Boaters, business owners find
paradise in Anacortes
City charts a course for future growth
by Dana E. Blozis

Anacortes, the second largest city in Skagit County, shares its recent successes with residents and visitors while looking to the future for new opportunities. This lovely island hideaway is fast becoming a destination of choice.

It’s a destination
Said to be the crown jewel of Fidalgo Island, the easternmost of the San Juan Islands, the 115-year-old City of Anacortes is the year-round home to more than 15,000 residents. In addition, this beautiful city situated midway between Seattle and Vancouver, B.C., draws nearly two million visitors each year, some to enjoy the city’s attractions while others pass through to Canada or the San Juans.
“It’s not just a tourist spot,” business owner Chris Terrell said of the town he has called home for 35 years. “It’s a destination.”
Indeed, with majestic views of Mount Erie, Mount Baker, Fidalgo Bay and Guemes Channel, there is little left to be desired in this quiet, tucked-away marine community. With a little bit of everything, Anacortes offers residents and visitors alike a multitude of activities and amenities including shopping, dining, hiking, biking, theater, fine art, boating and more.
Among the city’s charms is the downtown area. Having undergone numerous renovations and revitalization projects in recent years, the downtown area continues to thrive in spite of competition from strip malls along the nearby I-5 corridor.
Noting that the local economy is stable, Mayor Dean Maxwell said the area doesn’t have the land base to compete with the I-5 corridor. In spite of that, however, Anacortes has been able to attract significant businesses, drawing in oil refineries, marine and marine-related businesses, antique and specialty shops, independently owned businesses like Bunnies by the Bay and Bayshore Office Products, and unique restaurants like the Rockfish Grill and Anacortes Brewery on Commercial and Randy’s Pier 61 on T.

Recent successes
According to Maxwell, currently in his fourth term as the city’s mayor, Anacortes has much to offer area residents and businesses. Because of its location in the heart of the Puget Sound, the city has become a booming marine community, attracting casual boaters, yachting and sailboat enthusiasts, and ocean lovers as well as a wealth of marine-oriented businesses.
“We’ve been extremely successful in attracting marine and marine-related businesses to the community,” Maxwell said.
In fact, according to the Economic Development Association of Skagit County (EDASC), at least four boat building companies have either moved or expanded their operations in Anacortes within the last year.
“The area has a rich and very interesting marine sector,” EDASC Executive Director Don Wick said. “It’s part of the culture of Anacortes.”
As a result of such activity, hundreds of service jobs have been created in the area in the last dozen or so years, Maxwell said, keeping an estimated 60 percent of the workforce inside the community. The area’s largest employers include Puget Sound Refining Co., Tesoro Northwest, Anacortes School District, Northern Lights Casino, Island Hospital, and a handful of marine and boat-related businesses.
Trident Seafoods, for example, houses one of its fish processing and packaging plants in Anacortes. After a recent expansion, Trident employs between 300 and 400 employee on two shifts. Dakota Creek Industries, a worldwide shipyard, employs about 200. Started in 1998, San Juan Composites, a state-of-the-art yacht builder, employs close to 100.
As the city grows, area developments are popping up at an exponential rate. In 2005, for example, Anacortes saw more than 70 active projects in the works, including The Orchards near 41st and Heart Lake Road and The Isles, a planned unit development near 2nd and York.
In July of 2005 work began on the restoration and revitalization of The Wilson Hotel at 8th and Commercial. Originally built in 1890, the hotel is Anacortes’ oldest building and is listed on both the National Register of Historic Places and the State of Washington Historic Register. In conjunction with city and county agencies, the Anacortes Housing Authority and Beacon Development Group are working to restore the hotel to its previous glory.
Once complete, the first floor, scheduled to open in March, will feature retail businesses, while the second and third floors will offer subsidized studios and one-bedroom apartments. The upper floors are targeted for completion this fall or the spring of 2007.
In addition to these projects, local refineries are investing in the community with upgrades to machinery and equipment. Investments like these, including the construction of a $24 million emission control system at Tesoro, not only improve the environment, but they also drive the local economy as new jobs are brought to the area to facilitate such upgrades.

Looking to the future
Despite the city’s most recent successes, Maxwell said there are opportunities for other businesses to move to Anacortes to further expand the area’s business mix and to enhance its retail shopping. In general terms, Maxwell anticipates more mixed use buildings in downtown Anacortes. By combining retail space with housing, Maxwell expects the downtown to continue its successful revitalization, drawing more visitors and residents to the area. Maxwell also anticipates some outlying businesses, including a popular Italian restaurant, to move to the downtown area this year.
Maxwell said the community has identified specific needs to be fulfilled. Of particular interest is the city’s pursuit of a general merchandise store. To allay the concerns of superstore opponents, Maxwell is looking for a store like Swain’s in Port Angeles, which features sporting goods, hardware, clothing, shoes and sundries.
“We’d love to have a Trader Joe’s,” he added. “Anacortes would be an ideal location for a Trader Joe’s.”
Maxwell also pointed out commercial retail opportunities in the March Point urban growth area. Specifically, Maxwell said the area might be appropriate for commercial “big box” stores up to 50,000 square feet.
“There may be an opportunity in the right situation to consider something in that area,” he explained. “There are some great opportunities for the right businesses to move here.”
Maxwell added, however, that the area would have to be rezoned and would also have to undergo the normal planning process.
In addition to these potential growth areas, Maxwell said there are other projects in the works, including the $30.5 million expansion of Island Hospital. Scheduled to begin later this year, the hospital will add a new lobby and a two-story wing to house its intensive care unit and additional patient rooms. Paid for by a voter-supported bond, the expansion project is expected to take 20 to 22 months for completion.
“The hospital has always been quite important to us,” an excited Maxwell said of the community’s support.
Maxwell noted that the city’s state-of-the-art library was also the recipient of community support when $1 million in private donations were raised to purchase artwork for the library.
“The community recognizes and supports public projects like the library and the hospital,” EDASC’s Wick said. “There’s something very special about a community that, in the midst of these economic times, will step up to make investments like these.”
Submitted in conjunction with the city’s comprehensive plan update, Anacortes is considering a proposal from MJB Properties to build a hotel/resort project east of Q Avenue at 17th Street. MJB has requested that the city make changes to existing zoning regulations to allow taller buildings and residential units. The hotel is proposed to stand 100 feet above the existing grade. It will feature retail space as well as condominiums.
Maxwell stated the property would go through the normal, public planning process. A special planning commission meeting took place in January for the public to offer their comments and concerns. Proponents favor the economic benefits and public access to the waterfront, while opponents argue that the project is inconsistent with the city’s character and vision.
Also under consideration are a 24-acre, 103-unit residential development at Ship Harbor, and The Highlands project, a 64-unit subdivision.
“The housing market is booming,” Maxwell said.
In addition to these projects, the City of Anacortes continues to promote itself as both a destination of choice and a growing business community. Each year, Maxwell said, the city allocates between $120,000 and $130,000 of its hotel/motel tax money to promoting itself through the Chamber of Commerce.

Why Anacortes?
For anyone who has ever visited the marine haven of Anacortes, the answer is obvious – the beauty, the amenities and the people.
From a topographical standpoint, the Anacortes terrain is as varied as it is beautiful. From 2,800 acres of Community Forest Lands to the peak of Mount Erie, Anacortes offers some of the most breathtaking scenery in Skagit County. The city has 18 parks including 220-acre Washington Park, Causland Memorial Park, Ben Root Skate Park, and the Tommy Thompson Trail Parkway.
From a marine perspective, Anacortes is known as a “boater’s paradise.” Offering private marinas, public boat launches, and the Anacortes Yacht Club, many boaters and sailors make Anacortes their favorite port of call. Other popular seaside activities include whale watching, fishing, kayaking, diving and crabbing.
Wick agrees that the beauty of the area and its rich maritime history contribute to the city’s success, but he adds that its people are what really make it work. He cites the city’s active Chamber of Commerce, city and port leadership, and the community’s generosity and investment in itself as key factors.
“Anacortes is a great community. There is a lot of good energy in the community right now,” Wick said. “It has a vibrant business community.”
Others, including local business owners, love Anacortes for its small town flavor and the warmth of its people. These qualities not only attract business owners, but they help to ensure a long and successful stay.
Chris Terrell, owner of How It Works, a graphic design and Web development company, started his business in Anacortes in 1994 to learn more about the community. As he became more aware of the area’s needs, he added services designed to meet those needs, hiring walk-ins and customers with varied skills to help out.
“We have talented, creative people here,” Terrell said.
Suzanne Knutson and Krystal Kirkpatrick, sisters and owners of Bunnies by the Bay, were born and raised in Anacortes. When they started their business 20 years ago, it made sense to work there, too. While their retail store and Hareytale Museum are based in LaConner, the sisters’ 12,000-square-foot workshop is located in Anacortes on V Place, right on the water. This workshop serves as the design studio and customer service and shipping center for Bunnies by the Bay.
The business employs 30 people, 25 in Anacortes and five in LaConner, many of whom have been with Knutson and Kirkpatrick since the early days of their business.
“We’ve been around so long that we’ve had employees who have been with us for 18 and 19 years,” Knutson said.
“I’m a small town person,” she added. “This is a good place to raise kids and to draw employees from.”
In particular, Knutson loves the variety of outdoor activities, the forests, and the boating. Most importantly, she enjoys the quality of life in Anacortes.
“I wouldn’t want to be anywhere else.” Knutson said.
Doug Vanderpool and partner Duane Remmenga, owners of Bayshore Office Products, opened their Anacortes store for similar reasons. Remmenga and sister Jean, now Vanderpool’s wife, grew up in Anacortes, while Vanderpool grew up in Kent. Wanting to raise their children in a small community, the Vanderpools settled in Anacortes, opening their store 20 years ago on Commercial Avenue.
Across the street from the post office, the 20,000-square-foot business now offers a wide range of office supplies, machines and furniture. With 14 full-time employees, the store primarily caters to the business community in Island and Skagit counties.
“It has far outgrown our expectations,” Vanderpool said. “The community has been very good to us. We’ve appreciated their support over the years.”
Noting that 2005 was the store’s most successful year ever, Vanderpool is grateful to have settled in Anacortes. He not only enjoys knowing his customers on a first-name basis, but he loves the area as well.
“I’ve traveled around the country, and I’ve found no other place in the country as livable,” he said.