A St. Paul company that is pioneering a new way to raise fish and grow vegetables year-round is expanding, with a second location to meet demand from local restaurants and grocers.

Urban Organics signed a purchase agreement last month for a building on the old Schmidt Brewery site in St. Paul, where it will add a second farm operation. The company will keep its facility at the historic Hamm’s Brewery building in St. Paul, where it has created an indoor aquaponics system — a process that relies on urban fish to nourish and grow organic vegetables.

The company’s success has garnered national attention and attracted new tenants to the Hamm’s building on St. Paul’s East Side. Its founders hope to continue that momentum at the second location in the historically blue-collar neighborhood of W. 7th Street.

“We’ve learned a lot since we’ve started. There’s a higher demand than we had usable square footage for,” said Dave Haider, Urban Organics co-founder and lead farmer. “We are basically doing a scaled version of what we are doing now. We are ramping up quantities.”

Urban Organics produces two products at its current facility of about 9,000 square feet: fish and produce. Its new Schmidt location, at 543 James Av., will offer 80,000 square feet of single-story space after renovations.

Haider expects some upgrades to systems like heating, air conditioning and fire sprinklers, but won’t be asking for public assistance.

Aquaponics is designed as a mutually beneficial system for the fish and the plants. Fish waste feeds the veggies, which in turn keep the water clean for the fish. The water cycles year-round, using less than 2 percent of the water than conventional farming, according to Urban Organics.

The company partnered with the Fish Guys Inc. in Minneapolis to process tilapia, selling about 300 fish a month to a handful of local restaurants. The organic farm produces about 1,200 pounds of vegetables and herbs each month that it sells to area co-ops, Kowalski’s Markets and a few Cub Foods.

“We are selling everything we can grow. We are doing a really small number of herbs right now and haven’t gotten into salad greens yet,” Haider said. “So we are looking to play a much larger role in local protein as well by scaling the fish component.”

Urban Organics’ brewery-centric real estate is no accident. The sites are set up with access to freshwater wells, which Haider said means “we don’t have to treat the water.”

The company reclaims the sites’ history while introducing a new farming technology. Golden Valley-based Pentair Inc. developed a filtration system that enabled Urban Organics to move aquaponics beyond hobby farms and into the commercial realm.

New neighborhood

Haider hopes the project contributes to the neighborhood’s revitalization with an improved street presence and activity.

Plymouth-based Dominium completed a $120 million redevelopment project of the Schmidt Brewery’s most recognizable structures last year. The project turned the property’s marquee structures, such as the bottling building and brewhouse, into artist lofts. Urban Organics’ new location sits immediately adjacent to these residential units.

The company is buying the property from BHGDN LLC.

Hamm’s, the nation’s fifth-largest beer company in the 1950s, was once a major economic engine for St. Paul, employing about 2,000 people. But the company fell behind competitors with the rise in popularity of light beer, which led to its demise in 1997.

Since Urban Organics moved in, Flat Earth Brewing Co. and 11 Wells Spirits, a distillery, opened at Hamm’s.

Meanwhile, the landmark Schmidt property dates to 1855, before Minnesota was a state. It’s brick-based German architecture and bright-red sign are widely recognized in the Twin Cities. But the facility was shuttered in the early 2000s after multiple iterations as various breweries.

Urban Organics isn’t the only company using the closed-loop technique that combines aquaculture (raising of fish in tanks) with hydroponics (growing of plants in water). But it’s one of the only ones in the nation at commercial scale to be certified by the U.S. Department of Agriculture.

The Urban Organics team — composed of Haider, Fred Haberman, Chris Ames and Kristen Koontz Haider — anticipates moving through the city approvals process next month and beginning construction at the end of April with an eye on early 2016 for being full operational at the new site.