“G

reat River Energy" is one way to describe the industrial development climate stretching from the Mississippi River's headwaters to its halfway point, where it joins with the Ohio River. It's also the name of a power company contributing to that corridor's project total.
   In December 2006, Elk River, Minn.-based Great River Energy, the second-largest wholesale power supplier in Minnesota, broke ground on a four-story, 166,000-sq.-ft. (15,421-sq.-m.) new headquarters project in Maple Grove, a northeast suburb of the Twin Cities. Once a gravel pit belonging to Tiller Corp., the 12.5-acre (5-hectare) site will now host a US$60-million campus that will initially be home to 350 employees – though a possible future expansion could

Great River Energy's new headquarters will boast an on-site wind turbine in addition to other LEED features.

stretch its capacity to 300,000 sq. ft. (27,870 sq. m.).
   Great River is pursuing LEED (Leadership in Energy and Environmental Design) platinum level certification for its new campus, symbolized not just by things like the purchase of wind power, but by the actual presence of a 200-kilowatt wind turbine on the campus itself. Other features will include using nearby Arbor Lake for a geothermal heating and cooling system; designing a poured-in-place concrete structure that contains nearly 60 percent fly ash, a byproduct recycled from coal-based power plants; and installing new super-energy-efficient "green" elevators that use 60 percent less energy and require less space.
   "We anticipate that our new headquarters in Maple Grove will be the most energy-efficient office building ever constructed in Minnesota and one of the most energy-efficient in the world," said Great River Energy CEO David Saggau in December. Currently, there are only 15 newly constructed LEED platinum level certified buildings worldwide.The TEGRA Group is acting as the owner's representative for the project; Perkins + Will as project architect, and McGough Construction as general contractor.
   The Maple Grove project's December groundbreaking followed close on the heels of the electric cooperative's closing on a new $600-million, five-year senior unsecured syndicated revolving credit facility, co-led by National Rural Utilities Cooperative Finance Corp. and JPMorgan Chase Bank. Proceeds will be available for general corporate uses as well as for interim financing for Great River Energy's capital expenditure program. Great River Energy spokesperson Therese LaCanne says sulfur dioxide credits gained from emissions controls added to existing power plants will enable the cooperative to pay cash for the building: "Our board of directors liked that philosophy," she says.
   More than 100 employees will remain at Great River Energy's existing Elk River facility, which will evolve into an industrial site and house transmission and maintenance facilities, as well as the Elk River Station power plant. Great River recently completed construction of a $5.4 million warehouse/garage/office addition of more than 10,000 sq. ft. (930 sq. m.) in Elk River. /
   When originally announced, the new headquarters was slated to house approximately 250 employees, but LaCanne says the higher number of 300 is due to the addition of staff. The cooperative is growing at a six-percent rate, with employment growing at 20 percent over the past few years.
   In an interview, Project Manager Mike Finley says Great River's board approved the project concept and design in 2005, with site selection analysis beginning in July of that year. The starting point was a set of 18 criteria.
   "Image was number one," says Finley. Other criteria included searching within a 20-mile (32-km.) radius of Elk River, but a minimum of 10 miles (16 km.) away; expansion capability; visibility from an Interstate or highway system; proximity to amenities and quality of surrounding development; availability for purchase; ease of access; fiberoptics; an exit strategy (return on investment); incentives; and travel time for employees.
   "We looked at eight different sites, did write-ups and tours, then narrowed it to three sites, then two," Finley says. "Both were in Maple Grove. One was a large site, called Radnitz, at 138 acres [56 hectares], but we only needed about 12 to 15 acres [4.8 to 6 hectares] to build our facility. We talked to them first, in September, and they did not want to sell the site, and continue to hold out for a larger development. The other site was Arbor Lakes, on a lake, which made for very good green capabilities." /
   The board then looked at the top eight of the 18 criteria, ranking each of the two sites on each one on a scale of one to five. A purchase agreement for the Tiller site was finalized on Nov. 15, 2005.
   Incentives were completely local. Finley says, "We might go back to the state once we have renewable energy on site," but there was "no discussion of incentives with the state." The City of Maple Grove offered a tax abatement for two calendar years, worth approximately $400,000, in 2009-2010, and also offered two years of bus service from Great River's Elk River site. "They have been very cooperative," says Finley.    The usual knock against going for LEED certification of any kind is the extra cost. Finley says in Great River Energy's case, analysis shows that the combined soft and hard returns on the investment more than justify the effort.
   "Our analysis is that it costs about 10 percent of the construction costs," Finley says of the green effort, which was part of the headquarters vision from the beginning. "We saw we could attain LEED platinum if we could get renewable energy on the site," he says, referring to both solar and wind sources. "Our CEO is a real visionary, and gave us the challenge to attain platinum, and I spent the last year on getting the city and landowner to approve our renewable energy. We also will use green credits for the building."
   Finley says energy and water are the largest hard returns that can be documented, which the cooperative has done: After first costs of $950,000 for such items as daylight control technologies, and a water side economizer, annual savings of more than $92,000 are expected, achievable within seven and a half years.
   "We need to demonstrate to our wholesale customers and to the public that buildings should be built more energy-efficient," says Finley. "On this building, we'll be 50 percent better versus code for energy consumption."
   Even the low-range estimate of soft paybacks still amounts to more than $1 million per year in productivity, according to Great River documents, taking into account measures such as daylighting and exterior views, improved ventilation and individual controls.
   Great River certainly has its own portfolio of new power plant projects on tap to help meet the region's surging demand. In November it proposed a 160-megawatt simple-cycle combustion turbine at its Elk River site. The natural gas peaking plant would begin operation in spring 2009, pending board approval, permitting and other processes. Great River is also looking at other possible projects "to determine which will best meet the organization's needs for intermediate resources by 2010." They include two alternatives for a site in Rosemount, Minn.; a second combined-cycle unit at Calpine Corp.'s Mankato, Minn., Energy Center; a northern Minnesota combined-cycle power plant project proposed by Minnesota Power; and a proposed purchase from Manitoba Hydro.
   The cooperative serves about 60 percent of Minnesota, but not the Twin Cities area itself. That said, system-wide energy sales growth was 6 percent in 2006, up from an average of 3 percent. But the company would like to postpone the new power plants for as long as possible, and offer up its own energy-efficient building as one of many paths to sustainability.
   LaCanne says the region faces a projected increase in demand of 6,300 megawatts. "Our whole system is about 2,500 megawatts, so that gives you some sense of the growth we're facing," she says. "There are not only more people moving here, but they're using more energy, building bigger houses. We want to help people build those energy-efficient buildings, manufacturing facilities and offices. It's far less expensive to build these new facilities than new power plants."    From the new Great River site in Maple Grove, it's less than a 20-minute drive to the 130-acre (52.6-hectare) parcel in Brooklyn Park that homegrown Target Corp. is looking to as the home for its Northern Campus. But this is more than just a well-landscaped complex: It's a 10-million-sq.-ft. (929,000-sq.-m.) vision expected to attract a projected investment of $1.75 billion.
   Up to 80 percent of that square footage is expected to be office, with a significant portion devoted to supporting the location of approximately 1,000 new employees a year from Target, which so far has moved 1,400 employees into a four-building starter kit. The company already employs 10,000 in downtown Minneapolis, including the space at its 1.8-million-sq.-ft. (167,220-sq.-m.) campus on Nicollet Mall. According to the St. Paul Pioneer-Press, the new campus "is expected to add 30,000 jobs in Brooklyn Park, with more than a third being Target employees."
   The paper reports that Brooklyn Park is offering $20 million in tax abatement over 30 years in return for building fees of $23 million and tax revenue of $28 million, with Target owning the land and paying for infrastructure improvements valued at up to $220 million.
   A Target spokesperson declined to make anyone available to be interviewed about the project by Site Selection, citing the need to keep competitive information confidential.
   The metropolitan areas of Minneapolis-St. Paul and St. Louis led the top performers by capital investment and by number of new plants and expansions between July 2005 and December 2006, according to the Conway Data New Plant Database. Major campus expansions by Cargill and Thomson Corp. are helping Target lead the charge in the Twin Cities suburbs for 2007.
   Legal publisher Thomson in January pledged a $100-million, 2,000-job expansion at its campus in Eagan, where the company has been located for over 20 years. Pending some tax incentives, the expansion will add approximately 425,000 sq. ft. (39,500 sq. m.) of office and 80,000 sq. ft. (7,400 sq. m.) of data center space to the campus, and represents a capital investment of more than $100 million, to be paid over two years. The new office space will house technology, finance, service and other professional jobs in Eagan, with the 2,000 jobs expected to be filled by 2012.
   Thomson Vice Chairman Brian Hall said the company expects to add 1,100 technology and operations jobs to support growth of the Thomson West business,

Brian Hall

as well as additional positions that support pan-Thomson services. "The decision to grow in Minnesota affirms the importance of the Eagan campus and ensures that it will continue to be a critical center for Thomson operations in the future," said Hall.
   According to a company release, the Eagan campus is the headquarters for Thomson West and the Thomson North American Legal business unit, and also is an important operations hub for Thomson. The campus has more than 6,800 employees, including 1,400 technology professionals and 800 attorneys. The company expects to break ground on the data center in April 2007 and the office space in August 2007; the data center occupancy is planned for November 2007 and the office space for October 2008.
   Also in early January, even as its renewable energy subsidiary was scouting the Midwest for four plant sites, Cargill announced a renewable site for its new office campus, thanks to final approval by the Hopkins City Council for the development plan proposed by Opus Northwest for its Excelsior Crossings office campus, on a site once home to a SuperValu warehouse.
   Cargill will initially occupy two buildings, or 450,000 sq. ft. (41,805 sq. m.), in the new campus. The first building will be seven stories and 250,000 sq. ft. (23,225 sq. m.). A ground-level skyway will connect it to the second building, which will be approximately 200,000 sq. ft. (18,580 sq. m.) and five stories tall. The plan also allows for a third building. "The campus will consolidate employees who are presently at several locations across the Twin Cities and will become the home of approximately 1,700 Cargill employees by mid-2010," said a company release. Employees will begin moving into the facility in mid-2008, but Cargill's world headquarters will continue to be in Wayzata, Minn.
   "As Cargill's Twin Cities workforce continues to grow, we felt it was time to add a second world-class office complex here," said Cargill Vice President and Office Services Manager John McCabe. "Excelsior Crossings promises to be just that. Its proximity to our headquarters, its access to public transportation, and its accessibility to the Hopkins commercial district will be huge benefits for our employees."
   "Cargill wanted an office space that would foster interaction and collaboration," said Dave Menke, vice president of real estate at Opus Northwest. "Excelsior Crossings' larger floor sizes and minimal walls separating workspaces accomplish that goal. Amenities such as a large cafeteria, exercise and locker facilities, plus proximity to regional walking trails make this an attractive work environment for Cargill employees."    For the July 2005-December 2006 period examined for this article, the counties containing the Quad Cities of Iowa and Illinois (Davenport and Bettendorf, Iowa, and Moline and Rock Island, Ill.) accounted for 17 projects, including 14 in Rock Island County alone and six in Scott County, Iowa. Of the top 25 projects by capital investment during that same 18-month period, eight were ethanol plants and one was a biodiesel plant. That subtotal included three ethanol projects in Henry County, Ill., just outside the Quad Cities.
   The Quad Cities headliner for 2006 was the $135-milllion, 620,000-sq.-ft. (57,598-sq.-m.) pork processing plant from four-year-old Triumph Foods in East Moline. The project was announced in mid-summer 2006, at about the same time that the company's first $150-million plant, in its headquarters location of St. Joseph, Mo., was celebrating its grand opening.

"Even though we did not obtain an enterprise zone, the state worked with us on replicating enterprise zone benefits." — Patt Lilly, Triumph Foods

Both facilities are planned to employ approximately 1,000 people, but in St. Joseph the company is already employing more than 1,500 people.
   Central to both projects was the creation of a tax-increment financing scheme. The Illinois project was headed toward being approved for inclusion in an enterprise zone, but local opposition intervened when the Silvis City Council twice voted to reject the enterprise zone request. Approval by all partners in the enterprise zone – the municipalities of Moline, East Moline, Milan, Ill., Silvis, Ill., and the County of Rock Island – is required for enterprise zone status. Though that status would have essentially doubled its total incentives, the company was satisfied with a $16-million incentive package put together by the State of Illinois through its "Opportunity Returns" program.
   In an interview transcript published by the Quad Cities Development Group, East Moline Mayor John Thodos said, "Unfortunately, the enterprise zone concept, which originally was created as a tool to facilitate these sorts of developments in the county, didn't work out for Triumph Foods. But in a roundabout way, the state incentive package is better, in that it means the project has the full blessing upfront of Governor Blagojevich and of all necessary regulatory agencies."
   One of those many St. Joseph jobs was created in 2006 when Patt Lilly,

Patt Lilly

the former president of the local chamber of commerce, signed on as the company's chief administrative officer. In an interview, he says the movement of hogs by the consortium of 30 swine producers who created Triumph Foods was central to the site selection process. Those attributes also happened to fit into two sectors targeted by the Quad Cities Development Group: food and logistics.
   "We knew we wanted to be on the eastern side of Iowa or the western side of Illinois in order to facilitate movement of hogs," Lilly says. He won't divulge the locations of the 30 owners, but says, "generally, they're located in Iowa, Minnesota, Nebraska, Kansas and Oklahoma."
   Sites in Plattsburgh, Neb., and former railroad hub Galesburg, Ill., were among finalists for the plant, but "East Moline fit our needs the best," says Lilly of a site selection process that commenced in early 2005. The chosen 116-acre (47-hectare) Greenfield parcel was annexed into East Moline in 2005.
   The TIF is associated with necessary off-site improvements, says Lilly. As for the bump in the road represented by the enterprise zone negotiations, he says, "Even though we did not obtain an enterprise zone, the state worked with us on replicating enterprise zone benefits from a statewide point of view." The assistance comes in the form of corporate tax credits; water and sewer infrastructure improvements; job training funds; investment tax credits; building materials tax exemptions and state utility tax exemptions. "They gave us what we needed in terms of incentives," says Lilly.
   The area also has what Triumph needed in terms of work force.
   "The labor market in the Quad Cities is different than St. Joseph, which is more of a stand-alone community," he says of the northwest Missouri city, just north of Kansas City. "We've been pulling locally from about a 70-mile [112-km.] radius, but we've also recruited from throughout the Midwest. In the Quad Cities area, with a larger labor base, and some current meat processing facilities, I don't know how far our recruitment will stretch. But we're working with a larger labor base than we were here, and that will be of benefit to us."
   The St. Joseph plant was constructed via a design-build process led by Chicago-based A. Epstein & Sons. Lilly says contractor selection for the East Moline project will be done in late spring or early summer 2007. While the company took two years to build their first plant, Lilly says the lack of demolition on the site in East Moline should help keep the construction schedule to 18 to 20 months. The plant is scheduled to open in early 2009.