BY GAVEL AND GRAVEL, PACIFIC RACEWAYS POISED FOR UPGRADES
Before the end of this calendar year, Pacific Raceways will see construction of motorsports garages that are part of Phase One of the sweeping tech innovation center initiative on this multipurpose property, according to facility President Jason Fiorito.
His family, which has owned the 320-acre multiuse property southeast of Seattle for decades, also owns an excavation business that has been a source of revenue to operate the racetracks, which include a showcase 2.25-mile road course that incorporates the dragstrip. And that gravel on the grounds, which has been used for such projects in the past as a new runway at Seattle-Tacoma International Airport, is about to fetch some serious money to prop up the new construction.
It’s all part of an "automotive and design technology campus" project with global reach that has the working title of Pacific Innovation Center. Its mission is to “create hundreds of clean-tech jobs and produce accelerated automotive innovation, while establishing Washington State as the international hub in this arena." The development calls for 1.2 million square feet of commercial space for technology-based and racing-related industry.
The forward-thinking project, that’s at once clever and economically and environmentally beneficial, can keep Pacific Raceways relevant, both to racing and environmental interests. It could be the perfect compromise to two factions on the political landscape that have not been compatible always. And Fiorito said this latest positive twist can be the springboard for making it materialize.
“After 15 years of arguing about permits with King County, we finally have the green light to not only start excavating gravel that gives us some initial investment capital, but also start putting up the motorsports garages at the end of 2019. The long-anticipated cashflow necessary to make some pretty aggressive upgrades at the facility is in the works right now,” Fiorito said.
“We’ll start taking in gravel money at the end of this month, and then it will be a steady source of cashflow for us over the next three years,” he said. “We also envision having our first tenants in our buildings the first quarter of 2020 that provides additional investment capital.”
The dragstrip that has been the site of the Northwest Nationals for 32 years, is expected to have some upgrades, Fiorito said.
“Ed [Garfield], our dragstrip manager, was just telling me that the first 660 feet of concrete here is slated to be replaced over the next two years. We’re going to start adding lighting for not only our weekly events, but our national event,” which he said, “can go farther into the evening, if necessary. We’re looking at some pretty significant improvements to the bathroom and concession facilities.”
He said, “We’re trying to keep up with some of the rest of the facilities across the country. And I know we’ve been overly optimistic on how quickly we can get these permits perfected, but now that the grading permit is issued and the land use has been approved for the buildings, we’re on our way to the significant improvements that the facility deserves.”
Some impatient fans have suggested openly that if the NHRA is looking to trim races for the Mello Yello Drag Racing Series, they would suggest dropping from Pacific Raceways from the schedule. Fiorito has heard and read it all, and he responded by saying that isn’t smart business for the sanctioning body and that he doesn’t see that happening.
“I think that would leave a pretty dark hole in the Pacific Northwest for professional racing. I think the NHRA’s advantage in the Pacific Northwest that they don’t enjoy nationally is the lack of a NASCAR race up here. So NHRA inarguably is the largest motorsports event in the Pacific Northwest and it’s a very important region for regional and national sponsors,” he said.
“I feel relatively comfortable that the Pacific Northwest is an important stop not only on the Western Swing but as part of the Mello Yello Series tour in a whole. As we keep making significant investments in the facility, I feel comfortable that the NHRA sees the benefit of having the largest market share in terms of racing fans and the largest motorsports event in the Pacific Northwest,” Fiorito said. “I would be surprised if Seattle was on the chopping block.”
Fiorito said he recognizes Pacific Raceways and he, as well, have had “credibility issues” since he took over management of the facility 17 years ago. Much of that has been overly optimistic expectation on his part and a much more drawn-out permitting process than he anticipated. But he also cautioned that Northwest Nationals fans aren’t going to arrive here next August and see massive improvements to the dragstrip.
“The interim-use permit allows us development on the 40-acre parcel as you drive in the facility. The master use plan is a global redevelopment of the entire property, including new tower facilities, new hospitality suites, new grandstands on the north side of the track, new concession buildings, new driving school building, new main office facilities, additional lighting on the dragstrip, additional new pavement on the dragstrip,” Fiorito said. “The acquisition of the permits this year starts a wave of improvements that you’ll see pretty aggressively implemented over the next 10 years.”
He said not to anticipate an immediate transformation: “We’re not expecting that over the next six months, because, really, that work happens over the winter. So we’re only a few months away from our construction period here, but we’ve got about a year-and-a-half lag before you see pretty aggressive upgrades starting to show up on the facility – not this winter but next winter.”
Fiorito clearly is proud of the improvements he has managed to make in the face of difficult permitting processes in the recent past.
“Well, but to be fair to myself, we’ve got two-and-a-half-million-dollars’ worth of grandstands sitting on the southside. We’ve repaved the concrete on the dragstrip twice. We’ve got well over a million dollars into repaving the dragstrip. We have new lighting. We had new bathrooms 17 years ago. We have dumped a bunch of money into the facility, and some of it goes unnoticed,” he said, “but we realize that the facility is not on par with other venues across the country. And we’ve been waiting patiently both as a family and as a racing community to realize the capital necessary for those improvements.
“It’s all a question of how to allocate limited resources. It has always been a question of not what to do here but how to allocate limited resources. The gravel extraction is profitable, the buildings are profitable, but it still doesn’t create ‘Bruton Smith money,’” Fiorito said, referring to the business mogul who owns the dragstrips at Sonoma, Calif.; Las Vegas; Concord, N.C.; and Bristol, Tenn.
Phase One of the tech innovation center is drawing interest in tenants, Fiorito said: “We have over 100,000 square feet of reserved space for Phase One, so the first 80,000-square-feet will start construction in late 2019 and will be ready for occupancy the first quarter of 2020. But we have over 100,000 square feet reserved right now out of the 200,000 square feet permitted. We anticipate that because we’ve had some credibility issues on whether this will get moving, that the next 100,000-square-feet will be reserved and filled relatively quickly.”
And who is interested in renting this space?
“We have a number of tenants, mostly with the traditional motorsports industry. The low-hanging fruit in this development has always been the individual car owners on both the road course and dragstrip that just want to keep their toys at the track,” Fiorito said. “We also have a number of businesses that are providing trackside service and fabrication and maintenance for race cars both on the road course and drag strip, part salespeople, retail stores that sell helmets, driving suits and high-performance parts. We’re getting ready to announce an MOU with an Australian-based EV dragster company that’s talking about relocating their R and D [research and development] in the United States, so more to come. But we have tenants on both the innovation center side and the traditional motorsports industry lined up.
An “MOU” refers to a “Memorandum of Understanding.” That’s a non-binding agreement between two or more parties that outlines the terms and details of an understanding including each parties' requirements and responsibilities. An MOU often is considered the initial stage in moving toward a formal contract.
Ford and General Motors have been pursuing EV technology, but Fiorito said that isn’t his target tenant: “Generally speaking, the large automotive companies already have test tracks on which they test their technology. We’re seeking to be like the coalition of some of the smaller companies that are looking for cheap research. That’s why we built relationships with Green River Community College and Central Washington University that are willing to craft curriculum around incubator projects that give our tenants access to their state research facilities in exchange for curriculum relevancy and higher placement. And our tenants get the advantage of free research from the state. So that all folds into the ‘project of statewide significance’ designation that gives us the ability to build memoranda of understanding with other state facilities – and incentifies the Department of Commerce to help us attract national and international companies interested in collaborating on innovation technology. Most of the time the big guys – Ford, Chevy, Tesla – all those folks that are kind of on a huge scale, keep that information mostly proprietary, but the smaller guys who need that coalition of other disciplines are the tenants we’re looking for.”
That’s the first phase of what Fiorito called “three pretty major phases.” He said, “This one will kick off the environmental impact statement that needs to be accomplished before we entitle and build more space. So the first 200,000 is permitted under the interim use permit. The next million square feet will be entitled under the master use plan that we’ll submit in the next couple of months to the county and start that review process.”
It all sounds like “legalese” and talk that’s over most people’s heads for extra bases. Fiorito put it more in laymen’s terms.
“What most people don’t realize,” he said, “is that the Pacific Northwest has the highest concentration of software engineers of anywhere in the world, even the Silicon Valley/San Francisco region. We have an influx of software engineers, over 10,000 technology companies (including artificial intelligence) in this state that are looking for outlets for their programmers. Similarly, even offshore companies are looking for that concentration of software engineers. When you pair the aerospace industry with Boeing, the skilled labor that they provide, the concentration of software engineers, the relationship with state research facilities and then a testing facility with a tech campus, we’ve really got all the ingredients to become the hub of automotive innovation industry in the United States. We have offshore companies – from China, South Korea, Japan – literally compiling billions of dollars to relocate their R and D to the United States with some of the incentives for R and D that’s going on right now. So we’re pretty well perched to become a magnet for that entire industry. They’re looking for United States-based R and D, not necessarily U.S. manufacturing but specifically United States based R and D.
Locally rooted giant Boeing anchors the aerospace-industry presence here, and Fiorito said he can envision some of Boeing’s vendors and supplemental, tangential support companies being involved in Pacific Raceways’ dynamic environment.
“We have support from IAM 751 [International Association of Machinists and Aerospace Workers], the Boeing machinists union, because they are always in search of non-traditional outlets for their skilled labor,” he said. “The same technology that goes into the aerospace industry applies to the lightweight and strength necessary for the renewable energy-driven-vehicle industry. We’ve always said that race cars are just airplanes upside down. Airplanes create lift; race cars want downforce. But they’re just wings equal and opposite to each other. So the composites, the lightweight metal energy that goes along with machining things for the automotive industry crosses over with the aerospace industry. Do we envision the aerospace industry basing R and D here for itself? No, but we envision the aerospace industry having an outlet for their skilled labor in the automotive industry here. IAM 751 has actually actively lobbied to help us get the legislation necessary to move forward with the innovation center because of its knowledge that we will be an outlet for their skilled labor.
“We’re really excited about the direction the facility is headed,” Fiorito said. “[And that’s] not only in the additional revenue that is being provided by the gravel extraction in the short-term right now, but the long-term benefit of spearheading the racing industry’s transitioning into EV and renewable-energy-driven vehicle technology.”
Fiorito said, “We’ve significantly improved the road course over the last six months. In fact, we’ve repaved over a mile of the road course over the winter which is 2.25 miles total. Our entire road course at this point meets national sanctioning width. We still have some safety improvements to install but we made a pretty significant investment in the road course over the winter that will allow us to segue into professional racing.”
But he said he likely would not make a bid for a NASCAR Monster Energy Series race on the road course. He did say he might entertain a NASCAR touring series event, despite an unfortunate history with that.
“We’re a talking with TransAm West about an event in 2020 that would be our first segue into professional racing since Dale Earnhardt won the Stroh’s 100 back here in the mid-’80s. It has been a long time since we’ve had professional racing on the road course, and we’d be interested in talking to all sorts of sanctioning bodies about the ability to host professional racing on the road course. I would be very surprised if NASCAR Cup ever ran a race in Washington State.” [It tried unsuccessfully several times in various counties in Western Washington a few years ago.] Nevertheless, Fiorito said, “Some of the lower series would be right for a fan base being very interested in it.”
Whatever he pursues for his racing program. Fiorito said his organization still is taking baby steps toward its grand overall goal.
“We have to prove, No. 1, that we’re capable of hosting races, and then we have to find promoters that are interested in paying for them. I hosted a semi-professional road course event in 2003 and we took an absolute beating when we hired Michael Waltrip to come up for the NASCAR Northwest Tour race. So I think there’s some legwork to be done, because that sport has been gone for so long in anything north of Portland that we’ll provide a facility capable of hosting that and then see if there’s any interest in promoters that want to come up here and give that a shot.
“I am probably not interested in gambling on a professional large series race as a track owner/promoter myself. I’m more interested in using the revenue generated by gravel sales and buildings to provide facility improvements. And if I take that money and try to host a race, then it hurts my ability to more aggressively upgrade the facility. I think the money is better spent on facility improvements than trying to host a big road course event.”
Washington Gov. Jay Inslee is a candidate for the Presidency of the U.S., and he’s campaigning on a single-agenda platform of save the planet / climate change. Fiorito rejected the notion that is hypocritical on Inslee’s part.
“Gov. Inslee is strongly supportive of both the current motorsports industry that adds about $10 million of regional economic impact to his state. He’s also very excited about leveraging the proximity of the innovation center to the testing facilities to promote acceleration of automotive technologies: electric, EV, Hybrid, autonomous vehicles, and all sorts of renewable-energy vehicles, including solar-powered and the battery technology that comes along with the renewable- energy-driven-vehicle industry,” Fiorito said. “Gov. Inslee is actually a very moderate Democrat when it comes to supporting businesses and pushing for environmental change. We’ve been working in lockstep with him to be on the forefront of the motorsports industry that embraces EV technology.”
So Fiorito said this approval to excavate gravel from the property will pave the way to eventual completion of his Pacific Innovation Center.