OREM -- Commercial activity is picking up at the 65-acre Northgate Village mixed-use project on 800 North in Orem.
Idaho-based discount grocery chain WinCo Foods began construction of its first 94,000-square-foot store in Utah County several weeks ago, and is scheduled to open in spring 2010. Negotiations to acquire an 8.5-acre lot for the store began last fall and were completed in July, said Spencer Croshaw, a real estate agent with NAI Commercial Real Estate.
The store is expected to hire about 200 workers.
"That location made sense for WinCo because it's next to I-15 and 800 North, a major east-west corridor in Orem. There's lots of traffic and visibility," he said.
According to WinCo's Web site, the company was established in 1967 when Ralph Ward and Bud Williams founded a discount warehouse grocery store in Boise, Idaho under the name Waremart. The company operated stores under the names of Waremart Food Centers and Cub Foods until 1999 when it changed its storefront name and the corporate name to WinCo Foods, which stands for Winning Company. It now operates 66 stores in Washington, Oregon, Idaho, California and Nevada and has more than 12,000 employees nationwide.
Northgate developer Paul Washburn said the recession has made it harder for retailers to get financing to expand, but inquiries have picked up over summer compared with earlier this year. Construction began about two months ago on TownePlace Suites, a 100-room Marriott brand, that's being built on a 2.25 acre lot, Reams said. "TownePlace Suites got held up in their financing last year when banks scaled back on lending. But it is now under construction," Washburn said.
"A 65-acre project like Northgate typically takes about seven to eight years to go. The Meadows mall in American Fork was a 12-year project. So we're making good time on our project," he said.
More than half of the 45 acres slated for commercial development was sold even before WinCo became the main anchor tenant, Washburn said. "We hope that within the next year, we'll finish out construction on the remaining 20 acres on the commercial site, depending on how the economy goes. About 15 of the 20 acres still needs to be sold."
Securing WinCo as a main anchor for Northgate also helped stimulate more inquiries from retailers, Croshaw said. "Without the main anchor, it would have been more difficult to entice other tenants," he said.
In-N-Out Burger acquired some land fronting 800 North and 1200 West in Northgate, but its site plan is pending city approval, said Jim Reams, Orem city manager. A Subway restaurant is also being considered for Northgate.
Matt Anderson, a broker with Spire Commercial in Orem, said PEG Development acquired about 2.5 acres of land on the corner of 1200 West and 800 North, and is planning about 8,000 square feet of retail space there.
"The recession has affected all retailers. But some segments, like lower-priced quick-serve restaurants are doing well because people aren't spending as much for the sit-down restaurant-type experience," he said. "In a downturn, land prices tend to come down. So if the restaurants can afford to expand, now is the time to do it."
He said the site is expected to be ready for occupancy in April 2010. Northgate is also looking for a small anchor for a 17,500-square-foot space adjacent to WinCo, Croshaw said. "This could be a clothing, pet supplies, hardware or other retail types."
Meanwhile, Northgate's residential component, Tuscan Villas, now consists of nearly 500 condo and townhome units, about half the size of what was originally planned because of changes in its commercial development plans, Washburn said.
"If you, for instance, have a nail salon on the main floor, it's easier to put residential dwellings on top of those. But it doesn't work well when you have WinCo.You can't stack apartments or condos on top of the grocery store," Washburn said.
By next summer, the residential project, which is currently two-thirds built, should be completed, he said.
Northgate's partners consist of Washburn, Smith & Berlin, an Orem-based land development and consulting company, and Orem-based Carter Construction, which is owned by Dennis Carter and Bill Fairbanks.
Earlier this year, Il Centro Piazza, a 72,000-square-foot office and retail building was completed. It is currently about 40 percent occupied, Washburn said.
Posted in Local, Orem on Thursday, September 10, 2009 12:15 am Updated: 2:27 pm. | Tags: Orem
© Copyright 2009, Daily Herald, Provo, UT | Terms of Service and Privacy Policy
