New residents are just one factor in rise in Spokane home values

Monday, 01 February 2021 / Published in News + Updates

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.

URM grocery purchases old Northwest Bedding facilities on West Plains, adds clients on coast

Monday, 21 December 2020 / Published in News + Updates

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.

Prepare to dine al fresco and sidewalk shop in Spokane.

Friday, 29 May 2020 / Published in News + Updates

First published in the Spokesman Review, Sun., May 29, 2020. By Adam Shanks.

In an executive order issued Thursday, Mayor Nadine Woodward established the Restaurant and Retail Program, which eases the city’s regulations on how and when a restaurant or retailer can expand onto a neighboring sidewalk or parking lot.

Woodward’s executive action complements the efforts already taken by the Spokane City Council, which earlier this month waived application fees for businesses that want to set up on a sidewalk or curbside, and revised city law to reduce the lag time between application and permit approval.

“We felt it was really important to allow businesses that are opening in Phase 2 to increase their capacity. … If you know anything about those businesses, that profit margin is so slim, it is very difficult for many of them to operate at 50%,” Woodward said.

As Spokane entered Phase 2 of Gov. Jay Inslee’s Safe Start reopening plan last week, its restaurants were allowed to open at 50% capacity. In response to business owners’ concerns that this would still hinder profitability, the city has scrambled to relax rules and allow restaurants to spread outside, increasing the number of customers they can serve at any one time and improving their odds of operating in the black.

The city’s new program is also aimed at helping retail businesses, which face similar limits, including operating at 30% of normal capacity during Phase 2.

Under the program, clusters of restaurants and businesses can also apply to have a street closed by applying for a special events permit.

Outdoor seating will still be subject to the 6-foot social distancing rules between tables that apply to restaurants in Phase 2, but outdoor customers will not count toward their occupancy limit. The Elk Public House in Browne’s Addition was the first to apply for a special events permit, which is under review by the city. If approved, it would close down the small section of South Cannon Street for use by The Elk and neighboring restaurants.

The Elk Public House was the first to apply for a special events permit that would close a small section of South Cannon Street for use by the Elk and neighboring restaurants in Browne’s Addition. COLIN MULVANY/ THE SPOKESMAN-REVIEW

The city launched a new page on its website Thursday that provides details about the regulations.

In addition to sidewalk cafes – in which tables are set up on the sidewalk directly outside a restaurant – the city is also encouraging businesses to apply for a streatery or parklet permit. A streatery is an outdoor seating area that encompasses up to two parking spaces at the curbside in front of a restaurant or a nearby loading zone. A parklet is effectively the same thing, but open to the public, not just customers of a specific restaurant.

Under Woodward’s order, the city will consider granting variances to the normal requirements of a sidewalk cafe or streatery, as long as they meet basic safety requirements and still conform to the requirements of Inslee’s Safe Start program.

The order was swiftly and unanimously ratified by the Spokane City Council on Thursday. The program is set to sunset at the end of 2020, but could be rescinded earlier if it becomes unnecessary or extended if needed.

Earlier this month, the council also asked the Washington State Liquor and Cannabis Board to relax restrictions that force a restaurant’s outdoor alcohol sales to directly connected to its premises. The temporary standard would allow restaurants that share space in a closed-down street to sell alcohol, the sales of which are a vital piece of many establishments’ profitability.

The liquor board has already temporarily eased some rules during the stayhome order, including allowing the sale of premixed cocktails to go from licensed restaurants.

During the pandemic, it’s allowing restaurants to apply for an extended floor plan that stretches outside, but “floor plan revisions must be adjacent and contiguous to a licensed premise,” and “areas of responsibility must not be communal or shared with other licensees,” according to the liquor board’s guidance.

“They are eager to work with restaurants to make what adjustments they can,” said Councilwoman Lori Kinnear, who has spearheaded the council’s efforts to ease restrictions on restaurants and retailers.

CONTACT THE WRITER:

(509) 459-5136 [email protected]

Business librarian helps Spokane-area startups

Monday, 30 March 2020 / Published in News + Updates
First published in the Spokesman Review, Sun., March 29, 2020.By Amy Edelen.

Mark Pond received very few questions from visitors about starting a business at the reference desk when he began a career at the Spokane Public Library in 2006.

“I just sat at the downtown library at the reference desk waiting for business questions to come to me. It was complete radio silence,” said Pond, the library’s business reference librarian. “People didn’t know what the library had to offer. I didn’t know how to market what we had to offer, and the tools we had available weren’t necessarily anything close to the toolbox we have now.”

Mark Pond, business reference librarian for the Spokane Public Library, is working out of StartUp Spokane while the downtown library is under construction. (Dan Pelle / The Spokesman-Review)
Mark Pond, business reference librarian for the Spokane Public Library, is working out of StartUp Spokane while the downtown library is under construction. (Dan Pelle / The Spokesman-Review)

 

Pond jumped into action and led an effort to provide resources to entrepreneurs at the Spokane Public Library. By 2016, the library’s business offerings had expanded to include the Level Up Coworking Space at the downtown branch that provides meeting rooms, Macs with Adobe Creative software and access to a Bloomberg Terminal.

The Spokane Public Library is the second in the nation – the New York Public Library being other – with a Bloomberg Terminal, which provides access to financial news, analytics and charts.

In addition to providing one-on-one business consultations and conducting workshops on various business topics at local organizations, Pond maintains resources at spokanebusiness.org that help people research market information, find potential customers, develop business plans and take online job-training courses.

“One of the primary drivers in opening up the Level Up Coworking Space is the gig economy. It gives them tools and resources to figure out how to do their jobs,” Pond said. “Having those kinds of ongoing education and learning opportunities for the Spokane workforce can be huge in terms of business retention and expansion.”

Becoming a business research librarian

Pond, a Kettle Falls native, graduated with a master’s degree in library and information science from the University of Washington in 2000. He worked as a reference assistant at the University of Washington library while attending college. After graduation, Pond was hired as a reference librarian for the Seattle Public Library, a position he held for more than six years.

Pond said he was drawn to library work because of the opportunity to help people with a range of questions and subjects.

“One of the things that appealed to me about the library world is – if you want – you can get super specialized, but sometimes just sitting at the reference desk taking whatever questions coming your way is really fascinating,” he said.

Pond and wife, Maggie, contemplated a move back to Eastern Washington in 2006 to be closer to family and raise their two children. Within hours of discussing the potential move, Pond saw a job posting for a business research position at the Spokane Public Library.

Although Pond had some experience with business research while working at the Seattle Public Library, he was a little concerned at first that the position would be too specialized and might not be a good fit.

“But I love it,” he said, adding it’s a combination of specializing in business topics while also providing the opportunity to answer many different questions from a variety of entrepreneurs.

“At the same time, there’s some common threads in the business research world – who you are selling to and what’s your business model. So those things, (the library) can really help them,” he said. “I enjoy being able to work with a whole span of different businesses around town. I find that really fascinating.”

Growing resources

It took more than a decade for Pond to develop business resources for the downtown library branch. He said the idea to improve the offerings was planted when he met a man who created a device that assists with safety checks for tractor-trailers.

Pond shared with the man some of the library’s business research tools and directories, and compiled a list of trucking companies on the West Coast within seconds.

“The guy said he paid $1,800 for the exact same list two days ago,” Pond said. “So, I had a couple of interactions like that for the tools we have. They are in need and of value to the business community.”

Technology has changed how people access information at the library. More people are gravitating toward digital access to books and reference materials, Pond said.

“I realized it will be a thing of the future and thought, ‘I have to get outside of the library and meet businesses on their own terms,’ ” he said.

After Startup Spokane – a program of Greater Spokane Incorporated – launched in 2015, more entrepreneurs began seeking Pond’s assistance for market research.

About half the businesses Pond works with are startups, and he recently assisted teams of students with business research for the upcoming Northwest Entrepreneur Competition.

“Even today, people don’t realize how incredible the resources and options he’s created for startups and small businesses,” said Mark Gustafson, director of innovation and strategy at Avista Corp. and managing partner of Mind to Market LLC. “For a startup, there’s no way they would have access to this rich of a system in their company.”

Mind to Market LLC is a program by Avista that connects startups with experienced coaches to prepare them for early-stage investments.

Mind to Market participants find business resources – especially PitchBook – useful at the library, Gustafson said.

PitchBook

The Spokane Public Library, with Pond’s help, became the first library in the country to secure a subscription to PitchBook, a venture capital and private equity database.

“Most mom-and-pop businesses in town aren’t looking for venture capital funding, so it doesn’t address them,” Pond said. “But, for the companies that are looking for venture capital funding, it’s really helpful to have the industry standard tool available to them when they come in and consult with me.”

University of Washington’s CoMotion Labs provided grant funds to cover a one-year subscription for PitchBook, totaling more than $18,500 per year.

Pond said the Spokane market and its location in Eastern Washington and proximity to Gonzaga, Whitworth and Washington State universities appealed to PitchBook.

“The universities don’t have a subscription, but I can present it to MBA classes and when they go back to their hometowns, they are aware of PitchBook,” Pond said.

Greater Spokane Incorporated, the Health Sciences & Services Authority of Spokane County and the Spokane Angel Alliance donated more than $13,000 toward a second-year subscription for PitchBook.

“It seems like the library is really well-positioned to be a crowdsourcing hub for access to more resources, even if they might be kind of industry specific, like PitchBook,” Pond said.

A win for the economy

Although the Spokane Public Library’s downtown branch is closed for renovations, Pond is continuing to accept online and phone consultations.

Pond said during the downtown branch closure, the Bloomberg Terminal will be moved to the Spokane Academic Library at the Riverpoint campus.

Prior to Gov. Jay Inslee’s order to restrict gatherings because of the coronavirus pandemic, Pond was holding several meetings at local organizations such as small-business resource SCORE, a volunteer mentorship program, to help people with writing a business plan and other topics.

Pond aims to continue working to provide resources for Spokane businesses and entrepreneurs.

“We are spending $100,000 per year just for business research tools. There’s zero startups anywhere in the nation that are going to spend $100,000 on market research,” he said. “The library can step in and reduce that scope of risk for our local businesses. It’s a win for them and it’s a win for the Spokane economy.”

Among the databases available through the library are:

  • Washington State Legal Forms, offering state and federal forms.
  • Statista, with market data, market research and market studies.
  • Reference USA, with market research, competitive analysis and sales lead generation.
  • Microsoft Imagine Academy, with online courses for Microsoft technology.
  • Demographics Now, offering demographics, consumer expenditures and interactive maps.

Region’s 2020 Economic Forecast Looks Very Much Like 2019

Thursday, 12 December 2019 / Published in News + Updates

First appeared in The Coeur d’Alene Press, December 12, 2019 at 5:00 am | By MIKE PATRICK Staff Writer

COEUR d’ALENE — Same ‘ol-same ‘ol looks pretty sweet.

Speaking to a packed house of 215 business people and community leaders Wednesday, economist Dr. John Mitchell said there’s little reason to expect the nation’s unprecedented 126-month expansion to come to a screeching halt. What we saw in 2019 should look a lot like what we see in 2020, he said.

Dr. John Mitchell delivers his keynote to Coeur d’Alene Chamber of Commerce (Loren Benoit, Coeur d’Alene Press)

In his annual Coeur d’Alene Chamber of Commerce breakfast address at the Best Western Plus Coeur d’Alene Inn, the veteran fiscal forecaster predicted economic growth might slow a bit but continue heading in the right direction.

“The things we traditionally worry about at the moment are not happening,” he said.

Sure, there’s some uncertainty with impeachment proceedings, Mitchell acknowledged. Angst ebbs and flows with international trade and tariff talk, too.

It’s always possible the market could see a big dip, or threats emerge to upend the tax system or the medical system. And of course, Mitchell had to raise the specter of a black swan event — some disaster that nobody sees until after it’s already happened — no matter how unlikely.

“I worry about… people’s willingness to take chances and invest,” he conceded. “That’s a threat.”

But having covered the big scary stuff, Mitchell’s forecast had a calming effect.

“The things that preceded many other recessions don’t seem to be there,” he said.

Nationally, Mitchell pointed to GDP slowing slightly next year but strong employment and low inflation propelling a steady course.

Close to home, Mitchell unwrapped a Christmas package of economic positivity.

He cited Idaho’s 2.1 percent population growth as No. 1 in the nation, tied with Nevada.

Idaho’s job growth for the year through October was a sturdy 2 percent, good for eighth in a nation where all 50 states showed job growth in 2019. Mitchell charted Kootenai County job growth for three years, from October 2016 through October 2019, and tallied 8.4 percent growth, with construction and leisure/hospitality leading the way.

The local housing picture is especially bright — if you’re looking at the value of your property rather than your tax bill, anyway. According to Mitchell’s research, the Coeur d’Alene metro area had the fourth highest housing appreciation rate in the country as of the year’s third quarter. Chico, Calif., rising from the ashes of the Paradise Fire, led the way with a 14.25 percent appreciation rate. Boise (11.81) was second, followed by Idaho Falls (11.33) and Coeur d’Alene (10.85). Demonstrating the growth power of the Northwest, Spokane was fifth in the nation (9.36).

Growth is also visible throughout Kootenai County, as building permits attest. Mitchell said residential building permits are up 11.5 percent year over year.

“The forces that have been driving the county would seem to be intact,” he said, pointing to confident employed consumers, an aging population in the higher cost areas, the many attributes of the region, and simply rising with the tide of continued national economic expansion.

He’s got some numbers to back that all up. Looking at 2010 through 2018, Mitchell showed a positive population change in Kootenai County. Making babies was responsible for 3,822 new faces, while net migration brought in 19,111 during that period, he said. That added up to a 16.6 percent increase, well ahead of Idaho’s strong 11.9 percent population growth.

Growth is evident not just in bodies but bank accounts. According to Mitchell’s research, Kootenai County residents’ personal income was up 7 percent last year. He noted that the big uptick isn’t all from hard-working employees getting raises or better-paying jobs, either: dividends, interest, rents and transfer payments are boosting the bankroll of retirees.

“Old people save a lot,” he said.

Worries over deficit spending haven’t slowed the overall economy, and the dreaded “R” word has somehow been held at bay. Mitchell called “recession headlines very common in 2019,” but said the warnings are often a reflection of political rather than economic interests.

“I always have in the back of my mind, ‘What’s the person’s agenda?’” he said. “The recession just keeps getting pushed further and further out.”

With some effort, the economist who has been making similar presentations for 47 years strained to see dark clouds, let alone black swans, on the 2020 horizon. However, all economic expansions end sometime.

“I don’t think it’s going to be in 2020,” Mitchell said, “but it’s out there somewhere.”

Inland Northwest Economic Development News, FALL 2019

Thursday, 21 November 2019 / Published in News + Updates, Uncategorized

The following projects, initiatives, and economic developments are making news in eastern Washington and northern Idaho. This release is distributed by the Inland Northwest Economic Alliance on behalf of its regional partners.

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COEUR D’ALENE, Idaho — StanCraft Boat Co. is expanding from manufacturing watercraft to offering aviation services with the addition of a $15 million StanCraft Jet Center at Coeur d’Alene Airport-Pappy Boyington Field. Construction on the new 85,000-square-foot FBO began in August east of Empire Aerospace, and the project is expected to be completed by May 2020. Coeur d’Alene-based Eric Hedlund Design is the architecture firm that designed the structure, and Hayden-based Young Construction Group of Idaho Inc. is the contractor. The 40,000-square-foot Southfield Aviation building will be used as a maintenance facility after the new jet center is built. In addition to refitting jet interiors, StanCraft Jet Center will offer jet refueling, conference rooms, waiting and pilot areas, and a tenant improvement space for offices. Contact Robb Bloem, StanCraft President, for more information.

Dauntless Air, an aerial firefighting company, relocated its aircraft maintenance operations to the Coeur d’Alene airport this year. Dauntless protects people, land and property from the devastation of wildfires through advanced aerial fire suppression tactics in Minnesota, Washington, Alaska, Idaho, North Carolina, California and Oregon. Learn more about the company at www.Dauntlessair.com or contact Brett L’Esperance, Dauntless CEO.

PULLMAN, WA — Washington State University’s Cosmic Crisp apple will hit the fruit stands on December 1, a project over 20 years in the making. Cosmic Crisp was developed specifically for Washington’s climate and growing conditions. WSU researchers combined the disease-resistant Enterprise with the Honeycrisp, known for its crispness, juicy sweetness, and hint of tartness. There are 12 million trees planted in the state of Washington and this year 450,000 boxes of Cosmic Crisp apples will be available. Washington apple growers will have exclusive rights to the Cosmic Crisp for 10 years. Washington produces 65-75 percent of the nation’s apples, yet this is the first variety that originated from the state. Contact Proprietary Variety Management for more information.

HAYDEN, Idaho — Roller coaster manufacturer, Rocky Mountain Construction (RMC), continues its Six Flags success with the innovative Jersey Devil Coaster at Six Flags Great Adventure in Jackson, New Jersey. Known as a single-rail coaster, riders in one-passenger cars will straddle a 15.5-inch-wide steel, monorail track and navigate a twisted course that will include multiple inversions, climbing 130 feet and hitting a top speed of 58 mph along 3.000 feet of monorail track. RMC has grown to 115 full-time employees and 5 manufacturing facilities, totaling more than 75,000 square feet. See USA Today’s article for more.

DAVENPORT, WA – Washington Department of Commerce, USDA, and Washington State University Medical School hosted a daylong workshop with 100 community leaders and residents from Eastern Washington to address the broadband law approved this year by Washington state lawmakers. A new statewide broadband office will approve and distribute grant and loan funds to local governments, tribes, public, private and nonprofit entities working together to expand broadband. The program has $21.5 million available, including $14.5 million for loans and $7 million for grants. The state will prioritize funding to public-private partnerships, with a focus on underserved areas in the state. Contact Margie at Lincoln County EDC for more information.
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MARIES, Idaho — City officials and housing developers, Troy Lozano, are projecting construction of new homes in Ragan’s Addition to begin in early 2020. Lozano purchased 21 lots in the addition and plans to partner with Julian Construction to build single family homes. Updates can be found at greystonehill.com.

OTHELLO, WA — McCain Foods broke ground on a 170,000-square-foot expansion, a project that will cost $300 million and is scheduled for competition in 2021. The expansion to the frozen potato products line is estimated to bring about 180 new jobs to Othello and is expected to be the biggest manufacturer of frozen potato products in the world. Dale McCarthy, McCain Foods, said Othello’s proximity to West Coast shipping makes it a crucial location for the company. “Othello is very strategic for us.” Adams County officials are working with McCain Foods and the state to develop a recruitment process and support. They plan to conduct a countywide housing needs assessment to confirm housing needs and development solutions.  Email Adams County Economic Development Council for more info.

MOSCOW, Idaho — Northwest River Supplies (NRS) began operations from its new facility on South Blaine Street on November 5. The newly constructed 155,000-square-foot building includes a warehouse, customer service center, corporate offices and a 3,500-square-foot NRS flagship retail store. The $13.5 million project received a tax break from Latah County that exempts 75 percent of the increase in the site’s value from property taxes for five years, ending in 2023. Read more here.

PULLMAN and COLFAX, Wash. — Two Inland Northwest businesses were recognized through the Washington Secretary of State’s Corporations for Communities Award Program. Schweitzer Engineering Laboratories, of Pullman, was recognized for donating and raising funds for local charities and providing money for employees to donate to the charity of their choice. Bunyard Automotive, of Colfax, was honored for repairing vehicles at little to no cost for families in need. Both businesses were awarded the National Association of Secretaries of State Medallion for their efforts in their communities. The full press release is here.

OSBURN, Idaho — The city dedicated the newly completed Shoshone Fire District #1 facility, which was awarded a $500,000.00 block grant earlier this year. The new 10,000-square-foot facility is a significant fire, training, and emergency services upgrade for the region. Contact Silver Valley EDC for more information.

LEWISTON, Idaho — With a start-up $839,809 grant from the National Science Foundation, the Northwest Intermountain Manufacturing (NIMA) Association has created a pilot project to train high school students in fabrication and machining. In partnership with Lewis-Clark State College, the Clearwater Economic Development Association, the University of Idaho and 16 school districts, the program gives students a solid skill set and educational background in manufacturing so they can be ready to start work right after high school for local companies. The first group of students will complete the program in 2020. See Idaho Department of Labor article here.

LIBERTY LAKE, WA — In response to a gap in the city’s flex office market, Liberty Lake Coworking LLC will open Jan. 2 at 23505 E. Appleway. The 4,600-square-foot space will have 11 private offices, six semi-private spaces, and open table space. The space will also feature booths for private calls, two semi-private meeting booths, a podcast and media room, access to high-speed fiber internet, and free parking. More details can be found here.

POST FALLS, Idaho — Construction on Idaho’s fourth state veterans’ home is expected to start next year. The 82,000 square foot project is to be built in Riverbend Commerce Park in Post Falls and will have 64 beds. The home will be built on 7.3 acres donated by the Jacklin Land Co. in Riverbend Commerce Park on Post Falls’ west side. It is adjacent to BioPol Laboratory and Buck Knives. See the full article here.

SPOKANE, WA — The Toolbox manufacturing incubator expanded to 17,000 square feet in a recent move to Logan Neighborhood. Anchored in the space is Vestis, which manufactures specially designed commercial awnings and canopies. The Toolbox continues to serve as collaborative space where established companies and business mentors share expertise, ideas, tools, and equipment with manufacturing startup and entrepreneurs. The Toolbox is overseen by nonprofit Spokane Create. Read full article here.

On December 4, the Edward Lowe Foundation and Washington Department of Commerce will lead businesses through the basics of Thrive!, a new state program that helps second-stages businesses to increase revenue, streamline operations, and expand into new markets. Contact Susan Joseph Nielsen for more information about Thrive!

POST FALLS, Idaho— Northwest Specialty Hospital completed a $4.5 million addition to include an Endoscopy Center and two additional operating rooms. The 15,000-square-foot addition brings to eight the number of operating rooms for patient surgery. The Endoscopy Center, a 8,650-square-foot addition to the hospital, features two procedure rooms, one exam room and eight preoperative and post-anesthesia care unit bays. See company news release for more information.

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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.

Boeing 797 manufacturing facility could be hub for thousands of jobs in greater Spokane

Monday, 11 March 2019 / Published in News + Updates
This article first appeared in the Spokane Journal of Business, February 28 2019. By Mike McClean.

Chicago-based Boeing Co. is signaling it likely will delay announcing until next year its much anticipated new aircraft line referred to as the new middle-market airplane, or more informally the 797, says Larry Krauter, Spokane International Airport CEO.

That delay could work to the advantage of Washington state’s efforts to convince Boeing to manufacture the plane within the state and quite possibly bolsters Spokane’s case that a significant share of the 797 manufacturing operations could be based here, Krauter says.

Krauter was appointed recently to the governor’s Choose Washington New Middle-Market Airplane Executive Council, which is tasked with convincing Boeing to choose Washington state for the design, production, and final assembly of the all-new aircraft. He’s also the chairman of the West Plains-Airport Area Public Development Authority, a tax revenue-sharing agency formed jointly by the city of Spokane, Spokane County, and Spokane International Airport to fund infrastructure to promote economic growth.

Though still early in the process, Spokane International Airport has developed a sketch that Spokane County Commissioner Al French describes as “what a 1 million-square-foot Boeing facility could look like.”

French also is a member of the public development authority board.

Todd Mielke, president and CEO of economic development organization Greater Spokane Inc., says such a facility could be the hub for thousands of good-paying direct and support jobs, including fabricators, machinists, welders, maintenance and operation personnel, administrators and managers, engineers, information technology professionals, and warehouse workers.

Boeing announced at the 2017 Paris Air Show that it was studying a new airplane design that would fill a market niche between its 737 line and its larger, long-haul 787 Dreamliner. The 797 aircraft would seat 220 to 270 passengers and have a range of about 5,200 nautical miles, the company said.

By comparison, Boeing’s 737 MAX series, its latest iteration of the 737, seats 138 to 230 passengers and has a range of up to 3,800 miles.

Krauter says Boeing is going through a diligent process to define the 797 to best fit customer needs for a middle-market plane.

“We’re aware of significant market challenges,” he says. “Some carriers are looking for twin-aisle aircraft with the economics of a single-aisle aircraft. Some carriers would like to carry more cargo and some less cargo.”

Due to anticipated competition from other plane makers for the market niche Boeing wants to fill with the 797, Krauter says Boeing likely isn’t in a position to defer the envisioned production date, and that creates potential advantages for Washington state and the Spokane area.

“I sense that they aren’t going to be able to slide that (market date) further out,” he says. “I think Boeing is going to have a more compressed time frame.”

That means the manufacturing site selection could be rapid once Boeing announces a decision to build the 797.

“Boeing is going to have to take advantage of existing infrastructure, both intellectual and physical,” Krauter says.

He contends Spokane has a compelling 1,200-acre site on the west side of the airport, and infrastructure improvements, including a rail spur and a truck-rail transfer facility, are planned or under way within the Public Development Authority district.

Also within the district, federally designated opportunity and trade zones could provide economic development incentives to enhance the manufacturing supply chain for such a major aircraft production, he says.

Krauter contends Boeing could bring in raw materials and subassemblies and manufacture a flyaway product at one potentially shovel-ready site here.

“From what I know, there’s only one megasite that can really work if Boeing wants the supply chain very closely located,” he says. “This aircraft has to be very economical. I believe Spokane has an incredible value proposition to be made to help drive costs out of that product.”

Krauter replaces Robin Toth, formerly of GSI, on the state’s NMA council, which falls under the purview of the Washington state Department of Commerce. Toth is now the state’s aerospace sector lead for the Commerce. She couldn’t be reached immediately for comment.

Gov. Jay Inslee also recently appointed former Washington State University Spokane chancellor and former state Senate majority leader Lisa Brown to be the Commerce department director, adding more Spokane roots to the department.

“I’m encouraged by that,” Krauter says. “Commerce is in the process of becoming a better partner for Spokane and a better department of Eastern Washington. It’s truly looking at a ‘one Washington’ approach to its mission.”

GSI’s Mielke says more than 130 companies supporting the global aerospace industry are operating in the Spokane area, making this the fifth largest aerospace cluster in the U.S.

He says many of those companies are part of Boeing’s supply chain.

French says one such company, Kent, Wash.-based Exotic Metals Forming Co., plans to expand in two phases on its 57-acre Airway Heights campus within the Public Development Authority’s jurisdiction.

Each addition will be similar in scope to the 150,000-square-foot plant the company built there in 2015, according to environmental planning documents.

French says, “When companies like that part of the supply chain are looking to expand in Spokane, that’s only good news. Not only does that make the case that we’re a good location, it attracts other (suppliers).”

French says the successful recruitment of Seattle-based online retailer Amazon.com Inc. within the Public Development Authority district only helps bolster Spokane’s case for a major Boeing manufacturing facility.

He says, “Now with Amazon, which is an international company, coming here, why not Boeing?”

Kent aerospace company hopes to expand to Airway Heights

Tuesday, 05 February 2019 / Published in News + Updates

This excerpt is from an article that first appeared in The Spokesman-Review, Sun., Feb. 3, 2019 at 4 a.m. By Amy Edelen and Becky Kramer.

Exotic Metals Forming LLC has submitted plans for future expansion on the West Plains.

The Kent, Washington-headquartered company specializes in aerospace sheet metal fabrication and design, working primarily with titanium and nickel alloys. Exotic Metals has a 150,000-square-foot industrial building in Airway Heights.

Company officials didn’t return calls last week, but documents filed with the city of Airway Heights indicate Exotic Metals is planning two expansions on the western portion of the 56.6 acres of property it owns at12821 W. McFarlane Road.

The first phase would be construction of a new manufacturing facility and employee parking lot, which could begin as early as this year for completion in 2020. The second phase would mirror the first expansion, but the company doesn’t have a timeline for that work.

Exotic Metals would bring on about 150 staff with each expansion phase, according to company documents.

Company officials have submitted a checklist for the planned development under Washington’s State Environmental Policy Act. Airway Heights officials have asked for additional information about traffic impacts.

Continued Job Growth in Spokane Metropolitan Area

Thursday, 31 January 2019 / Published in News + Updates

Originally appeared in the Spokesman-Review, 24 January 2019. By Becky Kramer of THE SPOKESMAN-REVIEW 

Education, health were key drivers in 2018, says economist

About 6,200 new jobs were created in the Spokane metropolitan area last year, reflecting the fourth year of strong regional job growth. The area includes Spokane, Stevens and Pend Oreille counties. For four years straight, the three-county area has gained more than 5,000 jobs annually.

Education and health care were drivers of job growth in 2018, said Doug Tweedy, regional labor economist for the Washington Employment Security Department. Both sectors added about 1,500 jobs last year.

Manufacturing also had a strong year, and so did professional and technical jobs. Attorneys’ offices and accountants were hiring last year, Tweedy said.

For comparison, the Spokane metro area created about 5,300 jobs in 2017.

Unemployment averaged 6 percent for the Spokane metro area in 2018, compared to 5.5 percent the year before.

Spokane County’s unemployment averaged 5.3 percent last year; Stevens County was at 7.2 percent; and Pend Oreille County at 7.3 percent.

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