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About The daily Astorian. (Astoria, Or.) 1961-current | View Entire Issue (Oct. 31, 2019)
A6 THE ASTORIAN • THURSDAY, OCTOBER 31, 2019 Hailey Hoff man/The Astorian A worker aboard the African Raven directs a crane as it lifts timber from the shore and places it on the ship. Slowdown: ‘We don’t have enough people to fi ll all three suites’ Continued from Page A1 “We’re just consolidating, because we don’t have enough people to fi ll all three suites,” said Chad Niedermeyer, the Asto- ria Forest Products yard manager . During the trade war, the Chinese have imposed tariffs on hemlock, the most common species exported from Astoria, along with Douglas fi r and spruce. The tar- iffs have made buyers hesitant and mostly dried up timber exports, which account for between one-fi fth and one-quarter of the Port’s operational revenue . Astoria Forest Products has drastically cut back its workforce, and local long- shore union leadership has reported hav- ing to travel farther away to fi nd work. The Port has cut its staff by about four posi- tions through attrition to help save money. By the end of November , the Port will also move out of its newer offi ces on Pier 1 to the older Gateway Building, where the agency moved from several years ago. “When revenues decrease, you have to fi nd ways to cut our costs,” said Will Isom, the Port’s interim executive director and fi nance manager. “That’s part of the rea- son we’re moving back to the Gateway . Sometimes it’s coming up with a string of small things to move the organization forward.” When the Port advertised its offi ces on Pier 1 for rent, it only took a couple of days to fi nd a local company, Watershed Wellness, to lease the space, Isom said. He doesn’t expect the 1,500 square feet Astoria Forest Products is vacating to stay empty for long. Niedermeyer and Isom are hopeful the trade war is ratcheting down after the most recent negotiations in Washington, D.C., during which the two sides struck a par- tial deal. The Trump administration agreed to halt a new round of tariffs scheduled for December, and the Chinese agreed to buy between $40 billion and $50 billion in U.S. agricultural products. But the pur- chase does not include timber. Astoria Forest Products reached a deal with Southport Lumber Co. to load barges at the Port with logs from a state timber sale in Washington for shipment to a mill near Coos Bay. But the agreement rep- resents a fraction of the revenue from shipments to China. Southport’s contract with Washington state wrapped up ear- lier this month, Niedermeyer said, but he expects the relationship to continue if there is more work. Astoria Forest Products was formed in 2014 under Murphy Overseas USA, a company owned by the family of Dennis Murphy, a former shareholder in Eugene- based timber giant Murphy Co. The fam- ily had been looking to sell the company since before the trade war, but could not immediately be reached for comment. Vacation rental fi rm could be state’s largest new company By MIKE ROGOWAY The Oregonian Oregon hasn’t produced a really big company in more than two decades. There have been many contenders during that time, among them tech aspi- rants Jive Software, Integra Telecom, Pup- pet, Pixelworks and Viewpoint Construc- tion Software. All ran into stumbling blocks along the way, or sold before they had a chance to grow genuinely large. That’s left the state with a dwindling number of aging, Ore- gon-based companies as corporations die off, sell or move out of state. Portland vacation rental management company Vacasa will now have the oppor- tunity to break Oregon’s losing streak. The company said Tuesday it has raised a whopping $319 million in new funding, with investors valuing Vacasa at more than $1 billion. Tuesday’s huge investment underscores the enormous potential major investors see in the Portland company — and the intense pressure Vacasa will face to deliver on that promise. Founded in 2009, Vacasa provides cleaning and maintenance services to own- ers’ vacation properties and lists their prop- erties online. It uses technology to dynami- cally adjust rental pricing online based on market demand, aiming to get the most for the property owners — while taking a cut for itself. Vacasa has been growing rapidly, fueled by more than $200 million in prior invest- ment and this year’s $162 million acquisi- tion of Wyndham Destinations’ own vaca- tion rental business. Privately held Vacasa doesn’t disclose detailed fi nancial results but says it now manages 23,000 vacation homes and has grown revenue sevenfold in the past four years. The company said it expects more than $1 billion in gross bookings and more than $500 million in revenue by July. “The opportunity that lies ahead of us is enormous, both on the property manage- ment and real estate side of the business,” Eric Breon, Vacasa’s founder and CEO, said in a written statement. Formerly an Oregon business analyst, Breon says he started Vacasa because he had diffi culty locating a rental manage- ment company for a vacation cabin his wife’s family owned on the Washing- ‘THE OPPORTUNITY THAT LIES AHEAD OF US IS ENORMOUS, BOTH ON THE PROPERTY MANAGEMENT AND REAL ESTATE SIDE OF THE BUSINESS.’ Eric Breon | Vacasa’s founder and CEO ton Coast. Breon, 41, thought a new com- pany could do better by adopting technol- ogy to track maintenance and cleaning and using algorithms to adapt prices to market demand. The company now employs 5,000 alto- gether, including 379 at its corporate head- quarters in the Pearl District. Most of its staff works in the fi eld, maintaining, clean- ing and managing properties from Long Island to Lincoln City. Silver Lake managing director Joerg Adams said in a written statement Tues- day that his fi rm believes Vacasa “has the potential to become a global brand.” With Tuesday’s funding Vacasa said it will focus on continued expansion, not just in big U.S. vacation markets but in Can- ada, Mexico and the Caribbean. Vacasa said it will also try to expand its new real estate business, which provides market and fi nancial data to property buyers and sellers. Tuesday’s investment was led by Sili- con Valley private equity fi rm Silver Lake, known for participating in leveraged buy- outs such as the $24 billion deal that took Dell private fi ve years ago. Vacasa did not disclose what level of debt accompanied Tuesday’s deal. Vacasa is now among the best-funded young companies in Oregon history. The company has made it clear it plans an ini- tial public offering of Vacasa stock, though the company has given no indication of its timetable. No Oregon company has held a signifi - cant IPO since 2004, when Cascade Micro- tech and McCormick & Schmick’s each went public. Both companies struggled in the public markets, though, and sold to larger companies. Oregon’s recent business history is fi lled with such cautionary tales. Consider Integra Telecom, which took on $1.3 bil- lion in debt in hopes of capitalizing on the rapidly growing market for internet ser- vices. Integra fl oundered when its growth evaporated in a competitive market, then wilted under massive debt. Others, like Portland tech upstart Jive Software, were undone by investors’ demands for outsized growth. Positioned between the roaring entrepre- neurial communities in San Francisco and Seattle, and stifl ed by the absence of large research universities and local investment pools, Oregon has rarely been a destination for the most ambitious entrepreneurs. Recent startups have tended to focus on less competitive, niche markets and are easily rolled into larger organizations with broader portfolios. The absence of locally based companies hasn’t crippled Oregon’s economy, which is enjoying one of its longest expansions on record and exceptional growth in per- sonal income. During that period, though, the state has become increasingly reliant on out-of-state employers who use Oregon as a low-cost outpost. That’s been a persistent worry to econ- omists, who warn outposts usually per- form the ancillary corporate functions that are most likely to be cut to save costs or respond to a market or economic down- turn. Just Monday, onetime Portland startup Sightbox notifi ed Oregon offi cials it will lay off 50 employees — two years after its sale to Johnson & Johnson. Tuesday’s funding makes Vacasa the state’s best chance to develop a new, homegrown company to help anchor Ore- gon’s economy and to nurture a new gener- ation of employees and executives to lead future businesses. Seaside American Legion Post 99 • 100 th Birthday of the American Legion Semi formal Celebration November 10th No host Cocktail hour 5:30 Dinner served 6:00pm $30.00 per ticket Prime Rib or Salmon All Dinner Guests MUST RSVP before November 2 nd so do it now! 503-738-5111 • 1315 Broadway Seaside Oregon Public event Proceeds go toward helping our Veterans
