‘98: The Year Ahead New Challenges Await Companies In 1998 Business Predictions
“Business as usual” in the 1990s means years of constant and dramatic change - and 1998 should be no exception.
Though Spokane and Eastern Washington didn’t share fully in the boom-level growth of the Puget Sound, 1997 still was a year of positive growth in many sectors and that trend should continue next year.
Parts of Kootenai County this year were among Idaho’s fastest-growing areas, and opportunities for business growth will follow.
Downtown renewal tops the civic and business agendas in both Spokane and Coeur d’Alene and new mayors in each city will face those challenges.
Businesses large and small throughout the Inland Northwest will face challenges as well, to compete and succeed. Here are some things to expect:
RETAILING
In 1997, the Spokane region saw more retail growth than any other year before, market observers say. That trend should continue in 1998.
Some of the nation’s largest retailers are scouting for, or building second stores in Spokane and Coeur d’Alene. Wal-Mart is looking for a North Side site to accompany its Spokane Valley store and Home Depot is under construction just north of the Division Street “Y.” Retailers like PETsMART and Fred Meyer also are adding stores on the city’s North Side, which should open in 1998.
That retail growth will be joined by progress on, and the opening of, expansions of current shopping areas. NorthTown Mall has launched a $54 million expansion, in which it plans to double the size of its Bon Marche store, add a sixth anchor department store and build a 20-screen cinema complex. Mall developers also are talking with some of the nation’s leading book retailers, such as Barnes and Noble and Borders Books, about building a store at NorthTown.
People passing the popular North Side mall will see construction under way during the course of the year. Then, just before Christmas 1998, the new movie theater is scheduled to open.
The rest of the development should be complete by 2000.
Work also will continue on downtown’s $100 million River Park Square development during 1998. Though none of that project is scheduled to open during the year, new tenants will be announced and Nordstrom’s new store will take shape on the corner of Lincoln and Main. That development should open in mid-1999.
The Steam Plant Square project also should open in the summer of 1998. A partnership between developer Wells and Co. and a subsidiary of Washington Water Power has been renovating the old plant into a retail and office space. The first tenants should be moving in and opening their doors in mid-1998.
CHAMBER
Spokane’s economic development organizations will undergo dramatic change in 1998 when they all move in together.
The Spokane Area Chamber of Commerce has purchased the former WestOne Bank Building at 801 W. Riverside, at the corner of Riverside and Post and is transforming it into the Spokane Regional Business Center.
The Chamber, Spokane Area Convention and Visitors Bureau and Spokane Area Economic Development Council will begin to move into the new building around the first of the year and will open for business shortly after.
Though the three organizations’ addresses will change, their phone numbers will remain the same.
MOVING
In other business moves, Metropolitan Mortgage and Securities Co. Inc. will move into its new home during the course of the coming year.
The Spokane company announced in November the closing of a deal to buy the Farm Credit Banks Building at 601 W. First.
Metropolitan, which is quickly outgrowing its building at Sprague and Monroe, plans to announce the grand re-opening of the new building in April. The building’s new name is expected to be announced at that time.
Metropolitan plans to immediately occupy about 80,000 square feet of the 262,000-square-foot building, and acquire more space as needed when tenants’ leases expire.
Other tenants in that building include Washington State University’s branch campus, the U.S. Small Business Administration, Merrill Lynch and Pegasus Gold Corp.
AGRICULTURE
Early in the year, Washington’s farmers will hear the results of the 16th sign-up for the Conservation Reserve Program, the federal government’s largest conservation program.
An expected 9.45 million acres of highly erodable farmland will be entered into CRP.
Depending on the results, farmers who don’t get their land accepted may have to look into alternative crops. If the rejected acres are planted with wheat, prices could fall.
LABOR
In January, an estimated 850 apple packing plant workers will vote on if they want to be represented by the United Brotherhood of Teamsters.
A two-year membership campaign with workers at plants in Wenatchee and Yakima resulted in the union requesting the vote late in 1997.
If the union is voted in by the workers of Washington Fruit and Produce in Yakima and Stemilt Growers Inc. in Wenatchee, it could affect workers at other plants in the region.
TRADE
As far as trade, this may be a year for a tightening of belts. Because of competition and slower growth, agricultural exports may decline.
U.S. wheat exports are expected to drop because of greater than expected competition from Australia and Canada.
The U.S. Department of Agriculture expects grain exports to drop to 55.1 million tons valued at $6.9 billion from 58.2 million tons valued at $7.5 billion in 1997.
Growth of the world’s gross domestic product is projected at 2.8 percent in 1998, down from 3.1 percent in 1997. Within the U.S., the GDP is expected to slow to 2.5 percent from 3.8 percent, according to the USDA.
While the markets in Southeast Asia my be down as a result of a recent financial crisis, the other major agricultural export markets such as Canada, Mexico, Japan and the European Union are expected to remain strong.
Exports to Mexico are expected to rise 14 percent to $5.8 billion. Demand for animal products, fruits and feeds should grow the most.
MINING
Silver prices topped the $6 mark for the first time in nine years in December and some European traders are predicting 1998 will be the year when the precious metal moves back into the $8 to $9 selling range.
Fueling higher prices are fundamentals for silver that analysts say make a continuing upturn inevitable. For almost five years, supplies have run at a deficit. In late December, warehoused silver was at a 13-year low of 118 million ounces.
The talk of higher selling prices is especially welcome in the Silver Valley, where firms like Hecla, Sunshine Mining & Refining and Silver Valley Resources Corp. stand to make millions in extra income if silver stays above $6.
COLDWATER
Coldwater Creek will expand its mail-order empire this year with the first phase of an East Coast distribution center in Parkersburg, W.V.
East Coast business now represents about 70 percent of the more than $200 million in annual catalogorder sales for the Sandpoint company. A temporary facility will open this year, and the $30 million, 400,000-square-foot distribution center will be on line in January 1999. Coldwater Creek expects to employ about 400 people in the new West Virginia facility, bringing total employment in late-1998 to more than 2,100.
Coldwater Creek has grown to become the largest private employer in North Idaho.
TOURISM
Silverwood Theme Park will add at least two new attractions for its 1998 season.
Tinywood will be a scaled-down mining town complete with a working mine, miniature town and roller coaster all devoted to children.
During the summer, Silverwood will decide whether to begin construction on a second, $1.8 million wooden roller coaster, or a haunted house that will ferry visitors through a series of pitch-black and sparsely lit areas in an attraction park owner Gary Norton wants to make so scary that “adults will be hanging on to their ride seats.”
UTILITIES
Discussion, if not action, will continue in Olympia and Washington, D.C., on deregulation of electric utilities. The decision to delay launch of full-scale deregulation in California illustrates technical difficulties that will accompany the tough political and economic considerations that confront lawmakers.
Competition among telecommunications providers will intensify in Spokane, with new players entering the market. In January, the Washington Utilities and Transportation Commission will rule on US West Communications Group’s rate hike proposal.
New faces will occupy some key chairs as Northwest deals with deregulation, salmon and other energy issues. A replacement for departed Bonneville Power Administration head Randy Hardy should be in place, and Washington Water Power Co. Chairman Paul Redmond has already announced he will step down when a replacement has been found. Also, Ken Casavant, Eastern Washington’s representative on the Northwest Power Planning Council, is returning to the faculty at Washington State University.
BANKING
Backers of New Century Bank expect to open the doors of the newly organized institution sometime in February. Established banks are likely to continue branch openings in an effort to reach all segments of the local market.
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