City subdivision nearly sold out

PALMER -- In its eight years of existence the Palmer Commercial Center has been developed in fits and starts and false-starts. Now the city-developed subdivision on the south side of town is almost entirely in private hands and has a handful of occupants, but most of its lots sit undeveloped. A recent spurt in sales of the remaining city-owned lots in the past few months suggests more buildings will be framed up soon.

"I just signed a warranty deed for six lots this morning. We've got an offer on two more, and we've heard there's an offer in the wings for another two more," Mayor Jim Cooper said Friday. "So either the economy is picking up or we're selling our land too cheap."

Once those pending transactions are complete, only six of the original 41 lots will remain in city hands.

The Palmer Commercial Center is a small subdivision cut into a hay field with rather striking views of the Talkeetna and Chugach mountain ranges. In that respect, it's not too different from nearby residential subdivisions. But the development also has city water and sewer, underground electric and telephone lines, paved streets and street lights. It was created in part from a federal economic development assistance grant.

The city had to take steps to create the business park. The development was built outside city limits and annexed into the city. The city also created a business park zoning ordinance that distinguishes the activities that can take place here from its industrial park which is just to the north. Last year, the city council loosened the business park zoning rules to allow for outside storage of heavy equipment, a move that came at the request of businesses within the Palmer Commercial Center.

The subdivision is located on Outer Springer Loop Road, just west of the Palmer Golf Course. It's a low-profile neighborhood not suitable for retail, but close enough to the Glenn Highway to accommodate shipping and receiving.

The city spent about $600,000 and received about $1.5 million in federal economic development grants to subdivide and extend utilities to the project, according to city finance director Allan Ossakow. The original intent of the project was to get back only the city's investment so lot prices have stayed low, from $16,000 to $40,000 depending on size.

"I'm surprised they haven't sold out years ago. This year it kind of went gangbusters. . . I wouldn't be surprised if the last six sell out this year," Ossakow said.

The original grant funding for the project prohibited relocation of businesses into the new subdivision from a certain radius -- the federal government doesn't want to subsidize one community at the expense of its neighbors -- but those restrictions have since expired, according to city manager Tom Healy.

In 2000, Northwood Furniture, a manufacturing plant with five employees, moved there from Anchorage. The company still has retail space in Anchorage, but Northwood's owner David McClure said quality-of-life for himself and his employees was a factor in the decision to move the plant to the Valley.

"Some of us already live out here and some are planning to make the move out," McClure said. The Northwood plant has a factory outlet, and McClure plans to build a retail showroom at the factory, even if it is off the beaten path. He's also expanding his businesses to take advantage of the current growth in home construction, and one sign on the building reads "factory outlet."

"We'll be getting into kitchen cabinets and counter tops," McClure said. "We'll be mostly oriented toward homeowners and owner-built homes. This is something new for us, it's a new development."

Just a couple of vacant hay field lots away there is another new development. Weldin Construction Inc., a general contractor that relocated from Eagle River, has about 20 yearround office workers and up to 60 employees during construction season. Weldin moved in last February.

Jennie Weldin said the company purchased its lots about four years ago but took its time building because their clients' contracts took priority. The city's development made sense because the company doesn't need a high-profile location, and the price was right.

"Price was the number one consideration," Weldin said, "looking for industrial and commercial space in Anchorage was pretty cost prohibitive."

Weldin has contracts on Elmendorf Air Force Base and other bases around the state where the company remodels everything from dormitories to fuel distribution systems. The company recently completed a project on a U.S. Naval base on the Johnston Atoll, which is east of Hawaii.

But the big news for Weldin Construction is the company's recent designation as the SABER contractor for Elmendorf. SABER is an acronym for "Simplified Acquisition of Base Engineering Requirements," which means that Weldin will be called on for all on-base projects not exceeding $500,000 that require an outside contractor, according to 1st Lt. Jason Foster of the Third Civil Engineer Squadron.

Foster said the SABER agreement starts with a one-year contract but can be extended to five years. The Third Civil Engineer Squadron is charged with all on-base maintenance and repair on Elmendorf and handles a lot of its own work with its 600 employees. But certain projects must go out for bid according to their size, or according to what manpower or funding is available. The SABER program is designed to streamline the process.

"What the SABER contractors do is kind of takes on the middle ground," Foster said.

Since the announcement of the SABER award, Weldin Construction has had no shortage of potential employees or sub-contractors, even if their new headquarters is off the beaten path.

"Since word got out about that, they've been beating down the doors," Weldin said.