Kiger's Notebook

Downtown apts., grocery taking shape

Metropolitan Market Place, the four-story apartment complex with the new People’s Food Cooperative (formerly the Good Food Store) grocery store on the main level, is really starting to take shape at First Avenue and Sixth Street Southwest.

This is the project that La Crosse, Wis.-based Gerrard Corp. is building. It will have 62 apartments will all of the dust settles.

Work on this began in May. It is moving at a pretty good rate, despite att of the First Avenue and Sixth Street road work this summer.

To encourage economic development, the City of Rochester sold the former Minnesota Energy building at 519 First Ave. S.W. to Gerrard for the symbolic price of $1, also on March 30.

The city hopes to recoup its investment in the property through a tax increment financing district set up for the project. The city bought the building in 2008 for $750,000.

$12M upgrade is under way at downtown apartment complex

A $12.3 million makeover of a more than 30-year-old senior apartment complex is moving right along in downtown Rochester.

The 105 apartments in Central Towers, 200 First Ave. N.W., are being revamped with new paint, carpet, cabinets and appliances as part of the project. It is also getting a new roof, elevators, heating/AC system plus new windows.

Work started at the end of May.

"So far, it is on schedule. We expect it to be completed by the end of the year," says Mark Steege of Titan Development and Investments, Inc. Titan manages Central Towers.

The goal of the project is described as preserving affordable housing for seniors in Rochester. Its one and two bedroom apartments are almost full occupied right now, says Steege.

Tenants will remain living in the tower throughout the renovation, which is being spearheaded of Frerichs Construction of St. Paul.

Central Towers, which is Section 8 income-based housing for seniors, was built in 1980 by Central Towers Limited, a group of investors lead by Rochester developer Gus Chafoulias.

As part of this renovation project, the original owners sold the tower for more than $5 million in April to new company called New Central Towers Limited Partnership, which includes some of the previous investors.

Chafoulias is listed as the lead agent for New Central Towers. The firm is based in the nearby Minnesota BioBusiness Center on First Avenue Southwest.

Tax credits from the Minnesota Housing Finance Agency were sold to investors to help finance this renovation.

Downtown construction of apts. and co-op rolls on

Following the demolition of one of the University Village Inn buildings, the Metropolitan Market Place construction crews are working in a big, now-open space at First Avenue and Sixth Street Southwest.

Meanwhile, at the other end of the First Avenue block, work on the Metropolitan Market Place plunges ahead.

The La Crosse, Wis.-based Gerrard Corp. is building the four-story apartment complex with the new People’s Food Cooperative grocery store on the main level.

It will have 62 apartments will all of the dust settles.

To encourage economic development, the City of Rochester sold the former Minnesota Energy building at 519 First Ave. S.W. to Gerrard for the symbolic price of $1, also on March 30.

The city hopes to recoup its investment in the property through a tax increment financing district set up for the project. The city bought the building in 2008 for $750,000.

More demolition on Roch.'s 1st Ave.

More demolition is under way in downtown Rochester to clear the path for a new grocery store and apartment complex.

One of the two buildings at the University Village Inn apartments, 501 First Ave. S.W., is being torn down. The demolition reportedly is to help with the construction of the Metropolitan Market Place at First Avenue and Sixth Street Southwest.

The other University Village building on Fifth Street appears as if it will remain untouched. There are several tenants living in the former hotel.

The University Village, formerly the Executive Inn, is owned by Mark Kramer of New Hampton, Iowa. Kramer, who also owns the Days Inn hotel downtown, bought the Executive Inn for $890,000 in May 2009.

In 2010, the plan was to renovate the building along First Avenue to house commercial tenants as well as update the connected housing units.

No tenants were ever signed, and the work seemingly stalled. Now the windows and doors have been removed, and demolition has begun.

Once cleared, but the buzz is that the space will be used as a parking lot, at least for while.

Meanwhile, at the other end of the First Avenue block, work on the Metropolitan Market Place plunges ahead.

The La Crosse, Wis.-based Gerrard Corp. is building the four-story apartment complex with the new People’s Food Cooperative grocery store on the main level.

I should have more details on this soon.

Downtown Roch. grocery, apt. complex grinding ahead

Now Friday's groundbreaking is in the past, so the downtown demolition is rolling in high gear at Rochester's First Avenue and Sixth Street S.W. this morning.

This is the Metropolitan Market Place project, a four-story apartment complex with the new People’s Food Co-op grocery store based on the main level.

The La Crosse, Wis.-based Gerrard Corp. is building the project.

The 62 apartments are expected to ready for tenants possibly by August 2013.

In today's paper, Edie Grossfield followed up with People's Food Co-op for more details on that piece of the project.

-------------
Co-op manager Liz Haywood said members of the Historic Southwest and Slatterly Park neighborhood associations expressed their excitement during the ground breaking.

"It's going to be amazing," Haywood said. "We've spent a lot of time during the past few weeks talking with people in the area and there's a lot of interest in natural, fresh and locally sourced food."

However, the neighbors will have to wait, probably until August 2013, when the Metropolitan Market Place is expected to be completed. Being developed by Gerrard Corp., of La Crosse, Wis., the building will include four floors of apartments above the retail space.

The new store in Rochester will be about 26,000 square feet, compared to the existing store's 7,000 square feet. The largest expansion will be in the delicatessen area, Haywood said.

"We'll still have a hot bar and salad bar, but it will be greatly expanded," Haywood said. "We'll have rotisserie chickens, a cut-to-order meat department. Our meat sales have been growing … and we'll have full-service cheese, too."

The expansion of the co-op, especially the deli and meat department, will require an additional 50 employees beyond the current 35, she said.

Rochester-built homes heading to Dakota oil boom

Here's an extended version of the oil boom housing story in today's paper. It is kind of an interesting project.

-----------

A new Rochester construction firm is gearing up to build six houses a week, don't expect to see many of them lining local streets.

The majority of the two- to six-bedroom modular homes will travel about 500 miles before anyone moves into them.

North Dakota is booming with oil flowing out of the fields at unprecedented levels that recently pushed the state past Alaska into the number two spot for U.S. oil production.

While 575,490 barrels of oil a day was pumping in March, a pipeline of thousands of people poured into the Williston Basin area to fill the growing need for workers.

That wave of humanity is looking for housing in the boom towns that are struggling to keep up with demand.

That's where Dale Jech and Creative Modular Concepts come in.

Jech, a local contractor for more than 20 years, is now certified as a manufacturer of modular housing. He plans to start working his crew of 60 workers two shifts a day to build houses that will be sent to North Dakota, Wyoming and other Western areas.

"I already have orders for 80 homes," says Jech, who has based his operation in a 14,000-square-foot warehouse behind the ProBuild lumber yard in northwest Rochester.

He hopes to build about 145 homes this year.

Why would anyone have a house built in Minnesota and then ship it to North Dakota? It might not look logical, but it is the logistics that make it add up economically.

"Labor there is simply too expensive. Most of the houses now are coming from Indiana. They're even buying some in Florida and shipping them to North Dakota," says Jech. "We're close to the need, just 500 miles away. We can give them the most bang for the buck."

Right now he is offering six different models for order. Some are stackable units. Some are on wheels. But all are built "tight" and up to Minnesota and North Dakota building codes, he says.

An average transport is expected to include a day of travel to deliver three modular houses. If the buyer requests the Turn-Key option, Jech's team will take a day to hook up all of the utilities on the homes.

The Hospitality Package takes that a step farther.

 "That includes everything like silverware, coasters… You walk in and there there will be a TV on the wall and couches in the living room," he explains.

The company also taking orders here in southeastern Minnesota. Eventually, he plans to have some model homes on display here.

While it is a great time to start building modular housing, this is not something that Jech just jumped into at the last minute. He has been jumping through the legal hoops to nail down the necessary certifications for the past two years. 

When the housing market went south with the economy, he decided it was time to look for new options and now he has Creative Modular Concepts ready to roll

"The best thing is seeing the guys in here building a truss or whatever in the sunshine. They are doing what they love to do," says Jech. "This is a big deal. It is really exciting."

Home Design Studio goes dark

While it has been for sale for a while, it looks like the once-red-hot Home DesgnStudio showroom building along West Circle Drive in Northwest Rochester is now completely cold and dark.

Staff of the Studio plus Home Improvement Professionals and the Olmsted County Lumber Mart moved out on Friday and shifted their offices to the remaining space they have in Byron.

I'll have more details soon, but this move has gotten me remembering the golden days in the fall of 2006 when this massive, multi-level 32,000-square-foot showroom opened its doors and flipped on the hundreds of fancy light fixtures made the complex glow like a spaceship at night.

Pictures from Business After Hours and Builders events held there in 2006 and in 2007 during that time show a big shiny place bustling with smiling people. Most of the folks I can indentify have long since made forced career changes, lost jobs, had businesses go under and have faced a variety of other difficulties.

That was also the same time that Rochester Market Square, another home construction mall, also opened on t he south side of the Med City. That has since retracted quite a bit and its developers finally sold it to an out-of-state corporation.

It is quite simply a bygone era. I realize how much better Rochester has fared than most during these turbulent times. However, it is my impression that most of the survivors from those days have a lot more scars today than they had then.

Moving beyond maudlin memories, I am wondering what kind of business might buy this cavernous place and what could it be used for. It is fantastic rambling showroom.

But not many businesses go that big anymore. Maybe a furniture store or an Aquarius-style dance club?

We'll see, I guess.

Window maker exec on how her business weathers bad economy

I feel compelled to confess that I did not have very high expectations when I walked into the Rochester Area Builders meeting last night to cover the president of Marvin Windows talk about the economy.

However, I quickly upgraded my attitude as Susan Marvin began her engaging and interesting presentation.

Here's part of what I wrote for today's paper. Thanks to Mike Pruett of MLT for the pics.

People, community and commitment are the basic building blocks to create a foundation for a business to weather any economic storm and even grow during tough times.

Susan Marvin, president of the popular and successful Marvin Windows and Doors of Warroad, Minn, shared her 100-year-old, family-owned company's philosophy at the Rochester Area Builders annual meeting Tuesday night.

"We serve all of our stakeholders — our employees, our customers and the community," she told the attentive crowd of more than 200 at the Rochester International Events Center.

Marvin and her straightforward approach to business and opinions on the economy hit the national stage in the fall, when the New York Times wrote about her and the international window-making company based in a small Minnesota town of just 1,700 people.

The story generated an "incredible response" across the country and soon Marvin was appearing on CNN, Bloomberg Television and even President Obama discussing the window-making company during a speech.

"It is a story people were hungry to hear," she said.

While she describes a simple business approach, Marvin acknowledges that is not easy one.

"The last few years have been very tough. The economy went into recession and the home building industry went into a depression, one deeper than the Great Depression, with unemployment in our industry hitting 30 percent at one point," she said.

While her family's company was in a very strong position with money on hand and no debt when the worst of the home construction slump started in 2009, she and her siblings realized they had to make some changes.

"We realized immediately that we had to do everything differently," she said.

The Marvin family's first decision was a key one. The company would not cut any employees.

"While a layoff would have been easier, the community would have been devastated," she told the crowd. "We kept the people, but cut everything else — wages, bonuses, travel reimbursements, 401(k)s — everything that didn't contribute to the bottom line."

Marvin Windows employs about 4,300 people, 2,000 of whom work in the small northern Minnesota town of Warroad, where her grandfather founded a lumber yard in 1904.

The town and the company are intertwined. In fact, her father originally turned the family lumberyard to making windows during World War II to help create jobs for returning GIs.

"The strength of the company is the community. It is … an incredible relationship," Marvin said.

However, cutting expenses to the bone to keep from letting workers go was not easy.

"It was a team effort, though not everyone liked it. But they were willing to do that rather than see their neighbor lose their job," she said.

Keeping the workforce intact was not just good for Warroad. The Marvins see it as good business.

"Retention of talent is key. Experience matters," she said.

New tenant banking on 318 Commons, Roch. downtown

Here's a little from my column in today's paper about a new tenant signing to go into 318 Commons on First Avenue Southwest.

It seems like downtown Rochester is bustling these days with action at Mayo Clinic, the City Centre, the Kahler Grand Hotel, the BioBusiness Center, Historic Third and along the river (Legends).

Come on northwest and south Rochester, downtown is getting all of the attention. Let's pick up the pace in the other quadrants.

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

Eastwood Bank is expanding its Rochester footprint by establishing a large branch and private banking office in the new University of Minnesota Rochester student housing complex, 318 Commons.

Subject to banking regulatory approval, the area bank will create a 6,000-square-foot branch on the street level of the complex at 318 First Ave. S.W.

"This is an exciting project for us. It flows along with our strategic plan to grow in Rochester and southeastern Minnesota," says Paul Tieskoetter, Eastwood's president.

If it goes as planned, bank officials anticipate getting approval from federal regulators within 30 to 45 days.

While Eastwood doesn't have any retail banking downtown now, it does have a private banking and trust department office that opened in 2008 in the Broadway Residence and Suites tower. That office will be expanded and folded into the new 318 Commons branch.

"We're tripling our downtown space," Tieskoetter says.

N.W. Roch. center sells for $925,000

Here's a follow-up tidbit about the ex-SEMCIL building on Rochester's North Broadway that will house a Mayo Clinic-driven child abuse program.

A northwest Rochester building sold for $925,000 at the end of last month, which is the latest in a series of recent changes for the complex.

The complex at 2720 N. Broadway was sold on Nov. 30 by the nonprofit, Southeastern Minnesota Center for Independent Living Inc., according to Olmsted County records.

A Rochester company called Nan's Legacy LLC bought the building.

This ownership change comes on the heels of an announcement that a new Mayo Clinic-driven program plans to move into the complex as a tenant.

Construction is already underway to transform it into a facility to work with victims of child abuse.

Here's how an statement from Mayo Clinic describes the project: "The Mayo Clinic Child and Family Advocacy program," working with child advocacy organizations in the community, will open a new facility dedicated to responding to allegations of child abuse in ways that are effective and efficient and put the needs of the child victims first."

Depending on construction, the goal is to open the center in early 2012.

SEMCIL recently moved out of the complex into a newly built one at 2200 Second St. S.W.

That's the address where the Rochester Area Foundation used to have its office before that nonprofit moved downtown. By the way, look for Foundation related news in my print column today.

Mayo Clinic owned the Second Street S.W. building that the Foundation formerly occupied. Mayo sold it to SEMCIL for $695,000 in 2010.

SEMCIL scraped the building off the site and built a 13,500-square-foot center that recently became the active base of operations.