The state of development in Sequim

According to Sequim’s planning department, the city is looking at a population of about 18,000 by 2015. That’s almost a tripling of the municipality’s current population in less than a 10-year period, but the number seems to conflict with Sequim’s current state.

A few years ago Sequim was booming, teeming with development projects such as Wal-Mart, Cedar Ridge, Willow Creek and Solana, just to name a few. It was a surge, one that brought as many critics as it did fans. Development was a major focal point in this year’s city council elections.

“We’re not against growth. It’s unchecked development we’re against,” councilwoman Susan Lorenzen asserted recently.

Today it seems development has subsided in Sequim, petering out or at least hitting a lull. While some projects, such as Cedar Ridge, trudge forward, others like Serrento have stalled, and as far as new projects just coming in front of the planning board there aren’t many. What does this mean? Did developers overestimate the power of Sequim’s draw, or is this just the calm before the storm?

According to Larry Freedman, Sequim’s present predicament is a reflection of the real estate market as a whole. Chairman of the planning commission, he also heads the city’s affordable housing committee as well as being the developer behind Cedar Ridge. As Freedman puts it, Sequim’s development surge a few years back was the direct result of a good market. People were selling their homes with ease, then relocating to Sequim in droves. Developers, noting the intense migration, hopped on the bandwagon and started designing residential developments in unprecedented numbers. It’s essentially a case of supply and demand.

“When interest rates were lowered tremendously it created a demand and a capability to buy houses in other areas, so those people sold their houses and came to Sequim. Many of them paid in cash because they’d gotten so much money where they were. What that did was create a huge demand in this area. Well, developers responded — like myself — and started developing more lots and more houses,” Freedman said.

And then the market went soft. It slowed down. People aren’t selling their homes as easily as before, so naturally they’re not buying as easily either. Freedman says he was selling some 10 lots a month before the market slowed but now it’s more like two or three.

The result is a sort of survival of the fittest. Developers with enough financing have the ability to weather through until the market changes, while other developers are forced to pack up and leave town.

“It’s not as if the market in Sequim or anywhere else has gone south. It hasn’t. It’s just slow. Now normally if we had enough young people living here who were moving up, the market would sustain itself, but we don’t have that here yet,” Freedman said.

Freedman predicts that the market will pick up by next spring in Sequim, although it won’t be anywhere near where it was during the last boom.

“The history has always been a couple years of boom and then flat,” said councilman and former mayor Walt Schubert, who owns Action Property Management. Although Schubert’s seen the market fluctuate, he believes the next boom will be something of a permanent fixture. Why? Baby boomers and lots of them.

Baby boomers are something of a godsend to developers for the simple fact that they buy retirement homes and Sequim, if anything, is a retirement-based community.

“It’s not at a standstill. Permits are still being pulled, and there’s contractors with financial strength under them that they can still build and even hold inventory if they have to. There is a pent-up demand that we know about that’s out there nationally that’s waiting for this mortgage issue to resolve itself, and when it does we’re going to see another surge and retirement communities are going to be hit the hardest because of who the buyer is. They’re in their late 50s, early 60s and they’re ready to move away from work,” Sequim’s special projects manager Frank Needham said.

“We’re not against growth. It’s unchecked development we’re against.”

— Susan Lorenzen, Sequim City Council

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