the crisis nursery spent less than $5,000 for its online event.
Don Hamilton, owner of Hamilton Studios, says he started adapting his video production and photography studio into a socially distanced, livestream-capable studio in March. A friend was scheduled to deliver a lecture to a college in Virginia in late March and decided to do so via Zoom. Hamilton thought his friend deserved better than a bland setting.
“It got me wondering — how could I use my cameras, lights, mics, and large studio to safely offer my friend a high-production-value presentation?” Hamilton says. “I started looking into the technology to adapt my motion picture production equipment to support a multicamera, livestreaming studio.”
Hamilton asked the Spokane Regional MarCom Association if he could handle the nonprofit organization’s annual Spark awards event to prove he could do a hybrid virtual event that combined livestreaming with pre-recorded segments.
“They were game, so we started by producing a glossy teaser announcing the event,” Hamilton says. “We then had a number of members of the MarCom board come in, one at a time, to pre-record announcements of the winners.”
Hamilton says the event was a success.
“The show moved seamlessly between pre-recorded packages and the live hosts reading a script from a large studio teleprompter,” he says.
Since then, Hamilton Studios has handled five livestreaming events, including the Vanessa Behan luncheon and YWCA Spokane’s “An Evening in Tuscany” fundraising event.
Social distancing at Hamilton Studio is easy, he says. His studio is located in the former auditorium of St. Joseph Catholic School, and he’s divided the basketball court in half.
“The idea is that whatever we do in there, we get one half-court for the crew and one half-court for the talent, so that nobody’s ever closer than 15 feet,” Hamilton says.
Hamilton says no more than seven people are in the studio at any one time. When a livestreaming event is taking place, just three crew members run the show: Hamilton and his wife, Lorna, sit together at the master controls, where Lorna manages the teleprompter, and Hamilton manages four live cameras in addition to pre-recorded videos. About 25 feet away from master controls, video editor Hannah Sander becomes the live program manager during livestreaming events.
Hamilton says he believes it will be at least another two years before nonprofits can return safely to holding in-person events. In that time, he expects demand for hybrid livestreaming events will increase exponentially.
“I’m already lining up more things,” Hamilton says.
Dana Morris Lee, chief philanthropy officer at YWCA Spokane, says the organization’s livestreaming of its 14th annual Tuscany event surprised her in that it required so much more technical effort and volunteer participation beforehand, as compared to in-person events.
“We had to become virtual experts as quickly as possible,” Morris Lee says. “You need to have a location to do this, and you need somebody who understands the technical restrictions around sound and video, and how to switch between different components of the program.”
An Evening in Tuscany typically draws about 400 people, Morris Lee says. About 200 people watched the livestreamed event.
The fundraising portion of the event was stretched from one night to about six weeks. Morris Lee says the organization decided to do a longer fundraising campaign after watching and learning from other organizations’ events.
“Creating a longer-term fundraising campaign around the event was a critical piece, because you just aren’t going to get the same attendance online that you’re going to get in person,” Morris Lee says.
YWCA Spokane had hoped to raise $100,000. As of July 20, the fundraising campaign had received about $75,000. Now, Morris Lee says she hopes to reach $92,000 by Friday, July 31, when the campaign ends.
While an online event can provide a nonprofit with some funding, Vega says she still missed being in a roomful of people who have a long-standing relationship with the crisis nursery.
“It always feels like you’re going to a kind of reunion,” she says. “It’s always so fun to get to visit and catch up on things, and we just didn’t get that luxury this year. That was probably the hardest part of it.”
This article first appeared in the Spokane Journal of Business on August 13 2020. Written by Virginia Thomas.
An emerging restaurant model known as “ghost kitchens” is gaining popularity in some parts of the U.S. and could find a foothold in Spokane, industry experts say.
The concept appears to be becoming more appealing as COVID-19 pandemic-related restrictions continue to batter the restaurant industry.
Ghost kitchens refer to restaurants that operate exclusively on a takeout-and-delivery model, without in-house dining. There are three types: commissary kitchens, pop-up kitchens, and pods, according to digital food-tech publication The Spoon. Commissary kitchens are shared kitchen spaces owned and operated by a third party. Popups are areas within the main kitchen of a restaurant that are dedicated to fulfilling pickup and delivery orders and typically have a distinct menu and branding from that of the established restaurant. Pod kitchens operate within shipping containers and can be placed nearly anywhere.
Adam Hegsted, owner of the Liberty Lake-based Eat Good Group LLC., says the company had planned to open a ghost kitchen space in Spokane Valley, but it’s holding off until the area’s economy stabilizes.
Hegsted says Eat Good’s partner, GVD Commercial Properties Inc., bought the former liquor store building at 5004 E. Sprague earlier this year. Hegsted planned for four companies to share the space: Incrediburger & Eggs, Taco Suave, Doughlicious Bakery, and either a fried chicken or healthy food restaurant.
Hegsted has experience dabbling in the ghost kitchen model. Eat Good Group’s cafe, located in the Meadowwood Technology Campus, in Liberty Lake, also produced orders for Incrediburger Express, a takeout- and delivery-only version of Hegsted’s hamburger restaurant. That has been suspended temporarily, partly due to the impacts of the pandemic, Hegsted says.
“The idea works great, as long as you can get enough delivery orders,” Hegsted says. “There’s a lot of savings as far as the buildout. And same with labor. You don’t have to have as many front-of-the-house people doing customer service and helping guests. You just have a cook back there to create the food, and someone getting orders ready, taking orders, and cashing people out.”
Adam Stinn, director of business solutions at Rosemont, Illinois-based national foodservice distributor US Foods Inc., says the idea was catching on in some U.S. cities before the pandemic struck, but it’s become an important way for entrepreneurs to launch their food businesses, as well as a way for existing sit-down restaurants to add another revenue stream to compensate for lost revenue due to COVID-19-related occupancy restrictions.
“We have seen growing popularity and growing interest across all segments around ghost kitchens,” says Stinn, whose company operates the Food Services of America warehouse in Spokane. “I’ve seen some numbers saying that in the next 10 years, this could be a trillion-dollar industry. There’s definitely a lot of growth potential.”
Ryan Wilcockson, owner of Spokane Salad Delivery LLC, says he chose to use a ghost kitchen model to start his salad delivery business in order to keep overhead low. Wilcockson, the sole employee of Spokane Salad Delivery, works out of the Kitchen Spokane commissary space in the Northtown Mall.
“They have all the supplies we need, all the fridge space, freezer space, and dry (ingredient) space,” Wilcockson says. “It saves a lot, and I can afford to buy fancier products for the customers.”
Kitchen Spokane is a nonprofit that offers commissary kitchens as incubators for small food businesses. Jayme Cozzetto, director of Kitchen Spokane, launched the first commissary kitchen under the Kitchen Spokane name in 2014. Since then, it’s grown to include two locations in Spokane, two in Coeur’ d’Alene, one in Ponderay, Idaho, and another in Vancouver, Washington. Most of its commissary kitchens are in malls.
Donita Humrich, kitchen manager for Kitchen Spokane, says malls are a good fit for commissary kitchens because the infrastructure already exists, and clients can access the space at all hours. Also, mall security keeps the space safe, and the mall itself is responsible for maintenance. With many malls struggling to fill spaces, it’s a partnership that works for everyone, she says.
In the early days of the pandemic’s presence in the U.S., Kitchen Spokane’s revenue dropped by about 30%, Cozzetto says. Around late April, that changed.
“We started to see something we did not expect: a rise and growth in the industry,” he says.
In the past few months, nine new businesses have signed up to use Kitchen Spokane’s spaces. That brings the total number of businesses operating through Kitchen Spokane’s locations to nearly 90.
Cozzetto says the organization is continuing to expand, with two new spaces in the Spokane Valley mall and one in Coeur d’Alene’s Silverlake Mall expected to be established within the next two months. He claims that the COVID-19 pandemic has brought rental rates for commercial spaces, especially those located in malls, down significantly.
Kitchen Spokane charges clients $15 an hour to use its space and equipment, with dry and refrigerated storage space offered at a starting rate of $3 a day.
Cozzetto says many new clients had planned to launch elsewhere but have found their options severely limited by the pandemic.
“We’re seeing people who maybe had an idea before that they were going to do, and they were going to (sell at) farmer’s markets and public festivals,” Cozzetto says. “What I’m seeing is that instead, they’re focusing their efforts online. They’re selling everything online, and they’re doing remarkably well.”
Stinn says that when Washington restaurants were forced to close their dining rooms in March, many eateries grappled with switching to takeout- and delivery-only models.
“While there was definitely revenue and continued sales there, it was clearly not what restaurants are used to, and there’s also additional costs that come with those delivery and carryout mechanisms,” Stinn says.
Some restaurants have embraced the ghost kitchen model, either by starting a second ghost kitchen restaurant that has a separate menu within their existing kitchen, or by adding a “digital franchise,” Stinn says.
In the digital franchise option, for example, a local restaurant that makes its own Mexican-inspired food could add revenue by partnering with a national pizza franchise, enabling the franchise to use part of its kitchen to produce pizzas for delivery.
“I think the most attractive thing about the model is if there’s consumer demand for a certain menu type, a lot of operators already know their fixed costs, whether it be a lease, cost of utilities, those kinds of things,” he says.
The ghost kitchen model enables restaurant operators to continue to have a sales channel, even if it means providing a different menu altogether, Stinn says, adding that it can be done with relatively low startup costs.
“You’re not starting an entirely new brick-and-mortar location,” he says. “You’re really just expanding a menu, which can be done with relatively low risk.”
However, launching an unconventional restaurant through a ghost kitchen comes with its challenges. Chief among them, Hegsted says, is brand recognition.
“If you don’t have an established name, it’s difficult to get the marketing out there, because you don’t have a physical space for people to connect with,” he says.
Spokane Salad Delivery’s Wilcockson says the technological aspects of running a delivery-only business have created an unforeseen obstacle.
“Not everyone is tech-savvy, so unfortunately for people who aren’t used to it, using the internet or their cell phone makes it complicated,” Wilcockson says.
Vying for time in the kitchen also can be challenging, he says. If another Kitchen Spokane client reserves the space for the time Wilcockson had intended to use it, he’s in a tight spot.
Despite these hurdles, Wilcockson says he believes the ghost kitchen model will stick around.
“Not only in Spokane, but nationwide, worldwide. With the whole COVID situation, it’s kind of going to have to go that way,” he says. “I think it’s going to be the way of the future, at least for a couple of years.”
Midtown Drive Up Deli owner Mikele Williams visits with employee Lori Nirk’s daughter, Amanda Flom, before opening for the day. Midtown is in the southeast corner of the My Favorite Things parking lot on Seltice Way in Post Falls. Photo credit: Devin Weeks
Hegsted likens opening a take-out or delivery restaurant through a ghost kitchen to launching a restaurant in an unpopular neighborhood.
“In the beginning, it may be a little more difficult to get people to latch onto the idea of coming to that neighborhood,” he says. “It’s the same with people figuring out the idea that it’s delivery only. But once you get that clientele and build that loyalty, people are willing to get food delivered that they know is going to be good quality.”
Long before the era of COVID-19, Laura Kasbar was a Spokane mother who merely wanted to find a way to address her children’s autism.
Almost by chance, she noticed that video lessons would help, particularly with a child who doctors had declared would never speak.
Nine years later, in 2011, her son Max was mainstreamed, and her Gemiini Systems, still based in Spokane, has become a worldwide leader in online distance learning for people with autism, Down syndrome, dyslexia, speech delay, stroke and other issues.
Since the novel coronavirus outbreak, Gemiini has seen “an avalanche” of interest as families and school districts seek virtual solutions to real-life challenges of learning from home, Kasbar said from her home in Southern California.
The company, with about 50 employees, is run by her son Nicholas out of the Holley- Mason Building in downtown Spokane. After an initial adjustment, Gemiini has adapted to a surge in business.
Gemiini has opened its certification program to professionals and has waived the $490 fee for certification.
Gemiini is also offering schools and clinics the use of its system at no cost as long as they agree to submit the cost of the program to Medicaid.
Gemiini has proven to be a valuable solution for special education administrators, who are struggling to navigate this crisis to continue to meet the needs of special needs students and families.
For many children, “this can be the only link to therapy,” Kasbar said. “And now with COVID everyone is on that boat.
“Our team has been able to get to work immediately. Our subscription base has increased dramatically.”
Gemiini – the unique spelling is Kasbar’s tribute to her autistic twins, Max and Anastasia – was the product of Kasbar’s yearslong search for a solution.
Nicholas Kasbar is ready for a busy day at Gemiini Educational Systems located in the Holley-Mason Building in downtown Spokane. Gemiini Educational Systems, which Kasbar co-founded with his mother Laura, is a video-focused system to teach autistic children. Business is booming for Gemiini since the COVID-19 pandemic sent students home for school.
It was in 2001 that Kasbar recalled walking into a room in her Spokane home, saw all six of her children lined up in front of the television and “couldn’t really tell which were the autistic ones.”
At that time, conventional wisdom dictated the television should be turned off if autistic children were nearby. But that experience told Kasbar video was the answer.
She and her husband Brian had noticed that young Max wouldn’t make eye contact with them but would interact with the television.
“I thought, ‘I’ve got to get my mouth on the TV,’ ” Kasbar said.
That night, they made one-minute videos of a cup and Barney, the TV dinosaur.
“It was a close-up of my mouth saying the word ‘Barney’ next to the actual Barney and then saying the word ‘cup’ next to a cup. We did three sets in a row,” Kasbar said.
That night, after watching several times from his highchair while eating, Max made his biggest breakthrough.
Kasbar held up a cup and he said “cup,” his first word – 3 years and 8 months of age.
During the next decade, and with the help of her oldest son, Nicolas – who also had been on the autism spectrum – Kasbar developed the video program.
In 2012, thanks to funding from the Spokane Angel Alliance and Inland Imaging, Gemiini was launched.
Backed by studies from four universities, Gemiini serves 30,000 clients in 40 countries.
Its use of discrete video modeling, which presents only a specific piece of audio information, was showed by a Portland State University study to be 300% more effective than standard video modeling.
Kasbar was so inspired by the success of her program that she shared her experiences in a book, “Embracing the Battle: Secrets of Victory from a Warrior Mom.”
Closer to home, Gemiini has worked with former NFL star and Spokane native Mark Rypien to develop an application to address suicide prevention.
The goal, Rypien said last fall, is to connect circles of friends of persons at risk so they can better monitor their state of mind.
Lately, the main focus has been reaching children who have been isolated by COVID-19.
“It’s been pretty easy,” said Nicolas, who runs the Spokane headquarters. “After a few headaches, we’ve been able to keep going and helping people, and we’ve updated a lot of our instructions on Facebook Live to walk people through how our lessons work.”
Jim Allen can be reached at (509) 459-5437 or by email at [email protected]