12 minute read
The Shoppes at Sun Mountain
A rendering of the Shoppes at Sun Mountain.
Cameron Johnson | A&C Investment Group
The Shoppes at
Sun Mountain
Wasilla grows with first Sonic, a Planet Fitness, retail, residential options
Alaska Business R eal estate developer Cameron Johnson is building a mixed-use walkable community amidst one of the last large pieces of undeveloped land along the Parks Highway in Wasilla. His plans for the thirty-two acre Shoppes at Sun Mountain include the first Sonic Drive-In restaurant in Alaska, other restaurants, professional offices, a Planet Fitness gym, townhouse condominiums, and senior housing.
“There really isn’t anything else in the
A rendering of The Shoppes at Sun Mountain.
© Cameron Johnson | A&C Investment Group
Valley that has that walkability factor, where you can walk out your front door and walk to the gym, go shopping, have lunch, go to the bank, and everything is within walking distance. That’s what we want to develop,” he says.
Missed Opportunity
A rendering of The Shoppes at Sun Mountain.
© Cameron Johnson | A&C Investment Group
Cameron Johnson Co-owner, A&C Investment Group
20 | September 2019 Warehouse, the Windbreak Hotel, and homes. The location is just east of downtown Wasilla, among a cluster of large retail stores that include Target, a Walmart Supercenter, Fred Meyer, and Lowe’s.
More than a decade ago, there were plans to develop the site into a Costco store. When the Great Recession hit,
Alaska Business the former developer’s lender, First National Bank Alaska, foreclosed on the property.
Johnson grew up in Wasilla back when the main retail shopping was an indoor mall, which has since been demolished and is now the site of the Wasilla Target. Today, Johnson lives in Southern California where he is co
www.akbizmag.com owner of A&C Investment Group. The majority of A&C’s business is developing residential properties in California. The company has also worked in Arizona and Utah.
In 2011, the company started working in Alaska’s Matanuska-Susitna Borough, an area in which Johnson sees a lot of potential.
“The population continues to grow, and with it is going to come infrastructure and more commercial amenities,” he says. “There’s [also] a sentimental value to me. I want to help grow our community. It’s my community.”
A&C Investments has developed more than 300 housing units in the Mat-Su Borough, much of it new construction, Johnson says. The company also recently purchased Settlers Bay Lodge, a Wasilla steakhouse.
The Shoppes at Sun Mountain : is the largest commercial project A&C Investment Group has ever undertaken. Johnson estimates it will cost between $50 million and $60 million to construct all the new buildings and associated infrastructure. Because most of his experience is in residential development, Johnson partnered with Anchorage-based commercial broker Jack White Real Estate on the project. The general contractor is H5 Construction, a Wasilla-based construction company that Johnson helped found in 2012.
Breaking Ground
Johnson began thinking about buying the site of the failed Costco development starting in 2011. In 2018, demand for new commercial buildings in Wasilla convinced him it was the right time to buy and develop the lot.
“We were getting so many calls from businesses looking for something newer, bigger, [in a] better location. And we didn’t have many sites,” he says. A&C acquired the property in May 2018. In addition to the original plot that was planned for Costco, A&C purchased two adjoining parcels for a total of thirty-two acres.
During the first year, construction focused on grading and utility work. Vertical construction began this spring on the first two buildings: the Planet Fitness gym and the Sonic Drive-In.
Persistence Pays Off
www.akbizmag.com The first business to open at The Shoppes at Sun Mountain will be the Sonic Drive-In. Construction started earlier this summer, and owner Larry Clark said in mid-July he anticipated
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An aerial view of the space cleared for The Shoppes at Sun Mountain in June.
© Cameron Johnson | A&C Investment Group
Lyn Carden, City of Wasilla Deputy Administrator
22 | September 2019 opening the restaurant in late August. Sonic is a 1950s style drive-in hamburger restaurant known for its roller-skating carhops and huge drink menu, which includes some unusual items like dill pickle slushies.
Clark wasn’t the first hopeful Alaskan restaurant owner with dreams of bringing the initial Sonic Drive-In to the
Alaska Business 49th State. He says the corporation has received more than thirty applicants from Alaskans in the last five years.
The corporate office didn’t approve any of the other applications. So, what made Clark’s application different? Pure doggedness.
“I wasn’t going to go away until I got a solid yes,” he says.
www.akbizmag.com In addition to persistence, attention to detail and research played a role. Clark says he’s been working on the Sonic project on and off for four years. He did legwork to convince the corporation that he has the supply chains in place to serve fresh food in a more remote location than typical Sonic restaurants. For example, he lined up Franz Bakery
A partially constructed Sonic Drive-In in June at the new Shoppes at Sun Mountain development in Wasilla.
© Larry Clark
NO ATTRIBUTION
24 | September 2019 in Anchorage to provide fresh buns for his restaurant.
“I was already way ahead of where other franchise applicants would start. I had already mapped out locations and shipping and getting our products here,” he says.
Supply lines are a major challenge in the Alaska restaurant business. Clark says he previously considered opening a Chick-fil-A in Alaska. The fast food restaurant has a large following here, but the restaurant required fresh chicken daily, which would require a chicken farm and a chicken processing plant here in Alaska, Clark says.
Clark is also a former police officer and is the founder and owner of Valkyrie Security and Asset Protection in Anchorage. Since moving to Alaska fourteen years ago, he’s devoted most of his attention to the security business, which he will continue to focus on once he gets the restaurant business going, he says.
But the idea of opening a Sonic Drive-In has always been in the back of his mind. He has strong ties to the iconic drive-in burger joint. As a young man growing up in north Texas, going to Sonic after football games and rodeos was a teen tradition.
In those days he drove a Chevrolet Camaro or a Ford Mustang Fastback to the drive-in, he says. Sometimes he rode his horse.
“In high school, that’s what you did. You drove around town square, went through the Sonic, met up with your friends,” he says.
Sonic Corp. is based in Oklahoma City and started as a drive-in business when it was founded in 1953. The
company was purchased in 2018 by Inspire Brands, the Georgia-based parent company of Arby’s and Buffalo Wild Wings.
There are more than 3,500 Sonic restaurants in the United States, but Clark is bringing the first one to Alaska. Clark’s application to be a franchisee started with an email to the company. After passing the first round of vetting, he traveled to Sonic headquarters in Oklahoma for a series of interviews with company leaders, who eventually agreed to let him open the franchise. Clark plans to hire more than 100 employees by opening day.
The Sonic Drive-In located in Wasilla won’t be the only Alaska Sonic for long. Johnson is working with Clark to build a second Sonic in Fairbanks in 2020.
Development Timeline
The Shoppes at Sun Mountain doesn’t yet have an anchor tenant.
Like the previous owner, Johnson considered basing the development around a warehouse discount store, but that’s no longer under consideration. “At one point we did talk to Costco about coming in there, it just didn’t work out,” he says.
Today Johnson is considering several possible anchor tenants. He says it will likely be a large clothing store.
The shopping center part of the new development will take up about twenty of the property’s thirty-two acres. Five acres will be offices and three acres each will go to senior housing and townhouse condominiums, Johnson says. One and a half acres will remain
open space because it's home to an eagle's nest and therefore must remain undeveloped.
Construction of the commercial properties will precede the housing construction.
After the Sonic Drive-In, Planet Fitness is scheduled to open next. A&C has also signed leases with Krispy Kreme (a 2,700-square-foot location with a drive-through) and with Matanuska Telephone Association (MTA).
MTA says it will open a 6,000-square foot location in The Shoppes at Sun Mountain, where it will provide the complex with high-speed Wi-Fi access. MTA’s new space is slated to include a retail sales location, call center office, and an “experiential multi-use area with interactive, high-tech features.”
“We can’t wait for our members, partners, and the rest of our local community to experience MTA in a whole new light with this location,” said Jessica Gilbert, public relations manager at MTA, in a press release. “To be a part of The Shoppes at Sun Mountain moving forward puts MTA in one of the premier new retail locations in our area, where visitors will be able to look forward into the future of technology and innovation.”
MTA’s new location is tentatively set to open its doors late 2019 or early 2020, the company says. Its current Wasilla location on East Parks Highway will close once the new location is up and running.
A&C is also in talks with Tacos Cancun Mexican Grill—a locally-owned business—to add a new 2,400-squarefoot restaurant in an 11,700-square-foot small shop building, which is slated for construction this fall, Johnson says. Overall, Johnson plans for the shopping center to have about 20,000 square feet of small store space, with other possible tenants including a bank and a cell phone repair store. He also plans for about 100,000 square feet of “junior box” stores. Junior box is a real estate industry term for large retail stores that are smaller than the largest big box stores like Walmart and Home Depot. These stores usually range between 10,000 and 25,000 square feet and at this shopping center may include clothing and pet supply stores, Johnson says.
Johnson anticipates breaking ground on the development’s senior citizen apartments in 2021, building forty housing units. Townhouse condominiums—twenty to thirty of them—are planned for the next year.
Retail Growth Is Key
By 2045, Alaska Department of Labor statistics predict the Mat-Su Borough will have grown by 60 percent to reach 167,000 people, making it by far the second most populous part of Alaska after Anchorage. Alaska’s Interior region, by comparison, is predicted to have 6 percent population growth over the next few decades to reach a population of 119,000 by 2045.
For Wasilla, the largest city in the Mat-Su Borough, new residents flocking to the area won’t help balance the municipal budget. Wasilla doesn’t have property taxes and doesn’t receive any of the property tax revenue collected by the Mat-Su Borough.
Wasilla does have sales tax and has been able to compensate for the lack of property taxes by having a large number of commercial businesses. “Whether by design or by happy accident, our master plan was set up for us to be the financial business hub of the Mat-Su valley,” says City Deputy Administrator Lyn Carden. “We have somewhat intentionally looked for that revenue base.”
The local government collects a 3 percent sales tax on the first $500 worth of transactions in the city.
That sales tax rate will revert back to 2.5 percent in January 2020, when a voter-approved program to fund the construction of a new police department headquarters sunsets.
The fact that Wasilla is dependent on sales tax revenues actually makes it harder for the city to attract potential commercial developments to the city. Cities with property taxes can offer developers property tax breaks, but the city’s code prohibits municipalities from offering specific developers sales tax exemptions, Carden says.
Instead, it tries to encourage businesses to come to Wasilla by offering them a particularly efficient permitting process.
“I think we run about forty-five days, start to finish,” she says. “We want to make sure that we’re very user friendly.” One resource that fueled the Mat-Su Borough’s rapid growth is the large amount of open land in the MatSu Valley, especially compared to Anchorage, which is tightly confined by the Chugach Mountains and the waters of Cook Inlet.
But Wasilla is beginning to fill up and mature as a city. The Shoppes at Sun Mountain development is filling the last remaining large piece of open land within the city limits on the Parks Highway corridor, Carden says. A few other similarly large pieces of land remain within city limits on the Palmer Wasilla Highway and on Knik Goose Bay Road.
