Nearly 30 new employees are heading for the waterfront, as First American Title Insurance Company has signed a five-year lease with the port for space in the Bellwether Building.
First American has been located downtown for at least 20 years at 215 N. Commercial St., but had been looking for a new location that could help spruce up its image, said Timothy Krell, the company’s Whatcom County manager.
Company officials decided to make the move to Bellwether Way when they learned recently that Wachovia Securities LLC would not renew its lease with the port in its 7,900-square-foot space on the third floor of the Bellwether Building.
“We feel the port’s property affords us comfortable, beautiful, efficient office space in which to consummate real estate transactions,” Krell said. “This space will do a lot for the image we want to portray to the community and be a nice place for our employees to work.”
First American, which has 26 employees, will likely move to the new location in mid-February, Krell said. Depending on how business goes, the company may be looking to add staff members next spring or summer.
During the next five years, First American’s rental schedule at the new location would range between $12,373.90 per month to $15,203.00 per month. The company has two five-year renewal options.
While Wachovia is vacating the Bellwether Building, it is not leaving the area.
Mike Perry, senior vice president of investments, said the six-person office will be moving nearby to the Paulsen Building, at 12 Bellwether Way, Suite 238.
Perry declined to disclose terms of the lease but said Wachovia, which was established locally in 2000, should be in its new space by Dec. 9.
“It’s just a business decision that made a lot of sense for us,” he said. “We’ve got a good long-term lease with extensions available.”
Perry, Krell and port officials have said they like the idea of financial institutions locating on the peninsula.
“I think a title company coming down here is pretty powerful for this area, as far as exposure and the client traffic they’ll have,” Perry said.
Back downtown, Jim Peeples, president of Peeple’s Enterprises, the owner of the current First American Title location across the street from the library, said he was surprised that First American wanted to leave, but said it shouldn’t be a problem finding a new tenant.
“The building’s location close to the courthouse and City Hall are big factors,” he said. “We’re already working with a potential new tenant.”
Christian Krogstad, the former co-owner of Orchard Street Brewery, is again gaining momentum in the alcoholic-beverage business, this time making distilled spirits in Oregon.
Krogstad launched House Spirits with longtime friend Lee Medoff in August, 2004. He said getting into the distillery business was a natural transition from making beer, but he had to open House Spirits in Oregon because Washington has laws against establishing distilleries.
Orchard Street Brewery closed abruptly in 2004, after almost 10 years in business. In doing so, OSB broke its lease agreement with its landlord, Eiford & Eiford Development, and as a result, Eiford & Eiford filed a lawsuit against the brewery for $118,377 in back rent and damages to the property.
Krogstad said the lawsuit was dropped, and the matter has since been settled. A representative from Eiford & Eiford had no comment on the issue.
After the collapse of his former business, Krogstad said there was no reason to go on in the brewery business in Washington. He also said the other owners of the company had no interest in continuing.
According to Krogstad, his first venture was a good business education. In moving forward, he said he has shed prior mistakes and kept his successes, applying them to his new business. Orchard Street Brewery did a good job focusing on making top-quality products and packaging those products to consumers, he said. Missteps at the brewery included having high reccurring monthly expenses, namely rent and debt service; he has learned from those mistakes by having very low expenses at House Spirits.
His new business strategy has apparently paid off, as House Spirits will soon move to a new location in Portland, having outgrown itsspace in Corvallis. He said the company needs the extra space as they are doing some custom distilling for clients in the fine-spirits business, and are making more of their own product.
House Spirits’ first product, Medoyeff Vodka, is named after his partner, who is of Russian descent. Krogstad said the company will eventually get into making a line of whiskeys, and will introduce a gin this winter. He said they started with vodka to get the business off the ground, and to create a business platform to sell the whiskey, which takes about six years to make.
Prior work in breweries has helped him get the new business off the ground, especially the knowledge to comply with the federal regulations to sell spirits. Federal regulations for a distillery are complex, with a result being more tax on the product. According to Krogstad, a case of his vodka has $26 of tax applied to it, compared to the tax on a case of domestic wine, of about 39 cents. Additionally, the taxes are applied when the product is made, not sold, he said.
These regulations and processes made getting House Spirits up and running a bit slower than it took him to start the brewery, said Krogstad. Once underway, however, he said things went quite well, and considers the company a success after a year and a half in business.
Krogstad’s business is currently distributing its products in Washington, Oregon and California to restaurants, bars and liquor stores. He said their strongest market to date is in Oregon. Much like his customers at the microbrewery, Krogstad said his customers at House Spirits are “people who appreciate a higher-quality product and are willing to pay little bit more for it.”