Salt Lake City -- It could be called "the one that got away," but the Salt Lake City business community wasn't too upset when Frito Lay decided to locate its new facility in West Valley, Utah, instead of within the city limits. In fact, consensus is that the facility would not have made a significant contribution to the tax base, and the city is better off without the environmental impact that would have accompanied the manufacturing giant.

A short visit is all it takes to learn that Salt Lake City definitely isn't a "growth at all costs" market.

"We don't want 'no growth,'" says Mark Mabey, managing member of The Sussex Group, a real estate investment banking firm whose current projects include a shopping center south of the city. "What we want is 'controlled growth.'"

Those who might be surprised that too much growth would even be a problem in the Salt Lake area should take note. From March 1994 to March 1995, 25,660 new jobs were created in Salt Lake County alone. The Greater Salt Lake area has of late become a high-tech, back office and distribution mecca, with Micron as one of its more recent corporate prizes.

An additional boost was the announcement in June that Salt Lake City will host the 2002 Winter Olympic Games. The high-profile event could only help increase the area's exposure, but some locals say they fear that same exposure will do more harm than good. (Incidentally, construction of most of the games' venues has already been completed -- possibly a key to the success of the Olympic bid -- but some hotel construction is expected leading up to the event.)

With 6.2% growth, it's no wonder that the city can be selective in who it admits to its corporate community. "We're working on a plan of the types of companies we want to attract and what we will be willing to do for them," says Alison Gregersen, deputy to the director of Salt Lake City Community & Economic Development.

This economic growth has meant phenomenal change for the real estate community, which is coming out of a 10-year slump. In fact, vacancy rates for industrial and residential properties are quoted by some players as low as 1%.

Industrial absorption for Salt Lake County was over 3 million sq. ft. for each of the past three years and hit more than 900,000 sq. ft. for the first quarter of 1995, according to Consolidated Realty Group/New America Network of Salt Lake City. Rental rates increased 10.71% from 1993 to 1994, reports CRG, after a more than 27% rise from 1992 to 1993.

While office vacancies were 8% marketwide at the end of 1994, according to CRG, that's down from 21% vacant in 1990. The tightest office segment, suburban Class-A space, was only 3% vacant at the end of last year. Meanwhile, retail vacancies were 4% at the end of 1994, down from 13% in 1990, CRG reports.

No wonder then that new projects are on the minds of many area developers.

Ground broke in March on the first, 156,000 sq. ft. spec warehouse/distribution facility at Ninigret Park, a 178-acre park zoned for office, industrial and light manufacturing that is the fourth phase of Centennial Park, in western Salt Lake City. A 130,000 sq. ft. spec building is slated for construction this summer at the site as well.

Elsewhere in Centennial Park, Security Capital Industrial Trust is entering the market with several buildings for lease.

And north of the city, at the former Clearfield Naval Supply Depot, now a warehouse/distribution/manufacturing park called Freeport Center, construction has begun on a new 80,000 sq. ft. spec building that should be completed this fall. The rest of the buildings in the 735-acre park are about 95% occupied, and there's still over 100 acres left for development.

The office market is seeing some new construction, as well. Most notable is the 26-story headquarters tower downtown for American Stores. The building will be about two-thirds owner-occupied.

And east of downtown, developers Mielke Holdings Inc., of Pasadena, Calif., and Wallace Investments, of Salt Lake City, have started work on Cottonwood Corporate Center, a 44-acre project slated for 11 office buildings and one hotel.

The amazing thing is, with all of this new construction planned, and with the controlled-growth attitude, none of these developers seem worried about filling their space. They are confident of Salt Lake's ability to continue attracting high-tech industries, back office operations and warehouse/distribution facilities on the city's own terms. If anything, industry professionals say they worry about having to turn away new users because of lack of available space.