The last new-car dealership in Minneapolis and St. Paul is moving to the suburbs.
After more than 50 years in south Minneapolis, Kjell Bergh of Borton Volvo said that he's sold his buildings to a developer and will dramatically expand his dealership in Golden Valley.
"We wish we could have added to the nearly 57 happy years we have enjoyed in this great neighborhood," said Bergh. "Unfortunately, if we cannot expand our business, we cannot thrive."
While the sale will ultimately transform a bustling urban intersection, it's also a sign of the times for auto dealers, which were once a mainstay of city neighborhoods.
"It's the end of an era," said Scott Lambert, executive vice president of the Minnesota Auto Dealers Association. "It's too bad, but I guess time moves on."
Lambert said that during the 1950s each central city had at least a dozen major car dealerships, most of them strung along University Avenue in St. Paul and along Lake Street in Minneapolis. But by the 1980s they began a migration to the suburbs where there was space for brightly lit lots and sprawling showrooms. Today the epicenters of those auto super-malls are in White Bear Lake, Brooklyn Center and along the Interstate 494 strip in Bloomington.
Lambert attributes the shift to changing demographics and less tolerance for such operations in urban neighborhoods where the focus is on pedestrians, not cars.
"In general, city planners are not favorable toward car dealers, and it's too bad because people need to get their vehicles serviced, but now they have to go to the suburbs for that."
Bergh, who still owns nearly a full city block next to the block that he just sold along Lyndale Avenue S. and 54th Street, said the sale gives him an opportunity to create a five-acre "super-campus" at his dealership next to Menards in Golden Valley.
The first phase of that expansion will be a 10,000-square-foot parts and service building that will double service capacity and enable the dealership to add evening and Saturday service. There are plans to substantially increase the size of the showroom and add a 24,000-square-foot, pre-owned showroom.
The Minneapolis land sale has closed; terms weren't disclosed. Bergh said the move is expected to be completed by mid-June, and that he'll offer loyal customers who don't have time to go to the dealership a valet pickup service.
Walgreens was unable to confirm a role in the project Friday, but Bergh speculated that the pharmacy is seeking a larger building than the one it occupies across the street.
Bergh, who joined the company in 1967 and is sole owner, said he had considered expanding his operations at the south Minneapolis location, but decided not to because of zoning ordinances and a lack of land.
The Borton deal mirrors much bigger changes for Volvo, which was owned by Ford until four years ago when it was bought by China-based Geely, which vowed to maintain production of the cars at Volvo's factories in Gothenberg, Sweden, and to invest in technology and new factories in other parts of the world. Volvo is in the midst of an $11 billion overhaul of its worldwide operations.
"We wanted to show our total commitment to Volvo by creating this new five-acre campus," said Bergh.
The company was started by Oscar Borton in 1957 and has been based in south Minneapolis since then. Bryan Simmons, chairman of the Kenny Neighborhood Association, said that Borton had been a good neighbor and was always willing to support a variety of neighborhood groups.
"We're kind of sad because they've been a great supporter of these communities, and you never know who the new neighbor is going to be," he said. "They've been an institution in this neighborhood."