CIRI's assets nearing $1 billion with new projects on tap
Cook Inlet Region Inc. will build new office buildings in Anchorage and is proposing a major new shopping mall in the Matanuska-Susitna Borough, Sophie Minich, CIRI’s new CEO, said May 2.
Groundbreaking on the new office buildings, one to be CIRI’s corporate offices, will be this summer, Minich said.
Minich briefed members of the Resource Development Council on new CIRI developments in her first major public address since taking the reins at CIRI in January when Margie Brown, CIRI’s long-time CEO, retired.
CIRI, which is based in Anchorage, is one of twelve Alaska Native regional corporations formed after Congress passed the Alaska Native Claims Settlement Act in 1971.
A big achievement in 2012 for the corporation, in Brown’s last year at the helm, was bringing the $65 million Fire Island wind project into commercial production after several years of planning and construction.
CIRI has been a partner in many ventures but this is its first as an owner, developer and operator. The project performed well in its first operating period, the last quarter of 2012, Minich said.
Power was sold to Chugach Electric Corp. and it allowed Chugach to reduce use of natural gas for power generation by about 200 million cubic feet.
In financial developments, Minich said CIRI’s assets are nearing $1 billion dollars, reaching $935 million at the end of 2012. It’s a coincidence, but total dividends paid to CIRI shareholders since 1972 will exceed $1 billion dollars in the third quarter of 2013 with a scheduled dividend payment, she said.
Dividends paid out reached $987 million at the end of this past December.
CIRI’s profits for 2012 were $16.4 million, which has been typical in recent years, Minich said, although profits in 2011 were higher, $29.6 million, due to a one-time asset sale.
Meanwhile, the new Midtown office building development, involving three buildings, will be on a tract CIRI owns at Fireweed Lane and Gambell Street in Anchorage, not far from the corporation’s present office building on C Street.
CIRI took ownership of the Fireweed and Gambell parcel, where the Fireweed Theater once stood, as part of a deal with the owner of the theater involved developing theaters at Tikahtnu Commons, a mall CIRI developed in northeast Anchorage with California-based Browman Development Co.
The new development will include a new office “tower” and two smaller office buildings, Minich said.
“We are out to bid for a contractor now and we will soon publish a Request for Proposals for an architect,” she said.
The planned Four Corner Commons mall will be on Trunk Road and the Palmer Wasilla Highway.
“Our plan is that it will be similar to Tikahtnu Commons,” Minich said, meaning that it will be a major mall with retail and entertainment.
The actual size has yet to be determined.
“We’re looking for an anchor retail tenant now, but we have yet to find one,” Minich said.
Meanwhile, the 900,000-square-foot Tikahtnu Commons mall will be fully “built out” this summer when its latest addition, a Sam’s Club outlet, is completed this summer. That will complete the mall’s five-year plan, Minich said, although there is still space for smaller retail outlets.
Tikahtnu Commons is a $100 million-plus development and its tenants are reporting good sales, some achieving record revenues within their retail chains.
Meanwhile, CIRI’s government contracting business continues although federal budget cuts means, “we’re having to buckle our belts, and watch our costs,” Minich said.
Two new acquisitions in the corporations’ portfolio of 8-a minority-owned companies include Weldin Construction, acquired in March 2012.
Weldin does specialized construction on military bases and has contracts at Joint Base Elmendorf-Richardson, Fort Greely and Eielson Air Force Base.
Dick Weldin, who started the company, is a CIRI shareholder, Minich said. The family still owns 25 percent of the business. Two years ago CIRI acquired the North Wind Group, which specializes in environmental remediation at military bases and mining sites in the Lower 48, although the company maintains an office in Alaska.
On the energy side, CIRI owns a small part of the Cook Inlet Natural Gas Storage Alaska, which now stores natural gas for utilities to use in peak demand times of winter, and is expanding its holdings of wind generation properties in the Lower 48 besides operating the Fire Island project in Alaska.
The corporation is also participating in development of new natural gas supplies for Southcentral Alaska through the leasing of 450,000 acres of CIRI-owned lands to exploration companies.
NordAq Energy, a small independent company based in Alaska, has gas prospects under exploration on the Kenai Pensinsula and on the west side of Cook Inlet, and CIRI also has lands under lease to Apache Corp. and Hilcorp Energy, two large independent companies active in Cook Inlet.
Another CIRI-operated project is Stone Horn Ridge, an underground coal gasification prospect on coal lands owned by the corporation west of Anchorage, Minich said. CIRI is working this year to better define a location where a project could be developed, she said.
Underground coal gasification involves drilling into deep coal seams and igniting a reaction to produce a synthesis gas from the coal. The gas can be used in power generation or manufacturing, or could be upgraded into a form of synthetic natural gas for use by local utilities.
Tim Bradner can be reached at [email protected].