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February 03, 2016

Another hotel to be built near Costco

The final pieces of the Costco development in northwest Rochester are slated to be built this summer, starting with a new hotel.

A South Dakota-based developer, SD Rochester LLC, purchased land between the Comfort Inn and McDonald's along West Circle Drive from Northwest Investments of La Crosse for $1.45 million on Jan. 15.

Si_ms_slides_01According to city documents, the firm lead by Dan Henderson is planning to build an almost $6 million, three-story hotel under the dual brands of Sleep Inn and MainStay Suites. It will join two hotels — Comfort Inn and Staybridge Suites — built last year.

"They are a highly sophisticated group. I think this will be a good project," said Hans Zietlow, of Northwest Investments. "They got a pretty key piece of property."

Zietlow began carving the development out of a farm field for Northwest Investments in 2010. Northwest Investments is the real estate arm of Kwik Trip Inc. Zeitlow typically handles land planning for the Wisconsin convenience chain's stores, so this was not his usual type of project.
 
Starting it during a recession gave it a slow start, but a recovered economy plus a prominent anchor such as Costco has made it a hot property.

"Once or twice in your life, you have way more buyers than land to sell. Then you get to be picky about selling property," he said. "This is one of those times for me."

Beside the addition of the third hotel, a multi-tenant center also is slated to be built by Aldi this summer by a Twin Cities developer. There's no word yet on what retailers or restaurants it might house.

"I think that one will take off like a rocket," Zietlow said.

With the Costco development pretty much wrapped up, Northwest Investments is turning its attention to a nearby 50-acre property at West Circle Drive and Valleyhigh Drive. They have started the planning process to add roads and utilities into the area to prepare to sell lots, just as they did at the larger Costco property.

If things go as expected, construction could start there yet this year.

"There's a lot interest in that area, particularly since the new Hy-Vee opened," he said.

Zeitlow and Northwest Investments have driven a lot of change along Rochester's West Circle Drive area, and now more is one the way.

"Anyone looking for a place to build in Rochester now has to look at Northwest before they make a final decision of where they are going to go," Zietlow said. "That wasn't the case 10 years ago."

January 28, 2016

Semiconductor maker to open new Rochester office

GlofoAfter its $1.3 billion acquisition of IBM's computer chip operations in 2015, an international semiconductor company is setting up a new office in Rochester.


GlobalFoundaries, which is owned by an investment arm of the Abu Dhabi government, bought IBM's Microelectronics Division in July 2015. That deal gave the California-based company a footprint in Rochester.


"As part of this transaction, we acquired a team of about 30 engineers based in Rochester. These engineers are part of the global design team for our application-specific integrated circuit (ASIC) business unit," said Jason Gorss, senior manager of corporate and technology communications.


GlobalFoundaries' deal also included major IBM facilities in Poughkeepsie, N.Y., and Burlington, Vt. 3555-9th-St-building-front-690x410

That team has continued to work at IBM's Rochester campus since the acquisition. Now the company is renovating an off-campus space in north Rochester. GlobalFoundaries is revamping a spot at 3555 Ninth St. NW. That's in the commercial center off of West Circle Drive, behind Kwik Trip.

Semiconductor maker PMC-Sierra operated there from 2010 to 2012. PMC-Sierra was collaborating with IBM at that time on "a multicore, multithreaded RAID solution." The resulting maxRAID device was used in IBM's System x EXA servers. That office closed when PMC-Sierra abruptly pulled out of Rochester.

Since PMC-Sierra left, the about 8,000-square-foot space has been briefly used by other tenants, such as the Minnesota Department of National Resourcesand outdoors retailer Scheels as a hiring office for its large Rochester store.

Gorss expects GlobalFoundaries to be in up and running in the spot in the near future.

"Beginning some time in Q2 2016, we plan to move this (Rochester) team into the independent office," he said in an email.

 

January 27, 2016

Snack maker buys Dexter facility for $1.5 million

Rochester's Reichel Foods is expanding its operations and is bringing 14 jobs to Dexter by buying a long empty facility for $1.5 million.

Reichel Foods bought the 54,000-square-foot complex on Nov. 18 from the Development Corporation of Austin, according to Mower County records. It had been used by McNeilus Cos. of Dodge Center from 2003 to 2009 to manufacture cement mixer drums. McNeilus vacated the facility in 2013.

214 Industrial Park Drive, Dexter“We're growing. This gives us an opportunity to do what we need,” Reichel owner and president Craig Reichel said. “The building fits our needs really well.”

He said the snack-foods company is using the Dexter building for a combination of storage and distribution. While his company already is using part of it, he said remodeling is underway. Once that is complete, Reichel will be able to fully use it and add the new jobs.

ImgresThe Dexter building is an addition for Reichel Foods' Rochester facilities, which employs more than 400 employees. Reichel Foods makes snack foods, including the popular line of Dippin’ Stix products used in many vending machines and sold in stores such as Walmart. 

"It's a good fit for Dexter, " said DCA president John Garry.

The Austin DCA is a nonprofit corporation focused on economic development in Austin and greater Mower County. The DCA built the facility in 2003 for McNeilus in the Dexter industrial park just northeast of the I-90 juncture with Minnesota Highway 16.

The building has been on the market since November 2014, when McNeilus pulled out. When it closed the facility, almost 30 people worked there.

“These are good jobs for Dexter. I’m excited for the community, Reichel Foods and our region. I think it will work out really well," stated Garry in an announcement of the deal.

 

January 25, 2016

Popular clothing chain to open large Rochester store

A trendy Swedish clothing retailer plans to open its first southeastern Minnesota store in Rochester's Apache Mall this fall.

Image-007H&M, one of the world’s largest fashion retailers, has signed a lease for 22,000-square-foot store in the mall. H&M carries "fashion forward" clothing and accessories for women and men. The Apache Mall location will also carry H&M’s children’s collection, for newborns up to teens.

This will be the Stockholm, Sweden-based H&M's ninth store in the state. It has a location in the Mall of America as well as a two-story store in Minneapolis' Calhoun Squareshopping center in Uptown. The company has pegged Minnesota as "a quickly growing market."

The Apache Mall leadership is pleased with the addition to its lineup and is making adjustments to accommodate them.

“We are excited to have H&M opening at Apache Mall and to be able to stay true to our mission of providing stellar retailers for our customers,” said General Manager Kim Bradley

The new H&M store will have access to the mall from both the Scheels and JCPenney mall corridors. Stores relocating to accommodate the new H&M include: Northwoods Candy Emporium, Caribou Coffee, Payless ShoeSource and Aeropostale.

January 20, 2016

New owners, old name at Northgate Health Club

A longtime Rochester health club is getting an upgrade under new owners as it returns to its old name.

When Dan and Ronaele Hoffman took over Northgate Fitness and Wellness Center in November, one of the first things they did was ask employees and clients about the name.

"Employees preferred the old name of Northgate Health Club. That's what people call it in the community, so we decided to change it back to Northgate Health Club," said Dan Hoffman.

12472391_10153879088087292_5822154243486821442_nBesides returning the 47-year-old center to its original name, the Hoffmans plan to update all areas of the club at 1112 Seventh St. NW in the Northgate Plaza.

"We've already made improvements in the free weights room and there's a lot more to come," he said.

Northgate Health Club has a team of 30 employees on staff.

The Hoffmans bought the club from Prow Co., which owns the shopping center. The idea of buying it came up as they were outfitting a health club in their other property, the Grand Meadow Business Center.

"We starting looking at it. Pretty soon we decided the culture was right, so we bought it," explained Dan Hoffman.

January 19, 2016

Rochester retail complex sells for $14.5 million

The retail center anchored by Kohl's and Sports Authority in southeast Rochester sold for $14.5 million on Friday.

36ffb495a8b44937a46acc506881eb46An Austin, Texas, firm, EREP Broadway Commons, bought it from Inland Private Capital Program, of Oak Brook, Ill. The 131,931-square-foot center sits at 30 25th St. SE in the Broadway Commons development between Walmart and Menards.

The 15-year-old complex was appraised at $15 million, according to state documents. Inland originally acquired the property in 2002 for $16 million. Olmsted County estimated its 2016 market value at $11.23 million.

It was built by Wisconsin-based Continental Properties in 2001.

The center is fully leased with tenants that include Kohl's, Sports Authority, Michaels, Designer Shoe Warehouse and Famous Footwear.

Biz buzz

ServeAttachmentWhile the Broadway Commons sale is the largest Rochester deal so far in 2016, it wasn't the first one at more than $1 million.

That honor goes to the sale of the building that houses a Perkins Restaurant at 1818 South Broadway.

Perk 18 LLC, of Rochester, bought the 13-year-old property for $1.9 million on Jan. 4. Olmsted County estimated its 2016 market value at $1.2 million.

No individual names were listed on the Olmsted County documents. However, Perk 18 LLC receives its tax bills at 123 Carlton St. SW, which also is the headquarters of Elcor Construction. Elcor is owned by Rochester developer, business owner and real estate investor Dan Penz.

Perk 18 bought it from JLC Properties of Rochester. The seller is based at 1807 Seventh St. NW and it lists Dave Hanson as its registered agent in state documents.

JLC originally purchased the 1818 South Broadway property for $495,000 in 2002, before the building was constructed.

 

January 13, 2016

Knives are coming out again at Sushi Nishiki

Look for the knives to come out again at Rochester's Sushi Nishiki.

01132016sushinishkiOwner Sammi Loo says the sushi shop will re-open its doors for lunch at 11 a.m. Monday. This follows a short hiatus at the restaurant at 2854 41st NW that started in November. The previous closure was rumored as a transition to a new owner, but Loo remains as owner of the popular sushi eatery.

Loo says sushi fans will find familiar faces and a familiar menu at Sushi Nishki when they walk back in the door. However, she does plan to offer some special deals to welcome back her customers.

Sushi Nishki has a team of 8 to 10 employees on staff.

Loo and Lawrence Wong originally opened Sushi Nishiki in the Northwest Plaza, near IBM's hungry campus, in 2008.

In 2011, they also opened Impiana Kitchen and Sushi Bar at 318 S. Broadway — the former home of Sushi Itto/Katz's. Impiana Kitchen didn't find a niche on Broadway and that restaurant closed in 2013. Mango Thai soon moved into that spot and started cooking.

Thanks to my ever alert reader and Man About Town Jim Miner for taking the pic.

January 12, 2016

Colorful downtown Mexican restaurant goes dark

It looks like El Loro has flown from Rochester as the Mexican eatery on Fourth Street Southeast has been dark for days. 

El-loro-logoEl Loro, which translates to The Parrot, opened in the old Chicago Great Western train depot at 20 Fourth St. SE in 2012. It is owned by Marcos Gomez, who owns a number of other Mexican restaurants in Minnesota with his brother.

The restaurant now sits closed and has been that way for days. Details of the closure are unknown, as Gomez has been unavailable for comment at his other restaurants.

The El Loro website lists restaurants in Bloomington, Burnsville, Savage and Hutchinson. Rochester recently has been removed from the list.

El Loro's abrupt closure comes on the heels of the building's recent sale.

The 115-year-old depot building was purchased for $800,00 in November by a collection of local and out-of-state investors under the name of The Med City Restaurant Group.

Realtor Nick Pompeian of Realty Growth Inc., who handled the deal, said the new owners had no plans to change anything and hope to keep a restaurant operating in the building.

"They just saw this as a good opportunity to own a piece of downtown," he said at the end of December.

So whatever happens next, it seems likely that a restaurant eventually will fill t 01112016depotplaquehe depot again. However, it's unclear how soon something like that could happen.

Before  El Loro, it housed another Mexican restaurant. In 2001, Jorge Ocegueda opened Dos Amigos in the depot. In 2011, he revamped the eatery and renamed it as Paseo del Rio. Paseo del Rio had a short run and soon was replaced by El Loro in 2012.

The depot originally was built in 1899 by Winona & Southwestern Railroad at the intersection of First Avenue and Second Street Southeast. Two years later, the line was sold to Chicago Great Western, which moved the building north across the river in 1903 by cutting it in two, placing each half on a flat rail car, and reassembling it at 19 Second St. SE.

In 1949, the structure was remodeled to also serve as a terminal for the Jefferson Bus Lines. The last passenger train left the depot in 1950, but Jefferson remained until 1987.

It then was sold to the city and slated for demolition until a "Save the Depot" citizens group temporarily moved it near the power plant at 533 First Ave. N.E. It was moved across the street a year later to allow Marigold Foods, now Kemps, to expand.

In 1997, Bruce Kreofsky & Sons acquired it at no cost from the City of Rochester. Kreofsky renovated it and moved it to the current location. Rochester Depot LLCof Plainview, which is connected to Kreofsky, acquired it at no cost in September 2010.

 

January 08, 2016

ArchMN mag's take on Mayo Clinic's DMC plan

20141216_dmc01_53Over the past few years, many publications have analyzed, dissected and speculated about Mayo Clinic's proposed Destination Medical Center plan.

And now Architecture MN magazine has published its own take on the plan in an article by Thomas Fisher. He looks at the plan and chats with DMC's lead urban designer Peter Cavaluzzi of the New York firm.

Here are a few excerpts that caught my eye:

• "One of them —Discovery Square—will provide a place near the Mayo Medical School for technological development and entrepreneurial spin-offs from the school and the Mayo Clinic. That integration of research and practice, innovation and application, fits the Mayo model perfectly, and Discovery Square may, ultimately, do the most to secure the economic future of the city, as start-up companies emerge and grow. The Perkins Eastman master plan calls for an open space at the center of this district, above which skyways converge into an elevated glass building that, while a good idea, looks too big for the space and a bit ominous in the renderings."

6a00d83451cc8269e201b7c791bc82970b-300wiIt's nice to hear an expert question the big glass structure slated for Discovery Square. My uneducated eye has always thought that it looks like a big, glass "Independence Day"-like spaceship landing on downtown in the renderings. However, I have never be very good at visualizing what development projects will look like in reality.

• "Another big move in the master plan—the Downtown Waterfront—links the government center and the civic and art center with pedestrian-friendly plazas that open up to a widened Zumbro River, finally freed from its current flood-control channel to become a real asset for the city. This district’s sweeping set of bridges, embankments, and buildings will break Rochester’s insistent street grid and provide a place for community events and celebrations that today have few options for outdoor venues. A grand gesture like this doesn’t happen without controversy, however. Some have questioned the planned removal of the existing public library near the river, even though, as Cavaluzzi observes, the library had already begun to look at moving, having outgrown its small, nondescript building."

Hhmmmm.... I have never heard the Rochester Public described as a "small, nondescript building" before. I guess it is a matter of perspective.

Read the full ArchMN article here.

 

January 06, 2016

Alliance@IBM dissolves after 17 years

After almost 17 years, a group attempting to organize a union at IBM is closing up shop.

Lee Conrad announced the dissolution of Alliance@IBM on Tuesday. The Endicott, N.Y.-based organization was affiliated with Communications Workers of America. It has been an outspoken critic of IBM and its treatment of its employees since it formed in 1999.

Allianceibm-220x64"Years of job cuts and membership losses have taken their toll. IBM executive management steamrolled over employees and their families," wrote Conrad, Alliance@IBM's national coordinator. "We tried to push back when we could, but we didn't have enough people power to change the working conditions or stop the massive job cuts or offshoring at IBM."

He estimated the membership of the Alliance@IBM never topped 400 at any point. That number has been shrinking in recent years to below 200 members at the start of 2016.

"Most are now ex-IBMers. The constant job cuts, the fear inside the workplace and offshoring have had a devastating impact on organizing," he wrote in an email. "We felt we have done all we could."

The Alliance@IBM grew from the IBM Employee Benefits Action Coalition, which had its roots in Rochester. That group formed in protest of IBM reducing employee benefits.

Former Rochester IBM employee Janet Krueger was the national spokeswoman for the coalition. It filed lawsuits, lobbied politicians in response to the pension changes and hired planes to fly protest banners during the Olmsted County Fair.

In 1999, Alliance@IBM was given the Disgruntled Employees of the Year award by Disgruntled magazine.

In recent years, Alliance@IBM has been best known for informally tallying IBM job cuts and commenting on layoffs. IBM stopped discussing layoffs and employee numbers at each campus, such as Rochester, in 2008. 

The Armonk, N.Y.,-based computer giant opened in Rochester in 1956 and soon became the top employer for much of the late 1950s and early 1960s. In 1966, Mayo Clinic tied it, when each employed 3,600 workers. Mayo pulled ahead in 1967 with 3,850 employees compared to IBM's 3,800.

IBM's presence in Rochester, which topped out at more than 8,000 employees in the 1990s, has since been whittled down by layoffs and attrition to an estimated less than 3,000 today.

Insiders estimate that IBM has now slipped to the third spot on the list of top Rochester employers behind the Rochester Public Schools.