Retail Foundation Evergreen Interchange Pact Clears Way For Aggressive New Development East And West Of Mall

A deal struck by Spokane County commissioners and developer Raymond Hanson earlier this month paved the way for a new Interstate 90 interchange at Evergreen Road.

But a new interchange isn’t all that’s coming.

The deal also opened the floodgates to commercial development of about 100 acres of land that now sandwiches the Spokane Valley Mall. Hanson, who owns that land, released sketches this week of several retail complexes he plans to construct east and west of the mall.

The plans include over 1.1 million square feet of new retail and commercial space - more than the mall itself. They include two new shopping complexes, along with a retail center that will contain restaurants, convenience stores, recreation facilities, offices and hotels.

Stores could start popping up as early as next spring, and be open for business by summer or fall, said Joe Ward, a broker for Pinnacle Realty, which handles leasing for Hanson’s property.

Ward hopes to bring several motels, hotels, grocery stores, sit-down restaurants and national “big-box” retail stores to the proposed Market Pointe II, Evergreen Crossing and Hanson Center East.

The three new shopping centers would Hanson’s existing complex, Market Pointe I, which sits just east of the mall and includes Barnes and Noble, Gart Sports, Circuit City. Staples, now under construction, will open there in the spring.

The four complexes will form Hanson Center. Together with the mall, Hanson hopes it will become the Valley’s retail hub, drawing shoppers from Spokane and North Idaho.

By focusing the retail development around the mall, Hanson Industries officials hope to capture a larger market and attract shoppers with convenience and critical mass.

Hanson’s agreement to pay $5.2 million toward the cost of building the new freeway interchange, which will accommodate the traffic that will come with the new development, allows him to proceed with the plans. Prior to the agreement, he’d developed all the commercial space granted to him by the county.

Price Development Co., the owner of the Spokane Valley Mall, continues to face the square footage restrictions because it hasn’t yet reached an agreement with Hanson or the county about its share of the funding.

But unlike Hanson, Price hasn’t maxed out on available space. It has enough square footage left for some additional outside stores and restaurants, such as the Red Robin now under construction near Tony Roma’s. Price’s plans are long-term, mall manager Jerry Irwin said. After 15 months of operation, the mall still has about 15 percent of its retail space unfilled. It probably won’t plan expansions for several years, until the Valley grows enough to warrant it, Irwin said.

But Hanson’s plans are very much in the present.

Negotiations with prospective tenants, which grew tepid while development was restricted, have heated up in recent weeks, Ward said. Ward is trying to recoup some of the tenants lost when an interchange agreement with the county took longer than expected.

Several would-be tenants didn’t want to wait to build new stores. Toys R Us and Michaels, for example, had been in negotiations with Hanson, but built new stores at Broadway and Sullivan this year rather than waiting for the moratorium on construction near the mall to be lifted.

While Ward declined to name current prospective tenants, he said he’s had offers or inquiries from a grocery store, two housewares stores, two sit-down restaurants, a fast-food restaurant and two convenience stores interested in Market Pointe II, a complex across Indiana Avenue from Barnes and Noble. Clothing stores, shoe shops, coffee shops and a handful of national big-box retailers also have expressed interest.

Other prospective tenants for the future complexes include several motels, a local upscale furniture store and a supermarket that’s looking at a huge 80,000-square foot site west of where Evergreen Road will extend from the new interchange to intersect with Indiana.

Bob Boyle, vice president of Hanson Industries Inc., predicts that once the Evergreen interchange goes in, Evergreen Road will become the mall’s primary entrance. Evergreen Crossing, which has over 350,000 square feet of available retail space including the 80,000-square-foot anchor, will be located just west of the new road.

Eventually, Price Development Co. plans to expand the mall from its current 700,000 square feet to 1.2 million square feet, and add at least one additional anchor store.

Several small shops have opened in the mall in the last few months, including Gymboree, Snickerdoodles and Wilson’s Leather. The Outback Steakhouse is a prospective tenant.

Dillard Department Store, a national chain with over 250 stores, is one possible anchor candidate. Officials with the Little Rock, Ark.-based company say they’ve had discussions with Valley mall owners, but have not reached any agreements.

“We’re still working on it,” said Wes Cherry, Dillard’s vice president of real estate. “We would love to be in that market.”

Graphic with map: Valley Mall, Hanson Center and Evergreen interchange future projects