Costco Wholesale Co. wasted little time bringing construction equipment to the site of its next Tri-Cities store after it signed a long-term land lease with Washington state on Nov. 6.
Here's what the Issaquah-based warehouse giant is planning for the 30-acre Richland site, according to its 97-page agreement. The Washington Department of Natural Resources (DNR) released the document to the Tri-City Herald under the Public Records Act.
The document is packed with standard legal minutiae and "what-if" scenarios. It also gives a clear picture of what comes next.
Location: The future Costco will be at 3125 Queensgate Drive, behind Grocery Outlet and Target.
The property is bordered by Kennedy Road, Truman Avenue and the future royalty-themed intersection that will result when Queensgate Drive and Kingsgate Way intersect at the northwest corner.
Ownership: The former Chiawana Orchards land is owned by the state and managed by DNR to generate money for schools.
Costco's money is earmarked to pay for new school construction.
DNR converted the land to commercial use in 2020 after the former orchard operator said it would not renew its lease. Fruit trees that had reached the end of their useful lives were removed from the 330-acre property at that time.
Construction: Excavation and other site related work has started to prepare for actual construction in February. A bulldozer was scraping the outlines for the future store on Tuesday.
The fueling station is expected to be built by July 2025 and the store by October 2025.
It could open in late 2025 in theory. But 2026 is more likely. Costco itself does not comment on new stores until they are three months from opening.
Lydig Construction Inc., which has built several Costco stores, including one in Spokane, is the contractor.
Why it's needed: Costco operates a single store in the Tri-Cities, off Gage Boulevard in Kennewick.
The store is considered overburdened for the size of community it serves. That much is obvious to anyone who has circled the parking lot on weekends looking for a place to park.
The new Richland store will be about 20% larger than its sister in Kennewick. Its parking lot will have 1,024 spaces. That's 24% more than Kennewick's 828 spots.
Timing: Costco will control the site for a total of 55 years, including an initial term of 25 years, followed by one 10-year extension and four 5-year ones.
Rent: Costco will pay a total of $12.2 million for the initial 25-year term, starting at $400,000 each year for the first five years and increasing to $586,000 years 21-25.
DNR and Costco will negotiate a new base rate for the 26th year. The lease includes automatic increases throughout the remainder of the agreement. Costco also will pay leasehold taxes equable to about 13% of the taxable rent.