Breathing room
by Matt Krumrie Ram Motilall, president of Newport-based Diversified Manufacturing Corp., knows something about searching for the right home.
Motilall has moved the manufacturer of personal care products, animal shampoos, cleaning products and automotive products four times before settling off Highway 61, about 10 miles southeast of downtown St. Paul. Prior to that the 80-employee business was headquartered in Eagan and before that Minneapolis. Before moving the business back to the east metro, Motilall considered locations in Edina, Chaska and western Wisconsin.
One factor played a major role in the decision to locate in Newport: location, location location. It’s a stone’s throw from Motilall’s home in Inver Grove Heights, resulting in a commute under five miles. And it’s near a growing southeast metro population, as well as a transportation system that provides easy access to downtown St. Paul and the Minneapolis-St. Paul International Airport.
“I just wanted to be closer to the company because I am there so much,” says Motilall. “But more than anything, the region is really growing, yet at the same time still has a convenient highway system that is less congested than the west metro. We have easy access to all the major highways, and are about 12 minutes from the airport.”
In the northeast sector of the east metro is Mahtomedi, a town of 7,900 residents just off the junction of Hwy. 694 and Hwy. 36 that is about four square miles in size, yet home to a major Federal Express hub and to Century College.
It has a small-town feel with big city life just a short drive away, and that’s what people like, says Mike Johnson of Chariot Construction. Johnson and his company are building an 18-acre, 135,000-square-foot office complex that will be filled 75 percent by professional businesses and 25 percent by retail shops. The complex also will feature walking trails, modern landscaping and design, and in Johnson’s words, “a chance to stay away from all the riff-raff that you can get into when you have to head west to do business,” he says.
Like Motilall, Johnson says he appreciates what the east metro offers.
“I truly think the biggest thing people want today is the chance to stay close to home,” he said. “They want to be able to wake up in the morning and have everything in proximity to where they work and play. I think living in the east metro and doing business in the east metro still allows that.”
Defining the area
The best way to define the east metro might be to follow the lead of the St. Paul Chamber of Commerce, which breaks the east metro into cities in Ramsey, Dakota and Washington counties, east to the St. Croix River.
According to the Minnesota Department of Economic Security and the U.S. Census 2000, Washington ($66,305) and Dakota ($61,683) counties represent two of the top five Minnesota counties for median household income. Among the industries adding the most jobs are health care, social assistance and educational services. Those boosts can be linked to the fact that the population in the three-county area grew by 18 percent (adding 161,200 people) between 1990 and 2000, and the fact that the Minnesota State Demographer’s Office forecasts the population to grow 31 percent between 2000 and 2030. Population will grow from a little over 1 million in 2000 to 1.4 million in 2030.
“It looks like we might not have that casual commute as long as we think,” says Johnson. “Because there is a lot of land in the east metro that still isn’t developed.”
Johnson lives in nearby Grant Township, a 27-square-mile area of undeveloped land bordering Mahtomedi to the east that Johnson likes to call “the best kept secret in the Twin Cities,” he says.
Jon Hohenstein, city administrator for the city of Mahtomedi, says one reason Federal Express located in the city was the access to I-694 and the regional transportation system.
In 1990 Woodbury was a modest community of just more than 20,000 people that was touted as the fastest-growing city in the state. Today, it is called “Eden Prairie East” by many. It’s a fast-growing suburb, just what the city planners hoped for. Population estimates as of April 1 were at just more than 50,000, and according to city planner Janelle Schmitz, the city is just over half-developed.
Woodbury is the poster child of the east metro. The city is home to the Prime Outlet Mall (with more than 30 retail, manufacturer and specialty shops), Tamarack Village Shopping Mall, virtually every major retailer and restaurant chain in the Twin Cities, as well as larger companies such as Fortis Financial. The gem of the city may be Woodwinds, a 30-acre health campus and facility with more than 500 employees.
“The city planners and leaders knew that in order to continue to attract industry and businesses, we needed a facility like Woodwinds,” says Julie Schmidt, CEO of Woodwinds. “From a small-business perspective, we feel we are growing up right along with the city.”
Schmitz agrees.
“With the residential growth we needed to provide the services that any city needs, and with that growth we saw a major expansion in retail, health care, insurance and financial businesses,” says Schmitz. “We like to think that everything our residents need is right in our own city.”
Another advantage for the city of Woodbury is its proximity to major freeways. Heading east on Hwy. 94 out of St. Paul to Wisconsin, travelers pass by retail shops, restaurants and other small businesses. Business owners also like the proximity to downtown St. Paul, Hwy. 35E and 694, as well as the 10-minute drive to fast-growing Hudson, Wisconsin, just on the other side of the St. Croix River.
People growth
Eliza Lovejoy, founder and president of USA Gym Kids, is one Woodbury resident who is taking advantage of the growth. USA Gym Kids is a traveling gymnastics program that teaches kids agility, coordination and other physical and mental skills. The population growth has resulted in the addition of new schools in Woodbury, where Lovejoy does most of her business.
Woodbury is served by three independent public school districts. The majority of the city is located in the South Washington County School District 833. The Stillwater Area Schools (District 834) and the North St. Paul-Maplewood-Oakdale District (622) also provide service to the community. District 833 operates five elementary schools, two junior highs and a senior high school in Woodbury.
Districts 834 and 622 have no school facilities within Woodbury. However, Valley Crossing School is a collaborative elementary school that serves students from all three public school districts. Two parochial schools, New Life Academy and St. Ambrose, are located in Woodbury. The city also is home to the Math and Science Academy, which is a District 833 charter school, and the Crosswinds Middle School, which serves middle school students from several east metro area school districts.
Lovejoy developed her business plan through St. Paul-based WomenVenture, and in her studies, she targeted the population growth as one of her top reasons to do business in Woodbury.
“Woodbury is growing so fast and I know that my market is elementary children,” says Lovejoy. “It seems like they cannot even keep up with the growth, so when I was doing my market research I knew this would be a great place to call home.”
It’s no wonder, says Kyle Uphoff, that health care, education and social services are the fastest-growing sectors in the east metro.
“I would say that employment expansion in industries such as health care and education is due to demographic shifts,” says Uphoff, Twin Cities’ regional analyst for the Minnesota Department of Economic Security. “Like much of the state and country, the east metro is also aging. As the baby boom generation ages, the need for health care services, in particular, will increase.”
Heart and soul
For many traditionalists, the heart and soul of the east metro will always be St. Paul. One business that provides a lot of that tradition is St. Paul-based Summit Brewing Co. The 43-employee company is as Minnesota as it gets.
“When you look at the viewpoint of tradition, St. Paul has very deep history of brewing, and the fact that our brewery was founded in St. Paul, I think it is significant to continue to do business in St. Paul,” says Mark Stutrud, president and founder of Summit Brewing Co.
Stutrud said through the early 1990s the company traditionally did more sales in Minneapolis, but due to the addition of the revamped West Seventh Street night life — boosted by Xcel Energy Center and the Minnesota Wild — more business is now being done in St. Paul and the east metro.
“The population growth certainly has helped those numbers,” says Stutrud, who adds sales through May of this year were up 14 percent from last year. “St. Paul is forming an identity of its own, and the revitalization of the local food and restaurant community has helped a great deal. It’s no longer the adopted sister to Minneapolis.”
Growth appears to be everywhere in the east metro. Drive north past Forest Lake and Hugo and new housing developments seem to blanket the area. Drive south through Eagan, Rosemont, and down to Lakeville, and the urban sprawl continues. Lakeville is a 38-square-mile community with a population of more than 43,000. The city has doubled in size during the past 10 years. Over the next decade, Lakeville will continue to be one of the fastest-growing communities in the seven-county metropolitan area. By the year 2020, its population is projected to reach 75,000.
Two communities not expanding as rapidly are South St. Paul and Inver Grove Heights. South St. Paul, a community that once took pride in its stockyards and meat-packing plants, has transformed the once 160-acre stockyards off of Concord Street into a mixed-use business park.
Businesses in the park include The Sportsman Guide, Twin City Bagel, Bester Brothers Moving and Storage, and CLT Floor Coverings. Twin City Bagel recently completed a 40,000-square-foot remodeling that will allow the company to produce about 1 million bagels per day. This transformation has been a plus for South St. Paul.
Only 24 acres of the stockyards remain, and in reality, the city has never recovered from the loss of the stockyards and meat-packing plants. In the 1970s the city’s population was 26,000, but within five years of those plant closings, the city lost 8,000 residents. In 1970 the U.S. Census reported South St. Paul with a population of 25,016. In 1980 it was 21, 235, in 1990 it was 20,197 and in 2000 it was 20,167.
Now, as the city tries to attract more business it must deal with the Wakota Bridge Project, which won’t be completed until 2007. While transportation is a big plus for many residents and businesses, in the east metro anybody who has to go over the Wakota Bridge — where Highway 494 meets the Mississippi River between South St. Paul and Newport — is likely stuck in traffic for a long, long time.
“South St. Paul has a lot of new, but everyone remembers the old,” says Bill Lucking, of Progress Plus, a public and private partnership that strives to improve the economic development, create and maintain jobs, and expand the tax base and improve the quality of life in South St. Paul and Inver Grove Heights.
Inver Grove Heights is another city that has not attracted the businesses of the surrounding cities. In fact, many of its residents do their shopping in West St. Paul, Eagan and Woodbury. After a bitter battle with residents, the Inver Grove Heights city council recently approved a 134,000-square-foot Wal-Mart. In addition, the city of just under 30,000 residents will soon open a 22,000-square-foot retail center that will hold a sit-down family restaurant, a hair salon, dry cleaner and other retail shops.
But it’s the stores like Kohl’s, Home Depot, and other department stores many city residents want. The city did have a Sam’s Club, off Robert Street bordering the busy West St. Paul business sector, but it closed because another one opened up in Woodbury and Eagan.
“It’s hard for the bigger box retail to come in and justify taking away from their stores in other communities, and it just doesn’t make sense,” says Lucking. “That in turn has slowed the attraction of other small businesses who want to be where the people are.”
With more land to develop, why doesn’t Inver Grove Heights develop like neighboring cities? Lucking has a simple answer.
“It took 28 years for the highway department to finish building Highway 52 from downtown St. Paul to the junction of Hwy. 55,” says Lucking. “Construction follows the transportation system. I have no doubt in my mind that if that would have been completed earlier Inver Grove Heights would be seeing the growth Eagan is today.”
