HOOD RIVER — Subject to final negotiation, a popular Hood River food manufacturer with a long tradition and national brand will purchase the Lower Hanel Mill site outside Odell from the Port of Hood River.
With one dissenting vote, Port of Hood River commissioners authorized executive director Kevin Greenwood to sign a purchase and sale agreement with Dominguez Family Enterprises (DFE) on Tuesday, Aug. 18. The vote follows a July 21 decision by commissioners to place the former mill land back on the market after an earlier agreement with Amazon lapsed, as previously reported by Columbia Gorge News.
The online retailer hoped to build a 49,000-square-foot distribution warehouse.
Instead, DFE will develop an initial 35,000-square-foot manufacturing and warehouse facility to expand its existing Hood River operations, retain approximately 60 existing jobs and create about 15 to 20 additional jobs, according to a press release issued by the port. The company also anticipates development of additional warehouse and light-manufacturing space for other businesses, the port indicated.
The company makes Juantonios tortilla chips and related products, marketed in the Northwest under the Juanita’s brand. As explained on its website, the family first visited the Hood River Valley in 1937, moved here in 1953 (one of the first three local Mexican families), then settled permanently in 1967. They began to build the company ten years later, renting a room on the Heights. Stores across the nation now carry Juantonio’s and Juanita’s brand. Juantonio’s combines the names of company founders Juana and Antonio Dominguez.
At their August 18 meeting, port commissioners reviewed three offers: one from the Dominguez Family, for $3,251,000; another, more complex combined offer from four separate but still local companies, which would have required four different purchase agreements, for a combined $2,582,997; and a third from Amazon itself, which requested an extension of the earlier agreement to April 16, 2027. In return, Amazon offered $15,000 in non-refundable earnest money, added to $65,000 already committed to the port. Amazon’s purchase offer was $3,473,910.
The combined offer was from Paul Jones of Neal Creek Forest Products, Garin Buckles of Champion Tool Storage, Jon Davies of Catapault Properties, and Cory Level of Level Excavating. They would have divided the property into four parcels.
As with all of the proposed uses, Amazon’s warehouse was allowed outright on the industrially-zoned land. Local advocacy group Thrive challenged the deal, citing traffic impact and other concerns. Hood River County’s Planning Commission upheld Thrive’s appeal, as previously reported by Columbia Gorge News, but the board of commissioners reversed that decision on Monday, Aug. 17. Amazon submitted its new proposal to the port the following morning.
Port property sales criteria do not predicate decisions on price alone, but also take into account economic value to the local community, job creation, development and financing risk, timing and “catalytic development potential,” where one company drives the creation of others.
That philosophy helped drive Tuesday’s decision.
“Dominguez is the best possible win-win situation for us,” said Commissioner Tor Bieker, noting that the Dominguez family offered $750,000 more than the combined offer — with no broker commission, since Dominguez would negotiate directly with the port. (Broker’s commission would have applied to both of the other offers.)
Another point favoring the Dominguez offer, as noted by Commissioner Kathryn Thomas, was the complexity and staff time required in developing four separate agreements for the combined offer. (Similar concern was voiced against Amazon’s proposal, which would have delayed purchase into 2027.)
“We need the cash now,” Thomas said. Sale proceeds will likely be directed to waterfront recreational improvements and the airport.
But port commissioners remained sympathetic to Amazon, saying it had negotiated in good faith, only to run afoul of local opposition.
“I do feel it’s unfortunate that we’re in this situation,” said Commissioner Kristi Chapman, suggesting the land use process should engender public confidence rather than uncertainty in the outcome. Similar concerns led Commissioner Heather Gehring to cast the single dissenting vote.
The sale represents the latest step in a port effort that began more than a decade ago to acquire, clean up and return the brownfield to productive economic use, the port said in its press release.
The Port acquired the approximately nine-acre property in July 2015 for $775,000 after years of environmental investigations of the former Hanel lumber mill site. The property had remained undeveloped in part because of environmental concerns associated with its historic industrial use, including petroleum contamination and former log ponds containing an estimated 13,700 to 15,000 cubic yards of saturated wood waste and other debris, the port noted.
The port acquired the property with the goal of cleaning it up, preparing it for redevelopment and increasing the supply of industrial land available to businesses in Hood River County. The port then partnered with the Oregon Department of Environmental Quality and Business Oregon in a recovery program, including excavation and removal of material from an old log pond and other cleanup, with cost estimated at $1.8 million. Part of this was covered by state and federal contributions.
“Cleaning up former industrial property and putting it back into productive use is exactly the kind of long-term economic development work ports are uniquely positioned to do,” Greenwood said. “The private market had struggled to overcome the environmental challenges at this site. The port was able to acquire it, undertake the cleanup and prepare it for the next generation of industrial development.”
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