Hillyard business leaders and the city of Spokane are working together on an economic-development strategy to transform the underutilized former railroad community into a more vibrant commercial and residential center.


The city has budgeted $189,000 for street and sidewalk improvements and park upgrades in Hillyard this year, and also has assigned a neighborhood planner to help property owners develop strategies to improve the area. This summer, the facades of four historic buildings in the northeast Spokane neighborhood will be restored to their original condition with the help of $20,000 in state and private grants. There also are plans for a business incubator.


We have the ear of Spokane to realize our dreams, says Paul Hamilton, a 50-year Hillyard resident and owner of an Allstate insurance agency there. There are a lot of cool things happening here.


Hillyard, generally thought of as the area between Crestline and Havana streets from the Spokane River north past Francis Avenue, has had a rough-and-tumble reputation dating back to its days as a railroad maintenance hub. Today, much of its main thoroughfare, Market Street, is dominated by antique stores, bars, and boarded-up buildings. The neighborhoods around it are a mix of blue-collar homes and nondescript commercial and industrial buildings, some on unpaved roads.


Still, inexpensive land and potentially important transportation advantages there have commanded the attention of distribution and industrial users, sparking periods of resurgence. For years, Hillyard seemingly has been poised for growth.


Its a diamond in the rough, says Melissa Wittstruck, the city of Spokanes neighborhood planner assigned to work with residents and businesses there. Its underutilized. The energy is there, and we need to build on it.


The Hillyard area already is home to several substantial companies, including food-industry players URM Stores Inc. and Pasta USA Inc., as well as Spokanes biggest biotech company, Hollister-Stier Laboratories LLC. Its also home to a host of general contractors, and the Community Colleges of Spokanes Training and Education Coordinating Center.


North-south freeway awaited


Revitalizing Hillyard has been discussed for decades, but many longtime business owners there believe a catalyst is finally approaching: the planned construction of the north-south freeway through the Hillyard neighborhood.


The north-south freeway is our economic future, says Hamilton. We have at least 100 acres of industrial land that is perfect for redevelopment. Ive been talking about this for a long time, and now its finally here.


Well, not quite here. It could be five to 10 years before construction of whats now being called the North Spokane Corridor Project reaches Hillyard, says Mike Gribner, a project engineer with the state Department of Transportation. Just when the freeway arrives depends on the availability of legislative funding, Gribner says.


So far, work on the project has been concentrated north of Hillyard where the planned new freeway would connect with U.S. 2 and U.S. 395. Eventually, the project will move south, through Hillyard and down into East Spokane, where the roadway will connect with Interstate 90.


When the project does arrive in Hillyard, freeway interchanges will be built at both Francis and Wellesley avenues, providing improved access for trucks to Hillyards industrial lands and making the district more attractive to businesses, Hamilton says.


The Francis to Wellesley piece is just one chunk, says Gribner. It could run between $30 million and $50 million. Its very hard to predict when we would start work on it.


The DOTs Gribner says Hillyard residents have been involved in planning the project from the start.


Hillyard is one of the top neighborhoods in terms of being really active, he says. Theyre getting as much influence as they can to bring prosperity there.


There are plans for a public plaza and a pedestrian-bicycle path in the area of the railroad tracks, which would be moved to the east to accommodate the new freeway, says Hamilton.


Some believe that the north-south freeway will eliminate heavy truck traffic on Market Street, giving it a more Main Street feel, and Hillyard hopes still to be able to capitalize on that re-directed truck traffic by attracting transportation-dependent businesses to the areas around the new interchanges.


In my opinion the north-south freeway will be a boon to the industrial area, says the citys Wittstruck.


Back on Market, meanwhile, less truck traffic will mean more people wanting to walk around and shop, she says.


We want to tie those opportunities into the historic business district, Wittstruck says Instead of being passed byHillyard should be a place where people want to stop. Its a real timing issue. We want to be ready when it (the freeway) comes.


Property values lag


Despite the optimism of business leaders and city officials, commercial and residential property values are substantially lower in Hillyard than elsewhere in Spokane, says Jim Orcutt, a commercial real estate agent with Tomlinson Black Commercial Inc.


Orcutt says Hillyards commercial land generally sells for between $1.50 and $2.75 per square foot, compared with the $3 a foot that land in other Spokane industrial areas fetches.


There are people in Hillyard who are thinking their ship has come in, says Orcutt. I think its premature to say, I am going to hit a home run if I buy land there.


Home prices arent skyrocketing either, says Orcutt.


The demographics are like living in the back woods of Mississippi, Orcutt says. Its a poverty-ridden area.


Still, some property owners are confident the area will improve.


Pete Rayner, a Spokane businessman and co-chairman of the Hillyard neighborhood stakeholders group for neighborhood planning, owns 195 acres on Beacon Hill, which is located just east of Hillyard and overlooks Esmeralda Golf Course.


Last year, Rayner asked the city of Spokane to amend its comprehensive land-use plan to allow for a neighborhood center on Beacon Hill, but a series of roadblocks erected by City Hall made it impossible to do so, he says. Rayner now hopes to make those changes through the neighborhood planning process. He says several developers are interested in buying the land to build single family homes.


Paving the way


Rayner also says the city shouldnt wait for the north-south freeway to divert truck traffic from Market. He believes that a temporary alternative truck route needs to be created now, by widening and improving Freya Street, a few blocks east of Market, and connecting it to Garland Avenue, which would need to be extended east about a half mile.


Meanwhile, a group of residents is petitioning the city to annex about 300 acres east of Hillyard to encourage growth and to lower the cost of water and sewer services for businesses there. The area is east of Havana Street to the base of the hills even farther to the east.


Hamilton and Rayner both say they also would like to see the city pave the streets and add sidewalks in the eastern part of Hillyard.


If all of Hillyards industrial area was paved, it would mean a huge increase in activity, and peoples perception of the quality of the area would improve, says Orcutt, the real estate agent. Theyre going to need a local improvement district to get those roads fixed. Right now, the property on dirt roads is about $1.50 a square foot.


Rayner says the possibility of forming a street LID has been studied, and it would cost about $6 million to pave all of the dirt roads in Hillyard. He says paving work also could be financed through tax-increment financing, a relatively new economic-development tool made available by the state.


As part of the effort to build new facades, Tom Weaver, who owns the 1906 Hillyard Laundry building, at 3108 E. Olympic, has received $5,000 in grant money from the state Office of Archaeology and Historic Preservation and Spokane Preservation Advocates, a nonprofit group dedicated to preserving Spokanes historic character. Hell use the money to help restore the buildings faade to its original appearance.


I am thankful for people who have been working to get this done, Weaver says. We want Hillyard the way it was. Its a disgrace what has happened here.


Weavers business, Pages from the Past, sells used books, antiques, and espresso in the building. He expects to spend another about $2,500 of his own money on the restoration project.


Were going to strip the paint back to the gray stone, Weaver says. The grant money is nice, but its only a fraction of what needs to be done.


Three other buildings in Hillyard also have received $5,000 apiece in grant money for faade restoration.


Those grants require that the work is finished by the end of July, says Weaver.


Something is starting to happenon a small scale, of course, he says. Its a step forward.


Weaver says he also has requested from the city a street cart and equipment to start sweeping in front of his building.


Were not asking for more money, we just need the equipment to do the job, he says. Were going to take care of it the way it used to be a long time ago.


Not everyone in Hillyard has embraced the revitalization projects, says Weaver.


Weve been having some problems with tenants not cooperating, he says, but I think its possible theyll see the value in this.


New historic district


In yet another step that could help Hillyard, the Spokane City Council recently approved placing a 12-building district in Hillyard on the Spokane Register of Historic Places. The area becomes the second district in the city to be added to that local register, which differs from the state and national historic registers. The buildings are located between the 4900 and 5200 block of Market Street. The buildings are close together, but theyre not contiguous.


Under the guidelines of the local historic register, owners of the 12 properties have agreed to maintain the appearance and character of their buildings.


Its rare to get so many property owners to agree to one common goal, says Teresa Brum, the preservation officer for the city and Spokane County. The historic district is a real tool for going after grant money.


Buildings in the district would be eligible for property-tax incentives for work approved by the City County Historic Landmarks Commission.


The city also received a $35,000 implementation grant from the state to help older commercial districts in Spokane, such as Hillyard, follow a revitalization plan under a Main Street U.S.A. model for such restorations. Hillyard will be the focus of the citys initial planning work and used as a model for other districts, says Wittstruck.


Tom Reese, the citys economic development adviser, says there are plans for a business incubator in Hillyard, says. A business incubator provides space, office supplies, and support staff for startups, says Reese.


Eastern Washington University, the city of Spokane, and the Spokane Area Economic Development Council are pursuing about $2 million in funds from federal sources for several planned incubators in the Spokane area, says Reese. They also will seek another $2 million from private foundations.


Some residents arent waiting for federal help or the freeway to arrive to start fixing Hillyards problems. Jim and Georgia Hedley recently bought several historic buildings on Market and plan eventually to restore them.


Hedley says he lowered the rents of his tenants after buying the buildings.


We need businesses to stay and we need more, he says. You have to create business, and I am big believer in that.