A growing Hermiston company will build a powder coating facility in Richland’s Horn Rapids Industrial Park as it moves to keep up with rising demand from the Tri-Cities.

N.W. Metal Fabricators Inc. has a tentative agreement to buy 5 acres near Polar Way and Logan Street from the city of Richland. The city’s economic development committee has recommended the city council authorize the city manager to enter a purchase-sale agreement worth $340,000.

The council was expected to consider the sale on Nov. 15, after the deadline for this publication.

Mandy Wallner, the city’s economic development director, called N.W. Metal Fabricators a win for Horn Rapids, the industrial park north of Highway 240, where the city is steering commercial development.

“They are a fantastic firm in a great growth phase of their business, and we are pleased we could reach a deal that works for them to grow their company in our area,” she said.

The city welcomes the addition of a growing business and wishes it success, she said.

Aaron Karlson, general manager, said N.W. Metal Fabricators intends to build two 12,000-square-foot buildings in separate phases.

He owns 25% of the company, which was founded by his parents, Vendla and Kerry Karlson, who own the balance.

The Karlson family lives in Kennewick.

Vendla and Kerry Karlson established N.W. Metal Fabricators in 1986 and incorporated in Oregon in 1988. It employs about 45. The Richland business will be incorporated in Washington.

Aaron Karlson has managed the family-owned business for about 10 years and added powder coating services to its list of metal finishing services about five years ago.

Gross revenue increased to $1 million by this year. Much of that demand comes from the Tri-Cities, where there is a need for powder-coated products from the construction and irrigation industries. The project will be privately financed. The cost has not been finalized.

“This is to get a presence in the Tri-Cities,” he said.

He said he first considered expanding to Horn Rapids several years ago but shelved the idea during the pandemic. When the time was right, he looked at other sites but circled back to Horn Rapids and concluded it had the right mixture of highway access and proximity to Tri-City customers.

Powder coating provides a clean, durable finish to metal products ranging from stair railings to irrigation pipe. Karlson said the Richand plant will use automated equipment to offer the high-speed services its industrial customers require.

He expects to employ up to six people in the first phase and anticipates revenue from the Richland site will reach $1 million in the first year, according to a letter of intent that is part of the offer for the property.

Under terms of the proposed deal, N.W. Metal Fabricators will construct the second 12,000-square-foot building within five years and will double its Richland workforce to 12.

The city will retain the right to repurchase all or part of the project if N.W. Metal Fabricators does not proceed with its intended plans. It will have eight months from the closing date to apply for building permits for the first phase and five years from the start of operations in the first building to pursue the second.

The purchase price works out to $65,000 per acre. The total price includes $15,000 for expenses related to road improvements.

Proceeds will be deposited in the city’s industrial development account to support future economic activity.