2019 Year in review: Big success with small businesses
24 Mar 2020
Great River Energy’s economic development services team reported a strong year for project deal flow again in 2019, with a high concentration in small- to- mid-sized business expansions in an array of industries.
Although the total financing secured through programs administered by Great River Energy and its member-owner cooperatives was down from 2018 totals, the volume of businesses served by these programs remained strong.
These stats reflect a greater need for financing among smaller businesses with proportionately smaller project budgets in 2019, along with several community development projects, and industrial projects that received support from the team, but did not require any economic development financing.
Project spotlight: Silt Sock, Inc.
With growing demand for its products, Silt Sock, Inc. planned to acquire and expand the former Haedt Brothers Sawmill in member-owner cooperative East Central Energy’s (ECE) service area just north of Milaca, Minnesota. As the company’s third manufacturing location, the project called for a new 22,500-square-foot facility to be constructed at the site, in addition to general facility upgrades.
Great River Energy’s economic development team provided loan packaging and loan analysis for ECE, resulting in a $205,000 subordinated gap loan to complement the owner’s equity and primary bank financing. This loan was provided through the revolving loan fund ECE has established through the USDA Rural Economic Development Loan and Grant program.
Great River Energy participated in 57 marketing events to reach target industry businesses and site selectors for the purposes of driving economic development and advancing business attraction efforts. The team responded to 20 unique projects requesting information on real estate options in the cooperative’s member-owner service areas.
Great River Energy’s target industries include data centers, agricultural and forest products, and advanced manufacturing, with a specific focus on aerospace components, food production, medical devices, mining and supply chain manufacturers. These target industries form the basis of the economic development services team’s business attraction efforts. Team members attend industry-specific events with groups of economic development partner organizations and member-owner cooperatives.
Project spotlight: Absolute Air
One of the most exciting milestones of 2019 was the Absolute Air project’s groundbreaking at the Northern Industrial Park in Faribault, Minnesota – a site option Great River Energy helped the company to identify.
Representing a $32 million investment, this cooperatively owned and operated air separation plant is expected to come online in early 2021, powered by reliable electric service from Steele-Waseca Cooperative Electric (SWCE), one of Great River Energy’s 28 member-owner cooperatives. Once online, the facility will produce gases used in the medical, electronic, food packaging, laboratory, and metal fabrication industries of the upper Midwest.
Great River Energy assisted in the site selection process and will lead the buildout of a new substation and overhead transmission lines to help SWCE deliver the robust electric power needed to serve the plant.
2019 was a year of celebration, as Great River Energy was honored with several awards and recognitions.
Minnesota Real Estate Journal (MREJ) recognized the City of Faribault with its “Municipality of the Year” award, after the city completed several multimillion-dollar industrial projects in 2018 and 2019. One of those projects is a new Daikin Applied manufacturing plant, which Great River Energy supported through the first use of the new Business Expansion Loan program.
Crystal Brook Senior Living, a new 138,000-square-foot facility built in Park Rapids in October of 2018, was honored at the 2019 Progress Minnesota awards and was also chosen as the winning project in MREJ’s “Senior Housing – Greater Minnesota” award category.
The project was constructed by KI Developers, a venture between Innovative Companies, Inc. and nonprofit Knute Nelson. Great River Energy helped member-owner Itasca-Mantrap Cooperative secure $1.71 million in zero-interest gap financing as part of the $18.4 million project budget.
Finally, Tom Lambrecht, economic development services manager at Great River Energy, was recognized for his leadership in the industry as the 2019 Economic Developer of the Year by the Economic Development Association of Minnesota.
As a recipient of this award, Lambrecht is recognized as a leader who exemplifies excellence in economic development through his use of best practices, collaborative thinking, creativity and a spirit of innovation.