The city of Cottage Grove is creating a new marketing strategy in the hope of attracting new, larger tenants to its 400-acre Business Park.
Since the late 1990s, city officials have been “serious” about developing the commercial hub, City Administrator Ryan Schroeder said during a recent joint meeting between the City Council and Economic Development Authority.
But several years after the recession and still a lack of activity, the city decided it was time to re-evaluate how the Business Park, located off Highway 61 at Jamaica Avenue, is marketed.
There is 4.4 million square feet of commercial and industrial land within the Business Park and only about 6 percent is vacant, Economic Development Director Danette Parr said.
“Typically in the industry between 5 and 7 percent (vacancy) is seen as healthy,” Parr said. “You want to have some room for mobility and for people to move around, and you want people to be able to come in.”
The vacant properties include the Majestic Ballroom, the Rush Nightclub, formerly the Rodeo Nightclub and the former golf dome.
Vanguard Construction and RJ Ryan Construction, both Twin Cities-based firms, are responsible for much of the growth at the Business Park.
Geoff Benedict, president of Vanguard Construction, said his company has spent the last decade building primarily in the Business Park, constructing seven buildings.
While the industrial property has experienced a decrease in the amount of activity since the recession, Benedict said it’s not necessarily a bad thing.
“Just because there is no growth doesn’t mean that something is broken,” Benedict said. “I think the fact that Cottage Grove has land available is something that a lot of cities don’t have. Cottage Grove does and that’s a great asset.”
Available land close to two major cities and a highway system should be highlighted in the city’s marketing plan, Benedict said.
EDA member Steve Schmid, who owns a plastic packaging company in the Business Park, agreed and stressed the importance of effectively placing Cottage Grove on a map.
“I tell people (Cottage Grove) is six miles south of (Interstate) 494, not north of Hastings,” he said. “We have to get people to know where Cottage Grove is.”
City Council member Justin Olsen said he wanted the marketing plan to allow Cottage Grove to better compete with surrounding communities.
“We don’t want to become the place where people say, ‘Well we’ve tried other places so we’ll go to Cottage Grove,’” Olsen said. “I want us to be the first choice.”
Benedict said cities experiencing a boom in commercial growth, such as Shakopee and Brooklyn Park, have a leg up in the public transportation department. With plans in the future for more transit opportunities in south Washington County, Benedict said that will assist in attracting more companies.
“I wouldn’t say Cottage Grove isn’t a first choice, but it will be more so in the future because you have available land,” he said.
RJ Ryan Construction, who built Schmid & Sons Packaging, including CCE Technologies and Werner Electric, said in a memo to the city that along with acreage, Cottage Grove also has an enthusiastic staff that is committed to providing opportunity.
“The attitude is certainly ‘Let’s get this deal done,’ or ‘How can we get this deal done?’” Tom Ryan, co-president, wrote. “The entire staff at Cottage Grove is great to work with.”
Earlier this year, Parr sent out hundreds of pamphlets via mass mailing detailing the advantages of the Business Park.
With neighbors like 3M-Cottage Grove, Andersen Windows and Up North Plastics, the commercial property is an incubator for all business types and sizes.
At a recent EDA meeting, there was conversation about constructing a spec building, which would give potential tenants an idea of what their unit might look like. However, Benedict said it would be throwing dollars away.
“I wouldn’t build a spec building without a tenant,” he said. “You have the ability to control the Business Park without needing to have a tremendous outlay of cash before you have an end user. You guys are developing partners, not developers.”
Tapping into the greater Minneapolis and St. Paul communities is another item on the city’s list. While many of the Business Park’s clientele comes from the east metro and western Wisconsin, Benedict said there is potential to attract businesses looking to move.
“I think it all comes down to relationships,” he said. “Logically, a lot of the interest is going to come from people on this side of the river. But there should be continued search around Minneapolis.”
As the 2014 legislative session gets under way, Benedict added it would behoove the city to stay mindful of the warehouse tax, something Democratic Gov. Mark Dayton wants to repeal.
The business-to-business tax, slated to go into effect April 1, is passed on to any business that buys storage or warehouse services from another entity. The tax, however, does not affect those who use their own warehouse services.
“I think the business environment is going to come back around (in Cottage Grove),” Benedict said. “It’s a timing thing. But if you have a lead dog come in, others will follow.”