A spring luncheon hosted on April 26 by the Columbia River Economic Development Council (CREDC) offered several experts’ insights into Clark County’s economic prospects. Held at the Heathman Lodge, the luncheon titled “Charting Economic Vibrancy” was attended by more than 100 people.
Delivering the first address, Washington Lieutenant Governor Denny Heck pointed out that he is the first native of the county to be elected to statewide office in almost a century. He praised the developments that the county has seen since his childhood here, with a population five times larger, more educational and business opportunities, and what he dubbed the “crown jewel,” the Waterfront development, with which the county “finally capitalizes on its location” by the Columbia River.
But Heck stressed that cooperation and determination are necessary in order to move ahead on priorities for the immediate future, among which, he said, “none is greater than solving the housing crisis.” He said that economic development professionals routinely cite the lack of housing as a prime barrier, and pointed out that families of color are disproportionately affected by this.
He also said a new river crossing, linking Washington and Oregon, is “long overdue.” Debates over its specific details must be overcome, he said, because “the best bridge is the one that gets built.”
Speaking on behalf of Greater Portland Inc., an economic development agency focusing on the area, Bret Marchant, director of data and research, said Clark County’s population is growing at a rate significantly higher than Washington as a whole or the entire US. It added 13,470 residents between April 2020 and July 2022.
Non-farm employment in the county grew by 15,600 or 9.2% from February 2020 to February 2023, a growth rate higher than the national average, he said. Indeed, the County’s job growth rate was the fastest of any county in Washington, both in the period after the 2008 recession and during the COVID-19 recovery period, he said.
But he pointed to persistent racial disparities in the poverty rate. While 1 in 5 Hispanic/Latino population members are living in poverty, the figure for the non-Hispanic White population is about 1 in 13.
While healthcare and social assistance is the biggest category of employment in the county, Marchant noted that the economic profile is shifting, with fast growth in the numbers of people employed in services and construction. Among the seven counties of the Portland metropolitan area, Clark came an impressive third in the 2021 volume of exports, driven by electronics and machinery, Marchant said, noting that a single company – Intel – played a big role in that. He pointed to semiconductors, computer services and software as promising growth sectors.
The real estate company CBRE was represented by two speakers at the event. Kristin Hammond, a senior vice president in the Portland office, spoke about office space, and Stuart Skaug, an executive vice president, also based in Portland, discussed industrial property trends.
Hammond said the office space picture at the moment suggests a stronger market in Vancouver’s central business district than that of Portland. While Portland’s 29.8 million square-foot inventory includes 6.5 million that is currently available, Vancouver’s downtown has just around 194,000 square feet available from a total pool of 3.4 million.
Vancouver’s relatively small size means one big company can have an outsized impact on the market, with the business data firm Zoominfo set to “flood the market” with class-A space once it vacates its current location to move into a new building currently under way, Hammond said. However, she also noted that, with remote work highly popular since the COVID-19 lockdown, the company may not need all the space it has commissioned, which might further boost the amount of vacant office property it unleashes.
She echoed Heck’s comments about the importance of a new I-5 bridge over the Columbia, calling it a “critical component to commerce and growth.” A more modern bridge, she said, will make a tangible difference to companies’ decisions to expand to this side of the river as a supplement to their present Portland-based operations.
On the negative side, she said ESSB 5096 – legislation that introduced capital gains tax in Washington starting last year – could be a factor discouraging moves to the state. Meanwhile, she said that business growth is impeded at present by a depressed level of venture capital and private equity activity. She noted that such financial sources had been a big part of the early story of Zoominfo, a company now generating a lot of local tax revenue.
While Clark County is well positioned to benefit from inward migration of businesses and residents, Hammond cautioned that it should not “get too comfortable,” but, instead, needs to create more office property to welcome newcomers and should “not make permitting harder” for real estate developers.
Moreover, she said that to take advantage of economic trends, Clark County could benefit from its educational institutions offering more training in promising jobs such as nursing or healthcare technician.
Skaug painted industrial development as a fast-growing area in recent years, noting that COVID-19 was “like rocket fuel” in that it drove a growth spurt in e-commerce. Clark County has hit an all-time low vacancy rate of 2.6% in industrial properties. However, he said that the boom in e-commerce may have been insulating the market from a negative shift that is coming soon. At present, there is not much fresh development happening in the segment, he said, with many developers holding back the groundbreaking of their projects until 2024 or later in an uncertain market environment.
Skaug also said the traditional factors that have attracted industry to Clark County have been a plentiful supply of cheap land, low taxes, and good transportation infrastructure. But he said the county must work to keep on attracting and retaining investment, including by creating a more predictable policy environment and streamlining the permitting process. He talked of a need for local educational establishments to focus more on training people for manufacturing opportunities, which he called “a big growth area in new leases.”
Summing up the event, CREDC Chief Executive Officer Jennifer Baker said this is no time for Clark’s leaders to be complacent or settle for being “middle of the pack.” She echoed the guest speakers’ remarks about the importance of transparency and a streamlined permitting process to “roll out the welcome mat to businesses.”
The CREDC promotes cooperations between the public and private sectors to advance regional economic growth. You can learn more about the Columbia River Economic Development Council at www.credc.org.
