Delayed by the recession, a retail development on a prime site in Savage is back on track, completing a project begun more than five years ago.

Dar Lao, who developed the first phase of the complex anchored by his Asian Direct Oriental Market, says construction of the second phase should begin this month. The new 10,000-square-foot building will be on a three-acre parcel next to the existing 20,000-square-foot property, which, in addition to the Lao's Asian grocery business, also houses Super Mercado La Loma, a Latino grocery store.

"We're very happy to have that parcel get developed," said Terri Dill, a senior planner for the city. She noted that both building sites were tax-forfeited properties before a business entity operated by Lao bought the land from the city for $950,000.

The existing building was completed late in 2007, when the recession was already on the horizon. Lao had the grand opening for his store early in 2008, "just about the time the economy tanked," he said.

Lao said he believed his business could survive the downturn because it marketed necessities, not discretionary goods. "In good times, they buy more seafood. When things get tough, they tend to grab a bag of rice. But people have to eat."

He also believed that both grocery businesses would benefit from the area's fast-growing Asian and Latino populations. The two groups accounted for just 2 percent of Scott County's population in 1990, but accounted for 10 percent of the total by 2010, according to the U.S. Census Bureau.

Lao said he was drawn to Scott County because he wanted to provide a more convenient shopping place for south-metro customers who had been traveling to another Asian market he operates in Richfield.

Lao said the downturn delayed the second phase by about two years and also made it difficult to find other tenants for the first phase. Super Mercado didn't move in until about 18 months ago. "But we knew it was a good location. We knew that in the future we'd be fine," Lao said. The development is just a few blocks from Savage's downtown, with good visibility on the south side of Hwy. 13.

One of the tenants in the new building will be a nail care supply business that will move from the older building. The Latino grocery is expanding and will take over the nail business' vacated space.

Lao said he is still looking for two other tenants to fill the new structure. The new building will have a drive-through window, a feature he believes would work well for a coffee shop. "The traffic counts on Hwy. 13 are extremely high. It would be a good place for people to grab their coffee in the mornings on the way to work." He said he's also looking for an Asian restaurant to take some of the space.

The City Council recently gave a green light to the second phase, whose original approvals had expired in 2010. Even so, Mayor Janet Williams said Lao is moving ahead sooner the city had initially expected.

"We're very excited about it," she said. "It is serving a population that is here and growing. It's been a wonderful improvement right along the gateway to our city."

Susan Feyder • 952-746-3282