Regional report: Valley city evolution


1012 ValleyCityEvolution 07The midtier cities of Salem, Albany, Eugene and Springfield look to retooled identities as the key to stronger economies.

Share this article!

BY LINDA BAKER

1012 ValleyCityEvolution 01
The Broadway Commerce Center, a project of Portland’s Beam Development, opened in downtown Eugene last fall and has attracted a range of technology, design and architecture tenants.
// Photo by Sierra Breshears

The Willamette Valley is noted for its rich farmland, world-class wineries and charming covered bridges and byways. But if the region attracts plenty of accolades, the midsize cities themselves tend to fly under the radar. Portland generates its own gravitational forces, attracting and spinning out all that is green, tech-driven and hip. But the smaller I-5 corridor cities — Salem, Albany, Eugene and Springfield — don’t get a lot of buzz, and not just because of their size. Lacking a clearly defined “brand” — the rugged individualism of Bend, the tourist orientation of Cannon Beach — these midtier urban areas occupy a relatively amorphous role in the Oregon popular imagination and post-recession economy.

Salem is at once the seat of state government, a center for agriculture and a commuter destination for Portland residents, says John Wales, Salem’s urban development director. But as the Salem economy continues to founder, “We’re really trying to figure out what we do well and who we are,” he says.

In search of the corridor-city identity, we traveled down I-5, stopping in Salem, Albany, Eugene and Springfield. Snapshots of each town reveal different approaches to brand development, along with a few challenges and success stories. Salem is pursuing economic-development strategies that specifically represent the state’s second-largest city, Albany is evolving beyond its heavy-industry roots, and Eugene and Springfield are experiencing a long-awaited downtown renaissance. Collectively, these changes spotlight the evolving identity of a region often described in context of the surrounding landscape and not the individual character of its cities.

 


 

Salem: A city in search of itself

1012 ValleyCityEvolution 04
Above: James Kohn is co-owner of Wandering Aengus Ciderworks, one of a growing number of small, value-added food and beverage processors springing up in the Salem area. 
Below: Salem architect Alan Costic (left) and property owner Eric Kittleson are among a group of downtown business leaders proposing an ambitious garden-based streetscape project for the central core. The project is intended to help revitalize downtown and make the city a destination.
//Photos by Eric Näslund
1012 ValleyCityEvolution 06

In the basement of one of Salem’s historic buildings, Carole Smith, a downtown property owner, is talking about one of the main problems facing Oregon’s second-largest city. “We’re always saying: ‘Portland does this, Portland does that.’ We need to come up with our own solutions.”

Forty miles from PDX, Salem suffers a bit from low self-esteem and dependency issues, especially where its bigger, brasher neighbor to the north is concerned. But in a city where the economy has yet to improve — the unemployment rate is 9.6% — there are signs Salem is ready to carve out its own identity, one based on the city’s unique assets. Two very different initiatives — a city loan program that so far has funded value-added food businesses and an ambitious streetscape plan — are indicative of this approach.

Home to NORPAC Foods, Truitt Brothers and other food-processing giants, Salem is now supporting smaller specialty food and beverage companies that capitalize on local, sustainable food trends. A case in point is the Fairview Urban Renewal Area small-business pilot program, an initiative that offers loans to existing manufacturers in need of capital to grow, then forgives up to 70% of the loan in exchange for job creation. So far, the program has awarded loans to three food and beverage companies, says Wales, the city’s urban development director.

“Our goal is to grow the next Kettle Chips,” he says, referring to the Salem-born company, now owned by Diamond Foods. One potential candidate is Wandering Aengus Ciderworks. The artisan cider company grossed $500,000 in 2011; that figure is expected to exceed $1 million in 2012, says marketing director and co-owner James Kohn. For his part, Kohn would like to see Salem convert some of the surrounding grass-seed farms to specialty apple orchards. “We’re trying to sustain growth in locally sourced products,” he says.

Across town, business owners in the central core are working on another Salem-sourced project, a streetscape plan built around the vision of Elizabeth Lord and Edith Schryver, renowned garden designers who lived in Salem in the early 1900s. Linking Riverfront Park to the capitol, the gardenscape would put a local stamp on the downtown revitalization trend, says Eric Kittleson, president of the board of the Downtown Partnership. By drawing tourists who visit the Oregon Garden in Silverton, and helping Salem Hospital and Willamette University attract high-caliber employees, the landscaped downtown would also “be a huge driver for the Salem economy,” says Smith. Supporters hope to tap urban-renewal funds for the project, says Kittleson.

So far, more traditional downtown drivers have stalled. The Rivers, a high-end condo building, has sold only a few units; the long-anticipated mixed-use redevelopment of the old Boise Cascade mill is on hold. “We don’t have much to comment on at this time,” says Jason Tokarski, VP of Mountain West Investment, which purchased the site in 2007.

The city has other Salem-branded projects in the works, including putting the finishing touches on a unique 100-acre wetland in the 650-acre Mill Creek Corporate Center, the largest industrial site on the I-5 corridor between Sacramento and Canada, according to Wales. As the city moves ahead with these and other strategies, business leaders are trying to keep one guiding principle in mind. “We shouldn’t be advertising we’re close to Portland,” says Ray Burstedt, president of SEDCOR, a local economic development nonprofit. “We need to focus on who we are.”


 

Albany: Mill-town transition

1012 ValleyCityEvolution 03
 Above: Historic downtown Albany is attracting a growing numer of upscale shops and restaurants, part of an urban-renewal goal to draw more people to the central core.
Below: There are 23 restaurants in downtown Albany, including Sybaris Bistro, owned by James Beard nominee Matt Bennett.
//Photos by Sierra Breshears
1012 ValleyCityEvolution 08

This past winter, an entirely new kind of business set up shop in Albany: Seattle-based EnerG2, a green nanotech startup that develops engineered carbon material for energy storage. The company benefits from the presence of Albany’s wood-products companies, which supply raw materials used in manufacturing, says plant manager Shaun Mortensen. EnerG2 employs about 25 people and already plans to increase capacity next year.

Albany’s economy is rooted in heavy industry and wood products. But the decline of the timber industry — symbolized by the closure of the International Paper mill in 2009 — has dealt a blow to that identity and the local economy. Over 40% of the jobs lost in Benton County were in wood products. Heavy-metals companies such as Wah Chang have also sustained job losses. Meanwhile, the housing-market collapse undercut Albany’s reputation as a mecca for antiques shoppers. Pre-recession, there were 15 antique stores downtown, says Oscar Hult, executive director of the Downtown Association. “Today there are four.”

Some of Albany’s traditional economic drivers are in decline. But a new generation of businesses is helping offset those losses, building on the city’s core strengths while also diversifying the city’s brand. For example, EnerG2 chose Albany in part because of the city’s reputation as a material-processing center and proximity to Oregon State University in nearby Corvallis. Vice president of manufacturing Phil Souza says the company also collaborates with Oregon Freeze Dry, which is building a new facility focusing on novel freeze-dry pharmaceutical technologies. The plant will employ about 35 people.

New types of businesses are also opening in Albany’s historic downtown, where a decade-old urban-renewal effort has created a mix of charming, renovated historic buildings. Capitalizing on the mid-Willamette Valley craft-brewing craze, Deluxe Brewing Co. and Sinister Distilling will open this fall. Another new establishment is Sweet Red Coffee & Wine Bistro, serving contemporary cuisine such as roasted asparagus with balsamic chili reduction and mushroom fondue. Albany has always been a French fries and bar food kind of town, says owner Cindi Alire. “I want people here to experience something out of their comfort zone.”

Not all downtown real estate is thriving. The WheelHouse, a sleek new waterfront office/restaurant/retail building, was completed in 2010 but, so far, has attracted only one tenant. Law firms, stockbrokers, restaurant owners and other prospective renters are “being cautious and conservative,” says developer David Johnson, who financed the $7 million building by selling a custom-packaging company he founded. Still, he’s optimistic about the future.

Albany is changing; it’s becoming a bedroom community for Corvallis and attracting more people interested in downtown amenities. Besides, says Johnson, pointing to sweeping views of the Willamette, the central core has a precious resource few communities possess. “There are only so many natural waterways,” he says.


 

Eugene/Springfield: Downtown rising

1012 ValleyCityEvolution 02
Above: “There are a lot of creative young people living near downtown Springfield, but there’s no place to go,” says Bart Caridio, the developer behind Plank Town Brewing Co., a brewpub scheduled to open on Main Street this fall.
Below: Developer Steve Master is building several mixed-use projects in downtown Eugene, including First on Broadway, which will house the Bijou Metro cinema and a bar and restaurant on the ground floor, with 16 apartments above.
// Photos by Eric Näslund
1012 ValleyCityEvolution 05

Bart Caridio abides by the brewpub theory of urban revitalization. Over a decade ago, the Cottage Grove businessman helped open Sam Bond’s Garage pub in Eugene’s Whiteaker district, and helped transform a languishing, crime-ridden community into one of the city’s hottest neighborhoods. This month, Caridio is opening Plank Town Brewing Co. in downtown Springfield, a neighborhood that, until recently, was known for its drug use, fights and prostitution. “It’s the right spot for business,” says Caridio. Plank Town, he says, “is going to be one of the premier brewpubs in the state.”

Defined by their proximity to the University of Oregon, Eugene and Springfield have struggled to develop their downtown districts into thriving business and social centers. For decades, strip clubs and bars have dominated Springfield’s central core. In Eugene, various downtown redevelopment schemes, most notably the failed pedestrian mall, never evolved into the desired urban catalyst.

Now, despite the recession, both downtowns appear to have turned a corner. In Eugene, more than $100 million is being invested in the central core. The roster of projects that have recently opened or are under construction include: the Broadway Commerce Center, a renovation by Portland’s Beam Development; a new Lane Community College campus; the Inn at the 5th, the city’s first luxury hotel; and a new 255-unit student-housing project.

In Springfield, new development includes the Hatch business incubator run by NEDCO, a neighborhood development corporation; a campus for the public charter school, the Academy of Arts and Academics, to open this fall; and Vino and Vango, a small business that offers wine and painting parties and classes. The former First Christian Church is also being remodeled and will house a year-round farmers market and an industrial central kitchen.

Local developers and business owners credit public officials for catalyzing the urban renaissance in both cities. “You need the public sector to come in and partner. Without that, these projects wouldn’t happen,” says Steve Master, the developer of Park Place, a luxury apartment building that opened in Eugene last month. A low-interest loan from the city and a multiunit tax exemption helped make the project pencil, says Master, who is building another project downtown, the Broadway Lofts.

The spate of development in Eugene “is no accident; it’s a huge investment on the city’s part,” says Denny Braud, a development analyst in the city’s planning department. The city was the sole lender on the Beam project and contributed $8 million in urban-renewal funds to the community college campus.

For his part, Caridio applauds Springfield officials for “getting behind the local economy” and creating a more positive climate on Main Street. The city launched an aggressive and successful three-year campaign to get rid of the problem bars and strip clubs, partnering with the Oregon Liquor Control Commission to challenge each establishment’s liquor license. The city also cut the cost of building permits in half, Caridio says.

The simultaneous rise of the Eugene and Springfield downtowns reflects the growing affinity between the two cities, which partnered on a regional-prosperity summit and a regional-food consortium. The expanding EmX bus rapid transit corridor and a planned mixed-use district in Glenwood, located between the two cities, also help solidify the relationship. As Eugene and Springfield strengthen their identities, they also are creating a stronger presence for the entire region.

There are “real opportunities” happening in both cities, says Shane Johnson, COO of Angle, a tech startup in Eugene’s Broadway Commerce Center. “Anytime you get a brewpub rather than a strip club,” says Johnson, “you’re getting ahead.”

Linda Baker is the managing editor of Oregon Business. She can be reached at [email protected].




Latest from Oregon Business Team