Another Bend manufacturing company is leaving the city to expand elsewhere, saying Bend's limited industrial land supply and the high prices that the land commands have priced it out of the market.
Ameritech Machine Manufacturing Inc., which has been in Bend six years, expects to relocate to a 2.2-acre site on First Street off Lake Road in Redmond, said Ameritech President Ron Cook. The 26,500-square-foot building is expected to be completed in April 2008, although the property sale is not final, Cook said.
"We need to grow, we need more space," he said. "And we can't do that in Bend." Light industrial space in Bend is nearly gone, economic developers say, as the city's growth has quickly absorbed available land. While space dwindled, costs shot up, says Roger Lee, executive director of Economic Development for Central Oregon, or EDCO.
In Bend, raw industrial land costs around $13 to $16 per square foot, according to EDCO, with NorthWest Crossing industrial land hitting $16 per square foot. In Redmond, prices are nearly half that - around $7 to $8 per square foot, Lee said, with some cheaper spots available, depending on location.
In October 2005, Bend Tarp & Liner announced it was being priced out of Bend and was moving its 16-person manufacturing operation to Prineville, where the new site's 10 acres cost around $2.50 per square foot. Tarp & Liner officials, like Ameritech, said Bend simply doesn't have enough space to expand. And what little space exists is too expensive to pencil out.
"It's just not cost-effective to stay in Bend," Ameritech's Cook said, joking that Bend doesn't want the company. "Redmond - they want us."
Lee says Ameritech's move is not a loss for the region because the company will remain in Central Oregon. Still, he expects more manufacturers will leave Bend until new land opens up.
"There's just no other options," Lee said. "The only new industrial land proposed to be added (to Bend) is at Juniper Ridge."
But Juniper Ridge, the 1,500-acre mixed-use development proposed in north Bend, is moving forward like a snail, Lee said, which is frustrating for companies interested in moving there. Les Schwab Tire Centers will be the first project in Juniper Ridge - construction is expected to begin this fall on its 120,000-square-foot corporate headquarters, which will move from Prineville, its home for more than 50 years.
"The only other possibility is maybe some redevelopment (of nonindustrial space)," Lee said of Bend creating new industrial opportunities.
Until then, Lee expects more stories like Ameritech and Bend Tarp & Liner.
"This is probably a sign of things to come in the Old Mill District," he said, "where they still have bits and pieces of land for light industrial use ... it probably will eventually all go away."
Ameritech's new space will cost $1.5 million, including the land and building, Cook said, and will create much-needed room for the company that makes structural steel and ornamental iron parts, like support columns and stairs on homes. The company also designs and builds equipment for the steel processing industry, like roll formers, flatteners and uncoilers, Cook said.
With the expansion, Cook's 16-person staff will increase to 25 to 27, he said.
To help fund the Redmond development, Gov. Ted Kulongoski awarded Ameritech a $33,000 forgivable loan Thursday. Kulongoski awarded the loan through the Oregon Economic and Community Development Department. A forgivable loan is one with no repayment obligation if a project meets certain requirements necessary for the loan.