Kitsap Peninsula Business Journal
9-6-2002
Silverdale’s empty big boxes
slowly but surely filling up
Kitsap Sports expanding into Homelife space
Rumors flying about HomeBase site and new tenants at Kitsap Mall
By Beth Taylor
   Don’t hang out the “No Vacancies” signs yet at the county borders, but retailers in Kitsap County are busily snapping up real estate and spreading their wings at other existing locations.

Kitsap Sports will nearly triple its current 12,500 square feet when it moves into the old Sears Homelife building in Silverdale this fall. The store shut its doors last year when the struggling national chain, HomeLife Furniture Corp., declared bankruptcy. A number of mega-stores in Kitsap County have closed over the past two years as the recession has forced their parent companies to take drastic steps. But for locally owned Kitsap Sports, the departure of HomeLife created the perfect opportunity to purchase a roomy new space.

“We’re in the middle of demolition right now,” said David Degarimore, whose grandfather started the original Kitsap Sports on Callow Avenue in Bremerton in 1946. “We’ll probably open in November.”

The Degarimore family closed the Bremerton store two years ago to focus on their current retail space in Silverdale, which has been open for a dozen years. The spacious new store will have room for a widely expanded selection of sporting-goods merchandise, plus a new element: interactive sports experiences, right inside the store.

“We’ll be offering indoor baseball, a driving range, and an indoor skateboard park,” said Degarimore. “Our goal is to have customers come here and have a good time. Why would they buy from another retailer when they can come and try out some products? This makes shopping more fun.”

And customers will have lots of extra elbowroom, something that’s lacking at the existing store.

“They’ve been undersized for a long time in the strip center where they’re located,” commented Dan Engelhard, manager of Kitsap Mall and Kitsap Place. “This will certainly be a big expansion for them.”

Interactive fun is an idea that has been championed by REI, the popular Kent-based outdoor-gear stores, but Degarimore says his store will not become an REI clone.

“I think it’s far beyond what REI is doing,” he said. “I’ve never seen anything quite like what we’re going to do. Ours is really focused on all ages of customers having a great time.”

Darryl Piercy, the director of long-range planning for Kitsap County, believes the Degarimores’ expansion plans will be warmly received by local residents: “I think this will be a great thing for the community.”

Another warehouse-size space, the former Krauss Furniture store, has also found a new occupant. It was transformed this summer into a Party City franchise. And as for the old HomeBase, a whopping 113,000-square-foot building, a couple of unconfirmed rumors are circulating in local real-estate circles. One theory is that Costco may be eying the space for its upcoming venture into the furniture business. The Issaquah-based volume-discount retailer has already announced plans to open its first furniture and appliance warehouse at the vacant HomeBase store in Kirkland.
Or, if not furniture, the Silverdale warehouse could end up housing groceries.

“I have heard that Fred Meyer was looking at the HomeBase store with the idea of putting a parking lot on the property on the north end,” said Rich Rucker, with The Rucker Group.

Furniture stores like HomeBase typically lack adequate parking for a business such as a grocery store, which attracts much larger volumes of customers. Because of that, there has been some concern over the suitability of the building for most prospective tenants. But Rucker has heard that Fred Meyer may be talking with the owner of adjacent property, which could be turned into a parking lot.

Also unspoken for is the former Good Guys store in Silverdale, yet another of the national chains that closed many or all of their mega-stores during the economic hard times.

But that doesn’t hold true for every retailer. Some are even expanding. Lowe’s hardware, for instance, is making solid progress on its new store on Highway 303.

“It’s proceeding and getting closer to completion,” said Piercy. “It’s a considerably bigger building than their current location just inside the Bremerton city limits.”-

And the Wal-Mart in South Kitsap is still moving toward expanding onto the 8 acres it bought for $909,000 two years ago, right next to its store on Bethel Road.

“I think their intent is to add groceries and become a superstore,” said Piercy. “I suspect they want to get going quickly.”

Another long-vacant spot is likely to have a new tenant soon. Kitsap Place, which several years ago lost a Navy contractor that was occupying a good deal of space, expects to sign a new anchor very soon, said Engelhard. The company’s name has not been released yet, though rumor has it that the tenant will be Michael’s Arts and Crafts store.

Finally, there’s a lot going on at Kitsap Mall, where Sears just spent $3 million remodeling its store and several new leases have been signed. One of the most popular new shops is the 3,000-square-foot Kitchen & Company, according to Engelhard.

“It’s a great store, and we’ve had a great response by the public,” said Engelhard. “People are really excited about having a gourmet kitchen store in Kitsap.”
Coming soon is a VoiceStream T-Mobile, and after the first of the year, an Anchor Blue clothing store.

 “We get phone calls all the time wondering how come Kitsap is doing better than so many other malls,” said Engelhard. “Part of it is the stability of the military, and also the other growth going on in the county, especially compared to other parts of the country that have been harder-hit.”

Indeed, Kitsap’s economy continues to pick up steam faster than its neighbors across the Sound. July figures show Kitsap’s unemployment rate at 6 percent, compared to King County at 6.4 and Snohomish, hit hard by the Boeing layoffs, at 7.6 percent. Jack Schillinger, an economist with the state of Washington, said repair work at the Naval Shipyard should help keep Kitsap’s economy growing steadily for the next few years.

Notes Engelhard: “Clearly, the military economy continues to be one of the major forces driving the economy in Kitsap. For a long time, we were behind the (economic) curve, but now we’re having our little wave, and we’re hanging on.”.