When is an office not an office? It’s a question under review in Burnsville, which is considering changes in zoning rules to stem the flow of certain medical service businesses into a very large and centrally located office and industrial district.
Created in 1987, the 300-acre district runs along both sides of County Road 42 between County Road 5 and the Savage border. The city has long envisioned it as an area for light manufacturing, technical, office and professional service businesses.
There’s a small pocket inside the district that allows retail businesses such as restaurants and dry cleaners to support tenants in the nearby industrial and office buildings. A couple buildings have showrooms or stores that make up a small amount of their manufacturing or office space.
But the district is mainly supposed to be for large employers occupying big blocks of space, including corporate headquarters — not a commercial strip.
A drive down the stretch of 42 shows otherwise. A growing number of the district’s 74 buildings have become multitenant properties, with some having a commercial strip look.
Some buildings are occupied by small health-services businesses, such are chiropractors, physical therapists and dentists. They work in offices, but due to a reinterpretation of zoning rules, they are considered more retail in nature by the city’s planning department.
The possible changes in zoning rules could specifically prohibit new ones, while grandfathering in existing ones and allowing them to stay.
“We’re certainly not eliminating them,” said city planner Chris Slania at a recent Planning Commission meeting. He said small medical offices are allowed in six other zones, including the Heart of the City redevelopment area. City planners surveyed several other cities and found that only Edina allows small medical offices in industrial zones, while Blaine will consider the businesses on a case-by-case basis.
Slania told commissioners that the influx of small medical businesses is a result of the still-weak market for space in the industrial district. “Some [buildings] are leasing at lower rents, and that makes it attractive to tenants,” he said. As a result, the small medical offices are pulling out of other higher-rent districts, such as the Burnsville Center area, he said.
Slania said the migration also reflects a larger change in the way many health care services are now delivered, sometimes in retail-oriented settings. “Everyone’s going for convenience and quick stops and short wait times,” he said in an interview. “There’s also the interest in exposure and visibility. They want to be on 42, where they’ve got a lot traffic going by their front door.”
But the result can be traffic and parking problems for an area that wasn’t designed for customers going frequently in and out, Slania said. It’s also at odds with the city’s larger economic development goals for the district. “We want major employers there,” he said.
Gene Happe, whose EFH Realty Advisors owns and manages a building in the district with a chiropractor and a dentist, said the proposed changes would hamper his ability to get tenants for his property. “I think that if they had to go up to more expensive areas, like those around Fairview [Ridges], many would simply leave town,” Happe said.
Commissioner Jim Bradrick said that it’s unusual for the city to add restrictions after an area like this district is largely developed. “If I’m an owner in that area … that could be kind of disturbing for me,” he said.
Commissioners also expressed concern over the proposed grandfathering provision, which could limit existing tenants’ ability to expand. “There is some interest in some manner … of protecting folks that already are there,” said John Corey. That’s especially the case if building owners or tenants had already invested in fitting out their office or clinic space, he said.
Corey and other commissioners also asked if the new zoning rules could allow for some flexibility in considering prospective building users on a case-by-case basis. “If it’s something that would be bringing in 20 employees with very good-paying professional jobs, you just don’t want to say, ‘You can’t go there,’ ” Corey said.
The commission plans to continue discussing the possible changes later this month, and members told Slania they want to get feedback from area building owners.