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19 posts from May 2014

May 30, 2014

Countertop business gets new owner, name

A new owner is re-launching a Rochester countertop maker with a new name and the same staff.

Tom Pinske, a well-known figure in the Corian countertop industry, has purchased the facility and equipment formerly used by AFM Surfaces at 1233 Eastgate Drive S.E., near the Wicked Moose Bar & Grill.

AfmcountersUnder the new name of Ultimate Surfaces, the company will continue to make stone, quartz and other types of countertops. Pinske has kept the former AFM's seven employees, including General Manager Tony Heintz.

The ownership change became official on May 21, when Pinske bought the facility for $495,000. He had leased it for some time before that.

Ultimate Surfaces is now a division of one of Pinske's three companies based in Plato, Minn. Pinske owns Plato Custom Concepts, which makes kitchen cabinets and Corian countertops for commercial construction projects.  He also owns Pinske Edge and Pinske Power, which make specialized tools for the countertop industry. Many of those tools were invented by Pinske when he started working in the trade 26 years ago and couldn't find the tools he needed.

"Like my dad did when he couldn't find the right tool when he was building churches, banks and schools, I made what I needed," he says. "I started out making tops and ended up in the tool business."

Over the years, he has become famous for those tools and was inducted into the International Surface Fabricators Association Hall of Fame in 2003.

Tim Buechler, who started AFM in 1990, purchased and used many of those tools in Rochester. When AFM became available, it caught Pinske's attention.

"I don't do any engineered stone or quartz up here in Plato. I thought this was a good opportunity to get into the stone business without revamping things up here," he said. "I was looking to expand and this kind of fit with my plans."

Like many construction-related companies, AFM has faced difficulties in the past few years. While Buechler is no longer with the operation, Pinske thought what he built was worth polishing and re-launching. He particularly wanted to keep the current employees on the job.

“We love what we do and look forward to growing under Tom’s leadership," said Heintz, the general manager. "The skill and expertise he can bring us, and our customers, is incredible."

May 29, 2014

Second Salvation Army store to open

Rochester should have two Salvation Army thrift stores within a few months.

Work has started in a 1,400-square-foot space in the Slumberland Center at 4909 U.S. 52 North, along the frontage road, according to David Ferber, the local director of community engagement for the Salvation Army.

The space is being divided to set up a sales floor separated from the donation sorting area.

E06c662a-9cf7-4fa6-b6ed-565c49263db1The hope is to have it ready to open by late summer or more likely by early fall.

The Salvation Army is leasing the space from Lou Grimaldi, who owns Slumberland as well as the commercial space behind the store. It will be about half the size of the current south Rochester thrift store at 201 Ninth St. S.E., though it will offer the same mix of donated clothing, household goods, toys, books and more.

"We have been working on this for a while. We realized there was a need in Rochester for another store," Ferber said. "Our customers have told us that they want a northwest store."

He credited Grimaldi with helping to finally make this project a reality. While the location is not as visible as most traditional stores want, Ferber says it is a good fit for the Salvation Army.

"We're a destination. I think people will find us," he said.

The Salvation Army's thrift store always has been popular in Rochester, though it has been located in different spots.

Since 2006, the thrift store has been in its spot in the west end of the Kmart center. Its former building downtown now is used for its Caring Partners Adult Day Program.

In recent years, the resale market has grown in Rochester, with Savers, Goodwill and several private shops opening or expanding. That has served Salvation Army well, as more than 80 percent of the sale of each donated item is used to support Rochester programs.

"We have an amazingly generous community," said Brad Dahlke, who is assistant manager of the current store and will be in charge of the new north Rochester location.

Dahlke anticipates it will take about 15 to 18 employees to staff the new store. The current one has about 28 staffers.

He says Rochester always has responded well to the Salvation Army's store with donations as well as shoppers. Some frequent the store for its inexpensive basics. However, others shop like it's a "treasure hunt."

"Lots of antique dealers and collectors shop the store," Dahlke said.

While finding that valuable item is rare, it does happen occasionally. He recalled the story of a person who bought a dusty floor lamp for $5 and re-sold it for $5,600.

May 28, 2014

Analyst speculates that Hormel may be target of takeover bid

There's a lot of merger and acquistion activity cooking in the meatier aisles of the financial markets these days.

Spammy2The latest was Pilgrim Pride's surprise move to buy Hillshire Brands. Lots of investors with stock options profited from the $6.4 billion deal and that's leading to speculation about the next meat deal to hit the grill might be.

I spotted a very speculative column today on Barron's website by Scott H. Fullman of investment research firm, Increasing Alpha, on that topic. Fullman focused Austin's favorite Fortune 500 company and the creator of Spam, Hormel Foods, as a takeover candidate.

I have no idea if his theories make sense.

Here's some from Fullman's piece:

"Often when such an acquisition takes place, we look for other candidates. One stock seeing increased interest re Spamproductscently is Hormel Foods Corp, which rose back above its 100-day moving average Tuesday and was attempting to break above its 50-day moving average, but ended the day just below it. Momentum is rising sharply and volume is higher as well.

We are seeing a slight increase in implied volatility for Hormel, even as the shares jumped. The 30-day implied volatility is up more than 0.7% for calls, and down 0.8% for puts, indicating a sharp shift in bullish sentiment.

Despite the rise, those risk premiums are still close to their 52-week lows. Clearly, other traders are having the same thought as we are.

If you are looking for a low-cost, low-dollar-risk entry, consider purchasing the Hormel July $50 calls, which are offered at 40 cents. The delta on that option, which shows the current relationship between the movement of the stock and the option, is 23%, but it is expected to rise as the call becomes closer to being at-the-money, thereby increasing the leverage of the option. If the stock rises 10% from here to $52.58, the options will be worth $2.58, for a gain of $2.18 per share, or 545%. If the shares fail to rise, you will lose 40 cents per share, or 100% of your investment.

That compares, however, to a potential loss of $1.14 for those purchasing shares if the stock reverts to Friday's closing price.

Our suggestion is to purchase an equivalent number of calls to the amount of stock you can afford to buy, thereby keeping your risk in check.

May 27, 2014

Zumbro River Cafe to focus on breakfast, lunch

Going with the flow, Rochester's Zumbro River Café is following the current toward the rising sun.

The café at 120 Elton Hills Dr. N.W. will soon shift its daily schedule earlier by offering breakfast every day and continuing to serve breakfast items through lunch. Previously, breakfast was only offered on weekends. As part of the hours adjustment, the restaurant will also drop its dinner service.

ZumbroRiverCafeExteriorOwners Dennis and Lynn Wong say the new earlier schedule started at 7 a.m. today. Zumbro River Cafe will then serve breakfast followed by lunch until closing time at 2 p.m. It's open Tuesday to Sunday and is closed on Monday.

Dennis Wong says the change is spurred by customer requests and how traffic fades in the evening.

"We've had a really good response," he said of telling customers about their plans.

Customers are particularly pleased about being able to order some of the restaurant's popular breakfast items, like the New Orleans Omelet, for lunch.

The Wongs opened Zumbro River Cafe in 2011 to complement their Dunn Bros. coffee shop, which is its next-door neighbor. The restaurant gives customers a place to get a full sit-down meal, if a quick bite with coffee is not enough.

The Zumbro Cafe seats about 35 people in  950-square-feet of space just east of the coffee shop, between Dunn Bros. and the Olmsted National Bank branch.

"It has worked out well," Dennis Wong says. "The cafe is a little quieter. The coffee shop is louder and has more more hustle and bustle."

The Wongs also own two other Rochester Dunn Bros. as well as a downtown noodle shop called Hot Pot.

May 23, 2014

New Amish furniture store opens in southwest Rochester

Rochester's newest Amish-made furniture store opened its doors for the first time Thursday. 10356346_241722129357743_6258011130625535514_n

Deutsch Furniture Haus opened its 7,700-square-foot store at 3551 Commercial Drive Southwest in the old Mill's Fleet Farm building along South U.S. 63. ApplianceSmart occupies the rest of the building.

Two Rochester couples, Brian and Michelle Rand along with Philip and Nissa Kraling, are excited to have the business rolling along. They even have an Amish buggy out front.

"We ha 10382875_243297112533578_8444091897688806088_nve something for every room — the bedroom, dining room, office, nursery, pretty much everything," said Michelle Rand.

They even carry a line of Amish-made mattresses.

All of the furniture is crafted by Amish families in southern Minnesota and some in northern Indiana.

As a sideline, Brian Rand sold furniture made by local Amish for five years online. It eventually grew to the point that they decided it was time to open a store. Brian Rand and Philip Kraling are brothers, so it's a family-owned-and-operated business.

The Rands and the Kralings have a grand opening event planned for June 12-14. It will include a drawing for prizes.

To be respectful of the furniture makers' beliefs, the new store will not be open on Sundays. Amish beliefs also factored into why the word Amish was not included in the store's name. It is open from 10 a.m. to 7 p.m. Tuesday through Friday and 10 a.m. to 5 p.m. on Saturdays.

May 22, 2014

H3 Plaza rising quickly in downtown Roch.

05222014plazaonthird1Once construction eventually began, Rochester developer Andy Chafoulias' long-planned Plaza on Historic 3rd at 300 S. Broadway has been steadily on the rise.

Chafoulias' Titan Development and Investments is building a six-story complex on the spot once occupied by the former C.O. Brown insurance offices.02282014cobrowndemo

Here's a little reverse retrospective on that site:

The photos go back in time, though the final image is the rendering of what The Plaza is slated to look like.

While it has seen significant changes, the latest version of the TitanCo_brown project still includes the restaurant on the street level and the roof-top lounge/bar that were in the original vision.  

Restaurateurs Pat Woodring and Scott Foster, the minds behind Chester's Kitchen & Bar and Pescara, are still slated to create, own and manage those operations. Woodring and Foster have worked with the Chafoulias family for many years.

In September, the Rochester Economic Development Agency approved a special redevelopment tax-increment-financing district to raise $300,000 to cover asbestos removal and demolition of the former C.O. Brown building.Citycenter-H3-Plaza-on-Historic-3rd-rendering-1-600x330

The project was earmarked by the Rochester City Council in September to be included in the $2 billion in private investment promised to the state as part of Mayo Clinic's Destination Medical Center initiative.

 

Hers store to reluctantly close at Apache Mall

Sometimes things don't work out as planned, like a longtime local retailer's return to the Rochester's Apache Mall.

Hers, which has a pair of successful women’s clothing stores in downtown, opened a third store in the Apache Mall in 2012. That signaled the Dahlstrom family's return to the mall, where the first version of their store originally opened 34 years. In fact, the store founder, BoApacheb Dahlstrom, was once the manager of the old Dayton's store in the Apache Mall.

Owner Bruce Dahlstrom, Bob Dahlstrom's son, thought having a store in the mall would help Hers reach customers who don't shop in downtown Rochester.

Now that outreach will soon come to an end. The Apache Mall location put up signs this week announcing the start of "a store closing sale." Bruce Dahlstrom confirms that his Apache Mall store will close its doors at least by the end of July, a move that he feels was forced on Hers.

"It wasn't our choice," he said.

Hers has one year left on its three year lease with the Apache Mall. Dahlstrom had planned to keep that store open at least into 2015. The sales numbers have been "reasonable" to support the store, which has five employees on staff.

3e455f11-88a5-4cb5-81a5-ecfbb83eb371The hitch in that plan is that the Apache Mall management has different plans for the 1,550-square-foot space Hers occupies in the Macy's wing of the mall. Dahlstrom says he was told that  the space was needed for a national tenant.

When contacted for a comment, Mall Manager Kim Bradley said her company, General Growth Management, doesn't discuss such business dealings.

"The gave us the option to re-locate to another spot, but we'd to build it out at our expense," Dahlstrom said. The Rochester retailer had already invested quite a bit in building out the current Apache Mall.

Eventually, a frustrated Dahlstrom decided to just close the Hers store in the mall and put all of his focus on the "healthy" downtown stores as well as its online presence.

May 21, 2014

Mayo launching bioservices firm

Mayo Clinic has long processed and stored patient specimens for its own researchers.

Now it's packaging those services and others together to offer to outside clients via a new start-up company to be called Mayo Clinic Bioservices.

537cd487db2b9.image"Basically, we're taking advantage of some internal business that we've been doing for some time and now we're offering all of that externally to customers," explained Stephen Thibodeau, co-director of the Biorepositories Program in the Mayo Clinic Center for Individualized Medicine.

This new firm will allow Mayo Clinic to compete in a growing bio industry valued internationally in the billions.

He compared the business model to that used at Mayo Medical Labs, which tests patient sample for hospitals and researchers around the world. Mayo Clinic Biosciences won't run tests, though it will process, store and ship samples for its clients.

In addition to those services, it will also offer access to Mayo Clinic's Biobank. The Biobank features thousands of biological samples, such as blood, from healthy volunteers. Mayo Clinic has been collecting samples for seven years toward reaching a goal of 50,000 samples. Thibodeau estimates that the Biobank will finally reach that goal by June 2015.

The primary base for the new operation is being set up in the warehouse at 2915 Valleyhigh Dr. N.W., which Mayo Clinic bought in 2012. Some freezer units have already been installed and more construction to adapt the facility is underway. Thibodeau estimates that the facility will be ready this summer. Mayo Bioservices is expected to move in by August and have the operation running by September. It will also have satellite locations on Mayo Clinic's Florida and Arizona campuses.

Mayo Clinic currently supports the internal clinic sample processing and storage with a staff of about 70 employees, 50 of which work in Rochester.

"Initially, we expect to have a sufficient amount of staff. Though we do expect the business to grow over time and that we'll need to add more later," he said.

While it's not in operation yet, Mayo Clinic Bioservices has already signed up its first customer.Los Angles-based Sanguine recently signed up to have Mayo Clinic Bioservices process, store and ship biospecimens that Sanguine has collected for clients.

"We are excited about the pilot project with Mayo, not only because it increases the scalability of our business, but also because it allows individuals that have been on our waiting list to participate in the research and development of new treatments," stated Sanguine CEO Brian Neman in the annoucement. "Mayo Clinic Bioservices has tremendous infrastructure and processing capacity that will meet our existing needs while also offering the potential for future expansion."

The agreement between Mayo Clinic and Sanguine is a fee-per-service deal at this point, though they expect the business connection to deepen as time goes on.

"We hope to have a long-term relationship with Sanguine," according to Thibodeau. "Essentially, we're the laboratory arm of Sanguine."

May 20, 2014

Hy-Vees to add sit-down restaurants

The Hy-Vee grocery chain plans to upgrade the in-store restaurants in its three Rochester stores to fit its full sit-down model, which serves beer and wine. 

05202014hyveebarlowRemodeling the current spaces into Hy-Vee's Market Café casual restaurant format could begin as soon as June at the Barlow Plaza and Crossroads Plaza stores, said Chris Friesleben, the Iowa-based grocer's director of communications. She estimates that the new cafes could be ready to open by August.

The Hy-Vee store on 37th Street Northwest also has a new Market Cafe on the menu, but it will always undergo a major renovation. It will get a new pharmacy, customer service counter and floral area. The exterior will get a major face-lift and Rochester2the parking lot will be repaired as well as expanded. That construction project is tentatively expected to begin in July.

When they open, the new Market Cafes will have a wait staff that will take orders at the tables, in contrast to the current cafeteria-style ordering used in Rochester's Hy-Vee eateries. They will also offer beer and wine with the meals.

West Des Moines-based Hy-Vee is an employee-owned corporation operating 235 retail stores in eight Midwestern states. For 2013 the company recorded sales of $8 billion, ranking it among the top 25 supermarket chains in the United States.

The sit-down Stor1547 restaurant is a model that Hy-Vee has found success with in other markets.

"We've always been in food service. We do very well at breakfast and at lunch, but it really drops off for dinner in Rochester now," said Friesleben. "Everywhere we have Market Cafes, we find that the evening traffic picks up. By adding these to the Rochester stores, we hope to capture more of that dinner crowd."

She explained that by the end of the work day, customers want to relax and have someone come to take their order. They also seem to be more interested in having a glass of wine or a beer with dinner.

The seating in the Hy-Vee's food service areas will close down for construction, which should take about two months.  New tables and booths will be installed as will new decor.

"They will have a completely new look," Friesleben said.Iow0520hy-veemarketcafe03

The Market Cafes will also have a larger, dedicated staff than the store's restaurants have had in the past.

While Hy-Vee is moving decisively ahead with upgrades of its existing Rochester stores, it's "re-visiting the layout" of the proposed  95,000-square-foot store to be built along West Circle Drive, she said.

The project is still slated to move ahead, though the time line is uncertain until the plans are finalized. This fourth Rochester store was first announced in October 2011 after Hy-Vee purchased the property just south of the Northern Hills Golf Course for $3.19 million. It will be part of Rochester developer Dale Ragan's planned Northern Hills Commercial Park.

Previously estimated at costing between $15 million to $17 million, the proposed store is anticipated to be the largest of Hy-Vee's Rochester locations once complete. By comparison, the Hy-Vee in the Barlow Plaza is 78,000 square feet; the Crossroads store is 70,000, and the 37th Street store is about 60,000. Hy-Vee estimates that about 450 people will be hired to staff it.

Unlike the other stores, the new one is expected to have a different restaurant format called Market Grille. That model, which Hy-Vee uses in its newly constructed stores, has a more elaborate kitchen allowing for a more extensive menu.

May 16, 2014

Sale of Woodruff Co. complete, facility sold for $2.3 million

Whoops. I had the price wrong in the first version of this. I didn't notice at first that 1504 Third Ave. S.E. and 1514 Third Ave. were sold separately from the 1524 parcel.

Those two other pieces brought the total up to $2.3 million.

-------------

It looks like the sale of Rochester's longtime plumbing supply firm, Woodruff Co., has wrapped up.

Fargo, N.D.-based Dakota Supply Group bought the 67-year-old Rochester plumbing and utilities wholesale supply firm from the Woodruff family. It was expected to conclude on April 30.

WoodruffcoThe deal included Woodruff's Rochester complex at 1504, 1514 and 1524 Third Ave. S.E. as well its Austin and Winona locations.

Olmsted County just posted that the Third Avenue property was sold to DSG for $2.3 million on April 30.

Dakota is a distributor of plumbing, electrical, HVAC, refrigeration, communications, filtration and metering systems. It has locations in Minnesota, North Dakota, South Dakota, Wisconsin and Montana

Woodruff was founded by 1946 by James F. Woodruff, John D. Flowell and Frank C. Weber. The Woodruff family has long been very active in the community with involvement with Lourdes Catholic schools, Rotary Club and the Rochester Area Chamber of Commerce.

It built and moved into its current facility on Third Avenue in April 1964.