Subway of Nenana Brings Fast Food and Jobs to Underserved Community
Elijah and Erin Verhagen brought a slice of the familiar to the remote Alaskan town of Nenana when they opened the city’s first national fast-food franchise: Subway. Nenana is located over 300 miles and a 5-hour drive north of Anchorage, a journey comparable to driving from New York City to Portland, ME. It is considered remarkably isolated, with a population of under 360 people—roughly the same number of employees as the Pittsburgh Penguins hockey team.
Their venture quenched the local thirst for convenient, quick meals and injected new life into the Tanana River community. Beyond satisfying cravings and providing a healthy meal, the business has proven to be a cornerstone for economic growth, providing jobs and boosting the local economy.
However, as small business owners know, launching a business, especially in a remote location, presents unique challenges. The Verhagens faced a daunting hurdle in securing the capital needed to transform their Subway dream into reality. Tenant improvements, inventory, and equipment costs threatened to derail their plans.
Northrim Bank recognized the potential of their venture and its positive impact on the community. With a shared vision of success, the bank became a supportive lending partner with the Alaska SBDC’s State Small Business Credit Initiative (SSBCI) program, providing a loan guarantee that enabled Northrim Bank to confidently extend the financing necessary to equip the restaurant and bring the Verhagen’s vision to life. The loan amount, representing an investment of over $350 per community member, was a significant sum in this remote town.
“The SSBCI guarantee provided the needed flexibility to support a start-up business in a semi-remote community,” said Jonathan Tibbs, Vice President at Northrim Bank. “It enabled Northrim to provide the needed capital to complete the required franchise tenant improvements.”
The Verhagen’s venture has brought tangible benefits to the Nenana community. The new Subway has created nine jobs, representing 2.5% of the population. Given that rural Alaska unemployment rates hover around 4.9%, this job creation could decrease the local unemployment rate by half. Since opening its doors, the restaurant has quickly become a popular dining spot, offering residents a convenient and familiar meal option in an area previously underserved by this type of establishment.
Nenana’s new Subway has not only filled a void in the local food market but has also contributed to the city’s overall economic vitality. The Alaska SSBCI program and Northrim Bank are proud to have supported this successful venture and celebrate the Verhagen’s entrepreneurial spirit and commitment to their community.
