84 Lumber closes
POST FALLS - Even as construction proceeds on one big box near the state line, another is going vacant.
The 84 Lumber Co. in the Stateline Business Park on the west side of the city discontinued operations on Monday, laying off the last 10 of what had been about 20 employees at peak operation.
"The market shrank, or ceased to take off," said Jeff Nobers, vice president of corporate communications for the Pennsylvania company. "We do have to make market adjustments."
The company shut down nine other stores the same day, in Wisconsin, Mississippi, Illinois, North and South Carolina, Florida, Virginia and Pennsylvania, leaving 289 stores open in 34 states, down from 450 stores in 2007.
Some employees were asked to stay on as the company relocates its inventory to other stores. None were advised of the shutdown until Monday, Nobers said. They will receive severance packages based on length of service and be eligible for unemployment, he added.
He would not release information on payroll or sales at the Post Falls operation, but Alivia Body, economist for the Idaho Department of Labor, said an average annual wage in the industry is about $30,000. Studies indicate the layoff of 10 workers affects 17 others in sectors ranging from retail to professional services, she said.
84 Lumber opened on Oct. 25, 2005, in what turned out to be the late stages of a building boom. Contractors make up 95 percent of the company's sales, primarily in new home construction, Nobers said.
"From 2004 to 2007 the market was pretty robust," he said. "In 2006 it started to slip in a market that was far more precipitous than expected." The company tried several different angles to become profitable, including serving as a general contractor and partnering with other area companies.
"It doesn't matter who you partner with if nobody wants to build a house," Nobers said.
He estimates it will take two to three years before the housing market returns to normal.
"A couple of things happened," Nobers said. "When we opened we were seven months away from when the market started to erode. We were the new guy in town."
In some cases that sent customers back to suppliers they had worked with previously, and 84 Lumber began to "rack up losses."
Then, "the bottom fell out," Nobers said.
The lumber yard, built in one of Post Falls' urban renewal districts, which put in streets and utilities, sits on 11 acres and has a 34,500-square-foot main building, and two storage sheds of 10,800 and 12,000 square feet. All are metal construction.
When the company shuts down a store, it places the property on the market, Nobers said. The property is assessed at $3.47 million by the Kootenai County Assessor's Office.
Prospects for the sale of commercial property are limited significantly by tight credit, said Monte Risvold, who was instrumental in putting together the deal that brought 84 Lumber to Idaho.
"You never want to see one of your clients not succeed," he said.
Among the possible uses for the site would be as storage for boats or RVs, or a moving and transfer operation.
Walmart is under construction at the nearby Pointe at Post Falls, and Lowe's has signed a letter of intent to build there when that store opens, said Eric Keck, Post Falls city administrator. The home improvement company closed on the sale of the property, but with the shift in the economy it is uncertain if they will follow through, he said.
"It is unfortunate," Keck said "They were one of our larger employers. We hate to see jobs go away. They will continue to pay property taxes, but our concern is about jobs."