'Urban fringe' continues to boom

  • Article by: JOY POWELL
  • Star Tribune
  • September 24, 2008 - 10:15 AM

In Dakota County, 53,000 households are projected to be added from now through 2030, fueling demand for more commercial space -- and creating up to 58,000 new jobs.

That means about 2,200 acres will be needed for new commercial and industrial space, according to research conducted for the county's Community Development Agency.

"Most communities will see continued demand for commercial space as retailers fan out to serve their growing populations," said Jay Thompson, vice president of Maxfield Research Inc. of Minneapolis, which conducted the study.

"Office and industrial growth will be more concentrated to a few key areas with good freeway access and closer proximity to the core of the Twin Cities -- the three main areas being Eagan, Lakeville and Inver Grove Heights," he said.

His firm has so far presented the data to city leaders in Lakeville, Rosemount, Inver Grove Heights, Eagan and South St. Paul.

"The report shows strong growth in all segments for Dakota County and for Rosemount," said Michael Baxter, chairman of the city's Port Authority.

"As the economy and the housing markets recover, we will have exciting decisions to make about future development and redevelopment in Rosemount."

The south metro county is continuing to grow as the "urban fringe" of the Twin Cities metro area expands farther into the county. Outer-ring suburbs will see the greatest growth and potential to support more retailers and industry, the report said.

It points to the trend of big-box stores cropping up nationwide. Since 2000, more than a third of the commercial space added in Dakota County has been for big-box stores such as SuperTarget, Super Wal-Mart, Sam's Club, Gander Mountain and Hom Furniture.

Lakeville, where strong household growth is projected, will have the greatest demand for retail and commercial space, at 250 acres. Lakeville has less retail space per household, the study says, than cities north of it.

Countywide, consumer expenditures are expected to grow by $2.5 billion between 2007 and 2012, according to the study of Dakota's 11 biggest cities.

Among those growing fast is Rosemount, where hundreds of homes are being built and more than 500 acres of industrial and commercial land are reserved for development.

The study provides an important tool as the city moves forward, Baxter said. The projections, he said, "seem to provide for needed retail services without a glut of commercial development."

Still, the projections for commercial and industry growth in Rosemount struck him as low, especially in light of the development of UMore Park, Baxter said.

"Almost 80 million square feet of commercial and industrial space existed in the county in 2007," Thompson said. "Our projections are that about another 27 million square feet will be needed by 2030, or about a one-third increase."

The entire county is expected to see a 31 percent growth in jobs through 2030, the report said, with Eagan leading the way. That's well above the Twin Cities metro average for job growth at 17 percent.

"We have always been fortunate to have a large commercial and industrial base supplying a lot of jobs not only for Eagan but for others in the area," said Jon Hohenstein, Eagan's community development director. "The report helps underscore that, in fact, there is still space for the growth and expansion of that business and employment area."

In 2000 -- when there about 154,000 jobs throughout Dakota County -- about half were in Eagan and Burnsville, thanks in part to good access to freeways and the Minneapolis-St. Paul International Airport.

"More people come into Eagan to work each day than leave Eagan to work elsewhere in the metro area," said Tom Garrison, city spokesman.

In the 1990s, the county reaped 48,200 new jobs.

Between 2020 and 2030, fewer than half that number, about 20,000 new jobs, are projected to be added as the nation shifts from a manufacturing economy to one that's more service-based.

"The pace of commercial and industrial development will decline as we get closer to 2030, mainly because job growth will slow," Thompson said.

"With the baby-boom generation exiting the workforce that decade -- baby boomers will be ages 66 to 84 in 2030 -- many businesses may find it difficult to attract enough new employees to grow."

Mark Ulfers, executive director of the Community and Development Agency, said overall, the study will "empower cities through information when planning for industrial and economic growth in their communities."

Among other key findings:

• Dakota County is projected to add about 147,000 more people from 1990 through 2010. After that, growth will slow across the metro as the population ages, with Dakota County adding about 85,000 people between 2010 and 2030.

• Nearly 80 million square feet of commercial and industrial space existed in the county in 2007. A one-third increase, or 27 million more square feet, will be needed by 2030.

• Communities in the northern part of the county are reaching building capacity, with populations and numbers of households not expected to grow much during that time.

But jobs in Eagan and Burnsville will increase in much greater proportion to the population growth. Hohenstein said Eagan has strong businesses and developers who have provided opportunities.

"We're hopeful that will continue in the future," he said.

To read the study, go to

Joy Powell • 952-882-9017

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