Best of times for A&A Millwork

In this winter of our economic and job-shedding discontent, it's nice to stumble across a story of growth and renewal in an old neighborhood.

Mark and Cassandra Aune are putting the finishing touches on a new showroom, offices and wood-products manufacturing space for their company, A&A Millwork, a 27-year-old custom manufacturer of wood doors, windows, cabinets, moulding and other products that typically are made for older and historic homes.

"When the economy goes down, our business goes up," founder Mark Aune said. "People restore old houses instead of buying new."

The Aunes, who have worked together for 21 years, last summer moved from a cramped rental space into a 27,000-square-foot Minneapolis warehouse just east of Hiawatha Avenue that used to house the Segal candy and tobacco company. That's double the size of their former rental property, and it includes a modest showroom, offices and room to grow manufacturing and warehouse operations.

The Aunes put down $155,000, including retirement funds.

They estimate that they have put in at least as much time and expense to refurbish the building.

M&I Bank kicked in about $1.4 million through a U.S. Small Business Administration-guaranteed loan.

The Minneapolis economic development agency loaned about $125,000 to complete the mortgage and help the Aunes add to an impressive array of used equipment that Mark has acquired at deep discounts over the years.

The Longfellow Neighborhood organization also contributed to help with exterior improvements.

"We've invested just about everything we have," said Cassandra Aune, who once worked as a hairdresser to bring in extra money. "People never even knew we were in the neighborhood for 17 years. And now they come in to say how much they like what we've done with this building."

A&A, which had 2008 sales of $1.2 million and employs 10, aspires one day to sales of several million dollars and to have a few dozen employees.

Mark Aune, 56, who worked for years with an old-school Swedish carpenter, also tried his hand at building new homes in the suburbs as a subcontractor. He decided to focus on woodwork and remodeling of city homes and opened A&A in 1982 out of a garage on E. Lake Street in his old neighborhood.

Cassandra, 39, a neighborhood girl who was attending the Minnesota School of Business, showed up looking for a job several years later. She found stacks of invoices, bills and records piled on a dusty table.

"The place was a mess," she said. She became a partner in A&A several years later and married Aune. "We needed to get filed, organized and incorporated. I also have emptied lots of dust barrels."

Mark oversees the production of products for retail and wholesale clients. Cassandra is the business manager and accountant who also does some sales work.

And a daughter, Nicole, manages the office and gets involved in estimating, sales and marketing.

"My passion is wood and I like old stuff," Mark Aune said. "We can beat Menards on price if they don't have that door or window on the shelf. We also will do a $25,000 door for somebody who lives on Mississippi River Road. And we also sell vinyl replacement windows to contractors."

Kris Maritz, who works with neighborhood businesses to qualify them for commercial loans on behalf of the Metropolitan Consortium of Community Developers, said A&A is a well-run, cost-conscious and proven business that was able to slightly increase sales to $1.2 million in 2008, despite several months of distraction and work focused on the move.

Maritz also recommended that the Aunes be certified as a minority-owned business. They had resisted that in the past, because they didn't want special treatment.

"I thought it was just a lot of paperwork," said Cassandra, who is black.

However, the certification can help small businesses with contracts with the government and large companies.

"Being certified doesn't get you squat unless you can deliver a good product," Maritz said. "The Aunes are committed owners who are about growing their business and creating jobs."

Indeed, A&A recently won small contracts for work on the new Twins stadium and at Children's Hospital.

There's a nice human-growth story built into A&A, as well.

The Aunes' younger daughter, AunDreah, 19, a college freshman, was a basketball player and homecoming queen who graduated from nearby Roosevelt High School. A&A has partnered in recent years with Roosevelt High's woodworking shop to provide a paid internship.

The couple also managed a local girls' traveling basketball team for years and became temporary legal guardians to several girls who lived with them in their refurbished Powderhorn neighborhood home for extended stays.

Mark, the son of blind parents, was a hockey and football player at Central High in the late 1960s. He's big, gruff, loves kids and is strict, his wife said.

The Aunes, who both made their own way after high school, accuse each other of being softhearted when it comes to the single-parent and drifting girls they mentored.

"We call our house 'Sandy's House of Charity,' " quipped Mark. "We've tried to help some girls who played on our basketball team. Their moms knew we were strict parents. And a lot of them went from 'D' averages to 'B' averages. Some went to college."

Jim Roth, executive director of the Metropolitan Consortium, said the agency last year got fewer than 30 clients such as A&A approved by banks, less than half the usual number, as bankers tightened credit standards.

"Many of our clients operate retail and service business, which rely heavily on discretionary spending, and they are facing real challenges in this economy," Roth said.

"We also have clients with niche businesses who are doing well. Our building contractors who do work for public agencies are taking on more business and, like A&A Millwork, expect to add new employees later in the year," he added.

"Because the banks that loan to our clients are tightening up their standards, we can help borrowers pry open those loan windows by helping them put together complete and detailed financial reports."

With luck, A&A should prove to be a bright spot in a gloomy economy.

More information is at www.aamillwork.com.

Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com