Housing construction is in a slump but commercial development is at unprecedented levels in Medford.

Housing construction is in a slump but commercial development is at unprecedented levels in Medford.

"This place is hot," said Bill Hoke, economic developer for the city of Medford. "It's unbelievable the amount of activity that's going on here."

From The Commons urban development project downtown, to development around Rossanley Drive and the proposed Northgate Centre, the city is seeing dramatic commercial growth, he said.

But nothing compares to what's going up around the Medford airport.

The Site Plan and Architectural Commission has reviewed 80 commercial applications in the past five years for the land surrounding the Medford airport, said Planning Director Rob Scott.

Major developments include the Navigator's Landing commercial subdivision off Biddle Road, which has businesses ranging from banks and title companies to beverage distributors and paper companies; the Delta Center at Delta Waters Road and Highway 62, which will have retail businesses such as Sportsman's Warehouse; Lithia Motors' auto mall on Highway 62; and the industrial subdivision off East Vilas Road.

Curt Burrill, a broker with Burrill Real Estate, is among the location's property owners.

His company developed the Crater Lake Business Center west of Costco as well as the Lear Way Industrial Condominiums, which have tenants such as Providence Home Health Care.

He has about 20 vacant acres remaining along Excel Drive he plans to develop, though there are no firm plans.

"We still have the ability to do a couple more office spaces," he said.

The property surrounding the airport has been a magnet for development recently.

"Most of the available industrial land is out on both sides of the airport and the north side of the airport," he said. Given the land in the area is zoned for commercial and industrial development and is undeveloped, that's where the growth is happening.

Burrill also owns 51 acres farther north, between Highway 62 and International Way, south of Vilas Road. The city granted him a Measure 37 claim to revert that property's zoning from heavy industrial back to the equivalent of light industrial.

Development of that property is on hold, he said, partly in anticipation of a final decision on the Oregon Department of Transportation's Highway 62 bypass project.

Project teams of transportation planners, business owners and citizens in October selected a bypass design for the heavily congested Highway 62 corridor between the north Medford interchange and White City. The design would use the old Medco Haul Road route, which bisects Burrill's property, to bypass congestion now on Crater Lake Highway around the large commercial area at Delta Waters Road. A draft environmental impact statement is due out in February, though funding has not been identified. That means construction could be 10 years or more away, said Gary Leaming, project information coordinator for ODOT.

"For years we have not developed in the area that we thought the bypass would go through," said Burrill.

Hoke said the increase in commercial development in Medford, which has boosted the city's tax base, is due in a large part to Medford's attributes.

"It's a good location, it's on the freeway, it's got a good airport," said Hoke, adding that commercial land prices are still affordable.

Chris Reising, Medford's building and safety director, is optimistic the city will maintain its commercial success.

"Everybody's bettin' on Medford for future growth," he said. "It's not like people are going to stop moving to Southern Oregon.

"Since the '80s we have not seen any slowdown in the construction," said Reising, adding that there have been little flat spots some years. "It's always come back strong."

Big-box stores like Wal-Mart and Home Depot coming to the area show that Medford looks promising for supporting commercial growth because those companies do their homework before picking sites, Reising said.

Ron Fox, director of Southern Oregon Regional Economic Development Inc., said part of SOREDI's mission is to lure nonretail commercial and industrial businesses. He cites Medford businesses such as Lanphier Associates, a locally-based marketing and advertising firm with clients nationwide, as an example of the type of business SOREDI tries to attract.

Fox said the commercial growth is the result of the past five or six years of substantial residential growth.

"Commercial development generally trails residential growth and expansion," he said.

He said he doesn't worry about a potential recession, despite the decrease in residential housing construction locally and the fall-off nationwide.

"Most everything else in the economy is doing quite well," he said. "I don't see the things that cause me to be concerned about a recession, except residential construction."

Hoke said there are no signs of commercial growth dwindling any time soon, especially since Medford is a commercial hub for 460,000 people in seven counties.

"Nobody can predict five to 10 years out," he said. "I think the commercial side will continue to be healthy for the next three to five years."

Reach reporter Meg Landers at 776-4481 or e-mail mlanders@mailtribune.com.