Kiger's Notebook

Yogurt to start flowing on Second Street

CherryBerry is slated to open for business at 11 a.m. Friday, says Joel Granberg, who owns Rochester's new self-serve yogurt spot.

CherryBerry, a national self-serve frozen chain, adds some sweetness to the new Shoppes on Second by the new Holiday Inn Express and the Miracle Mile Shopping Center along Second Street Southwest.

The concept is that customers choose one or a combo of 12 flavors of yogurt and then hit the topping bar for 40-some choices ranging from fruit and granola to Gummi worms and chocolate syrup to create their own customized treats. The cost is based on what the final creation weighs.

If you are working a long day Friday due to extra work caused by the long holiday weekend, you have until 11 p.m. to make it in to try some yogurt.

Lunds/ Byerly's scouting state for new grocery locations

While Rochester has many grocery stores in the pipeline - Fareway, CostCo, People's Food Co-op and Hy-vee - there are a few chains, like Whole Foods, that local people seem to still want here.

Another grocery store chain that is often mentioned on local wish lists is Lunds/ Byerly's. It's a Minnesota company with 22 stores in the state, most in the Twin Cities area.

A recent posting on a national commercial real estate site could be good news for local fans of Lunds/Byerly's. The company is out and about shopping for new locations in Minnesota.

In their own words, Lunds/Byerly's describes what they are doing:

"Growth opportunities are sought throughout the existing market during the coming 18 months."

Now that "existing market" phrase could mean they are just looking in the Twin Cities-Land area.

Back in 2008, Lunds/Byerly's went on a similar shopping spree and they obviously skipped over Rochester then.

Jennifer Kent of Lund Holdings told me this back then, “We do understand there is a lot of interest to for us to come down to the Rochester area, but we are not quite ready to move that far out … of the Twin Cities area."

Of course, things can change. Rochester is larger now and is pegged as a growing and vibrant community in constrast to many other Minnesota cities.

So who knows? Maybe they'll give the Med City a closer look this time around. I probably should give Jennifer another call to check in.

Here's the posting from the Dealmakers commercial real estate site:

Lund Food Holdings, Inc. trades as Byerly’s and Lunds at 22 locations throughout MN. Lunds prefers to occupy spaces of 40,000 sq.ft. and Byerly’s prefers to occupy spaces of 60,000 sq.ft. in freestanding locations, strip centers and urban/downtown areas.  Typical leases run 20 years with options.

Mercedes shifting into high gear to build Med City dealership

I popped out to the groundbreaking at the new Mercedes-Benz car dealership Monday morning. They have done an amazing amount of work in less than a week out there. The dirt is really flying.

While out there, I had a flashback to September, 2006 when I went to another groundbreaking for a car dealership out there at the Shoppes on Maine area. That was before Target, before Lowe's, before Wherenberg and before my mustace went gray.

That groundbreaking was for the Rochester Toyota dealership owned by Rob Gregory.

Coming back to the present, here's some on the Merecedes groundbreaking:

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Construction of a new Mercedes-Benz car dealership is shifting into high gear in south Rochester as it drives toward a goal of opening sometime in March.

The Ballweg Family of Dealerships is moving its Mercedes dealership from Wausau, Wis., to a spot at Shoppes on Maine near Target South and Rochester Toyota.

Officials from Ballweg and Mercedes were at the site Monday for a ceremonial groundbreaking as big machinery roared by moving dirt in the background.

Ballweg CEO Jason Brickl says the project is moving forward quickly because of interest in Mercedes in Rochester.

"They did a market study and Rochester looked incredibly appealing," he says.

Jack Holt, Mercedes' franchise manager for the central region, said the company's research found that this location looks very promising.

"We think Rochester is the right place to be and we think we have the right partner in Ballweg," he says. "We think this will be great."
Already, area customers have been calling to inquire when the dealership will open.

"We've never had that kind of interest this early in a project before," he says.

Rochester has been without a new Mercedes dealership since about 1998.

Brickl expects to hire between 20 to 25 employees to staff the 21,000-square-foot dealership. It will have nine service bays. He has already brought in a general manager to run the Rochester operation.

Beyond Mercedes' well known line of vehicles, this dealership will also offer its smart brand of mini and micro cars and its line of Sprinter commercial vans.

Once open, Ballweg's Rochester dealership will keep between 100 to 150 new and used vehicles on display.

New owner to take over, expand Med City liquor store

A Med City liquor store is about to go through the blender, but it's expected to have a familiar flavor when the new version is poured back into the mix.

Apollo Liquors is leaving its store at 3514 55th St. N.W. at the end of the month, when its lease ends.

However, a new owner is stepping into the spot to keep it going as Northwest Liquors, which is what it has been called for the past 10 years in the space next to Gander Mountain.

Irv Keefe plans to take over as the owner and re-open the store under the same name of Northwest Liquors. He has already hired most of the current staff and the manager to stay on there.

"Customers will still see the same faces, when they come in," he says.

Construction is under way to expand the store to 6,200 square feet from its current 4,500 square feet. Look for that work to speed up after Friday, when Apollo leaves.

Keefe hopes to re-open the new version of the store by mid- to late September.

He plans to use the additional space to bring in a 60-foot, state-of-the-art cooler to expand the store's micro beer offerings. He also will add more varieties of other products and a new wine tasting area to the store.

Meanwhile, Ari Kolas has his own project in the works. He is still putting the finishing touches on the deal, so watch this column for more details in the near future.

Once Northwest Liquors closes, Apollo will have four stores in Rochester. It also has a store in Austin, where the chain was originally founded by Nick Kolas.

Keefe says while he has long worked as a distributor in the alcohol business, this is his first step into the retail side of things.

"It is something I've always wanted to do," he says. "It is a challenge. I've always liked a challenge."

With the idea of eventually opening a store somewhere, he acquired an off-sale liquor license from the city of Rochester back in March.

"There were only so many of them," Keefe explains. "So I decided to grab one while I could."

Some buzz has been going around that this new store will be linked to Rochester's Chafoulias family. They own Apollo's prime competitor, Andy's Liquor.

Not so, says Keefe. He explains that he is the owner, not the Chafoulias family.

The only connection to the Chafoulias family is that he does work for their company, Titan Development Group.

Victory will be sweet in Kemp's ice cream flavor contest

It's a fair question. Rah! Rah! Rhuberry or Mini-sota Donut?

Victory will be sweet no matter who wins Kemps' ice cream flavor duel underway at the Minnesota State Fair. Either way, Kemps senior food technologist Logan Julstrom will put the final touches on the recipe before the Rochester ice cream plant starts serving up the winner for a victory lap.

"It is super fun. I think it is so cool that the fans get to make their own flavor," says Julstrom.

This year Kemps asked people to create a flavor to evoke their favorite Minnesota memory for its Hometown Favorites Ice Cream Contest.

More than 240 ice cream flavor ideas were submitted and online voting narrowed the choices to 10 and then down to the final two that are now going head-to-head at the Minnesota State Fair taste test.

Fair-goers can stop by the Kemps booth on Machinery Hill from 1 p.m. to 2 p.m. daily to sample Rah! Rah! Rhuberry and Mini-sota Donut.

Rah! Rah! Rhuberry is described as "Custard ice cream, swirled with strawberry rhubarb sauce mixed in with pieces of pie crust." Its competition, Mini-sota Donut, has more of a fair flavor. It contains cinnamon and nutmeg chips with chunks of mini donuts.

The creators of both flavors were very specific about their vision of Minnesota, so Julstom had a clear road map for each. The sticky part was in the actually execution.

"It is not like I can just run out and buy a bag of mini-donuts and throw them in," she says. “These two flavors are unlike anything Kemps has ever created."

On Aug. 29, the grand prize winner will be chosen by a combination of fair-goer votes, online votes atwww.kempsnextflavor.com and a celebrity judging panel at the fair. The judging panel will feature Kemps spokeswoman (and Joe Mauer’s mom) Teresa Mauer, the 2011 Hometown Favorites ice cream flavor winner, Jen Folkens, and this year's Princess Kay of the Milky Way.

The winner will receive $2,500, a year supply of their ice cream and their flavor will appear on store shelves in 2013.

Last summer was the first time Kemps held this flavor contest. The 2011 winner, Land of 10,000 Licks, is in selected grocery stores like Cub Foods right now. The Rochester plant recently made 14,400 scrounds (That's what they call the squarish ice cream containers with rounded corners) for a limited run in the region.

Kemps will produce either Rah! Rah! Rhuberry or Mini-sota Donut next summer to hit the shelves.

So does Kemps flavor expert Julstrom have a favorite that she hopes will scoop the competition?

"I absolutely love them both…really," she says with a laugh.

Investing site looks at Mayo Clinic bonds

Here's another take on Mayo Clinic's $300 million bond issue. I wrote about this Monday (I think). The Bond Buyer web site took a much more in-depth look at Mayo Clinic's bonds in an article by Yvette Shields on Monday.

Here's some from Shields article and a graphic that accompanied it on the Bond Buyer web site.

Lured by attractive Treasury rates and the absence of tax-exempt compliance issues, the Mayo Clinic accelerated its borrowing plans and opted to go with taxable paper in a $300 million issue ready to sell this week.

The bonds are tentatively structured to mature in terms due from 2039 to 2043, but could change depending on demand, said the clinic’s manager of treasury services, Rick Haeflinger.

Bank of America Merrill Lynch is the book-runner with Wells Fargo Securities also serving as an underwriter. Dorsey & Whitney LLP is bond counsel and Raymond James| Morgan Keegan is advising the clinic.

Ahead of the sale, Moody’s Investors Service affirmed the Rochester, Minn.-based clinic’s Aa2 rating and Standard & Poor’s affirmed its equivalent AA rating. The hospital has $2.4 billion of rated debt. Both agencies assign a stable outlook.

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“We moved our plans up given where rates are and decided to use the taxable market given the ability to get the deal done quickly,” Haeflinger said. “With spreads so narrow we didn’t see much advantage in doing it tax-exempt.”

By forgoing the tax-exemption, Haeflinger said the clinic can more quickly put the proceeds to work since it won’t have to identify qualified tax-exempt projects and it is freed of regulatory compliance issues.

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The clinic has privately placed some taxable paper in the past, but the $300 million sale marks its first public offering to taxable buyers. On Monday, the 30-year Municipal Market Data top-rated yield stood at 3.01% while the 30-year Treasury yield was at 2.93%.

Roch.'s Sam's Club to get $3.5 million makeover

A $3.5 million makeover is slated to kick off yet this year at Rochester's Sam’s Club store

The Sam's at 3410 55th St. N.W. is one of 74 stores across the country currently scheduled for an upgrade. Sam's is the discount club member of Walmart's retail family.

"…This club will be modified to make shopping easier and faster by placing the most purchased products in more convenient locations and improving both interior and exterior areas of the club," stated Carrie Foster, Sam's spokeswoman, in an e-mail response to my questions.

A building permit estimating the value of the project at $3,546,318 was submitted to city planning officials earlier this week. Foster says the work is expected to wrap up next summer.

Sam's statement says a new drive-up canopy is being to added to keep customers dry when loading up their purchases during bad weather. The store's pharmacy and vision centers are also scheduled for remodeling to improve their efficiency.

The last time this store underwent a major remodel was in November 2010, when it expanded its selection of baby food, diapers, produce, meats, cheeses and over-the-counter medicines.

Is it a coincidence that this big dollar remodeling project is slated to kick off just as Sam's top competitor gears up to enter the market?

The company's officials chose not to respond to that question, when I sent it to them.

However, it is hard to not factor in the effect of the 150,000-square-foot Costco discount club store plus gas station under construction along West Circle Drive. Costco has announced an opening date of Nov. 16 for this store, its first in this part of the state.

One thing's for sure: Rochester discount shoppers will soon have both retailers working hard to vie for their business.

Competition, obviously, can be a good thing for customers looking for a good deal and for more variety.

Family's news stand wrapping up 57 years at Mayo Clinic

Here's some from my piece on the Subway News Stand and its 57 years at Mayo Clinic. There are so many good stories from these guys that it was a struggle to know when to stop writing.

One memory that didn't get in was Ben Kaplan picking up the daily horse racing newspaper from the Rochester 400 train every morning. Local legend said it took 400 minutes to get from Chicago to Rochester.

During the winter, sometimes the bundles of publications would get frozen to the train car and an ax would be needed to get them out.

There were five guys always waiting in the Kahler Hotel to buy those racing sheets, he said, but he declined to name them.

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It used to be common to see almost everyone in Mayo Clinic's many waiting areas, patient rooms and staff cafeterias reading a handy magazine, newspaper or paperback book.

For the past 57 years, much of that printed paper flowed from the Kaplan family's Subway News Stand in downtown Rochester. However, times and reading choices change.

"Today you don't see that. Now they all have an iPad, Blackberry or Blueberry or whatever. You know, all of that electronic stuff," says 84-year-old Ben Kaplan, who started the news stand with his brothers.

On Aug. 31, the long story of the close partnership between the Kaplans and Mayo Clinic will reach its end. The fifth and final version of the family's news stand will ring up its last sale.

Declining sales, changes in the industry and rising prices convinced Steve Kaplan and his uncle Ben that it was time to close up shop at the end of their 10-year lease.

The Subway News Stand is tucked inside the Mayo Clinic Gift Shop at the heart of the Gonda Building on the downtown campus. There's no word yet what Mayo Clinic has planned for the space.

"We've enjoyed serving patients and employees. We've made a lot of friends over the years," says Steve Kaplan, as he sits surrounded by postcards, newspapers and magazines. "The people are what we'll miss the most."

While talking about the past, a shopper with a magazine under his arm paused on his way out to tell Steve that he had spent a lot of time in shop during the past four years. "I'm really sorry to see you go."

Kaplan, who started helping his father and uncles when he was just seven, has been a familiar face in the Gonda Building since it opened 10 years ago.

It all started back in 1947. That's when three Kaplan brothers — Milton, Hyman and Ben — purchased a wholesale distribution business called the Rochester News Agency. It sold papers, magazines, books and more to city news stands.

The business quickly grew, and they bought a sibling firm in Wisconsin, the La Crosse News Agency. When the Mayo Building was constructed, Milt Kaplan met with Mayo official Bill Harwick about opening a news stand in the new building.

"He said, 'We'd been thinking about it. … Send me a letter, and I'll put it in my file," remembers Milt Kaplan, who now lives in Milwaukee. "They hadn't started the building yet. About nine months later, he called me to meet with the architect."

Just like the Gonda did 47 years later, the new Mayo Building opened in 1955 with a Kaplan news stand leasing space in its subway. Most magazines, like Readers Digest, cost just a quarter. Cigarettes were two packs for 25 cents.

Tire centers change ownership

To give his tire business more traction in this region, Jerry Bauer of Bauer Built Inc. bought two Hanson Tire Service centers this week.

On Monday, the Durand, Wis.-based Bauer Built took over Hanson Tire's original headquarters in LeRoy along with a location in Preston. While the center will eventually change names, they will remain under the Hanson Tire name for now.

"Our normal trend is to transition places we acquire over to the Bauer Built name sooner than later, but we're keeping these as Hanson Tire for a while," Bauer says. "They've been a very successful business, since 1953."

Almost all of Hanson's 20 employees are staying on under the new owner. Former owners Randy Eastvold and Greg Rollins, along with Ron Eastvold, are helping with the transition.

Bauer declined to discuss the financial terms of the acquisition.

These additions bring the tally of Bauer Built tire centers to 31, including ones in Rochester, Red Wing and Albert Lea. They also have seven Michelin retread plants, three wheel refinishing facilities and a bulk petroleum operation.

A second generation, family-owned business, Bauer Built was  founded by Sam Bauer in 1944.

Why add the LeRoy and Preston centers to the company's extension portfolio of facilities?

"We are always looking for going concerns that are profitable. They have many comparable products and they are very strong in agriculture," he says. "They will help us grow in that area."

Another reason is obvious from a quick look at the map. Bauer has locations surrounding the new additions.

"Geographically, they will fit in well and fill in some voids for us," he says.

This deal does not have any links to Hanson Tire of Austin, which has a different owner. The same is true of the Hanson Tire in Albert Lea, which has another owner.

Hanson Tire, started by Don and Donna Hanson in 1958, grew to 11 stores at one point. It was then recognized as the largest tractor and truck dealer in the nation.

There was once a Hanson Tire location in Rochester, but no longer.

From "Opening Soon" to "Now Open" - Jimmy John's South

The banner hanging over Rochester's south Jimmy John's Gourmet Sandwiches shop is changing from "Opening Soon" to "Now Open" today.

Skip and Tammy Christian are delivering their third Med City sandwich shop at 10:30 a.m. this morning.

"We just got the word Friday night that we're cleared to open," says Skip Christian. "Jimmy John's always opens on a Tuesday."

This latest Jimmy John's is along South Broadway in the Crossroads Plaza. It's in the former home of the Maid Rite Diner, which closed earlier this year.

Traffic on the first day could be significant. The sandwiches will start flowing today a few hours before Vice President Joe Biden will appear across the street at the Olmsted County Fairgrounds.

While the process to build out this new location took longer than expected, Christian says it is now ready to roll with clearance from local officials and Jimmy John's head office.

"You've got to be efficient… got to be quick and you've got to be fresh, before you open up," he says.

This new shop is staffed by a team of 30 to 35 people. That'll bring Jimmy John's total employee numbers to almost 100 in Rochester.

While the menu and fast delivery at this location will mirror its older siblings, a drive-though window makes it unique among the other Med City Jimmy John's.

This shop will be exactly the same size as the northwest location, which is at 2986 41st St. N.W. in the Jiffy Lube center. The Christians opened that one in 2009.

Their first shop launched in 2005 in the Kahler Inn and Suites complex in downtown Rochester.

Since then, Jimmy John's has seen a lot of competition come to town, with the latest being a Cousin's Subs opening on Second Street Southwest.

"Competition is good. It really does help us all," Christian says. "It gets people out. I enjoy the variety."