Founder and principal of Doran Companies
For commercial real estate developer Kelly Doran, the key to surviving and prospering is being nimble. For years, his forte was developing shopping centers, such as Tamarack Village and Woodbury Commons in Woodbury. He took a hiatus from the business in 2006, but by 2007 was ready to jump back into development. He saw, however, that it was getting harder to make money in retail development: Big retailers would rather own real estate than lease space from developers.
When he launched Bloomington-based Doran Companies, he shifted to upscale, student-housing development around the University of Minnesota. Projects included Sydney Hall and redevelopment of the Dinkydome. Now Doran is expanding into senior housing with plans to develop, own and operate upscale, senior facilities. He got approval for his first development in Rosemount.
QAs you began developing student housing, was anyone else here developing higher-end units?
AWe were probably the leader ... and a lot of that had to do with the rental rates you could achieve. When we did Sydney Hall, our quoted rents were 10 percent higher than anybody else in the market. A lot of people said we couldn't get those rents, but we did .... Our apartments were more upscale, with granite countertops and stainless steel appliances. The market received that well and it's becoming the standard over there now.
QHow big of a shift was it moving from retail to student-housing development?
AThere's no more difficult development than shopping centers, because you have so many competing interests from the cities and neighborhoods, and the retailers themselves have specific requirements .... It's just a much more complicated project from a development standpoint than apartment buildings. Through that experience and the tenacity it takes to build retail centers, we were comfortable making the leap.
QWhy senior housing now?
AIt's the next evolutionary step for our organization, and we think we can bring some added value by building upscale projects we own and operate.
QHow competitive is that business?
AThere's always competition in everything you do .... We're going to attempt to build a little better mousetrap and hope people understand -- just like they did in the student-housing business -- that our facilities are worth that extra dollar. (Projects will offer dining, recreation and exercise facilities, state-of-the-art security, housekeeping and access to health care).
Liz Wolf is an Eagan-based freelance writer. She can be reached at email@example.com.