Signs of growth exist here and has helped Cheyenne avoid national trend.

By Michelle Dynes
mdynes@wyomingnews.com

CHEYENNE -- People refer to it as the worst economic slump since the Great Depression.

But in Cheyenne, growth has just slowed, not stopped.

Commercial real-estate agents continue to show properties. Local employers continue to add jobs. And business groups continue to get requests from companies looking to expand.

Louisiana-based Bedrock Seafood plans to open a Cajun seafood restaurant and meats distribution center in early 2009.

Vice president John Swatzel said Wyoming is an attractive site for a couple of reasons. First, the state does not have a corporate tax. Cheyenne's location at the cross-section of two major interstates also offers access.

He added that it's possible to reach customers in five surrounding states with lobster, crawfish and jumbo shrimp from a home base in Wyoming's capital city.

"You have a captive audience," he said. "There's no competition for 300 miles. I'm surprised that no one has put up a distributorship yet."

Residential real-estate agents are experiencing a business slowdown, but they are not witnessing a crash like agents in other markets, said Dale Steenbergen, president and CEO of the Greater Cheyenne Chamber of Commerce. He added that banks continue to provide loans and interest in Cheyenne remains steady.

The requests for business relocation information are double what they were during the summer months. A majority of the interest comes from smaller entrepreneurs looking to expand, but larger chains also continue to call.

Steenbergen said if business owners weren't serious about a move, they would ask vague questions about how to start a local business. Instead, he fills requests for traffic data, delivery patterns and Realtor recommendations. He also hears from people who want to take the time to tour the city.

The tax benefits are attractive, but it often plays a small part in the final decision. The bigger selling points are a community with stable growth, a housing market that is still afloat and storefronts that remain open.

Steenbergen said business leaders look for stability during an uncertain economy. And while Cheyenne isn't a site for metropolitan-sized growth, it also won't succumb as easily to a widespread recession.

The Property Exchange tallies about 166,000 square feet of vacant commercial space in Cheyenne. The total also includes projects under construction such as the new locations for AVI Engineering and Jonah Bank, said Bonnie Berry from the company's commercial department.

But while supply remains strong, so does demand.

Sales of commercial properties increased 20 to 30 percent over last year, said commercial broker Vicki Graham. Sales totaled $34 million in 2006, $38 million in 2007 and hit $54 million this year.

She added that a great deal of the interest stems from the projected 2010 addition of the National Center for Atmospheric Research supercomputer. The project raised Cheyenne's profile and attracted new interest.

"We saw a slowdown, but not a slump," she said. "If there's a bottom, we've seen it."

Broker Neil Emmons said some curious retailers withdrew after stocks crashed. But better-than-expected third-quarter earnings could reignite interest.

Broker Bill Graham said if there's a lull now, it's the same seasonal slowdown brokers experience every year until business picks up again in January. But he is seeing more clients who took money out of the stock market to buy and lease commercial property instead.

He added that he also is hearing from retirement community operators who want to expand into Wyoming. Another customer wants to buy small neighborhood malls worth $15 million or less to tap into the northern end of the Front Range market.

"We're still getting inquiries," Bill Graham said.

Berry said if residents see an empty storefront, it may be because the business relocated to another part of the city. Commercial development follows booms in residential construction. Hundreds of new rooftops to the east are now attracting businesses toward Dakota Crossing and Saddle Ridge.

She added that the Pizza Hut on Lincolnway may move in this direction. The University of Phoenix signed up for space off of Yellowtail Road.

Commercial lease rates remain competitive but steady. And a variety of options scattered throughout the city is attractive to any site selector, Berry said.

Customers still sign up for accounts and the loan volume remains decent, said John Balser, president of Western Vista Federal Credit Union. The credit union operates with about $100 million and mostly with Wyoming customers in Cheyenne, Casper, Wheatland and Torrington.

"Sometimes there is a drop-off at the end of the year anyway in preparation for Christmas," he added. "We're still seeing a healthy growth in loans. We're probably having our best year."

People who counted on overtime pay might have seen a reduction in hours, and people who bought a large SUV last year might regret the decision, but customers are not facing desperate situations, Balser said. Delinquency rates saw a slight increase, but the trend mirrors other market downturns.

Overall job growth averaged increases of 3 percent a month last year, said Dick O'Gara, director of the Wyoming Center for Business and Economic Analysis. By the end of the first quarter of 2008, job growth slowed to 2.8 percent. He said he predicts the total will drop to 1.6 percent during the year's third quarter.

The good news is that the state continues to add jobs while other communities experience job losses. The bad news is that this growth is expected to slow even further in the coming months and could even flatten to a 0 percent rate by this time next year.

Another problem is that the uncertainty is nationwide.

"We are in major uncharted waters," O'Gara said. "We haven't seen anything like this since the Great Depression."

Every other recession since 1947 marked a drop in paper assets, while home values escalated or stagnated. Today, home values also are taking a hit. Meanwhile, individuals and governments alike have never carried so much debt.

"The market system is a harsh, cruel system," he said. "It doesn't care who it takes out, and that's what we're seeing."

Local home values aren't getting clobbered like they are in once-booming cities, but the majority of Americans still feel less wealthy in 2008. The effect is compounded by the fact that wages and salaries have not increased. So naturally, people are spending less.

Wyoming is insulated from many of the massive layoffs that hit other states. But it is not completely immune.

The recent collapse of Corral West and the sale of its local stores to national retailer Boot Barn is expected to result in some layoffs in Cheyenne.

And large national employers are looking for ways to cut back, and those changes will be across the board, regardless of where a business branch is located.

O'Gara said the coming months will indicate how much immunization Wyoming has against the nationwide economic cold.