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Business Pulse
2001: Better than It Seems? G-P, Intalco Shutdowns Overshadow County’s Growth in Many Areas by Dave Brumbaugh Whatcom County was rocked by several stunning economic blows in 2001 that overshadowed a number of positive accomplishments in the year. The county was set back on its heels early when Georgia-Pacific announced March 30 the permanent closures of its Bellingham pulp mill and associated chemical plant, resulting in the layoffs of 420 workers. The company had stopped pulp production in December 2000. Georgia-Pacific cited high costs of operation, due substantially to rising electricity prices, and the additional pulp available since its acquisition of Fort James. Georgia-Pacific still employs about 330 people in its tissue paper and converting facilities in Bellingham. The energy crisis also hit Alcoa Intalco Works in Ferndale. Alcoa agreed to stop production at the plant on May 18 until Oct. 1, 2003, in exchange for selling its right to purchase power back to the Bonneville Power Administration. Most of the Ferndale plant’s 930 employees were kept on the payroll through the deal. As signs mounted that the slowing economy was moving into a recession, the country was devastated by the Sept. 11 terrorist attacks that killed thousands in airplanes, the World Trade Center in New York and the Pentagon in Washington, D.C. The ensuing disruption to the economy was the final straw for many companies, triggering layoffs at airplane manufacturer Boeing, airlines and many others. Whatcom County’s unemployment rate steadily rose in the second half of the year, hitting 7.3 percent in November, its highest level since 1995. The county rate for previous years in November was 5.6 percent in 2000 and 4.9 percent in 1999. Home Base, Longs Drug Stores and United Express all left Bellingham during 2001. However, retail giants Best Buy and Bed Bath & Beyond opened stores in the city. A Lowe’s Home Improvement Warehouse will anchor a shopping center opening this year across from Sunset Square and one of its new tenants, restaurant chain Applebee’s. Also, Fred Meyer is moving ahead with plans to build a second Bellingham store near the intersection of Interstate 5 and West Bakerview Road.
CONSTRUCTION • Work began on a 29-acre commercial development near the intersection of Interstate 5 and Sunset Drive, across from Sunset Square. The shopping center is being developed by Sunset Drive Investors LLC, led by president Jeffrey Oliphant. It will be anchored by a 150,000-square-foot Lowe’s Home Improvement Warehouse store that will cost $16.5 million to build and add 175 jobs to the area. • Western Washington University is receiving $57.1 million in state funds for capital projects in the next two years. The projects include a $32.5 million, 128,000-square-foot communications building, $11.7 million for campus infrastructure development on the south campus and $12.8 million for preservation, renovation and access projects. A new 35,000-square-foot Campus Services Facility, costing $5.7 million, will be completed this summer to house public safety offices and the student health center. Construction on a $17.3 million Student Recreation Center, funded by student fees and cover 96,000 square feet, will begin this spring. • Construction on the Marketplace at Lynden, a shopping center at the corner of the Guide Meridian and Birch Bay-Lynden Road, began in August and should be completed this spring. The center will be anchored by a 60,000-square-foot Safeway supermarket and include 6,000 square feet of attached retail space, plus pads for restaurants. The project gave a boost to a community that had two longtime retail outlets, The New Crescent clothing store and DeWaard & Bode appliance store, close earlier in the year. • Work began in late summer on the Lummi Nation’s Silver Reef Casino, a $20 million project funded by Merit Management Group of Chicago. The facility at the corner of Haxton Way and Slater Road, three miles west of Interstate 5, will have a 25,000-square-foot gaming area and be completed by late spring. The casino is expected to create 150 jobs. • The Nooksack Tribe announced plans for a $20 million project that will include a 75-room hotel, a natural science center and a museum on 85 acres next to its two-acre reservation in Deming. The tribe owns the land and is asking the federal Bureau of Indian Affairs to place it in federal trust status. The tribe wants to build the facilities and expand its Nooksack River Casino in the next 3-5 years. It estimates the additions would employ 150 people and pump $14 million annually into the local economy. • The former Flame Tavern at the corner of Railroad Avenue and Holly Street in downtown Bellingham was demolished so developer Rick Westerop could begin construction on a four-story building with retail, office and residential spaces. • Kitty-korner from the Flame Tavern, the former Mason Building site — known as “The Pit” — was leased by the City of Bellingham to Marketplace Development, a partnership of Bellingham businessmen Jeff McClure and Jeff Kochman. Construction of a retail/office/residential building may begin this year. The city’s decision drew protesters who occupied the site for a number of days and disrupted City Council meetings. • Construction work began in early July on a $70 million expansion project at St. Joseph Hospital. The project will add 169,000 square feet to the hospital’s main campus. A 210-space, four-level parking garage will be the first structure completed, likely late this spring. • Finnegan’s Alley, a 20,000-square-foot retail/office building at 1106 Harris Ave., opened in the spring and much more construction is underway or planned in Fairhaven, including new homes for Village Books and Fairhaven Bike and Mountain Sports. • Permit applications for Pioneer Plaza, a 136-acre, mixed-used urban center in Ferndale, were filed Oct. 17 with city officials. The project, located on the east side of Interstate 5 and south of Main Street, would have 807,500 square feet of buildings and 3,439 parking spaces if fully developed. Construction of one of Pioneer Plaza’s two proposed anchor buildings, each covering 160,000 square feet, could begin this spring. OPENINGS • Bellwether on the Bay, the Port of Bellingham’s waterfront development, continued to grow. The three-story, 43,000-square-foot Bellwether Building has been filling with retail and professional-services tenants since opening in late April. Anthony’s Restaurant in Squalicum Harbor, with a capacity of more than 200 customers, opened its doors in September and the 34,000-square-foot Paulsen Business Center also was completed. • Another waterfront addition was The Chrysalis Inn & Spa at the Pier, a 43-unit room hotel overlooking Bellingham Bay in Fairhaven that was opened by Ellen Shea and Michael Kennan in April. • Work on Whatcom County’s newest 18-hole golf course, the 196-acre Point Roberts Golf and Country Club, was completed by late summer. • The three-story 54,000-square-foot Barkley Building III opened in September. Moss Adams LLP leased the entire third floor. • Two national chains, consumer electronics and computer giant Best Buy and home furnishings titan Bed Bath & Beyond, opened stores in Bellingham’s Cordata Center in the year’s last quarter. • Bank NorthWest was the only bank that added branches in the county. Starting the year with only headquarters in downtown Bellingham, Bank NorthWest opened offices in Birch Bay, Everson and the Barkley District of Bellingham. • Tenants previously in the Port of Bellingham’s Squalicum Mall moved in March to the new 18,000-square-foot Marina Square, also at Squalicum Harbor.
INDUSTRIAL • Phillips Petroleum Co. acquired Tosco Corp. and its oil refinery several miles west of Ferndale. The Ferndale refinery is in the midst of a $220 million project that will include modifications to existing process units, utility systems and storage facilities. The project is scheduled to be completed in spring 2003. • The BP Cherry Point Refinery completed in May a $20 million “turnaround,” a scheduled maintenance project that involved updating and repairing equipment. The project began March 30 and drew 1,700 contract workers to the refinery. • Gov. Gary Locke refused to approve an application to build Sumas Energy 2, a 660-megawatt electric-generation facility in Sumas. The proposal was opposed by some residents and organizations in Washington and British Columbia, primarily on air-quality concerns. The $350 million plant would have taken about two years to build, employing up to 400 workers during peak construction. The proposal has been modified and resubmitted to the state Energy Facility Site Evaluation Council.
GOVERNMENT • A coalition of business and trade associations have sued to stop implementation of ergonomics rules adopted in 2000 by the state Department of Labor and Industries. Unless a court intervenes, highest-risk employers with 50 or more full-time-equivalent employees must complete awareness education and hazard analysis by July 1, 2002 and complete hazard reduction by July 1, 2003. Other businesses face later deadlines. • The state Department of Revenue reports that taxable retail sales in Bellingham in 2000 rose 5.5 percent to $1.47 billion, ranking it 12th among Washington’s cities. Taxable retail trade sales, which better represent consumer purchases, in Bellingham increased 5.1 percent in 2000 to $878 million. • Whatcom County Superior Court Judge Steven Mura ruled the Bellingham’s storm-water fee ordinance, passed by the City Council in February, is not subject to a citizen referendum. People for Fair Stormwater Solutions had collected petitions with 3,200 signatures that sought a referendum. The ordinance charges owners of businesses and large homes $5 per month for every 3,000 square feet of impervious surface. • Haggen Inc. announced March 27 that it had ended negotiations with the City of Lynden for the purchase of city-owned property in downtown Lynden. The company was seeking to build a Haggen Food & Pharmacy supermarket on the property and had been working on the project since fall 1998. |
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