Plans for possible Liberty Lake Costco scrapped

Spokane-area shoppers who buy in bulk apparently will not be getting a new option in Liberty Lake.

A third-party company, which signed a purchase agreement for a large tract of land in Liberty Lake for what reportedly was a new Costco location, recently backed out of the deal, meaning the retail giant won’t be expanding in the area anytime soon.

“At this point, it is not going forward,” said Doug Yost, vice president for development and acquisition for Cowles Real Estate Company, which owns Centennial Properties.

Centennial owns the roughly 38 acres south of Interstate 90. It’s situated north of East Country Vista Drive and west of North Kramer Parkway and just northeast of Ridgeline High School.

Yost said he could not identify the retailer as Costco, under agreement with the third-party company, but plans filed with Liberty Lake called for a 167,000-square-foot building and 24-refueling stations, which is nearly the same size as the Costco built in 2018 at 12020 N. Newport Highway.

The third-party company had sought a zoning variance that would have expanded the fueling stations, but it was rejected by Liberty Lake planners.

“I don’t think that was the deciding factor in them not moving forward,” Yost said. “It didn’t help.”

Lance Beck, president and CEO of the Greater Spokane Valley Chamber of Commerce, said that site would work wonderfully for an anchor retailer that could have generated enough sales tax revenue for Liberty Lake to tackle any number of ongoing needs.

“It’s disappointing to hear the retailer is stepping away from the process at this time,” Beck said. “I guess on some level I remain hopeful” that the company could return to the table. “It’s still the right place for growth in this region.”

Steve Daines, designated broker for Daines Capital, has marketed property adjacent to the Centennial site and said it remains highly sought for development.

“It was a surprise to me,” Daines said of learning about the Costco decision. “It’s too bad that Costco won’t anchor it, but other people will come in and scoop pieces of it up. Unless (Centennial Properties officials) want to hold out for a big box retailer, there are lots of smaller groups who will want to scoop that up.”

Yost confirmed Daines’ assessment about discussions with other potential buyers. Yost works for Cowles Real Estate, which is a subsidiary of Cowles Co., which owns The Spokesman-Review.

“I’ve already received a lot of interest,” Yost said. “There was a lot of interest when it was under contract, too.

“It’s a great area. Once we get it developed, its going to be a really nice attribute to that area.”

While he was not part of the discussions or decision to pull back, Yost said the price of development appeared to play a part.

“I think the main reason was just the cost of construction has gone way up in the state of Washington. That coupled with the tax base and trying to make everything work created a situation where it increased their costs,” he said. “That caused them to re-evaluate.”

The contract for the land was terminated near the end of October. Asked if he believed the company was looking at a different site for a Costco elsewhere, Yost said he didn’t think so.

“It was more of a take a step back and re-evaluate,” he said.

Beck, the chamber CEO, said he hopes that means the door remains open for the third company to return to the table.

“You are never there with a development until the building is up and the doors are open,” he said, “and you are never fully away until something else is built.”

Beck noted that the property remains one of the few large, undeveloped parcels along the Interstate 90 corridor.

The Costco “would have been a tremendous win and an incredible project for the community of Liberty Lake,” Beck said. “You always want to see property go to the highest and best use.

“I’m confident in their team that they will come up with the best fit.”

Costco’s representatives reportedly also looked at property in Post Falls without making a deal.

“There is not perfect ground on the other side of the border, so we remain an attractive option to them,” Beck said. “I don’t think we’ve heard the last of what is going to be transpiring” at the Liberty Lake site.