Pump and sprayer maker Graco has purchased 100 acres in Dayton and plans to build a facility that can accommodate some workers from its flagship headquarters campus in northeast Minneapolis.

Terms of the purchase were not disclosed.

The company plans to build a 500,000-square-foot facility by late 2022 to accommodate two of its operating divisions as part of the first phase for the property. McGough Construction will be general contractor.

The expansion to the French Lake Industrial Center is the latest of similar moves over the last two decades by Graco, which makes industrial pumps and sprayers used by car manufacturers, construction contractors plus makers of tomato paste, peanut butter and other foods.

In 2019 Graco doubled the size of its Rogers operations, creating the largest construction project in that city's history.

Graco expects to move at least 225 employees from Minneapolis to Dayton, once construction is finished. The Minneapolis campus now houses about 800 workers.

Graco announced last week that it had closed on the Dayton land deal. The expansion "will support Graco's sustained growth," by letting two of its three business divisions in Minneapolis relocate, officials said.

The relocation will affect Graco's industrial products division and its process division. The two units are important contributors to Graco's $1.65 billion in annual sales.

Industrial products makes finishing equipment that applies paint or coatings to vehicles, airplanes, ships, appliances, furniture and other items in a factory. Graco's process division manufactures pumps, including those used to inject peanut butter into chocolate candies or to move beverages, cosmetics, chemicals, oil, gas or other industrial fluids through factories.

"The purpose of the Dayton expansion is to make space for our businesses that are crowded on our Minneapolis campus and to give us flexibility for future growth," said Graco spokeswoman Charlotte Boyd. Graco now has about 1,500 employees in Minnesota.

Angela Wordell, Graco's executive vice president of operations and president of its worldwide oil and natural gas division, said "We're thankful to be in a position to invest in this expansion and look forward to offering our divisions the space they need to keep designing, manufacturing, marketing and distributing our leading technology to customers worldwide."

The undeveloped land Graco bought in Dayton sits a few miles east from Graco's last major expansion site in Rogers and just a few miles northwest of Graco's Anoka facility.

Graco's stock closed at $72.15 Tuesday.

Despite the pandemic, the company enjoyed strong demand for its construction and contractor products last year, especially in the North American and Asian markets. Those segments remained strong while industrial demand improved dramatically in the fourth quarter, leading to companywide sales and profit gains for the quarter.

Dee DePass • 612-673-7725