Costco now a ‘no go’

WASILLA — Without immediate explanation, wholesale giant Costco suddenly Monday morning pulled its plans to build in Wasilla.

The move came a day after the Mat-Su Valley Frontiersman reported the Issaquah, Wash.-based store had officially filed an application to begin construction on a warehouse store in the city.

On Monday, City Planner Jim Holycross said Costco’s withdraw of its application came without warning.

“It’s a shock to me and probably to all of the people that want Costco,” Holycross said.

He said Costco likely spent anywhere from $25,000 to $50,000 putting its application together. The company also paid to have 27 test holes drilled into the ground where the store was to be built on land near the Parks Highway to test the viability of the soil, among other preparation activities.

“That had to cost a lot of money,” Holycross said.

A call to Mulvanny G2, a Lower 48 consultant firm working for Costco and the company that withdrew the application, seeking comment on the abrupt reversal was not returned by press time.

Holycross said a representative from Mulvanny hand-delivered the application to him, what he thought was a sign of Costco’s seriousness about building in Wasilla. Costco’s corporate offices in Washington do not comment on specific markets and repeated calls from the Frontiersman have not been returned.

Holycross said he expects reasons in writing sometime this week, but until then he has no idea what prompted Costco’s change of plans.

Rumors asserting Costco was coming to Wasilla began to gain traction near the end of summer when a representative from Anchorage-based Lounsbury and Associates, a project management company contracted by Meritage Development LLC, told Wasilla City Council the store planned to build in the city.

The site where Costco had planned to build is part of the Creekside Town Square development adjacent to Sportsman’s Warehouse, which is being developed by Meritage.

The site became the subject of controversy over the summer when former Wasilla mayor Dianne M. Keller was accused of working to benefit Meritage at the expense of private businesses and landowners.

Keller was eventually asked to resign in a 4-1 vote by the City Council, but refused.

On Monday, Kathy Wells, executive director of Friends of Mat-Su, said her organization was contacted by Meritage and Costco months ago and told to keep quiet about the development.

Wells said FOMS was not against the Costco development, but wanted to make sure the site plan was “the best it can be.”

She pointed out drainage from the site could have become a contentious issue, and Cottonwood Creek, where most drainage in that area flows, is already heavily affected and listed as an impaired stream in the Valley.

Another developer that has decided against building in the Creekside Town Square site is Coming Attractions Theatres, a Pacific Northwest company.

Chairman and CEO John Schweiger said Monday it would have cost millions of dollars in site work to get a building pad and parking lot, effectively making the case against building there.

“It became financially impossible,” Schweiger said.

The financial burden of preparing the site wasn’t the only reason Schweiger decided against building on Meritage’s development.

“In negotiations, they moved the theater three times without discussing it with us,” he said. “It seemed to play to other wishes.”

Schweiger will build his theater next to Wal-Mart off the Seward -Meridian Parkway.

As for Costco, “I think they made a good decision,” Schweiger said.

A message left for Meritage seeking comment was not returned by press time.

Regardless of the reason for Costco’s apparent change of mind, Holycross said there had been a general excitement for the store’s arrival.

“The majority of people want it,” he said. “It’s got positive buzz. I’m surprised they withdrew it.”

Contact Michael Rovito at michael.rovito@frontiersman.com or 352-2252.