Sierra Pacific Industries will buy the Riverside Industrial Park for $24 million and build a new mill and power plant

  • By Mike Benbow / Herald Writer
  • Tuesday, February 1, 2005 9:00pm
  • Business

The Port of Everett agreed to sell its Riverside Industrial Park for $24 million Tuesday to a California firm planning to build a modern sawmill.

Sierra Pacific Industries agreed to buy 106.8 acres of the property for $11.18 million and to pay $256,400 on an option to buy the remaining 54 acres later for $12.82 million.

“We’ll build something here you can be proud of,” Red Emerson, president of Sierra, told the three port commissioners after they approved the sale. “We’re very excited about it.”

The company plans to spend $60 million to $100 million building a sawmill designed to work with smaller logs. In addition, it will use the wood waste to create 25 megawatts of electricity, 7 megawatts that will power mill operations and 18 megawatts that can be sold on the open market. A megawatt provides enough power for about 1,000 homes.

The 200 direct jobs will pay an average of $17.80 an hour and include full benefits, said Eric Russell, the port’s property and development manager.

During Tuesday’s port meeting, the commissioners held a public hearing, then changed the agency’s comprehensive plan, declared the property surplus and approved the sale agreement.

Only two people spoke during the hearing. Kevin Duncan of Arlington asked how much the port had invested in preparing the property for sale and Tom Foster of Stanwood asked how long the property had been available for sale, as opposed to just a lease arrangement.

Russell said the port had spent $19.5 million to purchase the site from the Weyerhaeuser Corp. and prepare it for reuse and that the port had always been willing to listen to either a lease or a sale proposal.

After the port meeting, Emerson said the two-part purchase agreement was for business reasons and “there is no question that we’ll buy all of it.”

He said he expected to have the construction permits within three to six months. “We will vigorously start construction right away,” he said.

The number of jobs – 200 – is dramatically less than envisioned by port officials when they bought the property and developed it for an industrial park. Estimates called for at least five times that number through leases to companies in light industry or the distribution business.

“It’s a different use than what we anticipated, but that never bore fruit,” said Commissioner Jim Shaffer. “There are too many (business park) properties put on the market by the Boeing Co. and high-tech companies that are still empty. There are vacancy signs all over the place.

‘We’ve had lots of different offers down there, but they’ve been flaky deals,” Shaffer added. ‘These folks are the most solid.”

In addition to questions about whether the port could create more jobs on the property, critics have raised concerns about whether the high volume planned by Sierra would bid up the cost of timber and harm other mills in the region.

Sierra Pacific has 12 mills in California and another near Aberdeen. In 2003, the company had $1.4 billion in sales. Officials said they expect to use 150 truckloads of logs each day at the Everett site.

Asked about the company’s possible effect on timber costs, Commissioner Phil Bannan had this to say:

“They’re a good buyer who wanted to pay a good price for it (the business park) and create some jobs. I’m all for it. If there are some ripples throughout the industry, so be it. These guys may be a big fish that didn’t exist in the pond before, but it seemed like the right thing to do.”

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