A previously distributed artistic rendering shows what the completed Centralia Station Project, could look like.
The future of the long-promised Centralia Station project is up in the air following the announcement Friday that negotiations between developer Powell Development and Fred Meyer for a 175,000 square-foot anchor store are over.
The two parties had been in talks since March 2017, when the Port of Centralia entered into a real estate and purchase agreement with the developer for about 28 acres of land near the Interstate 5 interchange at Mellen Street. A 2017 study by ECONorthwest estimated Centralia Station, when completed, would produce $118 million in local sales and employ more than 500 people.
Kyle Heaton, executive director of the Port of Centralia, told The Chronicle earlier this month that he hoped to complete infrastructure development on the site by the end of next year. Powell has about 90 days to find another anchor tenant before its contract with the port expires and it could walk away as well.
“I know they’ve been reaching out other potential anchors and trying to backfill and see what a product mix would look like with a different anchor,” Heaton said. “Obviously as you go with different shopping developments and what locates well with different anchors, there’s some crossover. I think they’re trying to get their arms around it right now to try and come through with a replacement.”
According to Heaton, the developer first informed the port about a month ago that talks could go awry, an outcome which became clear within the past week.
The news caught local civic leaders by surprise Friday afternoon, including Matt Matayoshi, executive director of the Lewis County Economic Development Council.
Matayoshi had no comment when first reached by The Chronicle, but called back a few minutes later.
“It’s unfortunate,” Matayoshi said. “The port has worked for a number of years on the project and we’re hopeful there will be future opportunity, or another project comes along, and that as a community, we’re able to attract future retail or commercial development to the area.”
Asked what most caused the retail giant to end negotiations, Heaton said there was no question in his mind that delays in the permitting process at both the city and county level proved fatal in talks with Fred Meyer.
“It’s taken a very long time and the project faced headwinds at the beginning with needless appeals from Lewis County,” Heaton said. “We’ve tried to stress to the permitting agencies that time was of the essence. … Perhaps we were ambitious in thinking some of the agencies would understand it was a benefit to the community to expedite things.”
The land in question was among the hardest hit by the historic flood of 2007, which left houses in the area completely uninhabitable. Concerns about the environmental impact of such a large development there led Lewis County to appeal the State Environmental Policy Act (SEPA) determination by the port that the Centralia Station would not have an adverse effect on the environment.
That appeal was denied in 2014. The Centralia Station land was later annexed into the city of Centralia following another appeal by the county, this time to the Washington State Boundary Review Board of Lewis County.
“We don’t like losing any businesses in Lewis County,” said Lewis County Commissioner Edna Fund. This is really sad.”
Another major hurdle was a stated need for a new off-ramp from I-5 at Mellen Street that would connect with Centralia Station. The port received a permit for the ramp in Sept. 2017 from the Federal Highway Administration, but construction has yet to begin.
“We would like to thank Sen. John Braun, Rep. (Ed) Orcutt and Rep. (Richard) DeBolt for their assistance in securing infrastructure funding for the site,” Heaton said in a press release. “Whether the project moves forward as mixed-use or industrial, these funds will not go to waste in the Port’s efforts to create job opportunities and expand the tax base for our community.”
The three state legislators helped secure $3.1 million in state transportation funds for the I5/Mellen Connector Project earlier this year.
Should Powell Development step aside, Heaton said he expects the port would hit pause and reevaluate the best use of the site. He mentioned the presence of railroad tracks on the east side of the property that could prove enticing for an industrial tenant.
Peter Abbarno, a Centralia city councilor, deemed the news disappointing, but not terminal for economic development both on the Centralia Station property and the city as a whole.
He expects city officials to work with the port and other parties to find alternatives to Fred Meyer and additional options for the land if needed.
“I would caution people against throwing up the white flag when they hear this news,” Abbarno said. “It’s a blow, and it’s unfortunate, but that doesn’t mean people should stop working on that property or other opportunities throughout the city. … You may have some people using this to call time of death, but it’s not. It’s unfortunate, but there are other opportunities out there.”
