Speculative Iron Range buildings will be tailored for needs of tenants
The modern $1.6 million glass and concrete building Iron Range Resources constructed east of the Chisholm-Hibbing Airport late last year looks finished from the exterior. But step inside, and you'll find a cavernous 30,000-square-foot space with ...
The modern $1.6 million glass and concrete building Iron Range Resources constructed east of the Chisholm-Hibbing Airport late last year looks finished from the exterior. But step inside, and you'll find a cavernous 30,000-square-foot space with a 24-foot-high ceiling and a sand floor.
No, the project didn't run out of money before completion.
The building is waiting for the right tenant and will be tailored to the specific needs of that occupant.
This is far from the first time Iron Range Resources has built a speculative building. Iron Range Resources Commissioner Sandy Layman said the agency invested about $2.7 million in similar projects during the past decade.
She said that having an attractive building ready to go increases the Iron Range's odds of attracting new, good-paying jobs to the region.
"Sometimes, people do have a hard time envisioning what could be in the area, particularly if they haven't done business in a smaller community before," Layman said.
Almost five years ago, Bob Menne III moved his business, Premier Plastics, into a 35,000-square-foot spec building Iron Range Resources built in Hoyt Lakes. Were it not for the availability of the building, Menne said he probably wouldn't have relocated his growing manufacturing operations from Wyoming, Minn., to the Iron Range.
"It would have taken too much time," he explained.
Since moving, Premier Plastics has built a 5,000-square-foot addition onto its Hoyt Lakes plant and now employs about 40 people there.
"The sooner we can commit to providing a company with an opportunity to be in business, the more attractive our region appears," Layman said. "Generally, the business opportunity of today is the present moment, and having readily available space is a distinct advantage."
Layman said the ideal tenant for the Hibbing spec building would be a company that could make good use of the adjacent airfield at the Chisholm-Hibbing Airport. She hopes it's just the first of other developments to come in the airport's vicinity.
"This is the first building to go up in our future industrial park," said Shaun Germolus, executive director of the Chisholm-Hibbing Airport Authority. He noted that the authority has about 140 acres of developable land next door to the airport with which to work.
"There's a lot of potential," said Germolus. "It's an exciting time."
Duane Northagen, executive director of the Hibbing Economic Development Authority, hopes the spec building sets the tone for future development in the industrial park
"Typically, larger buildings like this tend to be metal," he said. "But we felt that if we made this first building more attractive, it would set a base for other businesses to follow."
Northagen noted that the new building also is one of the first sights as motorists approach Hibbing from the east on Minnesota State Highway 37.
"This is part of the entryway to our community," he said.
The Chisholm-Hibbing Airport Authority will own the building and will begin repaying Iron Range Resources for the cost of its construction only after it lands a tenant.
Layman hopes Iron Range Resource's role in financing the project will enable the Airport Authority to be choosy.
"If a local government authority takes on a project like this, it's typically under pressure to get paying tenants as soon as possible," she said. "As a result, the tendency is to settle for a business that's not ideally suited for the building or not paying best wages."
"We hope our involvement enables Hibbing to be patient and allows it to find the right tenant, before the building is built out to suit that tenant," she said.
Germolus said he has already received about a dozen inquiries about the spec building, even though the effort to market the property has yet to truly begin in earnest. He said the airport authority will work with Iron Range Resources and the Hibbing Economic Development Authority to recruit a growing company to the nascent industrial park.
Toward that end, a May 8 open house is being planned for the new building.
PETER PASSI covers business and development. He can be reached weekdays at (218) 279-5526 or by e-mail at firstname.lastname@example.org .